5 ms·

Let's take SF as an example. If a significant number of new units were built (somehow without detracting from the character of the city), would it really lower

Let's take SF as an example. If a significant number of new units were built (somehow without detracting from the character of the city), would it really lower prices much? Likely not - instead prices would dip just enough to make it viable for large numbers of high income people from outside SF to come to the city (which by massing effect may make SF even more desirable, so actually higher prices!) Wealth taxes are not a fairly tale, though of course they are a nightmare for the excessively wealthy! In the UK we used death duties to finish off the aristocracy.

sokoloff 3y ago
If it works temporarily, but gets consumed by induced demand, then do it again. And then again. And then again. This is a good thing. If SF is so great, many more people will be able to go there.
- seanmcdirmid 3y ago
  So you are claiming that if SF becomes as dense as Manhattan, it will be as cheap as Manhattan? Or maybe Hong Kong’s density and housing affordability is the target here? The ideal situation is Tokyo, where a lack of culture in speculating on housing coupled with population decreases leads (going down in the metro area for the last three years) to housing affordability.
  - sokoloff 3y ago
    I'm claiming that the balance of supply and demand affects housing prices. If you increase the supply by enough, that will tip the balance to where the market clearing price will go down.
    - bombcar 3y ago
      The real underlying problem is that you have X million people who want to live in the quaint version of San Francisco. It's literally impossible; the quaint version dies at some point as more and more people are piled in, even if the resulting city is world-class and quite desirable. Just like the entirety of Los Angeles couldn't move to Santa Barbara without Santa Barbara being changed forever. The closest reasonable equivalent we can do is maintain the quaint "old town" and build a "real city" around it where people actually live and work, and the old town remains as a tourist destination, basically. This is the case in much of Europe. The Paris you visit and the Paris people live in are often mixed, but they're noticeably different. Rapid mass transit to city centers can hide the distinction.
zemvpferreira 3y ago
This is a bizarre idea contrary to how many housing affordability crisis were actually solved in the past. Would SF's housing prices go down if you were to build 10,000 new units? You're right, probably not that much. Would SF's housing prices go down if you were to build 1M new units? No doubt. Shenzhen grew from 100,000 people in the 1980s to 13M now with no housing affordability crisis...by building. The whole pearl river delta region is essentially an 80M people megacity with no housing problems...because they continuously built. Tokyo is also a classical example of continuously building infrastructure to support millions more people per decade.
- zug_zug 3y ago
  Are you sure it's profitable to build 1million units in Soma (or whatever portion isn't protected historic houses limited to 3 stories) ?
  - eropple 3y ago
    "Profitable" and "necessary" might sometimes be at odds. That's why we have governments, though.
- IKantRead 3y ago
  > Shenzhen grew from 100,000 people in the 1980s to 13M now with no housing affordability crisis...by building. I wouldn't use China as an example of solving the housing problem by simply building. There's currently a large oversupply problem [0] and, not entirely unlike the US (but more extreme), excess supply of housing has lead to people simply owning more than one property as an investment strategy. 0. https://www.wsj.com/articles/chinas-smaller-cities-struggle-to-unload-empty-apartments-1a70f551 https://www.wsj.com/articles/chinas-smaller-cities-struggle-...
  - anthonypasq 3y ago
    yeah thats because the building was centrally planned, which is always a worse choice than just allowing the market to work itself out. It doesnt detract from the mind numbingly obvious statement that increasing supply decreases prices.

sokoloff 3y ago

If it works temporarily, but gets consumed by induced demand, then do it again. And then again. And then again. This is a good thing. If SF is so great, many more people will be able to go there.

seanmcdirmid 3y ago
So you are claiming that if SF becomes as dense as Manhattan, it will be as cheap as Manhattan? Or maybe Hong Kong’s density and housing affordability is the target here? The ideal situation is Tokyo, where a lack of culture in speculating on housing coupled with population decreases leads (going down in the metro area for the last three years) to housing affordability.
- sokoloff 3y ago
  I'm claiming that the balance of supply and demand affects housing prices. If you increase the supply by enough, that will tip the balance to where the market clearing price will go down.
  - bombcar 3y ago
    The real underlying problem is that you have X million people who want to live in the quaint version of San Francisco. It's literally impossible; the quaint version dies at some point as more and more people are piled in, even if the resulting city is world-class and quite desirable. Just like the entirety of Los Angeles couldn't move to Santa Barbara without Santa Barbara being changed forever. The closest reasonable equivalent we can do is maintain the quaint "old town" and build a "real city" around it where people actually live and work, and the old town remains as a tourist destination, basically. This is the case in much of Europe. The Paris you visit and the Paris people live in are often mixed, but they're noticeably different. Rapid mass transit to city centers can hide the distinction.

zemvpferreira 3y ago

This is a bizarre idea contrary to how many housing affordability crisis were actually solved in the past. Would SF's housing prices go down if you were to build 10,000 new units? You're right, probably not that much. Would SF's housing prices go down if you were to build 1M new units? No doubt. Shenzhen grew from 100,000 people in the 1980s to 13M now with no housing affordability crisis...by building. The whole pearl river delta region is essentially an 80M people megacity with no housing problems...because they continuously built. Tokyo is also a classical example of continuously building infrastructure to support millions more people per decade.

zug_zug 3y ago
Are you sure it's profitable to build 1million units in Soma (or whatever portion isn't protected historic houses limited to 3 stories) ?
- eropple 3y ago
  "Profitable" and "necessary" might sometimes be at odds. That's why we have governments, though.
IKantRead 3y ago
> Shenzhen grew from 100,000 people in the 1980s to 13M now with no housing affordability crisis...by building. I wouldn't use China as an example of solving the housing problem by simply building. There's currently a large oversupply problem [0] and, not entirely unlike the US (but more extreme), excess supply of housing has lead to people simply owning more than one property as an investment strategy. 0. https://www.wsj.com/articles/chinas-smaller-cities-struggle-to-unload-empty-apartments-1a70f551 https://www.wsj.com/articles/chinas-smaller-cities-struggle-...
- anthonypasq 3y ago
  yeah thats because the building was centrally planned, which is always a worse choice than just allowing the market to work itself out. It doesnt detract from the mind numbingly obvious statement that increasing supply decreases prices.