3 ms·

Huh? If housing supply exceeds demand, rents drop.

• itsoktocry 3y ago
  So why is the supply increasing? Are people are going to keep investing in housing in cities with crumbling infrastructure? Are people moving away?
  • JamesBarney 3y ago
    His argument is that demand will drop.
• xhkkffbf 3y ago
  If demand drops for your chosen neighborhood, it probably has nothing to do with people hoping for lower rents. It usually means people don't want to live in a place because it's less attractive. And that means it's not as nice. Be careful what you wish for.
  • nostrademons 3y ago
    It's a bit different when overall population is dropping, which is predicted for all major developed countries by the second half of the 21st century. When population drops, demand drops for reasons entirely unrelated to how desirable your neighborhood is relative to other neighborhoods. Demand is dropping everywhere. We only think that unusual because we've grown up in an era of perpetually-rising population. A lot of our economic rules of thumb don't hold once population growth reverses. It is true that de-growth generates all sorts of other problems, though. One is labor: you may have houses, but they'll be shittily maintained, and you won't be able to find people to do the maintenance. Another is peace: when growth is happening, everyone has an incentive for peaceful trade so that they can capture the long-term profits of growth, but when growth reverses, the incentive reverses to conquering and pillaging as much of the pie now, before it shrinks, so you don't get left without a slice when it's gone.
• xeromal 3y ago
  The idea is that the reason rent drops matters for the population in who moves in to the area. Building more housing drops rent, but means the area is growing. People leaving because they are no jobs also drops rent, but good luck living in a place with no jobs.