5 ms·

Manhattan (where I live) is extremely underbuilt. Lots of people want to live here! But yes, the implication of a housing abundance agenda is that places will

Manhattan (where I live) is extremely underbuilt. Lots of people want to live here! But yes, the implication of a housing abundance agenda is that places will change. I think it's generally underrated exactly how much the cities we know today changed during the 20th century as they grew in population. That said, you don't really need a lot of high rises to drastically increase density. Even row houses and low rise apartments make a pretty large difference and would be more than enough to meet demand for most cities that are experiencing a crunch.

seanmcdirmid 4y ago
Don't get me wrong, I'm pro density. However, it seems like they are kind of like building new freeways, which rather than reduce traffic, simply induce more demand. By say taking Seattle and making it 4X dense...I doubt it would become much cheaper...instead it would just become more popular (still, I would love to live in a more dense Seattle, but I don't think I would save money by it).
- kelnos 4y ago
  I'm not sure you can draw a parallel between those two things. Is there any evidence that induced demand applies to housing as well? I would think it might to some degree, but there would be several cut-off points, as living conditions change with more density, and people who previously wanted to move to a place might not like how a place changes as density increases. With a highway, you can add as many lanes as you want, and the experience of driving on it isn't changed much.
  - seanmcdirmid 4y ago
    > Is there any evidence that induced demand applies to housing as well? Yes, plenty of people are discouraged from moving to a hot city due to the lack of supply. Increasing supply then moves discouraged demand into actual demand. Otherwise why do dense cities (like Shanghai, NYC, Manila) still experience housing shortages? If the place is desirable, demand increases to catch up to the new supply, bringing us to the same place where we are now. Even if we built a lot of housing in a desirable place, enough that we hit a cut-off point: in a hundred years or so, we might have just had more children to soak up that supply (like what happens with agriculture surplus). Things go until an equilibrium is reached (where prices are high enough that demand is discouraged, or the place becomes undesirable to really reduce demand).
    - kelnos 4y ago
      I was asking for evidence, not a hypothetical rationale. It's possible (and likely) that housing in Shanghai, NYC, and Manila just have not reached a supply-demand equilibrium yet, because housing policy still constrains supply. There's nothing requires that demand is effectively infinite in these cities, or that demand will keep growing as more housing is built. Let's say unfilled demand for housing in San Francisco sits at 100,000 units right now (making up numbers; they don't matter). If we could magically build those 100,000 units tomorrow, yes, I do expect we will induce some more demand, because home/rent prices will drop. So let's say we build another 100,000 units. Maybe we get some more demand, because home/rent prices drop more. So we do it again, but not forever. Because my feeling here is that the main driver of more demand in SF would be drops in home/rent prices. Those prices can't drop to zero; they will always have a cost, and it seems unlikely to me that the cost will drop low enough -- no matter how many units are built, within the physical constraints of the space -- such that there will still always be unmet demand. And home prices will still always be propped up by housing policy to some extent; the city would never implement unrestricted housing development with no hurdles. But maybe the "equilibrium" price can be something significantly less ridiculous than it is today.
      - seanmcdirmid 4y ago
        > I was asking for evidence, not a hypothetical rationale. Equilibriums are not hypothetical. The fact that increasing supply can induce more demand is well known in many areas (expressways being just one). Cities take off, and building booms don't reduce prices like a recession or bust will. > the city would never implement unrestricted housing development with no hurdles. Not many people would like to live in such a city (who wants to live in Houston?), so that on its own would limit demand. > But maybe the "equilibrium" price can be something significantly less ridiculous than it is today. Sure. Perhaps a lot more WFH will eventually eliminate or reduce critical mass feedback loops that lead to these problems in the first place (e.g. why live in Seattle when you can live in Toledo?).
- seoaeu 4y ago
  Seattle is actually a good counter example showing that more supply does bring down rents: https://www.oregonlive.com/business/2019/01/apartment-rents-dropping-in-seattle-landlords-compete-for-tenants-as-market-cools.html https://www.oregonlive.com/business/2019/01/apartment-rents-...
dr_dshiv 4y ago
> Even row houses and low rise apartments make a pretty large difference and would be more than enough to meet demand for most cities that are experiencing a crunch 5 stories. Perfect height.
- jkepler 4y ago
  5 floors was pretty standard across Europe, from Paris to Kyiv, in the age before elevators, as it was about the maximum height most folks were willing to walk up the stairs. Though, in Paris a lot of the 6th floors (where lots of the typically small studio apartments are found) were originally constructed as the maids' quarters.
  - seanmcdirmid 4y ago
    In Seattle we hav a lot of 4+1s: a concrete 1st floor and wooden 4 floors above that (some kind of code thing). The first floor is usually retail, however.

seanmcdirmid 4y ago

Don't get me wrong, I'm pro density. However, it seems like they are kind of like building new freeways, which rather than reduce traffic, simply induce more demand. By say taking Seattle and making it 4X dense...I doubt it would become much cheaper...instead it would just become more popular (still, I would love to live in a more dense Seattle, but I don't think I would save money by it).

kelnos 4y ago
I'm not sure you can draw a parallel between those two things. Is there any evidence that induced demand applies to housing as well? I would think it might to some degree, but there would be several cut-off points, as living conditions change with more density, and people who previously wanted to move to a place might not like how a place changes as density increases. With a highway, you can add as many lanes as you want, and the experience of driving on it isn't changed much.
- seanmcdirmid 4y ago
  > Is there any evidence that induced demand applies to housing as well? Yes, plenty of people are discouraged from moving to a hot city due to the lack of supply. Increasing supply then moves discouraged demand into actual demand. Otherwise why do dense cities (like Shanghai, NYC, Manila) still experience housing shortages? If the place is desirable, demand increases to catch up to the new supply, bringing us to the same place where we are now. Even if we built a lot of housing in a desirable place, enough that we hit a cut-off point: in a hundred years or so, we might have just had more children to soak up that supply (like what happens with agriculture surplus). Things go until an equilibrium is reached (where prices are high enough that demand is discouraged, or the place becomes undesirable to really reduce demand).
  - kelnos 4y ago
    I was asking for evidence, not a hypothetical rationale. It's possible (and likely) that housing in Shanghai, NYC, and Manila just have not reached a supply-demand equilibrium yet, because housing policy still constrains supply. There's nothing requires that demand is effectively infinite in these cities, or that demand will keep growing as more housing is built. Let's say unfilled demand for housing in San Francisco sits at 100,000 units right now (making up numbers; they don't matter). If we could magically build those 100,000 units tomorrow, yes, I do expect we will induce some more demand, because home/rent prices will drop. So let's say we build another 100,000 units. Maybe we get some more demand, because home/rent prices drop more. So we do it again, but not forever. Because my feeling here is that the main driver of more demand in SF would be drops in home/rent prices. Those prices can't drop to zero; they will always have a cost, and it seems unlikely to me that the cost will drop low enough -- no matter how many units are built, within the physical constraints of the space -- such that there will still always be unmet demand. And home prices will still always be propped up by housing policy to some extent; the city would never implement unrestricted housing development with no hurdles. But maybe the "equilibrium" price can be something significantly less ridiculous than it is today.
    - seanmcdirmid 4y ago
      > I was asking for evidence, not a hypothetical rationale. Equilibriums are not hypothetical. The fact that increasing supply can induce more demand is well known in many areas (expressways being just one). Cities take off, and building booms don't reduce prices like a recession or bust will. > the city would never implement unrestricted housing development with no hurdles. Not many people would like to live in such a city (who wants to live in Houston?), so that on its own would limit demand. > But maybe the "equilibrium" price can be something significantly less ridiculous than it is today. Sure. Perhaps a lot more WFH will eventually eliminate or reduce critical mass feedback loops that lead to these problems in the first place (e.g. why live in Seattle when you can live in Toledo?).
seoaeu 4y ago
Seattle is actually a good counter example showing that more supply does bring down rents: https://www.oregonlive.com/business/2019/01/apartment-rents-dropping-in-seattle-landlords-compete-for-tenants-as-market-cools.html https://www.oregonlive.com/business/2019/01/apartment-rents-...

dr_dshiv 4y ago

> Even row houses and low rise apartments make a pretty large difference and would be more than enough to meet demand for most cities that are experiencing a crunch 5 stories. Perfect height.

jkepler 4y ago
5 floors was pretty standard across Europe, from Paris to Kyiv, in the age before elevators, as it was about the maximum height most folks were willing to walk up the stairs. Though, in Paris a lot of the 6th floors (where lots of the typically small studio apartments are found) were originally constructed as the maids' quarters.
- seanmcdirmid 4y ago
  In Seattle we hav a lot of 4+1s: a concrete 1st floor and wooden 4 floors above that (some kind of code thing). The first floor is usually retail, however.