12 ms·

so is there any actual evidence that foreign home ownership is causing meaningful housing price inflation in Spain? or is this just uninformed pandering like it

so is there any actual evidence that foreign home ownership is causing meaningful housing price inflation in Spain? or is this just uninformed pandering like it is in the US

nsklab 2y ago
For the last years we’ve had 500K immigrants coming every year. That’s what’s causing inflation.
- hjgjhyuhy 2y ago
  Printing massive amounts of money is what caused the inflation.
  - nsklab 2y ago
    I was talking about housing inflation specifically. Housing has increased in price more than the rest of goods plus it’s been increasing in price for a long time, long before covid. Adding millions of people and not building anything makes housing prices skyrocket. One of the two needs to be dealt with and, since immigration also makes salaries plummet for the most vulnerable, why not kill two birds with one stone.
scotty79 2y ago
Do you need specific evidence that additional demand causes price increase when the supply is pretty much fixed?
- draw_down 2y ago
  [dead]
stavros 2y ago
What's causing it in the US?
- rvnx 2y ago
  In Canada potentially Chinese immigrants in Vancouver/Toronto, in the US it's an over-generous monetary policy (through low interest rates, especially during COVID)
  - affinepplan 2y ago
    in Canada, like in the US, it's a lack of supply mostly because of draconian zoning and land-use policies. Chinese immigrants are NOT the primary cause of housing cost inflation, and are likely not even in the top 10 causes.
    - OJFord 2y ago
      I don't know or claim that it's any truer, but I thought the oft-reported reason, for Vancouver/BC especially, was Chinese investment, and explicitly not immigration even, the chief complaint that the growth has been/is expected to be such that they're left unoccupied?
      - _whiteCaps_ 2y ago
        This is my experience. The two houses that I share a backyard fence with are empty. A caretaker comes by once a month to have a look around one of the houses but otherwise they're unoccupied.
      - qball 2y ago
        >for Vancouver/BC especially The ALR bans any and all significant development in BC. Land is not scarce in BC; land that it's legal to build on is.
        OJFord 2y ago
        Ok - I'm not Canadian, idk what ALR is - I'm just saying what's disagreed with up-thread isn't what, in my experience, is the common claim (whether it's correct or not).
Retric 2y ago
Meaningful is a weasel word here. Even 0.1% price increase which would be impossible to measure directly still adds up across the entire housing sector. But, equally important is simply the number of natives prevented from buying the home they want because someone is getting a vacation property.
- renewiltord 2y ago
  Yeah, you have 0.1% of a house, sure. But do that across a thousand houses and you have 100% of the houses. It's that simple.
  - Retric 2y ago
    500$ on a 500k house might not seem like a big deal, but I’d still rather have the 500$.
- egwor 2y ago
  I think I read 20,000,000 need housing and this will impact 20,000 per year so broadly the numbers are inline.
  - throwaway2037 2y ago
    How can 20M be even remotely correct? Spain has a total population of about 48M.
- kasey_junk 2y ago
  But you also need to measure the dampening impact on home building. If builders would have built N units knowing they could easily sell some % them to foreign buyers but now they can’t, then you might lose the whole supply. And all the knock on effects for contractors, suppliers, etc
  - Retric 2y ago
    Cities are rarely constrained by the willingness of someone to build housing, it’s generally more an issue of being allowed to build housing.
yeknoda 2y ago
Depending on the market, market prices can be decided by a very small number of transactions that set things. Probably true for houses in Spain (limited supply) and foreign wealthy buyers (very high potential demand)
rolothrow 2y ago
Totally anecdotal, but I live in the largest city in Spain, and even in my residential area (as opposed to the touristy spots) every week I can see ads for "we buy your house, paid upfront over market value, Chinese investors". Posters in walls, flyers in windshields and so on.
- CommanderData 2y ago
  This is excellent, assets like property don't grow on trees and needs to be protected from foreign investors. Absolutely need something like this in the UK.
  - matt-p 2y ago
    I think the ship has sailed, but regardless isn't it all meaningless? Surely they can setup a company to get around it, or will be ban all foreign ownership of shares too?
    - zdragnar 2y ago
      Land is a public good, insofar as "buying" the land still comes with obligations to the state (paying taxes, conforming to building codes and zoning regulation, etc). Just because you "own" it doesn't actually mean you can do as you please. Given all of that, it is not unreasonable to limit or outright prohibit foreign ownership of land, or ownership of land by companies which are not majority-locally controlled.
      - matt-p 2y ago
        It's interesting, I just think the second order effects might be a bit scary. Having said that I guess for FDI there's always the option of getting a local company to "JV" with like in China.
    - CommanderData 2y ago
      Assets cant be shipped overseas. They are here, in the UK. That's the beauty of it. Taxes can force them back to UK ownership. The rich are buying the only asset the middle class will ever probably own, housing.
matt-p 2y ago
Of course, it's just more demand, like immigration, aging population and so on. Of course those are a much more difficult target..
iforgot22 2y ago
Even if it does, I don't see why it really matters. Cost of living has nothing to do with the value of the land you live on. Maybe the real problem is foreign investors leave the property vacant?
jopicornell 2y ago
In my hometown, Palma, in Mallorca, I live in a street where 50% of houses are owned by foreign people or investors/airbnb. The neighborhood is not 50% but not that low. The problem? Prices skyrocketed, like a 10x in 10 years (for big houses, small houses 4x). I hear more english/german/sweedish than spanish (or catalan) in my dog walks. Besides economic implications (a lot for local people trying to find places to live), there are cultural/social implications. The neighborhood used to be a community, where people were open to help and share. Now this is changing and evolving into an individualist neighborhood. Our oficial language is being minoritized even more. This doesn't seem like the neighborhood we used to live on. Not everything is economy. The intangible heritage is something we should take care more.

so is there any actual evidence that foreign home ownership is causing meaningful housing price inflation in Spain? or is this just uninformed pandering like it is in the US

nsklab 2y ago

For the last years we’ve had 500K immigrants coming every year. That’s what’s causing inflation.

hjgjhyuhy 2y ago
Printing massive amounts of money is what caused the inflation.
- nsklab 2y ago
  I was talking about housing inflation specifically. Housing has increased in price more than the rest of goods plus it’s been increasing in price for a long time, long before covid. Adding millions of people and not building anything makes housing prices skyrocket. One of the two needs to be dealt with and, since immigration also makes salaries plummet for the most vulnerable, why not kill two birds with one stone.

scotty79 2y ago

Do you need specific evidence that additional demand causes price increase when the supply is pretty much fixed?

draw_down 2y ago
[dead]

stavros 2y ago

What's causing it in the US?

rvnx 2y ago
In Canada potentially Chinese immigrants in Vancouver/Toronto, in the US it's an over-generous monetary policy (through low interest rates, especially during COVID)
- affinepplan 2y ago
  in Canada, like in the US, it's a lack of supply mostly because of draconian zoning and land-use policies. Chinese immigrants are NOT the primary cause of housing cost inflation, and are likely not even in the top 10 causes.
  - OJFord 2y ago
    I don't know or claim that it's any truer, but I thought the oft-reported reason, for Vancouver/BC especially, was Chinese investment, and explicitly not immigration even, the chief complaint that the growth has been/is expected to be such that they're left unoccupied?
    - _whiteCaps_ 2y ago
      This is my experience. The two houses that I share a backyard fence with are empty. A caretaker comes by once a month to have a look around one of the houses but otherwise they're unoccupied.
    - qball 2y ago
      >for Vancouver/BC especially The ALR bans any and all significant development in BC. Land is not scarce in BC; land that it's legal to build on is.
      - OJFord 2y ago
        Ok - I'm not Canadian, idk what ALR is - I'm just saying what's disagreed with up-thread isn't what, in my experience, is the common claim (whether it's correct or not).

Retric 2y ago

Meaningful is a weasel word here. Even 0.1% price increase which would be impossible to measure directly still adds up across the entire housing sector. But, equally important is simply the number of natives prevented from buying the home they want because someone is getting a vacation property.

renewiltord 2y ago
Yeah, you have 0.1% of a house, sure. But do that across a thousand houses and you have 100% of the houses. It's that simple.
- Retric 2y ago
  500$ on a 500k house might not seem like a big deal, but I’d still rather have the 500$.
egwor 2y ago
I think I read 20,000,000 need housing and this will impact 20,000 per year so broadly the numbers are inline.
- throwaway2037 2y ago
  How can 20M be even remotely correct? Spain has a total population of about 48M.
kasey_junk 2y ago
But you also need to measure the dampening impact on home building. If builders would have built N units knowing they could easily sell some % them to foreign buyers but now they can’t, then you might lose the whole supply. And all the knock on effects for contractors, suppliers, etc
- Retric 2y ago
  Cities are rarely constrained by the willingness of someone to build housing, it’s generally more an issue of being allowed to build housing.

yeknoda 2y ago

Depending on the market, market prices can be decided by a very small number of transactions that set things. Probably true for houses in Spain (limited supply) and foreign wealthy buyers (very high potential demand)

rolothrow 2y ago

Totally anecdotal, but I live in the largest city in Spain, and even in my residential area (as opposed to the touristy spots) every week I can see ads for "we buy your house, paid upfront over market value, Chinese investors". Posters in walls, flyers in windshields and so on.

CommanderData 2y ago
This is excellent, assets like property don't grow on trees and needs to be protected from foreign investors. Absolutely need something like this in the UK.
- matt-p 2y ago
  I think the ship has sailed, but regardless isn't it all meaningless? Surely they can setup a company to get around it, or will be ban all foreign ownership of shares too?
  - zdragnar 2y ago
    Land is a public good, insofar as "buying" the land still comes with obligations to the state (paying taxes, conforming to building codes and zoning regulation, etc). Just because you "own" it doesn't actually mean you can do as you please. Given all of that, it is not unreasonable to limit or outright prohibit foreign ownership of land, or ownership of land by companies which are not majority-locally controlled.
    - matt-p 2y ago
      It's interesting, I just think the second order effects might be a bit scary. Having said that I guess for FDI there's always the option of getting a local company to "JV" with like in China.
  - CommanderData 2y ago
    Assets cant be shipped overseas. They are here, in the UK. That's the beauty of it. Taxes can force them back to UK ownership. The rich are buying the only asset the middle class will ever probably own, housing.

matt-p 2y ago

Of course, it's just more demand, like immigration, aging population and so on. Of course those are a much more difficult target..

iforgot22 2y ago

Even if it does, I don't see why it really matters. Cost of living has nothing to do with the value of the land you live on. Maybe the real problem is foreign investors leave the property vacant?

jopicornell 2y ago

In my hometown, Palma, in Mallorca, I live in a street where 50% of houses are owned by foreign people or investors/airbnb. The neighborhood is not 50% but not that low. The problem? Prices skyrocketed, like a 10x in 10 years (for big houses, small houses 4x). I hear more english/german/sweedish than spanish (or catalan) in my dog walks. Besides economic implications (a lot for local people trying to find places to live), there are cultural/social implications. The neighborhood used to be a community, where people were open to help and share. Now this is changing and evolving into an individualist neighborhood. Our oficial language is being minoritized even more. This doesn't seem like the neighborhood we used to live on. Not everything is economy. The intangible heritage is something we should take care more.