7 ms·

Downward mobility is almost entirely caused by housing costs, which are a self-inflicted problem. We don't, as a matter of intentional policy, build enough hous

• Animats 3mo ago
  > We don't, as a matter of intentional policy, build enough housing. If actual number of houses was the problem, house prices would not be increasing in areas of population decline. It's existing houses being repriced upward by speculation that makes them unaffordable.
  • deleted 3mo ago
    [deleted]
  • jayGlow 3mo ago
    are these areas with declining populations and rising housing prices increasing the number of houses? it could be that the population declines because no one can afford to live there however it's still a desirable area so prices remain high. cities like Austin are seeing reduction in housing prices despite population increase due to construction of new housing.
    • alphawhisky 3mo ago
      That only covers a portion of the population. Don't forget the middle of nowhere towns that refuse to tax their citizens (but eat grant money like pigs) and refuse to allow new housing. All of this is essentially being done to maximize property value and keep new people out. This is why people are moving to cities in the US. Not a desire, but a need in order to make ends meet and get on the property ladder.
      • inigyou 3mo ago
        People move to cities because of lifestyle and jobs. Cheap housing has never been an attraction of cities...
        • alphawhisky 3mo ago
          Yes, they aim to improve their income to expense ratio with a high paying job, I.E. they have more spending power.
  • vslira 3mo ago
    It's not number of houses, it's number of houses where people want to live. "house prices would not be increasing in areas of population decline" -> the causation could be running backwards: a family of 2 (maybe 2 retired people with accumulated wealth) can outcompete with a young family of 4 for the same unit, that drives prices up and population down. I'm not saying this is the case, but decreasing population not being associated with decreasing housing prices does not mean that increasing housing prices is not caused by housing scarcity
    • brailsafe 3mo ago
      This seems to be, or have been, a very common scenario in Canada, which is why I completely discount when most politicians start going on about a "housing crisis" when in another breath they'll say they don't want houses to get cheaper. If it was a "crisis", one might think houses would be treated with special care instead of basically just another commodity. If a person with wealth can just buy up as many of a finite resource within, especially within the same city as they can tolerate the possession of, then nobody should have a surprised Pikachu face when they do that. If all of the food could and was bought up by a few rich people and figuratively removed from access by anyone who can't bid arbitrary amounts for it, there would and should be riots. That's how houses and condos are priced, and more supply without finite policy restrictions just mints more money for people who already have it. If it's a crisis, why is anyone allowed to own more than 1? Level it out.
      • anon7000 3mo ago
        Why not both?
      • bryanlarsen 3mo ago
        In Canada, second houses and vacant houses are taxed higher than primary residences.
        • brailsafe 3mo ago
          As far as I know, they're taxed higher in the sense that they're not exempt from capital gains, like primary residences are, but in my view it seems like that would at-most be a marginal disincentive if renters don't have much in the way of other options or protections (which vary across the country). Likewise, I'm fairly sure a mom+pop residential landlord can save on tax for any expenses related to secondary suites or secondary properties if it's considered business income. If there is very little suitable supply, it still makes sense to acquire the asset and profit off of rent, although this dynamic may be changing with increased cost of borrowing and less demand depending on market, AirBnB short-term rental restrictions, etc.. When money was free and restrictions were few, non-institutional investors seem to have capitalized aggressively on this, because the price of the property increased dramatically and also it was a near-certainty that there would be a constant stream of inflated rent a landlord could charge. I'm happy about those tax disincentives, but they do strike me as playing around the margins; in normal economic circumstances, they should play around the margins, but that particular aspect of the economy is so embarrassingly tilted that it's really not funny anymore.
  • thegrim33 3mo ago
    Anyone with 60 seconds of free time can trivially see that your claims hold no water. Simply Google for cities/areas with declining population, choose one, look up average housing prices there over the last 10 years or so, see how they've changed, correct the figures for inflation, and you'll see that in almost all cases inflation-adjusted prices are lower today in those places than they were 10 years ago.
    • ffsm8 3mo ago
      And anyone with a braincell would've remembered that wages didn't keep up with inflation, hence the point you're making isn't actually being made. You're just being rude for no reason, which is also why I'm now rude to you. You could almost call it rudeflation, tomorrow we'll probably cause a rudeness singularity
    • lostlogin 3mo ago
      I searched, the first hit was New York (seems odd?). I looked up average price over time, inflation adjusted. They are increasing. https://fred.stlouisfed.org/series/NYSTHPI https://fred.stlouisfed.org/series/NYSTHPI Edit: DuckDuckGo seems to have served me a terrible example, further digging shows some examples which don't even need looking up, its clear that pricing has plummeted. https://en.wikipedia.org/wiki/Shrinking_city https://en.wikipedia.org/wiki/Shrinking_city
      • scoofy 3mo ago
        He’s talking about places with long run population decline. NYC has grown by about 1.5 million people over the last 30 years.
  • medvezhenok 3mo ago
    Not necessarily. House occupancy laws also have a role here - some of the living arrangements that ended up in higher density in the past are illegal today, forcing population decline in a given area (which is not necessarily equivalent to _demand_ decline)
  • s1artibartfast 3mo ago
    How do you separate speculation from legitimate price increases? If the houses are overpriced due to speculation, why isn't someone building Alternatives and undercutting them? This implies that there is either a real increase in value, a manufactur bottleneck, or both
    • alphawhisky 3mo ago
      Civil Engineer/City Planner here. The bottleneck is legislative. NIMBY's are all over in US politics right now, local and larger. These folks put together legislation that makes it extremely hard to build without City/County/Township permission, unless the project benefits them in some way. So, most places will disincentivize new construction unless they get a grant for it, because they feel obligated to help their citizens by keeping taxes low and house values high. New construction does the opposite of these things.
      • mothballed 3mo ago
        This is exactly it. I built a house for 60k a few years ago in a HCOL area by finding a legal loophole to permitting/planning that bypassed civil engineers, code inspections, and almost all planning. The house next to me, quite similar and 50 years old, is selling for 5x that. In the old days it was common to build your own house. And it usually allows a house for half or less the market price. But this is effectively illegal/impractical in most the US. Some simple changes to legislation would halve the average cost of a house overnight!
        • bell-cot 3mo ago
          I'm thinking that very few folks, these days, have the mindset & skill set & finances & timeframe to build their own houses. And it wouldn't be just the currently-active NIMBY's who fought tooth and nail against any "simple changes" that might halve the average cost of a house overnight.
          • inigyou 3mo ago
  • Noumenon72 3mo ago
    After thirty years of house prices rising astronomically, you can't appeal to "speculation" any more. People are speculating because the underlying scarcity makes prices sure to rise. I think if you look closely at "population down, house prices up" you will find normal supply-and-demand stories like "population down, houses down even more" or "population down (downtown), prices up (suburbs)".
    • JKCalhoun 3mo ago
      Agree. So often I see people complaining "people treat their home as an investment…". Because in fact it turns out it is? Are we supposed to pass laws that fix the price of a home based on the square footage? (I wonder if jewelers complain that the reason silver is so expensive is that people treat it as an investment.)
      • ironman1478 3mo ago
        Nobody advocates for fixing the price. People want more supply which will bring the cost of housing as a whole down or at least provide more price diversity. Is it even beneficial to have a house worth a lot of money? Think about places where property is expensive, it is also expensive to live there in general because housing costs so much. The cost of housing means employers have to pay their employees a lot to keep them there. This in turn means you are paying more for goods and services. If you're a homeowner, but NOT a high income person, this is very bad. It means you can't make payments towards maintenance of your house, going out becomes harder, etc. Your quality of life decreases. People who inherit homes that are worth a lot, but aren't flush with cash end up having to sell frequently because there is no way for them to maintain it. It's also the plot of white lotus season 2 with the villas lol.
        • inigyou 3mo ago
          Expensive housing means expensive commercial rent too, which means high prices and less quirky niche shops. In Berlin I've watched them disappear and get replaced by a McDonalds or a cryptocurrency startup firm.
  • slibhb 3mo ago
    There's no question that underbuilding is the largest factor here. You can look at construction vs. population over time (it's well below historical standards). Or available home vacancy rates. Or notice that the number of households is increasing faster than the number of homes. Or look at the various models, which show a 2 million-4 million shortfall in homes. That aside, housing prices are reasonable in much of the country. Where population is stagnant or declining, they are generally reasonable.
  • ironman1478 3mo ago
    You can't look at the cost of a house out of context. If you look at Flint, Michigan it's actually one of the most expensive places in the country if you account for average income in that area. Absolute cost needs to be normalized by income in the area. The housing is actually very expensive if you do this type of calculation. We saw an example of under supply during COVID. Housing prices in "underpriced" areas increased during COVID because regions with no real economy saw people moving there with the high out of state salaries. Those areas didn't have enough supply. Now that remote work is less prevalent, those places are having their costs go down but the Bay Area is seeing skyrocketing costs. We are able to measure the effects of supply and demand pretty clearly due to COVID. Speculation is known to have an effect, but not nearly as much as an effect as under supply. Blackrock THEMSELVES published a paper that the reason their investments are working is due to the low development of housing. Their whole strategy is reliant on NIMBYism and people's lack of understanding of the housing market.
    • bryanlarsen 3mo ago
      Weren't there a bunch of houses available for $500 in Detroit 20 years ago?
  • TitaRusell 3mo ago
    If they were unaffordable they would not be selling. Don't underestimate just how much money people can conjure up. Most parents don't want to be buried with their money Egyptian pharaoh style.
• simonw 3mo ago
  Agreed, this feels so obviously a housing cost problem to me.
• sva_ 3mo ago
  In Germany we even import people by the millions to keep rents high, among other things, and more than half of them get their housing paid for by taxpayers money.
  • joe_mamba 3mo ago
    Same in Austria and other old wealthy EU countries that have since economically stagnated or even declined. All that seems to matters today, is that the GDP number keeps going up at any and all cost, regardless of long term externalities and second order effect to society. Kina like Saturn devouring his children. Like sure, now you need to wait 4 months to see a public healthcare specialist compared to only 2 weeks 8 years ago, but the GDP number is higher now than back then, so obviously we must be better off today than in the past, right? RIGHT?! That's why EU politicians are rushing to implement free speech crackdowns, invasive privacy laws using dictatorial techniques, like last week's Chat Control 1.0. They know they're on borrowed time before the majority of the population wises up and turns against them for the effects of the unpopular policies they pushed that lead to their decline in quality of life and purchasing power.
    • TitaRusell 3mo ago
      If GDP rises the country is not economically stagnating though.
      • joe_mamba 3mo ago
        If people are practically poorer and less well off than before, does it matter to them that the country is on paper NOT economically stagnating? Shoving a graph in their face with a made up number won't change their economic situation. Sure, let's say GDP went up 5%, but then everything that matters like housing and healthcare went up 10-20%. Average workers aren't the winners of this mythical economic growth we're told we need to keep prioritizing. What use is GDP growth if most of it just gets concentrated in the top 10% of asset holders and everyone else in the trenches keeping society going, ends up worse off in a decaying society. That's how we are now massively outputting homeless junkies who gave up on society and Luigis who want to shoot the elites responsible for this, because the system does not work for them. Now, the elites can avoid the homeless junkies their economic policies create, by living in gated communities in the suburbs and chauffeuring their kids to private schools, but the Luigis are more tricky to dodge because they're smart and motivated, that's why the like of the EU, UK, AU, etc are expediting privacy invasive laws under the guise of "protecting kids" to make sure any future Luigis will be preemptively dealt with the moment they speak ill of the king and the nobility.
• LastTrain 3mo ago
  I really hate this “we don’t build enough housing” narrative these days, because it implies this is a simple supply and demand problem, which it is not. I see so many progressives repeating this line, apparently not understanding that they are suggesting unfettered capitalism (up zoning…) is the solution. The fundamental problem is we simultaneously want our housing to be affordable and good investment. It can’t be both.
  • antinomicus 3mo ago
    Public housing is the answer to this.
    • LastTrain 3mo ago
      I agree that is a necessary component.
    • richwater 3mo ago
      The NYCHA is the largest slumlord in the city. The country has proven over decades that it cannot operate public housing with any measure of success.
  • heroiccocoa 3mo ago
    I can't think of a good reason as to why people would want housing to be a good investment except if their own wealth depends on it or they want to preserve the wealthy character of their own neighborhood. It takes away investment from local enterprise, local government, which would spur innovation, salary growth, better infrastructure, municipal services, etc.
    • patmorgan23 3mo ago
      For the average American homeowner 25-50% of their wealth is in their home.
  • rainsford 3mo ago
    Those aren't really two different arguments. Wanting housing to be a good investment is one of the reasons we have a supply problem because it incentivizes people to vote against allowing more housing to be built. But at the end of the day the high cost of housing really is a simple supply problem, it's the reason for that lack of supply that's more complex.
• paytonjjones 3mo ago
  A big political problem with YIMBYism is that almost by definition it will take years to see the effects. If you champion it as a politician, there's a very large chance you get all the flack for new developments, but the next guy gets all the credit for affordable housing. Texas seems to be the only place that actually does it, and I honestly have no explanation for why.
  • slibhb 3mo ago
    Yes, this is a real problem. Also, in high-demand areas, building more will lower prices compared to the counterfactual but that doesn't mean prices will actually go down. This makes it a harder sell.
    • 8note 3mo ago
      and in the near term, you reduce supply by kicking the people out of their homes and they need to find somewhere else
• taeric 3mo ago
  I highly challenge this. For a region, industry booms drive upward movement. And regions that are only held by one industry when it busts build rust belts. Ideally, you have industry for a region treated like a well balanced investment portfolio. But you have to internalize that balancing investment portfolios is is a protection against downside risks. And it specifically loses against the lucky portfolio that was heavy on something during a boom. So, the question heavily looms on if the regions we are looking at are diverse enough that they can sustain some downturns.
• antinomicus 3mo ago
  I may or may not meet your definition as a nimby 28 year old. I am all for housing, just not the type being built in my area. Dozens of “luxury” units built cheaply, selling for 4,000$ for a 1 bedroom. They get subsidized by the local government for including maybe 5 units that are “low income” and probably still cost 2k - and those low income units go away as soon as the building gets sold to another corporation. I want lots of high quality, dignified housing for myself and my community, not wealth extraction pods. I want real public housing. Housing should be a human right. As it stands now the land is being squatted by mega corporations seeking to extract as much profit from the community as possible.
  • toomuchtodo 3mo ago
    Please consider running for local office to be an advocate for non market social housing in a position of leverage.
  • ProfessorLayton 3mo ago
    Almost everything you said is a typical NIMBY talking point: > Dozens of “luxury” units built cheaply, selling for 4,000$ for a 1 bedroom A nebulous definition of "luxury", and totally ignores the fact that people with money can get what they want anyway, pushing those with less out. So yes, more "luxury" builds help. > They get subsidized by the local government for including maybe 5 units that are “low income” and probably still cost 2k Many purportedly want more low income housing, often at absurd rates like "100% affordable" knowing that projects like that will never pencil out. It's a way of saying "No" without actually saying it. > I want lots of high quality, dignified housing for myself and my community, not wealth extraction pods. Okay, so build some? If you can't build what you want then why stop others from building what they can with the budget they have? >As it stands now the land is being squatted by mega corporations seeking to extract as much profit from the community as possible. It's literally illegal in most places to build more densely due to height, parking requirements, discretionary reviews, etc. impacting everyone interested in building more units (Like for a multigenerational household as seen in elsewhere in the world). This is not just impacting corporations seeking to extract profit.
    • 3mo ago
• JKCalhoun 3mo ago
  "…get annoyed whenever there's new construction…" People "getting annoyed" doesn't prevent construction of affordable housing. I often see NIMBY comments but never see anything to back up the notion. Greedy developers that want the largest profit on a given plot of land is probably where you should be looking instead. Why build two inexpensive starter homes when you can build one luxury home and make a larger profit? (Never mind that the county gets larger property tax returns on the more expensive homes.) And yet. They build high end homes and they sell them anyway. So there seem in fact to be buyers out there?
• gtrplyrjimi 3mo ago
  It's not just about building more in existing areas. It's about making the construction of affordable housing PROFITABLE for developers; which in this world is nearly impossible. Every tax break you give for building anything just results in luxury developments and the builders keeping the breaks as profit. Also, you can't just build more in these already built up areas. Many of these areas already have strains on public services and just building up without adjusting for electricity consumption, water, schools, roads, transportation, parking, etc is just creating an even larger more expensive headache. You have to make building towns / hoas in undeveloped areas easier; and the includes high speed transportation to get to the nearest city hub. We also have to be alot more flexible on what's allowed to be called housing. We should have more places for people to be able to live in their RV's, cars, etc safely. All of this comes down to the economic reality of what it takes to actually build and maintain a home and piece of property in America. It's not a right to own a home because of that economic reality. The main ingredients are cheap land in an area that has access to electricity, water, streets, infrastructure and access to income. If you can maintain a job for long enough you can pay off the land and cost to build. That is the only viable way to own. Expecting those kind of prices in LA or NY near the beach or downtown is delusional. We have to also, philosophically, be honest about the way time passes and an intelligent species propagates itself. An frankly we can just look in the wild and see the same dynamics. If a species is successful, then there will be lots of individuals. Those individuals will be drawn to the BEST places to live. There are only so many BEST places to live. Do we really want to turn every place we live into giant high rises? This is an honest question and I think people aren't being entirely honest about their motives / vision for the planet.
  • 8note 3mo ago
    if developers cant build housing for people to live in profitably, the government should build it instead afordable housing is a bedrock to ecobomic prosperity, the same as education and healthcare
• nonameiguess 3mo ago
  Are they actually NIMBYs or just annoyed? I live in a major metro downtown full of construction and fully support it 100%, but that doesn't mean it doesn't irritate me. Roads and sidewalks are constantly randomly closing. Every bridge across the local highway is currently closed for the next five years. My wife had every tire on a brand new go flat within three months because of nails on the roads. Our houses are all covered in yellow dust because the gas company dug up bedrock 9 years ago, left an enormous pile on a street corner, which then washed away in rain and still covers half the sidewalks nearly a decade later. Most of the housing ends up becoming short-term rentals, which in turn mostly become party houses, so the streets are strewn with broken liquor bottles all the time, cops are getting called in the middle of the night to break up fights with strippers. My car's hatch got destroyed by a city dump truck a few years back and I've been hit while parked two other times by work trucks. All of my power tools were stolen out of my garage by a work crew because the original builders put me on the same radio channel as the guy two doors down, so my garage randomly opened without me knowing about it. I still support it. We need all the housing we can get. But I do get endlessly irritated by the attitude on Hacker News that no person could ever oppose rebuilding a neighborhood while people still live in it for a good reason and they must all by miserly hoarders trying to pull the ladder up from beneath them.
• stronglikedan 3mo ago
  > We don't, as a matter of intentional policy, build enough housing. Or maybe we do, but just couldn't keep up with the enormous influx of immigrants for a few years a that ended a couple of years ago. The housing costs have risen due to unforeseen demand, not supply.
  • solumunus 3mo ago
    This was a problem long before that, the trajectory has been clear. Is immigration a factor? Sure. The suggestion that it’s the key issue is complete nonsense. This is happening all over the world, even places with low immigration. There’s really no economists claiming that immigration is the main driver. This is reactionary right wing rhetoric and not much more.
    • 8note 3mo ago
      as an anecdatum, canadian, especially toronto proces are crashing after an easing of immigration nothing else has particularly changed
      • solumunus 3mo ago
        Could it be that middle/high incomes are getting squeezed badly year after year, following sharp housing inflation 2020-2022? Everyone is poorer and interest rates are higher my guy.
• inigyou 3mo ago
  Housing is flexible. Lots of poor people in some places live in RVs or trailers. It can't be that nice but they have to save a lot of money (or not, because RVs are expensive too). You have tent cities in non-totalitarian cities but their biggest downside is being illegal and therefore everyone who lives there gets periodically ransacked by police and sent to prison. People used to live 10 to an apartment, which also sucks, and were extorted by landlords but if we remove that part it's better than being homeless, but that's illegal too. It's starting to sound like the root of the problem isn't even a shortage of housing, but the fact that cheap housing is illegal.
• jjav 3mo ago
  > self-inflicted problem Self-inflicted would mean the person (or people) suffering from the problem is the same person causing the problem. But the gazillionaire corrupt politicians aren't really suffering from any affordability problem personally.
• mancerayder 3mo ago
  California problem. There's no constrained supply in Houston or Austin or a few other cities in the US that are now crashing from over supply. Another one is Manhattan. There's no space to build so things get retrofitted (office conversions) and new zoning (Hudson Yards) but it's expensive - high hourly rates to pay people on buildings with more 99 units, many many permits required, land is expensive, etc So it's luxury only in NYC None of this is NIMBYism. Part of it is return to office. Why move there if it's too expensive - the answer is you're unemployed otherwise Part of it is demand. NYC is the closest thing to Europe, where you don't drive around in an SUV to do simple things. The GDP is enormous, so you find jobs. Young people. Etc Housing costs are a lot more complicated than NIMBYism. There's a strong California bias for obvious reasons, here on HN.
  • slibhb 3mo ago
    While it's definitely true that NIMBYism isn't the problem everywhere, I live in Virginia.
    • mancerayder 3mo ago
      The only point I was trying to make is, "it's more complicated than <the parent comment I was replying to>." The household affordability problem is extremely complicated. In some cases it's indeed NIMBYism - some law that limits to single-family housing, or complicated HOA rules, etc. Local board approvals required. Sometimes it's just plain-old high-demand. Who doesn't want to live in a big fancy metropolis as a 25 yr-old with money? More people move in than it's physically possible to build (we're not China). Sometimes it's regulations - you need to pay construction workers a min wage of $50/hr if you build a unit more than 99, or no tax breaks for you. Sometimes land is expensive. But so is the architect, the materials, the permits. Then you have environmental regulations, sometimes that make sense, some that are too difficult. Then you have regulations to protect the consumer so the place doesn't burn up or fall on our heads, sometimes that make sense, some that are too difficult. You have interest rates that are high. We have the private equity investors buying up bulk new construction. We have wage growth that didn't match the growth of housing costs. Hopefully I've made my case that housing affordability has many factors. I'll need to save this message so I can cut and paste it elsewhere because about once a month on HN someone posts that the problem with housing affordability is not enough building and NIMBYism, which is only one of the factors here.