3 ms·

Are you saying that people routinely buy 5 or 6 houses to live in (thus excess demand) Or are you saying the only reason houses are expensive is because people

by ta1243 1y ago

Are you saying that people routinely buy 5 or 6 houses to live in (thus excess demand) Or are you saying the only reason houses are expensive is because people refuse to live in cars in high enough numbers? What do you mean by demand?

philipallstar 1y ago
It's because it would mean looking at immigration numbers. If immigration creates far more demand than there is supply, as it does in various first world countries, then it makes house prices shoot up. But this is not a popular topic, as voters with houses don't care about their house prices going up, and voters without houses are generally younger and don't have the capacity to hear economic statements on immigration without auto-converting them into racial statements they've been warned about on CNN.
- amanaplanacanal 1y ago
  Is immigration higher now than it has been historically? How did immigration impact housing prices in the past vs now?
  - philipallstar 1y ago
    Depends on the place, but e.g. in the UK it's massively high. Almost as high as the US. (Just talking legal immigration; I don't know how to interpret illegal immigration stats.) The UK takes in about 700k people a year net, and builds about 30k houses a year (which is probably about enough to cope with "natural" population growth. Supply and demand. Dwellings get smaller (or subdivided) because people will pay more and get less. Landlords appear to solve the problem (and make a profit from the fact) that young people can't raise the capital to buy a full house themselves any more. It's not the only factor - the jump to two-income households also raised prices massively and transferred a load of wealth to existing home owners back when that happened - but I'd say it's by far the largest factor today.
rcxdude 1y ago
There's two factors that have driven an increase in demand for housing above population growth: fewer people per household and a strong bias towards living in a city. Some of this is cultural: a stigma against living with your parents, for example, and higher expextations for what someone just starting their career should be able to afford, but it's also economic: cities are where the jobs are and they're often not where people grew up, so if they want any independance they pretty much must move away into a city with everyone else.
- ta1243 1y ago
  There are many reasons demand is increasing, all good. In the past a typical housing unit would be husband, wife, two kids. A 3 bed house. Divorce rates are higher now (better to be divorced than in an unhappy marriage - so that's good), so you instead you have divorced husband and one or two bedrooms for shared custody of kids, and divorced wife and one or two bedrooms for shared custody of kids Thus what used to be demand for a single 3 bed house is now demand for two 3 bed houses, with no change in requirements You are also right about cities, and not just any specific city. If you were born in London and get a job in Cambridge because you want to work for Astra Zenneca for example, that's a good thing. Having workforce mobility is a good thing, just because you are the son of a farmer doesn't mean you should be destined to be a farmer. You've also got people meeting and marrying people from outside their immediate geographic area, at least one of them will have to move. There's then the social appeal of cities in general -- if you're the "only gay in the village" that's a miserable life. If you live in a city there's far more choice. "living with parents" is on the increase, despite any "stigma". > The number of families in England and Wales with adult children living with their parents rose 13.6% between the 2011 Census and Census 2021 to nearly 3.8 million. https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/articles/moreadultslivingwiththeirparents/2023-05-10 https://www.ons.gov.uk/peoplepopulationandcommunity/populati... Adults living with parents is not a good thing, and in the west it never has been. Adults should be independent, and learn to fly the nest and build their own lives. Then you've got massive external immigration. As well as people moving from country and older mining towns, you have massive inward migration (in the UK this has reached an increase of about 1% population increase per year). This is a good thing for the economy (more workers, more productivity, more taxes), but comes with other issues - including more demand for housing.

by ta1243 1y ago

philipallstar 1y ago

It's because it would mean looking at immigration numbers. If immigration creates far more demand than there is supply, as it does in various first world countries, then it makes house prices shoot up. But this is not a popular topic, as voters with houses don't care about their house prices going up, and voters without houses are generally younger and don't have the capacity to hear economic statements on immigration without auto-converting them into racial statements they've been warned about on CNN.

amanaplanacanal 1y ago
Is immigration higher now than it has been historically? How did immigration impact housing prices in the past vs now?
- philipallstar 1y ago
  Depends on the place, but e.g. in the UK it's massively high. Almost as high as the US. (Just talking legal immigration; I don't know how to interpret illegal immigration stats.) The UK takes in about 700k people a year net, and builds about 30k houses a year (which is probably about enough to cope with "natural" population growth. Supply and demand. Dwellings get smaller (or subdivided) because people will pay more and get less. Landlords appear to solve the problem (and make a profit from the fact) that young people can't raise the capital to buy a full house themselves any more. It's not the only factor - the jump to two-income households also raised prices massively and transferred a load of wealth to existing home owners back when that happened - but I'd say it's by far the largest factor today.

rcxdude 1y ago

There's two factors that have driven an increase in demand for housing above population growth: fewer people per household and a strong bias towards living in a city. Some of this is cultural: a stigma against living with your parents, for example, and higher expextations for what someone just starting their career should be able to afford, but it's also economic: cities are where the jobs are and they're often not where people grew up, so if they want any independance they pretty much must move away into a city with everyone else.

ta1243 1y ago
There are many reasons demand is increasing, all good. In the past a typical housing unit would be husband, wife, two kids. A 3 bed house. Divorce rates are higher now (better to be divorced than in an unhappy marriage - so that's good), so you instead you have divorced husband and one or two bedrooms for shared custody of kids, and divorced wife and one or two bedrooms for shared custody of kids Thus what used to be demand for a single 3 bed house is now demand for two 3 bed houses, with no change in requirements You are also right about cities, and not just any specific city. If you were born in London and get a job in Cambridge because you want to work for Astra Zenneca for example, that's a good thing. Having workforce mobility is a good thing, just because you are the son of a farmer doesn't mean you should be destined to be a farmer. You've also got people meeting and marrying people from outside their immediate geographic area, at least one of them will have to move. There's then the social appeal of cities in general -- if you're the "only gay in the village" that's a miserable life. If you live in a city there's far more choice. "living with parents" is on the increase, despite any "stigma". > The number of families in England and Wales with adult children living with their parents rose 13.6% between the 2011 Census and Census 2021 to nearly 3.8 million. https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/articles/moreadultslivingwiththeirparents/2023-05-10 https://www.ons.gov.uk/peoplepopulationandcommunity/populati... Adults living with parents is not a good thing, and in the west it never has been. Adults should be independent, and learn to fly the nest and build their own lives. Then you've got massive external immigration. As well as people moving from country and older mining towns, you have massive inward migration (in the UK this has reached an increase of about 1% population increase per year). This is a good thing for the economy (more workers, more productivity, more taxes), but comes with other issues - including more demand for housing.