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Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. The prices increase directly

Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. The prices increase directly proportional to the current velocity of new housing availability at any given moment. If they continue to build new housing at this rate my city will become one of the 10 largest US cities within the next 15 years and the value of my house will boom to more than 3x what I paid for it. Why? Fixed assets exist outside the supply/demand cycle of high school economics. You can’t make more land but you can always build more houses irrespective of demand. Aside from conjecture and speculation there is no evidence (data) linking house price reduction (not rent) to new housing availability.

TulliusCicero 5y ago
> Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. Yes, because rules in the US handicap new housing growth. > The prices increase directly proportional to the current velocity of new housing availability at any given moment. Yes, because they have the same cause: demand increasing. Imagine that every car maker was heavily constrained in how many cars they could make. As demands for cars rise, they find every angle to try and produce more cars, but the price keeps going up. Did the new supply cause the price to rise? No, they just have the same cause. There have been myriad studies on this, almost every economist finds that new housing in booming areas makes housing prices less bad than they would be otherwise. > You can’t make more land but you can always build more houses irrespective of demand. This isn't true. Zoning severely handicaps more housing in the places people want to live. Well, except for Houston (sorta), and indeed, rent there seems substantially lower than other major cities in Texas like Dallas and Austin.
- austincheney 5y ago
  None of that is evidence of houses going down in price.
  - TulliusCicero 5y ago
    Yes, we have many studies for that.

TulliusCicero 5y ago

> Where I live they have not been able to build new housing fast enough to keep up with rising population over the last thirty years. Yes, because rules in the US handicap new housing growth. > The prices increase directly proportional to the current velocity of new housing availability at any given moment. Yes, because they have the same cause: demand increasing. Imagine that every car maker was heavily constrained in how many cars they could make. As demands for cars rise, they find every angle to try and produce more cars, but the price keeps going up. Did the new supply cause the price to rise? No, they just have the same cause. There have been myriad studies on this, almost every economist finds that new housing in booming areas makes housing prices less bad than they would be otherwise. > You can’t make more land but you can always build more houses irrespective of demand. This isn't true. Zoning severely handicaps more housing in the places people want to live. Well, except for Houston (sorta), and indeed, rent there seems substantially lower than other major cities in Texas like Dallas and Austin.

austincheney 5y ago
None of that is evidence of houses going down in price.
- TulliusCicero 5y ago
  Yes, we have many studies for that.