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> It does. Twenty thousand units represent about 5% of Denver's housing stock [1]. Commit to adding this many units to the housing stock every year for the next

> It does. Twenty thousand units represent about 5% of Denver's housing stock [1]. Commit to adding this many units to the housing stock every year for the next 10 years and you'll have solved the housing crisis. (You'll probably need to bail out recent homebuyers, who will be permanently underwater, but that's a separate issue.) That is only if you believe that more capacity does not induce more demand, which really isn't true as long as the city remains popular for jobs/climate/nature/etc.... People not moving to Denver because the rent is too high will decide to move to Denver if rents decrease (and the demand they add will cause rents to increase, wash/rinse/repeat until an equilibrium is reached). You also have cases where a city becomes even more attractive because of growing density alone (NYC, Hong Kong, Tokyo).

hdgvhicv 1y ago
Is you idea that people will be renting multiple units just for the fun of it? In large enough numbers to be impactful?
FredPret 1y ago
That's why you have to allow large-scale building everywhere. Then the market will find its own level. The inverse of this situation is that everyone lives somewhere they consider unpleasant because the rent is affordable there. The megacities you mention are enormously economically productive per capita. All sorts of efficiencies pop up when a huge number of people live near one another.
- deleted 1y ago
  [deleted]
- seanmcdirmid 1y ago
  > The megacities you mention are enormously economically productive per capita. All sorts of efficiencies pop up when a huge number of people live near one another. It isn't a bad thing. NYC and Hong Kong are nice cities, they should exist. But don't expect housing prices to fall because you add more density if demand isn't fixed, the opposite often happens instead (people want to live in megacities even though housing costs are high). And that isn't really a bad thing, like gentrifying a blighted neighborhood will drive up housing prices as well.
maxerickson 1y ago
Better to have good problems than to have bad problems.
tptacek 1y ago
Induced demand can only function if there's a scarcity to begin with, and it's premised on increased supply increasing affordability (that's the mechanism by which it works), but these axiomatic derivations don't matter because we have case studies (in MN, in TX, and now CO, a story we're literally commenting on). Empirical observations win.
- JumpCrisscross 1y ago
  > Induced demand can only function if there's a scarcity to begin with I don't believe this is true, assuming scarcity = shortage. Ad absurdum, if Denver overbuilt such that one could pick up a parcel for a song, you'd see opportunistic demand where there previously was none.
  - toast0 1y ago
    There's places all over where land, and sometimes land with buildings gets very inexpensive because there's not much demand. Here's a listing for a parcel for $9000, that's been listed for over a year[1]. Denver seems like a nicer place than Detroit, IMHO, but it's possible for there to be more supply than demand. I suspect at 5% annual growth in units, you would be able to reach the point where there's not enough demand for builders to recover costs. It might take a few years, depending on just how much unmet demand there is. [1] https://www.redfin.com/MI/Detroit/1752-W-Canfield-St-48208/home/145142144?msockid=47f37366fe7611ee993d8f15c298c8ad https://www.redfin.com/MI/Detroit/1752-W-Canfield-St-48208/h...
    - bombcar 1y ago
      In some places where well and septic costs say $25k to install, you can get land with working well and septic for $25k or less; the land is free.
  - bombcar 1y ago
    But there’s an obvious limit somewhere, Denver with 5 billion units might still see demand, perhaps even ten billion (need that second house of course!) but once Denver has 20 billion dwelling units demand will have leveled off, no matter how much more supply is added.
JumpCrisscross 1y ago
> only if you believe that more capacity does not induce more demand No, it doesn't. What you're describing is elasticity. It's a well-studed concept, and means that a 5% increase in supply will probably reduce prices by less than 4.8%. (An interesting side effect of a government committing to a zero real-price increase housing strategy is it eliminates whole categories of speculative demand. I wouldn't count on this for policy effects. But it's another feather in the cap for pro-housing policy.)
davidw 1y ago
This argument always comes up when discussing a specific place. "Everyone would move to ________ because it is the best place in the spiral arm of the Milky Way", where ________ is Boulder, Bend, Austin, Portland, San Francisco, Santa Barbara, Hawai'i, Santa Fe, etc.... etc.... It cannot be true for all of them. So they all need to build and people will figure out where they actually want to live. Bozeman, Montana, a small city of 50K people, is seeing falling rents because they built a lot of housing: https://montanafreepress.org/2025/06/23/has-bozemans-rental-market-finally-flipped/ https://montanafreepress.org/2025/06/23/has-bozemans-rental-... And it's very much the kind of small place where "everyone wants to live there".
- seanmcdirmid 1y ago
  If everyone could live where they wanted to live, then ya, why wouldn't everyone want to live in the best cities? If you have fixed demand, then you can definitely "build" your way out of a housing crisis. Bozeman, for example, doesn't have many jobs, so you can't really live there if you don't bring your own money. A big city like Seattle or Denver... they have lots of jobs, so they will grow at least to the point that all those jobs have people working them...but then a city like that attracts even more jobs (the way cities work since they concentrate talent, which attracts more businesses looking for that talent), more people, it could grow from a million people to 10 or 20 million easily. > And it's very much the kind of small place where "everyone wants to live there". MT is a bad place if you need to work for a living: high housing prices, jobs don't pay very well if you can find them at all. My mom moved to Helena in the late 90s and found that out first hand. If WFH took off as expected, then you definitely could make a good life in Bozeman or Missoula or Butte, but alas, the opposite happened and we regressed greatly.
  - davidw 1y ago
    The population of Bozeman is still growing, albeit more slowly. It's not like people left. They just built a lot of housing, vacancy rates increased and prices dropped. Same thing happened in Austin, Texas, which is a much bigger city with lots of jobs. The underlying story is that building enough housing is a good way to fix a shortage of housing, which is what causes high prices.
czhu12 1y ago
Giving significantly more people a way to live a lifestyle they seek, while holding the cost of housing flat -- if thats the worst case outcome, that seems totally fine, and arguably a better solution than trying to crash the cost of housing. I would imagine for most people, this is what "solving the housing crisis" means
happymellon 1y ago
Except that all the folks that left Austin to move to Denver makes the houses prices in Austin drop. Now the folks in Denver who hadn't considered Austin due to high rates can move there and reduce the costs in Denver again.
mattmaroon 1y ago
A 5% increase in supply annually indefinitely would crash the housing market there, induced demand be damned. To put it in perspective, a metro area growing at 2% is killing it, the highest growth rate is Austin at 3%. Denver only grows at less than 1%. Cheaper homes may induce demand, they won't induce a 5% growth rate.
- caseyohara 1y ago
  > A 5% increase in supply annually indefinitely would crash the housing market there Only if population is held constant. Housing supply is inelastic, but housing demand is somewhat elastic. As seen in Denver, an increase in housing supply would decrease prices. But those lower prices will increase demand from people that want to live in Denver but previously couldn’t afford it.
  - mattmaroon 1y ago
    I think you missed my point. It won’t increase it to 5% because that’s basically an unheard of population level increase for a big city/metro. It’s like 5x your average fast growing big city. You may induce some demand, it will be nowhere near that much.
s17n 1y ago
Are there people who have been avoiding Denver because the rent is too high? I think of Denver as somewhere you go if you're sick of the cost of living on the coast.
- hnthrow90348765 1y ago
  You could definitely do better if that's the only criteria.
- seanmcdirmid 1y ago
  > I think of Denver as somewhere you go if you're sick of the cost of living on the coast. Denver hasn't been that place for more than a few decades. Heck, the whole rocky mountain region has never ever been a place for cheap housing. Western housing prices are high historically for reasons related to desirability. They never were as cheap as the midwest or deep south.
  - Manuel_D 1y ago
    Median price per sq ft in Denver is $377 according to Google. That's still on the order of half the cost in Seattle of SF.
    - seanmcdirmid 1y ago
      Ya, but also still way above average ($220/sqf). If you ever moved to Denver or anywhere our west for cheap housing, you didn’t do your homework.
SR2Z 1y ago
How much demand do you think CAN be induced? Colorado has 2.6M housing units for ~6M people. If Denver builds 20k units a year for the next 5 years, that would represent the entire state growing by 4% (230k people) off the back of one city alone. I guess that's not terribly unreasonable - if Denver was the only city in the country. Except, it's not. Where would all of these extra people come from? More to the point, Denver is already quite expensive. Where are you going to find another 230k people capable of paying even higher rents than folks do today?
kelnos 1y ago
You keep building until supply meets demand, regardless of what that demand is or where it comes from. We don't have an infinite number of people available to move into housing. There are only a certain number of people who will want to move into a particular region, and that number will stop growing at some point. Granted, you don't want to build too much and end up with a ghost town. There's a balance to be maintained, and I think housing should be affordable, not a race-to-the-bottom cheap as possible.

hdgvhicv 1y ago

Is you idea that people will be renting multiple units just for the fun of it? In large enough numbers to be impactful?

FredPret 1y ago

That's why you have to allow large-scale building everywhere. Then the market will find its own level. The inverse of this situation is that everyone lives somewhere they consider unpleasant because the rent is affordable there. The megacities you mention are enormously economically productive per capita. All sorts of efficiencies pop up when a huge number of people live near one another.

deleted 1y ago
[deleted]
seanmcdirmid 1y ago
> The megacities you mention are enormously economically productive per capita. All sorts of efficiencies pop up when a huge number of people live near one another. It isn't a bad thing. NYC and Hong Kong are nice cities, they should exist. But don't expect housing prices to fall because you add more density if demand isn't fixed, the opposite often happens instead (people want to live in megacities even though housing costs are high). And that isn't really a bad thing, like gentrifying a blighted neighborhood will drive up housing prices as well.

maxerickson 1y ago

Better to have good problems than to have bad problems.

tptacek 1y ago

Induced demand can only function if there's a scarcity to begin with, and it's premised on increased supply increasing affordability (that's the mechanism by which it works), but these axiomatic derivations don't matter because we have case studies (in MN, in TX, and now CO, a story we're literally commenting on). Empirical observations win.

JumpCrisscross 1y ago
> Induced demand can only function if there's a scarcity to begin with I don't believe this is true, assuming scarcity = shortage. Ad absurdum, if Denver overbuilt such that one could pick up a parcel for a song, you'd see opportunistic demand where there previously was none.
- toast0 1y ago
  There's places all over where land, and sometimes land with buildings gets very inexpensive because there's not much demand. Here's a listing for a parcel for $9000, that's been listed for over a year[1]. Denver seems like a nicer place than Detroit, IMHO, but it's possible for there to be more supply than demand. I suspect at 5% annual growth in units, you would be able to reach the point where there's not enough demand for builders to recover costs. It might take a few years, depending on just how much unmet demand there is. [1] https://www.redfin.com/MI/Detroit/1752-W-Canfield-St-48208/home/145142144?msockid=47f37366fe7611ee993d8f15c298c8ad https://www.redfin.com/MI/Detroit/1752-W-Canfield-St-48208/h...
  - bombcar 1y ago
    In some places where well and septic costs say $25k to install, you can get land with working well and septic for $25k or less; the land is free.
- bombcar 1y ago
  But there’s an obvious limit somewhere, Denver with 5 billion units might still see demand, perhaps even ten billion (need that second house of course!) but once Denver has 20 billion dwelling units demand will have leveled off, no matter how much more supply is added.

JumpCrisscross 1y ago

> only if you believe that more capacity does not induce more demand No, it doesn't. What you're describing is elasticity. It's a well-studed concept, and means that a 5% increase in supply will probably reduce prices by less than 4.8%. (An interesting side effect of a government committing to a zero real-price increase housing strategy is it eliminates whole categories of speculative demand. I wouldn't count on this for policy effects. But it's another feather in the cap for pro-housing policy.)

davidw 1y ago

This argument always comes up when discussing a specific place. "Everyone would move to ________ because it is the best place in the spiral arm of the Milky Way", where ________ is Boulder, Bend, Austin, Portland, San Francisco, Santa Barbara, Hawai'i, Santa Fe, etc.... etc.... It cannot be true for all of them. So they all need to build and people will figure out where they actually want to live. Bozeman, Montana, a small city of 50K people, is seeing falling rents because they built a lot of housing: https://montanafreepress.org/2025/06/23/has-bozemans-rental-market-finally-flipped/ https://montanafreepress.org/2025/06/23/has-bozemans-rental-... And it's very much the kind of small place where "everyone wants to live there".

seanmcdirmid 1y ago
If everyone could live where they wanted to live, then ya, why wouldn't everyone want to live in the best cities? If you have fixed demand, then you can definitely "build" your way out of a housing crisis. Bozeman, for example, doesn't have many jobs, so you can't really live there if you don't bring your own money. A big city like Seattle or Denver... they have lots of jobs, so they will grow at least to the point that all those jobs have people working them...but then a city like that attracts even more jobs (the way cities work since they concentrate talent, which attracts more businesses looking for that talent), more people, it could grow from a million people to 10 or 20 million easily. > And it's very much the kind of small place where "everyone wants to live there". MT is a bad place if you need to work for a living: high housing prices, jobs don't pay very well if you can find them at all. My mom moved to Helena in the late 90s and found that out first hand. If WFH took off as expected, then you definitely could make a good life in Bozeman or Missoula or Butte, but alas, the opposite happened and we regressed greatly.
- davidw 1y ago
  The population of Bozeman is still growing, albeit more slowly. It's not like people left. They just built a lot of housing, vacancy rates increased and prices dropped. Same thing happened in Austin, Texas, which is a much bigger city with lots of jobs. The underlying story is that building enough housing is a good way to fix a shortage of housing, which is what causes high prices.

czhu12 1y ago

Giving significantly more people a way to live a lifestyle they seek, while holding the cost of housing flat -- if thats the worst case outcome, that seems totally fine, and arguably a better solution than trying to crash the cost of housing. I would imagine for most people, this is what "solving the housing crisis" means

happymellon 1y ago

Except that all the folks that left Austin to move to Denver makes the houses prices in Austin drop. Now the folks in Denver who hadn't considered Austin due to high rates can move there and reduce the costs in Denver again.

mattmaroon 1y ago

A 5% increase in supply annually indefinitely would crash the housing market there, induced demand be damned. To put it in perspective, a metro area growing at 2% is killing it, the highest growth rate is Austin at 3%. Denver only grows at less than 1%. Cheaper homes may induce demand, they won't induce a 5% growth rate.

caseyohara 1y ago
> A 5% increase in supply annually indefinitely would crash the housing market there Only if population is held constant. Housing supply is inelastic, but housing demand is somewhat elastic. As seen in Denver, an increase in housing supply would decrease prices. But those lower prices will increase demand from people that want to live in Denver but previously couldn’t afford it.
- mattmaroon 1y ago
  I think you missed my point. It won’t increase it to 5% because that’s basically an unheard of population level increase for a big city/metro. It’s like 5x your average fast growing big city. You may induce some demand, it will be nowhere near that much.

s17n 1y ago

Are there people who have been avoiding Denver because the rent is too high? I think of Denver as somewhere you go if you're sick of the cost of living on the coast.

hnthrow90348765 1y ago
You could definitely do better if that's the only criteria.
seanmcdirmid 1y ago
> I think of Denver as somewhere you go if you're sick of the cost of living on the coast. Denver hasn't been that place for more than a few decades. Heck, the whole rocky mountain region has never ever been a place for cheap housing. Western housing prices are high historically for reasons related to desirability. They never were as cheap as the midwest or deep south.
- Manuel_D 1y ago
  Median price per sq ft in Denver is $377 according to Google. That's still on the order of half the cost in Seattle of SF.
  - seanmcdirmid 1y ago
    Ya, but also still way above average ($220/sqf). If you ever moved to Denver or anywhere our west for cheap housing, you didn’t do your homework.

SR2Z 1y ago

How much demand do you think CAN be induced? Colorado has 2.6M housing units for ~6M people. If Denver builds 20k units a year for the next 5 years, that would represent the entire state growing by 4% (230k people) off the back of one city alone. I guess that's not terribly unreasonable - if Denver was the only city in the country. Except, it's not. Where would all of these extra people come from? More to the point, Denver is already quite expensive. Where are you going to find another 230k people capable of paying even higher rents than folks do today?

kelnos 1y ago

You keep building until supply meets demand, regardless of what that demand is or where it comes from. We don't have an infinite number of people available to move into housing. There are only a certain number of people who will want to move into a particular region, and that number will stop growing at some point. Granted, you don't want to build too much and end up with a ghost town. There's a balance to be maintained, and I think housing should be affordable, not a race-to-the-bottom cheap as possible.