Comment by slibhb
2 hours ago
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 housing.
I live in an expensive area and I'm always shocked by how many of my friends who cannot afford to buy a home (or even a condo) are NIMBYs. These are people in their 20s through 40s who have been earning since college, can't afford to buy, yet get annoyed whenever there's new construction that "alters the character of the neighborhood". Talk about false consciousness. I can at least understand people who own a home feeling this way.
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.
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.
That is all that is allowed due to local and state zoning codes. Loosening restrictions on what can be built will bring down costs and all for more types of buildings. The bland housing is all that pencils out for builders at the moment.
They did this in New Zealand under Jacinda Ardern's government and house prices have started to fall, but only slightly so far. IIRC the rules were something like, lots in a certain radius of a train station or town center are mandatory mixed-use zoning, overriding any city rules to the contrary. It was very controversial for the national government to override city governments like that.
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.
It's all talking points on both sides. "Build more housing" being the one true solution has become a religious tenant in a lot of wonkish circles. I see it repeated uncritically every single time this topic comes up on HN and similar spaces.
The reality is that demand is always going to far outstrip supply in certain areas. You can only cram so many houses into a place like San Franciso, even if you raze the city to the ground and replace it with some yimby paradise that houses 25% more people. The extra supply might lower costs to some degree in the short term but the induced demand will ensure they stay above what someone on an average salary can afford. Everyone seems to understand this when the topic is freeway expansion, but not with housing.
The actual solution for housing costs is a lot more complicated and multi-pronged, but that doesn't fit neatly on a bumper sticker. There actually is a ton of affordable housing in the US, but it's mostly in areas that people in influential industries like tech and media tend to sneer at, so it gets dismissed; and suggesting someone move there is practically treated as a human rights abuse.
Dramatically increasing housing density does have adverse affects for existing residents. It's fine to say the tradeoffs are worth it, I'm not saying it's never the answer, but even acknowledging that it's a tradeoff usually gets met with dismissive insults from the yimby crowd.
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Please consider running for local office to be an advocate for non market social housing in a position of leverage.
> 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.
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
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.
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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)".
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.)
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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.
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
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
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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
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.
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)
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.
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.
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.
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.
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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
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.
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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.
About half of social housing in London is headed by people born outside of the country. Social housing is quite rare in the UK now after 1980s mass privatization started. It is provided at a steep rental discount and if you qualify for it you can keep it for life. Or purchase it at a steep discount.
Quite bizarre, but difficult to talk about, because it plays in to the wrong side of ongoing culture wars for some people.
https://www.reuters.com/fact-check/fact-check-foreign-born-p...
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.
If GDP rises the country is not economically stagnating though.
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Agreed, this feels so obviously a housing cost problem to me.
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.
> 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.
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.
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.
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.
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.
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.
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.
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.
For the average American homeowner 25-50% of their wealth is in their home.
Public housing is the answer to this.
I agree that is a necessary component.
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.
"…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?