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This is everywhere now. People who own houses want to see the value increase. This is even more true of all the investment companies, pension funds, etc. - they

This is everywhere now. People who own houses want to see the value increase. This is even more true of all the investment companies, pension funds, etc. - they must show a substantial ROI. Build more houses, to make housing more affordable? They will fight it at every turn. Not openly, of course. You cannot openly oppose affordable housing. But through lobbying, they will prevent rezoning, put hurdles in the way of easing building regulations. Ensure that NIMBYs protest cheap housing near their upper-class neighborhoods. Whatever it takes.

ta1243 3y ago
In the UK a significant number of people think there's no need for more housing, not just in their back yard, but anywhere. They're BANANAs. The excuses are typically a mix of 1) Too many immigrants 2) Lack of rent controls 3) Greedy developers 4) AirBNB 5) Empty houses Depending on their political views.
- graemep 3y ago
  All those are factors. They also leave out the biggest single problem: years of very low interest rates inflating prices, making it hard for people to afford deposits though. There is BoE research showing interest rates are the biggest factor in the earnings to house price ration. "Immigrants" also leaves something out. Foreign investors and rich foreigners buying holiday homes/second (or third or fourth etc.) homes are a factor in some places (especially London) - in much the same way that people from London and other big cities push up prices in places like Cornwall.
  - TheOtherHobbes 3y ago
    Foreign money is far more of a problem than foreign people. Notoriously, many newbuild flats end up empty because not many people can afford the rent, and they're really just investment tokens anyway. Property is like Bitcoin with bricks.
    - ta1243 3y ago
      Reality isn't like that, according to a pressure group that says empty homes is a major problem (and are thus unlikely to be underestimating) https://www.actiononemptyhomes.org/ https://www.actiononemptyhomes.org/ London, where the main problem is (two people on minimum wage can buy a 3 bed house pretty much everywhere in the country outside the south east) has under 2.5% either empty, in use for short term lets like airbnb, or used for people who have a flat in London and a family home elsewhere. https://static1.squarespace.com/static/6553693f7d629a133b6a4ece/t/6556395f5ebbf5732fcbc36e/1700149600422/London+stats.pdf https://static1.squarespace.com/static/6553693f7d629a133b6a4...
      - matt-p 3y ago
        "two people on minimum wage can buy a 3 bed house pretty much everywhere in the country outside the south east" source? Because it doesn't feel like that at all. https://www.theguardian.com/society/ng-interactive/2023/jun/12/interactive-tool-that-shows-where-you-can-afford-to-buy-or-rent-home-great-britain https://www.theguardian.com/society/ng-interactive/2023/jun/... take a look at this map - all the bits of Britain that are actually nice to live in are in "can't buy, can rent" or worse. Prove me wrong, give me an example area?
        dukeyukey 3y ago
        Also worth seeing that London has about 9 million people, and the south-east has another 9 million. That's 27% of the UK's population in the now-unaffordable area. Throw in some expensive areas outside the south-east (Cambridge, Bristol, seaside resort towns) and that goes up to 30% easily.
        matt-p 3y ago
        Indeed. That's before you've even gotten to places like Manchester, Edinburgh and the like. Instinctively it feels like about 2/3rds of people live in "unaffordable to buy" areas. Worse it's probably the best paid 2/3rds of the country.
  - brutus1213 3y ago
    Housing seems to be a disaster almost everywhere in the world these days. This makes me think the issue is not a local one (or perhaps there are some traits in all of us as humans that are causing this mess). What is odd to me is that previous real-estate bubbles have been localized. Now, every single place I would consider living has had significant housing price increases/bidding wars, etc. From an economics perspective, lets assume there was no govt regulation at all. I am not sure if the problem would be fixed. There is a trite old sayings .. "they aren't making any more land" or "location-location-location". But this inelastic supply of land is nothing new. So why is this happening now?
    - voisin 3y ago
      > Housing seems to be a disaster almost everywhere in the world these days Interest rates have been ultra low (versus historic norms) in the developed world for two decades. And prior to that they were on the decline. Similarly, the developed world has largely not been building housing in line with population growth. For decades. We are at the natural conclusion of decades of bad policy and we aren’t going to squeeze out of it in a few years. It will take decades of good policy to fix this and our leaders don’t seem programmed for maintaining good policy for more than a few years until there’s a hint of prosperity and then they fritter it away.
      - dukeyukey 3y ago
        Low interest rates _should have_ allowed builders to build more homes too, but they haven't.
        jackcosgrove 3y ago
        In the US housing supply did keep pace with demand until about 2006. Witness the reversion of prices to historical norms (briefly) after the housing crash. So the response of home builders to interest rates is mixed. The problem here at least is that many homebuilders went bankrupt after the housing crash and the supply of skills and willingness to build homes decreased for a generation.
        3y ago
  - matt-p 3y ago
    I think we can add "high interest rates" to the above list. That is a symptom, not a cause. If we built more houses it wouldn't matter anywhere near as much. We can't have a situation where demand is outstripping supply to this extent and expect our economy to grow. We need workers able to live somewhere near where they work, we need them to not have a mortgage so high that they feel unsafe in moving jobs, starting a business or going freelance. We need folk with disposable income to spend on other sectors besides overheating the property market. All this promotes growth in our economy, housebuilding also of course generates work for builders, electricians, trades, road designers, rail companies etc etc
- hackerlight 3y ago
  (1), (3), (4) and (5) are all covert admissions that there's not enough available housing. For example, (1) says that net migration is outstripping housing, (3) usually comes down to the "land-banking" theory or this idea that heterogeneous developers are colluding to restrict housing, while (4) and (5) are about investors restricting housing for tenants. In my experience, the people adopting these explanations are usually neutral or hostile to actual new housing, aside from their pet solution of punishing their chosen scapegoat. The challenge is there's a grain of truth to all of these explanations. House prices and rents would go down if vacancies were outlawed. But these solutions that target scapegoats are probably insufficient to move the dial much. The vacancy rate in Ireland has gone down over the last decade while prices and rents have skyrocketed. AirBNBs are a small fraction of housing. The two biggest things you can do to reduce prices and rents is to build a lot by removing obstacles (whether private or public housing), and reduce incentives (tax and otherwise) for investors to buy and hold land.
  - DrBazza 3y ago
    > (1), (3), (4) and (5) are all covert admissions that there's not enough available housing. Well, (1) isn't. It says demand outstrips supply, as the birth rate on its own would be a shrinking population in the UK. The obvious, low cost answer is to reduce demand. An 'x' in a box, saying no to immigration. Instead we have yes, and then thousands of pounds buying land, building houses, co2 emissions, loss of countryside, environmental destruction, loss of arable land and so on. We could reduce immigration to pre 1997 levels, when the economy grew at similar rates to now. The arguments for mass immigration in the UK are unproven simply because stopping immigration and seeing the result hasn't been tried. You could argue that with 10x 1997 levels we should have a measurable increase in annual GDP better than pre-1997. We don't. With a shrinking population, Japan's economy has stagnated and contracted a little. But nothing catastrophic. Perhaps the pursuit of 'GDP' is simply the wrong thing to be concerned about. House builders are happy with the current situation. They're pretty much a cartel, as they're solely responsible for the supply of new houses. They don't want to lose money on sites they've paid over the odds for. They don't want to be told to deliver more houses, if they could, as more supply would be competitive and prices would potentially drop, as would profit. Which is why they donate huge amounts to the national political parties, as well as locally as well to keep the status quo. Near me there's several fields of Grade 1 land owned by Bellway and Redrow for the last 2 decades. 20 years. The land has permission. They've not yet built on it. Can't think why.
- sys_64738 3y ago
  Britain's problem is cramming everything into the London areas and surrounding counties. There's plenty of space in the midlands and up north. What should happen is that Parliament be relocated from London to Manchester and other city-state services moved to the rest of the country. A huge rebalancing of investment will quickly equalise and normalise the lopsided weighting that this country has.
  - matt-p 3y ago
    Manchester has the same house price issues as London these days. Leeds or something could be appropriate though. The problem is the Tories were re-elected on the basis of 'leveling up' the regions but f-all has actually happened so the metaphorical well has been poisoned.
softwaredoug 3y ago
In our town even when new housing is approved litigious and wealthy homeowners will delay the projects with lawsuit after lawsuit. Meanwhile we have derelict properties and a lot of empty commercial real estate. I don’t know how to solve it but it seems to only takes a handful of homeowners to scuttle a project. And I fear my town will slide into irrelevance and decay at this rate. And for some reason popping up another strip mall or box store doesn’t cause the same ire? It’s all very strange.
- pydry 3y ago
  [flagged]
  - snapplebobapple 3y ago
    This is only possibly correct in situations where you have a surplus of units and lots of vacancies. Any situation where the problem is a shortage of units those two policies will make it worse by making the math of building more units look worse. What you actually need are policies that make it profitable to offer market units at lower prices profitably from many different suppliers to get both enough supply on the market as well as that supply being from enough different suppliers that they compete the prices down rather than abusing oligopoly market power to capture more profit for themselves. Example policies: - Get rid of most categories of residential zoning into one or two zones and have the least dense zone allow for high density while also allowing people to choose to build less dense (i.e. one zone that allows up to 80% lot coverage and six stories and one for more dense than that). - Set tight turn around times for development and building permits and switch them from default not approved to default approved unless the city makes a valid case from a very short list of potential reasons. Basically make it impossible to not approve something very quickly that fits within the new zoning guidelines. - Set tight timeline requirements for all construction inspections to keep the construction process moving. - taxing land based on maximum allowed construction rather than what is there would making holding vacant land and not building way more costly, which should spur development. It would also make it dramatically cheaper to do assessments since all that will matter is lot square footage and general area for the purpose of assessment. - Enforce antitrust law so that no one can own enough units in any area to have market power. If you want to be a large REIT you will need to diversify geographically. There's a bunch more nuance to this than I have outlined above but this is turning into a novel already so I will end it here.
rswskg 3y ago
Pff, or it's massive amounts of immigration?

ta1243 3y ago

In the UK a significant number of people think there's no need for more housing, not just in their back yard, but anywhere. They're BANANAs. The excuses are typically a mix of 1) Too many immigrants 2) Lack of rent controls 3) Greedy developers 4) AirBNB 5) Empty houses Depending on their political views.

graemep 3y ago
All those are factors. They also leave out the biggest single problem: years of very low interest rates inflating prices, making it hard for people to afford deposits though. There is BoE research showing interest rates are the biggest factor in the earnings to house price ration. "Immigrants" also leaves something out. Foreign investors and rich foreigners buying holiday homes/second (or third or fourth etc.) homes are a factor in some places (especially London) - in much the same way that people from London and other big cities push up prices in places like Cornwall.
- TheOtherHobbes 3y ago
  Foreign money is far more of a problem than foreign people. Notoriously, many newbuild flats end up empty because not many people can afford the rent, and they're really just investment tokens anyway. Property is like Bitcoin with bricks.
  - ta1243 3y ago
    Reality isn't like that, according to a pressure group that says empty homes is a major problem (and are thus unlikely to be underestimating) https://www.actiononemptyhomes.org/ https://www.actiononemptyhomes.org/ London, where the main problem is (two people on minimum wage can buy a 3 bed house pretty much everywhere in the country outside the south east) has under 2.5% either empty, in use for short term lets like airbnb, or used for people who have a flat in London and a family home elsewhere. https://static1.squarespace.com/static/6553693f7d629a133b6a4ece/t/6556395f5ebbf5732fcbc36e/1700149600422/London+stats.pdf https://static1.squarespace.com/static/6553693f7d629a133b6a4...
    - matt-p 3y ago
      "two people on minimum wage can buy a 3 bed house pretty much everywhere in the country outside the south east" source? Because it doesn't feel like that at all. https://www.theguardian.com/society/ng-interactive/2023/jun/12/interactive-tool-that-shows-where-you-can-afford-to-buy-or-rent-home-great-britain https://www.theguardian.com/society/ng-interactive/2023/jun/... take a look at this map - all the bits of Britain that are actually nice to live in are in "can't buy, can rent" or worse. Prove me wrong, give me an example area?
      - dukeyukey 3y ago
        Also worth seeing that London has about 9 million people, and the south-east has another 9 million. That's 27% of the UK's population in the now-unaffordable area. Throw in some expensive areas outside the south-east (Cambridge, Bristol, seaside resort towns) and that goes up to 30% easily.
        matt-p 3y ago
        Indeed. That's before you've even gotten to places like Manchester, Edinburgh and the like. Instinctively it feels like about 2/3rds of people live in "unaffordable to buy" areas. Worse it's probably the best paid 2/3rds of the country.
- brutus1213 3y ago
  Housing seems to be a disaster almost everywhere in the world these days. This makes me think the issue is not a local one (or perhaps there are some traits in all of us as humans that are causing this mess). What is odd to me is that previous real-estate bubbles have been localized. Now, every single place I would consider living has had significant housing price increases/bidding wars, etc. From an economics perspective, lets assume there was no govt regulation at all. I am not sure if the problem would be fixed. There is a trite old sayings .. "they aren't making any more land" or "location-location-location". But this inelastic supply of land is nothing new. So why is this happening now?
  - voisin 3y ago
    > Housing seems to be a disaster almost everywhere in the world these days Interest rates have been ultra low (versus historic norms) in the developed world for two decades. And prior to that they were on the decline. Similarly, the developed world has largely not been building housing in line with population growth. For decades. We are at the natural conclusion of decades of bad policy and we aren’t going to squeeze out of it in a few years. It will take decades of good policy to fix this and our leaders don’t seem programmed for maintaining good policy for more than a few years until there’s a hint of prosperity and then they fritter it away.
    - dukeyukey 3y ago
      Low interest rates _should have_ allowed builders to build more homes too, but they haven't.
      - jackcosgrove 3y ago
        In the US housing supply did keep pace with demand until about 2006. Witness the reversion of prices to historical norms (briefly) after the housing crash. So the response of home builders to interest rates is mixed. The problem here at least is that many homebuilders went bankrupt after the housing crash and the supply of skills and willingness to build homes decreased for a generation.
      - 3y ago
- matt-p 3y ago
  I think we can add "high interest rates" to the above list. That is a symptom, not a cause. If we built more houses it wouldn't matter anywhere near as much. We can't have a situation where demand is outstripping supply to this extent and expect our economy to grow. We need workers able to live somewhere near where they work, we need them to not have a mortgage so high that they feel unsafe in moving jobs, starting a business or going freelance. We need folk with disposable income to spend on other sectors besides overheating the property market. All this promotes growth in our economy, housebuilding also of course generates work for builders, electricians, trades, road designers, rail companies etc etc
hackerlight 3y ago
(1), (3), (4) and (5) are all covert admissions that there's not enough available housing. For example, (1) says that net migration is outstripping housing, (3) usually comes down to the "land-banking" theory or this idea that heterogeneous developers are colluding to restrict housing, while (4) and (5) are about investors restricting housing for tenants. In my experience, the people adopting these explanations are usually neutral or hostile to actual new housing, aside from their pet solution of punishing their chosen scapegoat. The challenge is there's a grain of truth to all of these explanations. House prices and rents would go down if vacancies were outlawed. But these solutions that target scapegoats are probably insufficient to move the dial much. The vacancy rate in Ireland has gone down over the last decade while prices and rents have skyrocketed. AirBNBs are a small fraction of housing. The two biggest things you can do to reduce prices and rents is to build a lot by removing obstacles (whether private or public housing), and reduce incentives (tax and otherwise) for investors to buy and hold land.
- DrBazza 3y ago
  > (1), (3), (4) and (5) are all covert admissions that there's not enough available housing. Well, (1) isn't. It says demand outstrips supply, as the birth rate on its own would be a shrinking population in the UK. The obvious, low cost answer is to reduce demand. An 'x' in a box, saying no to immigration. Instead we have yes, and then thousands of pounds buying land, building houses, co2 emissions, loss of countryside, environmental destruction, loss of arable land and so on. We could reduce immigration to pre 1997 levels, when the economy grew at similar rates to now. The arguments for mass immigration in the UK are unproven simply because stopping immigration and seeing the result hasn't been tried. You could argue that with 10x 1997 levels we should have a measurable increase in annual GDP better than pre-1997. We don't. With a shrinking population, Japan's economy has stagnated and contracted a little. But nothing catastrophic. Perhaps the pursuit of 'GDP' is simply the wrong thing to be concerned about. House builders are happy with the current situation. They're pretty much a cartel, as they're solely responsible for the supply of new houses. They don't want to lose money on sites they've paid over the odds for. They don't want to be told to deliver more houses, if they could, as more supply would be competitive and prices would potentially drop, as would profit. Which is why they donate huge amounts to the national political parties, as well as locally as well to keep the status quo. Near me there's several fields of Grade 1 land owned by Bellway and Redrow for the last 2 decades. 20 years. The land has permission. They've not yet built on it. Can't think why.
sys_64738 3y ago
Britain's problem is cramming everything into the London areas and surrounding counties. There's plenty of space in the midlands and up north. What should happen is that Parliament be relocated from London to Manchester and other city-state services moved to the rest of the country. A huge rebalancing of investment will quickly equalise and normalise the lopsided weighting that this country has.
- matt-p 3y ago
  Manchester has the same house price issues as London these days. Leeds or something could be appropriate though. The problem is the Tories were re-elected on the basis of 'leveling up' the regions but f-all has actually happened so the metaphorical well has been poisoned.

softwaredoug 3y ago

In our town even when new housing is approved litigious and wealthy homeowners will delay the projects with lawsuit after lawsuit. Meanwhile we have derelict properties and a lot of empty commercial real estate. I don’t know how to solve it but it seems to only takes a handful of homeowners to scuttle a project. And I fear my town will slide into irrelevance and decay at this rate. And for some reason popping up another strip mall or box store doesn’t cause the same ire? It’s all very strange.

pydry 3y ago
[flagged]
- snapplebobapple 3y ago
  This is only possibly correct in situations where you have a surplus of units and lots of vacancies. Any situation where the problem is a shortage of units those two policies will make it worse by making the math of building more units look worse. What you actually need are policies that make it profitable to offer market units at lower prices profitably from many different suppliers to get both enough supply on the market as well as that supply being from enough different suppliers that they compete the prices down rather than abusing oligopoly market power to capture more profit for themselves. Example policies: - Get rid of most categories of residential zoning into one or two zones and have the least dense zone allow for high density while also allowing people to choose to build less dense (i.e. one zone that allows up to 80% lot coverage and six stories and one for more dense than that). - Set tight turn around times for development and building permits and switch them from default not approved to default approved unless the city makes a valid case from a very short list of potential reasons. Basically make it impossible to not approve something very quickly that fits within the new zoning guidelines. - Set tight timeline requirements for all construction inspections to keep the construction process moving. - taxing land based on maximum allowed construction rather than what is there would making holding vacant land and not building way more costly, which should spur development. It would also make it dramatically cheaper to do assessments since all that will matter is lot square footage and general area for the purpose of assessment. - Enforce antitrust law so that no one can own enough units in any area to have market power. If you want to be a large REIT you will need to diversify geographically. There's a bunch more nuance to this than I have outlined above but this is turning into a novel already so I will end it here.

rswskg 3y ago

Pff, or it's massive amounts of immigration?