7 ms·

Asking why they don't build affordable housing is like asking why don't they build used cars

bsder 1y ago
The problem is that you don't generally destroy the used car in order to build a new one. So increasing the new cars on the road eventually also increases the number of used cars on the road.
- JumpCrisscross 1y ago
  > you don't generally destroy the used car in order to build a new one There is very little de-densification construction happening in hot housing markets.
  - elgenie 1y ago
    De-densification isn't required; a one-for-one knocking down and rebuilding of a single family residence suffices.
    - JumpCrisscross 1y ago
      > De-densification isn't required; a one-for-one knocking down and rebuilding of a single family residence suffices Sure. The only reason developers do that is because land-use restrictions prevent the construction of denser, more-profitable and more-efficient housing.
tiahura 1y ago
Why don't they build $10,000 Ford Rangers anymore?
- JumpCrisscross 1y ago
  > Why don't they build $10,000 Ford Rangers anymore? Fleet economy standards.
- bullfightonmars 1y ago
  The same reason housing isn't being built, it was regulated out of existence.
  - proggy 1y ago
    This is the real answer, not the pat “no one builds new used cars” nonsense. It is entirely possible to build new, no-frills apartments that are 100% habitable and to code. But because of all the regulatory boxes one needs to check — namely all the fees spent, and time spent waiting for seemingly endless approvals — it is simply not possible to rent out bottom-dollar builds at a low market rate. The same logic applies for single family homes sold for purchase. The startup costs are just too damn high.
  - SideburnsOfDoom 1y ago
    It's simplistic to say that the US car market is "regulated out of existence". Consider how huge trucks that mow down children because they can't even be seen over the hood are unregulated, even incentivised. (1) Wrong regulation, maybe. But not merely "too much regulation". 1) https://news.ycombinator.com/item?id=36480122 https://news.ycombinator.com/item?id=36480122 https://www.nbcnews.com/news/us-news/americas-cars-trucks-are-getting-bigger-are-front-blind-zones-children-rcna52109 https://www.nbcnews.com/news/us-news/americas-cars-trucks-ar... https://www.vox.com/future-perfect/24139147/suvs-trucks-popularity-federal-policy-pollution https://www.vox.com/future-perfect/24139147/suvs-trucks-popu...
    - bullfightonmars 1y ago
      You are right of course. I was being flip. There are multiple reasons it is no longer profitable for car companies to make small trucks. CAFE regs are part of that.
PaulHoule 1y ago
The project to build https://www.libraryplaceithaca.com/ https://www.libraryplaceithaca.com/ was almost a decade late, like a nuclear reactor, and they realized only after it was built that there is no market in our town for "luxury senior housing" because seniors with money go to Florida or Arizona. If they could fill the places you might say that it's better business to build expensive rather than cheap apartments but when these places are vacant you start to wonder if they are farming tax writeoffs or something https://www.youtube.com/watch?v=9wfblqh9icQ https://www.youtube.com/watch?v=9wfblqh9icQ What you expect first is they are going to tell the local town they can't pay the property taxes, in a few years they'll tell the bank they can't afford the loans they took out to build it. Other "luxury apartment" projects outside of Collegetown usually have some segment of subsidized "affordable" units, one of these has at least two police calls to it a day and in the last few weeks these have included murder and arson.
- deleted 1y ago
  [deleted]
- kccqzy 1y ago
  How are they still able to live in subsidized affordable housing after they are convicted of murder or arson? Don't we have jails for this kind of criminals?
galangalalgol 1y ago
Except that outside of Japan, it is unusual for detached homes to depreciate in value. Apartments though you do have a point. Unless the location adds the value they will depreciate over time.
- freddie_mercury 1y ago
  It's not unusual at all. Here's a bunch in America just over the past 12 months and during a huge economic expansion with low unemployment. https://www.realtor.com/news/trends/zip-codes-cities-home-prices-falling/ https://www.realtor.com/news/trends/zip-codes-cities-home-pr...
- nradov 1y ago
  Detached houses almost always depreciate in value everywhere and require constant maintenance expenses just to keep from falling apart. It's the land under the house that appreciates in value. People often mix those two numbers up.
  - s1artibartfast 1y ago
    Not my experience. Cost to rebuild and cost/sqft seem to outpace inflation.
infotainment 1y ago
Exactly -- all new housing is going to be marketed as "luxury". Who is going to build a brand-new apartment and say "well, this is janky low-quality housing, you might want to live here if you're poor or something"?
- donatj 1y ago
  I go outside and look at my neighborhood of bungalows largely built immediately after the war, they were not sold as luxury. They were sold as affordable housing.
elliotec 1y ago
No… it’s like asking why they don’t build cheap cars. Which they do.
- kfajdsl 1y ago
  Do they? Are there any production cars under 20k? Plenty of used ones for that.
- lanfeust6 1y ago
  This is a fair point, but the analogies to vehicles don't really work anyway: they're a depreciating asset, houses are not. Even a tiny rundown place can cost millions owing to location. But all things held equal, if you have a new house that's big and a new house that's small, the smaller one is cheaper. And further, mixed density builds will be cheaper than single detached homes. Beyond that there's nothing caked-in to the walls that makes a house cheaper or expensive. Shitty houses are just unmaintained, dilapidated. Flooding the market with houses will drop prices.
lambda 1y ago
This is a perfectly succinct way to put it. New housing is simply more expensive; so it's marketed as "luxury", and it's sold at a premium to the higher end of the housing market. This reduces demand for the older, more affordable existing housing stock, and with depreciation and wear and tear, the new housing will become more affordable as time goes on. If you're in a market with a shortage of housing, those with more money will simply outbid those with less, even for older, less desirable housing. I've seen it, where when I moved out of my last apartment before I bought a house, my landlady raised rent considerably when looking for a new tenant, and even then she got a tenant who wanted to pay her over the rate that she was asking for to ensure that they were able to get the apartment over all of the other applicants. Wealthy empty-nesters who were downsizing, and willing to pay a premium for an older apartment in a desirable neighborhood, forcing out anyone who might have otherwise been able to afford it. So yes, while it does help for there to be some push to build more affordable housing, if taken to an extreme building only luxury housing will leave an unbalanced market, in a lot of cases building luxury housing is exactly what you want to do to reduce the competition for the existing, more affordable housing stock.
- JumpCrisscross 1y ago
  > New housing is simply more expensive There is no natural reason for this to be the case. If anything, learning curves and economies of scale should result in new units costing less, not more, than ones built by artisans.
  - supertrope 1y ago
    Baumol’s Cost Disease means construction labor cost rises faster than productivity. We’re allergic to prefab construction - banks and insurance companies block it. A lot of construction workers left the industry after 2007. Baby Boomers are retiring and told their kids to not get a blue collar job. New housing has to be ADA compliant. People expect to give each kid their own bedroom and have two car garage instead of one car or no garage at all. Recent immigration crackdowns and trade wars are the icing on the cake.
    - 1y ago
steveBK123 1y ago
Exactly Plus housing you are mostly paying for the land. The land is expensive because it is finite and because zoning constrains how much housing you can build on it. In many places the land is 2/3 the cost of the housing. The cost difference in building what left nimbys deride luxury and what would be considered affordable is really marginal. It’s like $100k in finishes in a $1.5M condo type difference.
111111IIIIIII 1y ago
[dead]
Der_Einzige 1y ago
r/cars swears up and down that they'd buy a brown manual wagon pre-used from the factory!
donatj 1y ago
Because most people are out here driving used Ferraris and Koenigseggs and living in old mansions? Your argument falls apart when you realize they manufacture and sell explicitly affordable cars. It's nearly half the market.

The problem is that you don't generally destroy the used car in order to build a new one. So increasing the new cars on the road eventually also increases the number of used cars on the road.

JumpCrisscross 1y ago
> you don't generally destroy the used car in order to build a new one There is very little de-densification construction happening in hot housing markets.
- elgenie 1y ago
  De-densification isn't required; a one-for-one knocking down and rebuilding of a single family residence suffices.
  - JumpCrisscross 1y ago
    > De-densification isn't required; a one-for-one knocking down and rebuilding of a single family residence suffices Sure. The only reason developers do that is because land-use restrictions prevent the construction of denser, more-profitable and more-efficient housing.

tiahura 1y ago

Why don't they build $10,000 Ford Rangers anymore?

JumpCrisscross 1y ago
> Why don't they build $10,000 Ford Rangers anymore? Fleet economy standards.
bullfightonmars 1y ago
The same reason housing isn't being built, it was regulated out of existence.
- proggy 1y ago
  This is the real answer, not the pat “no one builds new used cars” nonsense. It is entirely possible to build new, no-frills apartments that are 100% habitable and to code. But because of all the regulatory boxes one needs to check — namely all the fees spent, and time spent waiting for seemingly endless approvals — it is simply not possible to rent out bottom-dollar builds at a low market rate. The same logic applies for single family homes sold for purchase. The startup costs are just too damn high.
- SideburnsOfDoom 1y ago
  It's simplistic to say that the US car market is "regulated out of existence". Consider how huge trucks that mow down children because they can't even be seen over the hood are unregulated, even incentivised. (1) Wrong regulation, maybe. But not merely "too much regulation". 1) https://news.ycombinator.com/item?id=36480122 https://news.ycombinator.com/item?id=36480122 https://www.nbcnews.com/news/us-news/americas-cars-trucks-are-getting-bigger-are-front-blind-zones-children-rcna52109 https://www.nbcnews.com/news/us-news/americas-cars-trucks-ar... https://www.vox.com/future-perfect/24139147/suvs-trucks-popularity-federal-policy-pollution https://www.vox.com/future-perfect/24139147/suvs-trucks-popu...
  - bullfightonmars 1y ago
    You are right of course. I was being flip. There are multiple reasons it is no longer profitable for car companies to make small trucks. CAFE regs are part of that.

PaulHoule 1y ago

The project to build https://www.libraryplaceithaca.com/ https://www.libraryplaceithaca.com/ was almost a decade late, like a nuclear reactor, and they realized only after it was built that there is no market in our town for "luxury senior housing" because seniors with money go to Florida or Arizona. If they could fill the places you might say that it's better business to build expensive rather than cheap apartments but when these places are vacant you start to wonder if they are farming tax writeoffs or something https://www.youtube.com/watch?v=9wfblqh9icQ https://www.youtube.com/watch?v=9wfblqh9icQ What you expect first is they are going to tell the local town they can't pay the property taxes, in a few years they'll tell the bank they can't afford the loans they took out to build it. Other "luxury apartment" projects outside of Collegetown usually have some segment of subsidized "affordable" units, one of these has at least two police calls to it a day and in the last few weeks these have included murder and arson.

deleted 1y ago
[deleted]
kccqzy 1y ago
How are they still able to live in subsidized affordable housing after they are convicted of murder or arson? Don't we have jails for this kind of criminals?

galangalalgol 1y ago

Except that outside of Japan, it is unusual for detached homes to depreciate in value. Apartments though you do have a point. Unless the location adds the value they will depreciate over time.

freddie_mercury 1y ago
It's not unusual at all. Here's a bunch in America just over the past 12 months and during a huge economic expansion with low unemployment. https://www.realtor.com/news/trends/zip-codes-cities-home-prices-falling/ https://www.realtor.com/news/trends/zip-codes-cities-home-pr...
nradov 1y ago
Detached houses almost always depreciate in value everywhere and require constant maintenance expenses just to keep from falling apart. It's the land under the house that appreciates in value. People often mix those two numbers up.
- s1artibartfast 1y ago
  Not my experience. Cost to rebuild and cost/sqft seem to outpace inflation.

infotainment 1y ago

Exactly -- all new housing is going to be marketed as "luxury". Who is going to build a brand-new apartment and say "well, this is janky low-quality housing, you might want to live here if you're poor or something"?

donatj 1y ago
I go outside and look at my neighborhood of bungalows largely built immediately after the war, they were not sold as luxury. They were sold as affordable housing.

elliotec 1y ago

No… it’s like asking why they don’t build cheap cars. Which they do.

kfajdsl 1y ago
Do they? Are there any production cars under 20k? Plenty of used ones for that.
lanfeust6 1y ago
This is a fair point, but the analogies to vehicles don't really work anyway: they're a depreciating asset, houses are not. Even a tiny rundown place can cost millions owing to location. But all things held equal, if you have a new house that's big and a new house that's small, the smaller one is cheaper. And further, mixed density builds will be cheaper than single detached homes. Beyond that there's nothing caked-in to the walls that makes a house cheaper or expensive. Shitty houses are just unmaintained, dilapidated. Flooding the market with houses will drop prices.

lambda 1y ago

This is a perfectly succinct way to put it. New housing is simply more expensive; so it's marketed as "luxury", and it's sold at a premium to the higher end of the housing market. This reduces demand for the older, more affordable existing housing stock, and with depreciation and wear and tear, the new housing will become more affordable as time goes on. If you're in a market with a shortage of housing, those with more money will simply outbid those with less, even for older, less desirable housing. I've seen it, where when I moved out of my last apartment before I bought a house, my landlady raised rent considerably when looking for a new tenant, and even then she got a tenant who wanted to pay her over the rate that she was asking for to ensure that they were able to get the apartment over all of the other applicants. Wealthy empty-nesters who were downsizing, and willing to pay a premium for an older apartment in a desirable neighborhood, forcing out anyone who might have otherwise been able to afford it. So yes, while it does help for there to be some push to build more affordable housing, if taken to an extreme building only luxury housing will leave an unbalanced market, in a lot of cases building luxury housing is exactly what you want to do to reduce the competition for the existing, more affordable housing stock.

JumpCrisscross 1y ago
> New housing is simply more expensive There is no natural reason for this to be the case. If anything, learning curves and economies of scale should result in new units costing less, not more, than ones built by artisans.
- supertrope 1y ago
  Baumol’s Cost Disease means construction labor cost rises faster than productivity. We’re allergic to prefab construction - banks and insurance companies block it. A lot of construction workers left the industry after 2007. Baby Boomers are retiring and told their kids to not get a blue collar job. New housing has to be ADA compliant. People expect to give each kid their own bedroom and have two car garage instead of one car or no garage at all. Recent immigration crackdowns and trade wars are the icing on the cake.
  - 1y ago

steveBK123 1y ago

Exactly Plus housing you are mostly paying for the land. The land is expensive because it is finite and because zoning constrains how much housing you can build on it. In many places the land is 2/3 the cost of the housing. The cost difference in building what left nimbys deride luxury and what would be considered affordable is really marginal. It’s like $100k in finishes in a $1.5M condo type difference.

111111IIIIIII 1y ago

[dead]

Der_Einzige 1y ago

r/cars swears up and down that they'd buy a brown manual wagon pre-used from the factory!

donatj 1y ago

Because most people are out here driving used Ferraris and Koenigseggs and living in old mansions? Your argument falls apart when you realize they manufacture and sell explicitly affordable cars. It's nearly half the market.