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> Hence why I said "building more supply won't help if it is never for sale". It doesn't need to be for sale to help with the situation, of course. It still re

> Hence why I said "building more supply won't help if it is never for sale". It doesn't need to be for sale to help with the situation, of course. It still relieves pressure on the demand side. An individual can never afford an infinite number of houses. Even if someone is, as you say, hoarding houses, at some point the last house they build will be the last house they can own and then they drop out of the demand side of the equation. > who does cheap credit / inflation help more, people with assets or people without assets? Whomever finds opportunity in it, I suppose. Same as always. Someone sitting on cash assets will be worse off (after all, that's what inflation is: a devaluing of a currency), while someone with no assets can leverage the situation to build real wealth. Even the job market tends to improve in a cheap credit / low inflation environment as businesses use that to chase more labour-requiring opportunities, which is a boon for those who have nothing. There is no one answer here.

Rury 2y ago
>It still relieves pressure on the demand side It doesn't if it's sitting there, with no one really occupying it, and priced out of the free market's reach. You're assuming a competitive free market is always determining the price here. That's another thing people don't understand, the theory that supply/demand fully determines prices again assumes a perfectly competitive market, which is almost never the case in reality, especially in places of low liquidity. (keep reading if you don't know what I mean). >An individual can never afford an infinite number of houses But there is still someone who practically can afford an infinite number of houses - those closely tied to the infinite money printer. Banks are deemed "Too big to fail". Take the SIVB failure for example, yes they failed, but the assets did not and got absorbed by other big banks. Just because those assets changed hands, doesn't really change anything in the grand scheme of things. I mean hell... there's a $25 million dollar estate with a private horse track and an observatory tower near where I live, whom locals are very familiar with, which has been vacant for 25 years ever since it was built. No one has ever lived in it. I happened to meet a greenskeeper at a golf course who happens to maintain it a while back. Who is paying his salary for maintenance? The banks. How can they afford to perpetually maintain those costs? Well, when they struggled like in 2008, they got bailouts, and the assets were never sold at whatever the market would bear. So the banks just sit on it, maintenance costs just get tacked onto the price or onto the banks customers over time, and if shit hits the fan, they'll get absorbed by another bank, and they'll just sit on it until hopefully someday someone will pay the price. It's technically for sale, but if the price is set by the bank and outside what demand for it actually is, its price is not really being determined by a competitive free market. And that seems the case in a lot of places. I mean Miami has some of the highest vacancy rates in the US, but median price is like $660k, which is also amongst the higher end in the nation. China has 65 million vacancies, and literally multiple ghost cities where there is like a few dozen people living in skyscrapers, but prices are still sky high. There's a Toronto man who owns 30,000 houses. The US has just under ~15 million vacant properties, but housing inventory for sale is ~1.2 million. I mean... I don't disagree that more supply is badly needed in some places, or fixes to zoning, but how does this not look like what the top post mentioned as the core underlying issue: underutilization of housing, and cheap credit creating an asset bubble virtually around the world? It just seems to me we do in fact have supply in many places, it's just no one is really being forced to adhere to the principles of supply/demand, due to cheap credit.
- randomdata 2y ago
  > It doesn't if it's sitting there, with no one really occupying it, and priced out of the free market's reach It does. Reiterating: Supply and demand, not just supply. When someone builds a house and keeps it for themselves, occupied or not, that is "one less demand" for a different house. Not even banks want to own an infinite number of houses. > price is not really being determined by a competitive free market. What difference does that make? Supply and demand says nothing about competitive free markets. Hell, supply and demand is just as applicable to socialist command economies and everything else you can imagine. Supply and demand is even observable in animal populations. It is considered a law, and not in the legal sense, for good reason.
  - Rury 2y ago
    > When someone builds a house and keeps it for themselves, occupied or not, that is "one less demand" for a different house. Not even banks want to own an infinite number of houses Not necessarily. Are you saying that if I demand to have $1 and keep it for myself, that is 1 less demand I have for different dollars? Seems to me I can still have demand for more dollars. In practice, there may be a point where I don't have demand for more dollars, but I don't see why demand could be unlimited. Are you implying prices have a theoretical maximum? Like $1000000000000000 and once that limit is reached, prices could never go above that? > What difference does that make? Supply and demand says nothing about competitive free markets. Hell, supply and demand is just as applicable to socialist command economies and everything else you can imagine. Supply and demand is even observable in animal populations. It is considered a law, and not in the legal sense, for good reason The difference matters when it comes to determining prices. Again, when it comes to prices, the law only holds true under certain conditions: competitive free market conditions. If the economic environment is not a free market, supply and demand are not influential factors when it comes to prices. We already discussed this above. In socialist economic systems, the government typically sets commodity prices regardless of the supply or demand conditions. In which case, if the price set by the socialist economic system (or monopoly) is higher than the price determined by what supply/demand for it really is, it is essentially being hoarded, and thus not for sale. I am definitely not wrong on this [1][2]. [1] - http://ingrimayne.com/econ/DemandSupply/SD_2.html#:~:text=Supply%20and%20demand%20analysis%20assumes,he%20does%20will%20influence%20price http://ingrimayne.com/econ/DemandSupply/SD_2.html#:~:text=Su.... [2] - https://www.investopedia.com/articles/economics/11/intro-supply-demand.asp https://www.investopedia.com/articles/economics/11/intro-sup...

Rury 2y ago

>It still relieves pressure on the demand side It doesn't if it's sitting there, with no one really occupying it, and priced out of the free market's reach. You're assuming a competitive free market is always determining the price here. That's another thing people don't understand, the theory that supply/demand fully determines prices again assumes a perfectly competitive market, which is almost never the case in reality, especially in places of low liquidity. (keep reading if you don't know what I mean). >An individual can never afford an infinite number of houses But there is still someone who practically can afford an infinite number of houses - those closely tied to the infinite money printer. Banks are deemed "Too big to fail". Take the SIVB failure for example, yes they failed, but the assets did not and got absorbed by other big banks. Just because those assets changed hands, doesn't really change anything in the grand scheme of things. I mean hell... there's a $25 million dollar estate with a private horse track and an observatory tower near where I live, whom locals are very familiar with, which has been vacant for 25 years ever since it was built. No one has ever lived in it. I happened to meet a greenskeeper at a golf course who happens to maintain it a while back. Who is paying his salary for maintenance? The banks. How can they afford to perpetually maintain those costs? Well, when they struggled like in 2008, they got bailouts, and the assets were never sold at whatever the market would bear. So the banks just sit on it, maintenance costs just get tacked onto the price or onto the banks customers over time, and if shit hits the fan, they'll get absorbed by another bank, and they'll just sit on it until hopefully someday someone will pay the price. It's technically for sale, but if the price is set by the bank and outside what demand for it actually is, its price is not really being determined by a competitive free market. And that seems the case in a lot of places. I mean Miami has some of the highest vacancy rates in the US, but median price is like $660k, which is also amongst the higher end in the nation. China has 65 million vacancies, and literally multiple ghost cities where there is like a few dozen people living in skyscrapers, but prices are still sky high. There's a Toronto man who owns 30,000 houses. The US has just under ~15 million vacant properties, but housing inventory for sale is ~1.2 million. I mean... I don't disagree that more supply is badly needed in some places, or fixes to zoning, but how does this not look like what the top post mentioned as the core underlying issue: underutilization of housing, and cheap credit creating an asset bubble virtually around the world? It just seems to me we do in fact have supply in many places, it's just no one is really being forced to adhere to the principles of supply/demand, due to cheap credit.

randomdata 2y ago
> It doesn't if it's sitting there, with no one really occupying it, and priced out of the free market's reach It does. Reiterating: Supply and demand, not just supply. When someone builds a house and keeps it for themselves, occupied or not, that is "one less demand" for a different house. Not even banks want to own an infinite number of houses. > price is not really being determined by a competitive free market. What difference does that make? Supply and demand says nothing about competitive free markets. Hell, supply and demand is just as applicable to socialist command economies and everything else you can imagine. Supply and demand is even observable in animal populations. It is considered a law, and not in the legal sense, for good reason.
- Rury 2y ago
  > When someone builds a house and keeps it for themselves, occupied or not, that is "one less demand" for a different house. Not even banks want to own an infinite number of houses Not necessarily. Are you saying that if I demand to have $1 and keep it for myself, that is 1 less demand I have for different dollars? Seems to me I can still have demand for more dollars. In practice, there may be a point where I don't have demand for more dollars, but I don't see why demand could be unlimited. Are you implying prices have a theoretical maximum? Like $1000000000000000 and once that limit is reached, prices could never go above that? > What difference does that make? Supply and demand says nothing about competitive free markets. Hell, supply and demand is just as applicable to socialist command economies and everything else you can imagine. Supply and demand is even observable in animal populations. It is considered a law, and not in the legal sense, for good reason The difference matters when it comes to determining prices. Again, when it comes to prices, the law only holds true under certain conditions: competitive free market conditions. If the economic environment is not a free market, supply and demand are not influential factors when it comes to prices. We already discussed this above. In socialist economic systems, the government typically sets commodity prices regardless of the supply or demand conditions. In which case, if the price set by the socialist economic system (or monopoly) is higher than the price determined by what supply/demand for it really is, it is essentially being hoarded, and thus not for sale. I am definitely not wrong on this [1][2]. [1] - http://ingrimayne.com/econ/DemandSupply/SD_2.html#:~:text=Supply%20and%20demand%20analysis%20assumes,he%20does%20will%20influence%20price http://ingrimayne.com/econ/DemandSupply/SD_2.html#:~:text=Su.... [2] - https://www.investopedia.com/articles/economics/11/intro-supply-demand.asp https://www.investopedia.com/articles/economics/11/intro-sup...