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This should generally hold for housing as well. Even though land is finite, we can build upward, so each individual new unit uses a negligible amount of land.

This should generally hold for housing as well. Even though land is finite, we can build upward, so each individual new unit uses a negligible amount of land. Perhaps the author has forgotten that the land base required to support a given human population cannot be expanded upward? The minimum area of productive farmland required to support a rather subsistence-level diet (95% vegetarian say) is about a hectare - two football fields - per person, according to most studies I've looked at. Technology can mitigate some of these issues to some extent, and already have - extensive inputs of fossil fuels to agriculture in the form of fertilizer and diesel powered water pumps have doubled per-hectare productivity, but at the cost of fertilizer pollution and eventual exhaustion of groundwater supplies. Hence, we have to conclude that there really are hard ecological limits to human economic activity. Property developers and their affiliated investors have an unfortunate habit of ignoring these realities, and for their own pockets it might make sense - build some housing, ignore the demands on the surrounding area, sell the housing, take the money and run. Most communities can see through these efforts. Now there is an argument for Tokyo-style tiny apartments (i.e. subdivide existing housing into smaller units) and little houses to lower prices and house the homeless and so on, but these approaches aren't really that profitable in terms of return-on-investment. P.S. If you want to examine 'artificial scarcity driving market prices' the place to start is the diamond industry.

jeffbee 5y ago
> Tokyo-style tiny apartments It seems you perhaps haven't been to Tokyo, or haven't been to America. The typical Tokyo apartment today is larger, newer, and cheaper than the typical apartment in New York. That's the result of decades of housing construction policy, in both places, but in opposite directions.
- photochemsyn 5y ago
  I researched your claim briefly. Doesn't seem very well-supported. https://japanpropertycentral.com/2020/02/apartments-in-tokyo-continue-to-shrink-in-size/ https://japanpropertycentral.com/2020/02/apartments-in-tokyo... > "Just under 40% of all new apartments were in the 70 sqm (753 sq.ft) range, while just 9.1% were sized between 80 ~ 100 sqm. The biggest shift is in the 30 ~ 50 sqm (323 ~ 538 sq.ft) sector where the total share has increased by 3.1 points to 10% in 2019." https://nypost.com/2022/03/03/why-the-size-of-an-nyc-apartment-gets-bigger-every-year/ https://nypost.com/2022/03/03/why-the-size-of-an-nyc-apartme... > "Data collected from 765 residential Manhattan buildings shows that their apartments grew from 950 square feet to 975 square feet on average over the last five years — roughly a 5% increase... Despite much-hyped tiny housing trends, the vast majority of new development in the city over the last 20 years has been in the “luxury” sector (i.e., larger than average). Meanwhile, each year, unit combinations enlarge the average square footage of individual apartments, while shrinking the city’s housing stock." That's actually the opposite trend on size in both places, isn't it?
  - JadeNB 5y ago
    > "Data collected from 765 residential Manhattan buildings shows that their apartments grew from 950 square feet to 975 square feet on average over the last five years — roughly a 5% increase…." I know you're quoting, but that sentence alone makes me suspicious; it represents an increase of under 3%, not 5%.
  - Firmwarrior 5y ago
    Japanese apartments are furnished in a different way that makes them feel spacious even though they're tiny compared to apartments in the USA My guess is the parent comment had a misconception because of that, or maybe because laissez-faire policies make Tokyo apartments way cheaper per square foot (you can take a job as a janitor in Shinjuku and easily afford a comfortable apartment within a 30 minute door-to-door commute)
helen___keller 5y ago
> Now there is an argument for Tokyo-style tiny apartments (i.e. subdivide existing housing into smaller units) and little houses to lower prices and house the homeless and so on, but these approaches aren't really that profitable in terms of return-on-investment. How do you figure? Japan has one of the most laissez faire real estate markets around. I would assume whatever steady state the housing market assumes is most profitable

jeffbee 5y ago

> Tokyo-style tiny apartments It seems you perhaps haven't been to Tokyo, or haven't been to America. The typical Tokyo apartment today is larger, newer, and cheaper than the typical apartment in New York. That's the result of decades of housing construction policy, in both places, but in opposite directions.

photochemsyn 5y ago
I researched your claim briefly. Doesn't seem very well-supported. https://japanpropertycentral.com/2020/02/apartments-in-tokyo-continue-to-shrink-in-size/ https://japanpropertycentral.com/2020/02/apartments-in-tokyo... > "Just under 40% of all new apartments were in the 70 sqm (753 sq.ft) range, while just 9.1% were sized between 80 ~ 100 sqm. The biggest shift is in the 30 ~ 50 sqm (323 ~ 538 sq.ft) sector where the total share has increased by 3.1 points to 10% in 2019." https://nypost.com/2022/03/03/why-the-size-of-an-nyc-apartment-gets-bigger-every-year/ https://nypost.com/2022/03/03/why-the-size-of-an-nyc-apartme... > "Data collected from 765 residential Manhattan buildings shows that their apartments grew from 950 square feet to 975 square feet on average over the last five years — roughly a 5% increase... Despite much-hyped tiny housing trends, the vast majority of new development in the city over the last 20 years has been in the “luxury” sector (i.e., larger than average). Meanwhile, each year, unit combinations enlarge the average square footage of individual apartments, while shrinking the city’s housing stock." That's actually the opposite trend on size in both places, isn't it?
- JadeNB 5y ago
  > "Data collected from 765 residential Manhattan buildings shows that their apartments grew from 950 square feet to 975 square feet on average over the last five years — roughly a 5% increase…." I know you're quoting, but that sentence alone makes me suspicious; it represents an increase of under 3%, not 5%.
- Firmwarrior 5y ago
  Japanese apartments are furnished in a different way that makes them feel spacious even though they're tiny compared to apartments in the USA My guess is the parent comment had a misconception because of that, or maybe because laissez-faire policies make Tokyo apartments way cheaper per square foot (you can take a job as a janitor in Shinjuku and easily afford a comfortable apartment within a 30 minute door-to-door commute)

helen___keller 5y ago

> Now there is an argument for Tokyo-style tiny apartments (i.e. subdivide existing housing into smaller units) and little houses to lower prices and house the homeless and so on, but these approaches aren't really that profitable in terms of return-on-investment. How do you figure? Japan has one of the most laissez faire real estate markets around. I would assume whatever steady state the housing market assumes is most profitable