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> If tenants are still moving inspite of the high prices, then the price is probably right. Housing is a necessity. Demand for which is inelastic. The price wi

> If tenants are still moving inspite of the high prices, then the price is probably right. Housing is a necessity. Demand for which is inelastic. The price will be paid regardless, via rent or purchase. And purchase is out of reach or unmanageable for many. Leaving rent as their only option. Also, in no particular order and not limited to: - Single or multi-year contracts. - Minimum space requirements for family size - Local social ties, extended family and friends - Dependency or ties to local services, groups, business - “Keeping up with Joneses” - Moving is a PITA - Comfort, familiarity, nostalgia - Work requirements and industry connections https://en.wikipedia.org/wiki/Price_elasticity_of_demand https://en.wikipedia.org/wiki/Price_elasticity_of_demand

asdasdsddd 2y ago
That's just not true, people leave shitty landlords, buildings, and cities all the time. People also confuse housing as a necessity versus good housing in a good location as a necessity. It's normal for desirable cities to be expensive, if algorithms are truly scalping people on rent, then those cities would be less desirable and the rent would reach equilibrium.
- chimpanzee 2y ago
  Elasticity is a spectrum. The relative elasticity of housing demand might be best illustrated by comparing to a similarly priced good: personal vehicles. Which is more elastic and why? If you have another appropriate or even better comparison to offer, please do.
Gigachad 2y ago
Demand for housing is not entirely inelastic. People downsize, move cities, move in with roommates/family, etc. It’s not rapidly responsive like subscribers of netflix, but it’s fairly elastic over the long term.
- chimpanzee 2y ago
  I agree. It is definitely not perfectly inelastic. But for the sake of pushing back against this claim by gp: >> If tenants are still moving inspite of the high prices, then the price is probably right. it’d probably be best to focus on housing’s relative inelasticity as compared to other goods where such a claim might actually be quite true.

asdasdsddd 2y ago

That's just not true, people leave shitty landlords, buildings, and cities all the time. People also confuse housing as a necessity versus good housing in a good location as a necessity. It's normal for desirable cities to be expensive, if algorithms are truly scalping people on rent, then those cities would be less desirable and the rent would reach equilibrium.

chimpanzee 2y ago
Elasticity is a spectrum. The relative elasticity of housing demand might be best illustrated by comparing to a similarly priced good: personal vehicles. Which is more elastic and why? If you have another appropriate or even better comparison to offer, please do.

Gigachad 2y ago

Demand for housing is not entirely inelastic. People downsize, move cities, move in with roommates/family, etc. It’s not rapidly responsive like subscribers of netflix, but it’s fairly elastic over the long term.

chimpanzee 2y ago
I agree. It is definitely not perfectly inelastic. But for the sake of pushing back against this claim by gp: >> If tenants are still moving inspite of the high prices, then the price is probably right. it’d probably be best to focus on housing’s relative inelasticity as compared to other goods where such a claim might actually be quite true.