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It’s a difficult problem not because we don’t know the simple solutions (supply and demand). It’s difficult because the people who have the majority vote also t

It’s a difficult problem not because we don’t know the simple solutions (supply and demand). It’s difficult because the people who have the majority vote also typically own the houses and they obviously don’t want the prices to go down. This is not just speaking about the US, many countries are facing this issue

philipallstar 7mo ago
Lots of people have kids and want them to be able to a) not be a victim of crime, and b) be able to afford a house. Anyone who has loads of money to afford high house prices and private security can afford luxury beliefs, as espoused in Oscar acceptance speeches, but everyone else with housing and kids is either voting for less crime and better affordability, or is not yet voting for those things.
- loudmax 7mo ago
  Plenty of people with kids are voting to block new housing. It's not that they don't want their kids to be able to afford to pay rent. They're just not making the basic connection between supply and demand. This just happened in my neighborhood. There was a proposal to build low rise apartment buildings about a mile from the detached single home neighborhood where I live, and people had lawn signs opposing the construction. Perhaps unsurprisingly, the loudest and most active anti-development voices were from Trump supporters. Economic illiteracy used to be the domain of the political Left, but the Republicans are making real inroads in rejecting free market principles, so there's some amount of political realignment. Luxury beliefs indeed.
  - salawat 7mo ago
    >They're just not making the basic connection between supply and demand. They don't like my beds. There's something wrong with them! I can't be the problem! -Procrustes Yes. It's the people's fault for not understanding markets. Couldn't be that markets are fundamentally structurally fucked by an inversion of the demo pyramid. Couldn't be that market participants are just delusional about how much other actors should have extracted from them.
    - kyralis 7mo ago
      The tragedy of the commons is a real thing. People focus on their own personal short term economic gain at the expense of long term sustainability and gain - even for themselves - because people in general find that longer term outlook difficult to reason about. Democracy is the worst form of government, except for all the others we've tried. This short term thinking is one of its classic failures, because in many ways you're codifying the tragedy of the commons.
  - bombcar 7mo ago
    In an area entirely filled to the brim with the "evil" Trump supporters ... new housing is going up, apartments, row homes, single family homes, it's all there. Nobody really seems to care ... yet. It's often very instructive to find out who is "behind" both promotion and resistance; because both groups will attempt to find ways to "play both sides" and get opposition moving.
    - loudmax 7mo ago
      > In an area entirely filled to the brim with the "evil" Trump supporters Hanlon's Razor applies: "Never attribute to malice that which is adequately explained by stupidity".
  - rootusrootus 7mo ago
    > Economic illiteracy used to be the domain of the political Left IMO the right is not really the right that most of us remember, so it's not worth trying to reconcile their current ideology with the fiscal conservatives of decades past. The current GOP is unserious, their base consumed by conspiracy theories and driven by grievance.
- deleted 7mo ago
  [deleted]
jorisboris 7mo ago
“Show me the incentive and i’ll show you the outcome” I’ve learned a long time ago that we’re not always aware of how incentives drive our own behavior, it just happens naturally. This is exactly what’s happening with housing.
deleted 7mo ago
[deleted]
pj_mukh 7mo ago
"typically own the houses and they obviously don’t want the prices to go down." I've never understood this: If I replace a single home with 20 apartment homes, I've raised the value of the whole property at purchase time no? You're already dealing with home valuations that have faaar outstripped wages, the only way you go any higher is to build more homes on the same property. Counterintuitively, the "I don't want to live next to apartments" line of thinking actually seems more potent in the regular NIMBY headspace? Like people will forego higher valuations to keep their suburb a suburb.
- giaour 7mo ago
  > I've never understood this: If I replace a single home with 20 apartment homes, I've raised the value of the whole property at purchase time no? It's a commons problem. In your scenario, you have absolutely increased the value of your property. 20 apartments is more valuable than a single family home. However, you have also reduced aggregate demand by housing 20 people. That reduced the value of your neighbors' properties (or at least reduced the rate at which their value increased). NIMBYism posits that values will continue to increase without forcing any property owners to invest in improvements so long as they collectively block any efforts to increase supply.
  - sidewndr46 7mo ago
    It's not a common problems in Austin at least. You (a property developer) buy a single home in bad shape on a big lot in the city. Then you redevelop the single home into 20 apartments, greasing the wheel appropriately (of the local government) to get the needed rezoning and permits. No one else can do this because they don't have the connections and monetary resources you do. You pocket the increase in value of that property (minus the cost of grease) by selling it off as "condos" which have dubious maintainability going forward. You never lived here anyways, you have a ranch in Bastrop.
    - giaour 7mo ago
      The article we are commenting on is literally about this happening in Austin.
torginus 7mo ago
But people who only own 1 house at most are still disadvantaged by this - sure, the value of their apt goes up, but if they want to switch to a larger house, the difference they're paying also increases, so do the property and wealth taxes, if applicable. There are many stories of solidly low-to-middle class families who lived in an area where property prices soared, and had to choose between bankruptcy or moving out, because they could no longer. The only people who benefit from this are the investors and landlords. So allowing housing prices to surge is literally taxing the poor for the benefit of the rich. Buildings also deteroriate - ask a civil engineer. Building something that lasts 50-100 years is much cheaper than something that can be maintained economically indefinitely. If you own a house with copper or PVC plumbing, that they go bad after 40-50 years, and fixing burst pipes quickly gets expensive. Why do countries allow housing prices to rise then? Simple, it allows banks to have a massive portfolio of loans, where they get a steady source of income for literally decades, while also getting a massive portfolio of real estate they can use as basis for leverage to grant loans (which they profit off of). Governments can then tax the banks and get some of that money without the dreaded specter of increasing income taxes. The only problem is that the everyman gets stuck with a 10,25, and now 50 year old loan (with a similar increase in price) for the very same median house.
- lenwood 7mo ago
  > So allowing housing prices to surge is literally taxing the poor for the benefit of the rich. How do we limit home prices increasing? I see your point but solving this isn't trivial.
  - exabrial 7mo ago
    Build more housing
    - testing22321 7mo ago
      If investment companies that already own tens of thousands of homes buy them and keep increasing the rent, the problem has not been solved.
harrall 7mo ago
That’s why California has had dozens of state laws passed in the past 3 years that override many city and county ordinances to force additional supply. Lawmakers knew the only solution was more housing. These bills permit the construction of denser housing near transit, force cities to actually meet housing quotas, allow the state to override a city’s zoning to permit more housing if they don’t make a good faith attempt, loosen the rules to build ADUs, and many other changes. Is it ideal that we had to get to this point? No, but housing wasn’t being built.
ccppurcell 7mo ago
A related idea: politicians know how to fix the problems, they just don't know how to get re-elected after doing so.
- rootusrootus 7mo ago
  I occasionally wonder if it would be a net positive to make political office terms a little bit longer, but limited to exactly once. No reelection pressure. Same part of my addled brain that thinks we should increase dramatically our count of representatives, abolish in-person legislating, and then fill the roles with sortition.
  - ApolloFortyNine 7mo ago
    Things are so party focused nowadays I don't think the person behind the mask really even matters. It might slightly help, you'd probably have less votes on giving themselves pay raises, but at the end of the day the majority of ads and voters are going to revolve around party lines.
lkbm 7mo ago
That's part of it, but I definitely have known quite a few renters who opposed building more housing. Denial of supply and demand, as well as general dislike of "rich developers" is strong in many groups. Incentives are typically the strongest force to watch, but so are various cultural/political narratives people come up with. People clearly don't all vote in our own economic interests in many situations. I'd assume this is largely because in the current information ecosystem, people don't understand what's in their economic interests.
- Forgeties79 7mo ago
  Do you recall exactly what kind of housing they were opposing? Because that is a major piece of context we are missing here. I don’t think I’ve ever met anybody who simply said “no more housing.” It’s usually much more specific than that, such as opposition to house flipping and STR’s, or wasteful planned communities of McMansions and concrete.
  - 4fterd4rk 7mo ago
    Generally these people oppose the building of "luxury housing" because they don't get how ALL housing increases supply/reduces market price. Also the idea of a developer building a kind of... predistressed property has never made any sense to me.
    - Forgeties79 7mo ago
      > ALL housing increases supply/reduces market price. I can tell you firsthand that that is absolutely not true. The massive rush to renovate or build new short-term rentals in the 2010s had a disastrous impact on rental prices around my city, especially coupled with historically low interest rates that made these enterprises far less risky. It’s also incredibly disruptive to neighborhoods/communities, not just because of bad guests but because it can rapidly drive up value, leading landlords to sell and/or rapidly drive up rent which means kick out lower income tenants whether it’s intentional or not. Most of the STR’s in particular were also not being done by locals. 70%+ were out of town developers. Currently almost 90% of STR’s here are whole home which means not local owner/operators living there. It’s just hotels by a different name taking up housing in residential neighborhoods. When interest rates and home insurance went up a few years ago, coupled with stricter rules for getting an STR license, a lot of people sold their properties (usually rentals/STR’s), and the price to buy as well as rent noticeably came down pretty rapidly. It’s still too high, but the drop was noticeable and quick. The purpose for construction absolutely factors in to these discussions.
socalgal2 7mo ago
that's true, but plenty if people oppose building new apartments because, in general, the price will be high and they see this high prices and incorrectly conclude rents are rising when in reality, people move in, freeing up the less expensive places they were in before. similarly they oppose because "gentrification" even though the evidence is that gentrification is net positive, even for those already living in the area. gentrification or not, people leave at the same rate. Those who stay see their income/wealth rise compared to the case of no-gentrification.

philipallstar 7mo ago

Lots of people have kids and want them to be able to a) not be a victim of crime, and b) be able to afford a house. Anyone who has loads of money to afford high house prices and private security can afford luxury beliefs, as espoused in Oscar acceptance speeches, but everyone else with housing and kids is either voting for less crime and better affordability, or is not yet voting for those things.

loudmax 7mo ago
Plenty of people with kids are voting to block new housing. It's not that they don't want their kids to be able to afford to pay rent. They're just not making the basic connection between supply and demand. This just happened in my neighborhood. There was a proposal to build low rise apartment buildings about a mile from the detached single home neighborhood where I live, and people had lawn signs opposing the construction. Perhaps unsurprisingly, the loudest and most active anti-development voices were from Trump supporters. Economic illiteracy used to be the domain of the political Left, but the Republicans are making real inroads in rejecting free market principles, so there's some amount of political realignment. Luxury beliefs indeed.
- salawat 7mo ago
  >They're just not making the basic connection between supply and demand. They don't like my beds. There's something wrong with them! I can't be the problem! -Procrustes Yes. It's the people's fault for not understanding markets. Couldn't be that markets are fundamentally structurally fucked by an inversion of the demo pyramid. Couldn't be that market participants are just delusional about how much other actors should have extracted from them.
  - kyralis 7mo ago
    The tragedy of the commons is a real thing. People focus on their own personal short term economic gain at the expense of long term sustainability and gain - even for themselves - because people in general find that longer term outlook difficult to reason about. Democracy is the worst form of government, except for all the others we've tried. This short term thinking is one of its classic failures, because in many ways you're codifying the tragedy of the commons.
- bombcar 7mo ago
  In an area entirely filled to the brim with the "evil" Trump supporters ... new housing is going up, apartments, row homes, single family homes, it's all there. Nobody really seems to care ... yet. It's often very instructive to find out who is "behind" both promotion and resistance; because both groups will attempt to find ways to "play both sides" and get opposition moving.
  - loudmax 7mo ago
    > In an area entirely filled to the brim with the "evil" Trump supporters Hanlon's Razor applies: "Never attribute to malice that which is adequately explained by stupidity".
- rootusrootus 7mo ago
  > Economic illiteracy used to be the domain of the political Left IMO the right is not really the right that most of us remember, so it's not worth trying to reconcile their current ideology with the fiscal conservatives of decades past. The current GOP is unserious, their base consumed by conspiracy theories and driven by grievance.
deleted 7mo ago
[deleted]

jorisboris 7mo ago

“Show me the incentive and i’ll show you the outcome” I’ve learned a long time ago that we’re not always aware of how incentives drive our own behavior, it just happens naturally. This is exactly what’s happening with housing.

deleted 7mo ago

[deleted]

pj_mukh 7mo ago

"typically own the houses and they obviously don’t want the prices to go down." I've never understood this: If I replace a single home with 20 apartment homes, I've raised the value of the whole property at purchase time no? You're already dealing with home valuations that have faaar outstripped wages, the only way you go any higher is to build more homes on the same property. Counterintuitively, the "I don't want to live next to apartments" line of thinking actually seems more potent in the regular NIMBY headspace? Like people will forego higher valuations to keep their suburb a suburb.

giaour 7mo ago
> I've never understood this: If I replace a single home with 20 apartment homes, I've raised the value of the whole property at purchase time no? It's a commons problem. In your scenario, you have absolutely increased the value of your property. 20 apartments is more valuable than a single family home. However, you have also reduced aggregate demand by housing 20 people. That reduced the value of your neighbors' properties (or at least reduced the rate at which their value increased). NIMBYism posits that values will continue to increase without forcing any property owners to invest in improvements so long as they collectively block any efforts to increase supply.
- sidewndr46 7mo ago
  It's not a common problems in Austin at least. You (a property developer) buy a single home in bad shape on a big lot in the city. Then you redevelop the single home into 20 apartments, greasing the wheel appropriately (of the local government) to get the needed rezoning and permits. No one else can do this because they don't have the connections and monetary resources you do. You pocket the increase in value of that property (minus the cost of grease) by selling it off as "condos" which have dubious maintainability going forward. You never lived here anyways, you have a ranch in Bastrop.
  - giaour 7mo ago
    The article we are commenting on is literally about this happening in Austin.

torginus 7mo ago

But people who only own 1 house at most are still disadvantaged by this - sure, the value of their apt goes up, but if they want to switch to a larger house, the difference they're paying also increases, so do the property and wealth taxes, if applicable. There are many stories of solidly low-to-middle class families who lived in an area where property prices soared, and had to choose between bankruptcy or moving out, because they could no longer. The only people who benefit from this are the investors and landlords. So allowing housing prices to surge is literally taxing the poor for the benefit of the rich. Buildings also deteroriate - ask a civil engineer. Building something that lasts 50-100 years is much cheaper than something that can be maintained economically indefinitely. If you own a house with copper or PVC plumbing, that they go bad after 40-50 years, and fixing burst pipes quickly gets expensive. Why do countries allow housing prices to rise then? Simple, it allows banks to have a massive portfolio of loans, where they get a steady source of income for literally decades, while also getting a massive portfolio of real estate they can use as basis for leverage to grant loans (which they profit off of). Governments can then tax the banks and get some of that money without the dreaded specter of increasing income taxes. The only problem is that the everyman gets stuck with a 10,25, and now 50 year old loan (with a similar increase in price) for the very same median house.

lenwood 7mo ago
> So allowing housing prices to surge is literally taxing the poor for the benefit of the rich. How do we limit home prices increasing? I see your point but solving this isn't trivial.
- exabrial 7mo ago
  Build more housing
  - testing22321 7mo ago
    If investment companies that already own tens of thousands of homes buy them and keep increasing the rent, the problem has not been solved.

harrall 7mo ago

That’s why California has had dozens of state laws passed in the past 3 years that override many city and county ordinances to force additional supply. Lawmakers knew the only solution was more housing. These bills permit the construction of denser housing near transit, force cities to actually meet housing quotas, allow the state to override a city’s zoning to permit more housing if they don’t make a good faith attempt, loosen the rules to build ADUs, and many other changes. Is it ideal that we had to get to this point? No, but housing wasn’t being built.

ccppurcell 7mo ago

A related idea: politicians know how to fix the problems, they just don't know how to get re-elected after doing so.

rootusrootus 7mo ago
I occasionally wonder if it would be a net positive to make political office terms a little bit longer, but limited to exactly once. No reelection pressure. Same part of my addled brain that thinks we should increase dramatically our count of representatives, abolish in-person legislating, and then fill the roles with sortition.
- ApolloFortyNine 7mo ago
  Things are so party focused nowadays I don't think the person behind the mask really even matters. It might slightly help, you'd probably have less votes on giving themselves pay raises, but at the end of the day the majority of ads and voters are going to revolve around party lines.

lkbm 7mo ago

That's part of it, but I definitely have known quite a few renters who opposed building more housing. Denial of supply and demand, as well as general dislike of "rich developers" is strong in many groups. Incentives are typically the strongest force to watch, but so are various cultural/political narratives people come up with. People clearly don't all vote in our own economic interests in many situations. I'd assume this is largely because in the current information ecosystem, people don't understand what's in their economic interests.

Forgeties79 7mo ago
Do you recall exactly what kind of housing they were opposing? Because that is a major piece of context we are missing here. I don’t think I’ve ever met anybody who simply said “no more housing.” It’s usually much more specific than that, such as opposition to house flipping and STR’s, or wasteful planned communities of McMansions and concrete.
- 4fterd4rk 7mo ago
  Generally these people oppose the building of "luxury housing" because they don't get how ALL housing increases supply/reduces market price. Also the idea of a developer building a kind of... predistressed property has never made any sense to me.
  - Forgeties79 7mo ago
    > ALL housing increases supply/reduces market price. I can tell you firsthand that that is absolutely not true. The massive rush to renovate or build new short-term rentals in the 2010s had a disastrous impact on rental prices around my city, especially coupled with historically low interest rates that made these enterprises far less risky. It’s also incredibly disruptive to neighborhoods/communities, not just because of bad guests but because it can rapidly drive up value, leading landlords to sell and/or rapidly drive up rent which means kick out lower income tenants whether it’s intentional or not. Most of the STR’s in particular were also not being done by locals. 70%+ were out of town developers. Currently almost 90% of STR’s here are whole home which means not local owner/operators living there. It’s just hotels by a different name taking up housing in residential neighborhoods. When interest rates and home insurance went up a few years ago, coupled with stricter rules for getting an STR license, a lot of people sold their properties (usually rentals/STR’s), and the price to buy as well as rent noticeably came down pretty rapidly. It’s still too high, but the drop was noticeable and quick. The purpose for construction absolutely factors in to these discussions.

socalgal2 7mo ago

that's true, but plenty if people oppose building new apartments because, in general, the price will be high and they see this high prices and incorrectly conclude rents are rising when in reality, people move in, freeing up the less expensive places they were in before. similarly they oppose because "gentrification" even though the evidence is that gentrification is net positive, even for those already living in the area. gentrification or not, people leave at the same rate. Those who stay see their income/wealth rise compared to the case of no-gentrification.