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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 buil

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.
  - prewett 3y ago
    Increasing supply doesn't necessarily decrease prices. Increasing supply above demand is required for prices to decrease. Unrelated to the above, but China's excessive building isn't actually from central planning, but because real estate is the one of the only viable investment methods in China, and because selling land to developers is one of the only ways local governments can raise revenue. Chinese cities are quite expensive to live in (especially if you have Western standards)
  - somewhereoutth 3y ago
    > mind numbingly obvious statement that increasing supply decreases prices Only in idealised markets. Housing markets are often not like that.
    - anthonypasq 3y ago
      can you explain how and when this wasnt the case barring regulatory interference?
selectodude 3y ago
This idea among residents of San Francisco that all 8 billion of us humans want to live there and it’s impossible to build enough housing to satiate demand never ceases to crack me up.
seanmcdirmid 3y ago
Shenzhen and Guangzhou are some of the least affordable cities in the world when it comes to housing prices. Yes, rents are actually not that bad and many units are vacant being just used as investments, but the cost to buy is astronomical given the Chinese housing bubble. Tokyo is an example where houses are torn down every 39 years so a new one can be built. Also, given the lack of population growth in Japan as a whole, the growth rate in Tokyo is anemic. Tokyo metro area has even been losing a small amount of population in the last three years: https://www.macrotrends.net/cities/21671/tokyo/population https://www.macrotrends.net/cities/21671/tokyo/population
- coryrc 3y ago
  Houses often are torn down, but not apartments.
  - seanmcdirmid 3y ago
    Apartments are torn down every 40-50 years instead of 30.
- helen___keller 3y ago
  Tokyo capped out and is now declining in population because there isn’t a backlog of millions of people who wanted to live there but couldn’t or had to move out because rent is 3x in Tokyo compared to Osaka. Rent is maybe 30% higher in Tokyo, even less if you live on the end of a train line. Can you imagine how many people would move to Bay Area CA or New York City or Boston or Seattle if their rent was only 30% higher? Pre pandemic my 3 bedroom in Boston area was 3500/mo. Since the pandemic rents have gone even higher. We have bidding wars of people trying to win a rental unit. Bidding wars. It’s ridiculous. Also I don’t see your point about houses being torn down. If anything that should make it more expensive (since buying used and not rebuilding is cheaper). Realistically rebuilding is vital (in conjunction with subdivision) because that’s how you increase density
  - seanmcdirmid 3y ago
    > but couldn’t or had to move out because rent is 3x in Tokyo compared to Osaka. Osaka and Nagoya are losing people also. The changes are for metro areas, not city cores. > If anything that should make it more expensive (since buying used and not rebuilding is cheaper). It simply means that you can't compute new housing very easily by new housing construction rates (you have to subtract old housing demolitions). Density currently isn't increasing (you tear down one three story narrow house and replace it with another three story narrow house, you need to buy a bunch of SFHs to make a new apartment building).
jjav 3y ago
> Would SF's housing prices go down if you were to build 1M new units? No doubt. Where could you built 1M units in San Francisco? It is less than 50 square miles surrounded on 3 sides by water.

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.
- prewett 3y ago
  Increasing supply doesn't necessarily decrease prices. Increasing supply above demand is required for prices to decrease. Unrelated to the above, but China's excessive building isn't actually from central planning, but because real estate is the one of the only viable investment methods in China, and because selling land to developers is one of the only ways local governments can raise revenue. Chinese cities are quite expensive to live in (especially if you have Western standards)
- somewhereoutth 3y ago
  > mind numbingly obvious statement that increasing supply decreases prices Only in idealised markets. Housing markets are often not like that.
  - anthonypasq 3y ago
    can you explain how and when this wasnt the case barring regulatory interference?

selectodude 3y ago

This idea among residents of San Francisco that all 8 billion of us humans want to live there and it’s impossible to build enough housing to satiate demand never ceases to crack me up.

seanmcdirmid 3y ago

Shenzhen and Guangzhou are some of the least affordable cities in the world when it comes to housing prices. Yes, rents are actually not that bad and many units are vacant being just used as investments, but the cost to buy is astronomical given the Chinese housing bubble. Tokyo is an example where houses are torn down every 39 years so a new one can be built. Also, given the lack of population growth in Japan as a whole, the growth rate in Tokyo is anemic. Tokyo metro area has even been losing a small amount of population in the last three years: https://www.macrotrends.net/cities/21671/tokyo/population https://www.macrotrends.net/cities/21671/tokyo/population

coryrc 3y ago
Houses often are torn down, but not apartments.
- seanmcdirmid 3y ago
  Apartments are torn down every 40-50 years instead of 30.
helen___keller 3y ago
Tokyo capped out and is now declining in population because there isn’t a backlog of millions of people who wanted to live there but couldn’t or had to move out because rent is 3x in Tokyo compared to Osaka. Rent is maybe 30% higher in Tokyo, even less if you live on the end of a train line. Can you imagine how many people would move to Bay Area CA or New York City or Boston or Seattle if their rent was only 30% higher? Pre pandemic my 3 bedroom in Boston area was 3500/mo. Since the pandemic rents have gone even higher. We have bidding wars of people trying to win a rental unit. Bidding wars. It’s ridiculous. Also I don’t see your point about houses being torn down. If anything that should make it more expensive (since buying used and not rebuilding is cheaper). Realistically rebuilding is vital (in conjunction with subdivision) because that’s how you increase density
- seanmcdirmid 3y ago
  > but couldn’t or had to move out because rent is 3x in Tokyo compared to Osaka. Osaka and Nagoya are losing people also. The changes are for metro areas, not city cores. > If anything that should make it more expensive (since buying used and not rebuilding is cheaper). It simply means that you can't compute new housing very easily by new housing construction rates (you have to subtract old housing demolitions). Density currently isn't increasing (you tear down one three story narrow house and replace it with another three story narrow house, you need to buy a bunch of SFHs to make a new apartment building).

jjav 3y ago

> Would SF's housing prices go down if you were to build 1M new units? No doubt. Where could you built 1M units in San Francisco? It is less than 50 square miles surrounded on 3 sides by water.