Comment by mft_
2 days ago
> The key issue is that housing is treated as an asset, and the policies made to boost housing construction are designed around building a market in a way that gives housing the same kind of financial yields as stocks. But while stock prices can grow because productivity increase, housing value can only increase if housing becomes more expensive.
I like your thesis, but can you give more information on the nature of the policies that drive the housing market in the manner you describe, but which aren't just "regulation" that makes it directly harder (e.g. you can't build housing in this zone) or more expensive (e.g. minimum plot sizes, parking requirements, building codes)?
Interest rates is the biggest one, but also most fiscal policies related to housing (fiscal exemptions on the revenues coming from rents, the possibility for an individual to deduce the interests of their mortgage from their income taxes, or the absence of taxes on the benefits you make from selling a house).
There are as many such policies as there are countries so not all the above examples necessarily exist in your country (my country — France — having the first and the last one above but not the one about mortgage interests for instance) but they all share the same underlying world model of housing being an “asset you invest on” instead of the “commodity that slowly but surely loses value over time” it really is.