Others say about 11 million illegals in the US, although that is a bit of an aging number, and most think tanks/academics tend to be liberal-globalists, and underplay any problems with immigration.
(Three-quarters of econ grad students in the US are foreign-born...which might also lead to biases).
So, if the US is short 10 million housing units but has 20 million illegals...
Housing in Japan is affordable, in part due to stable, or slowly declining population. Similar to regions of the US with slowly ebbing populations.
Rents in Sapporo about $400 a month for a unit in Los Angeles that costs about $2,400 a month.
People in Sapporo have higher living standards than people in Los Angeles.
You're not being shrill--the math is solid on this and the fundamental demonstration is the way in which all housing unit prices have appreciated at a higher rate than CPI over the last several decades. My personal metric is the resale value of "junk" houses on the outskirts of metro areas---these assess and sell for prices that don't make sense unless you account for the broad based scarcity of housing units everywhere. I happen to own one of these s--theaps and if I sold it I'd make a profit because someone will be desperate enough to buy it even if I don't fix the plumbing, electrical, septic, siding, kitchen, bathroom, etc.....
You quip on Twitter that reacted to the Marginal Revolution comments section was cynical and accurate. The path to housing abundance is all uphill everywhere.
> There is no feasible future with affordable housing that doesn’t also include a lot of new vacant and seasonal homes and homes used lightly by people of means
Why is that? It's an interesting assertion to make, but I don't see the logic.
First, sort of like the notion of "full employment", there is some minimum number of vacancies required for the housing market to function - for people to have places to move into, buyers to have homes to choose from, etc. We are millions of units below that functional number, nationally.
But, more subtly, the causation goes the other way. People only become concerned about luxury or inefficient uses of something when they are in a condition of deprivation. So, as long as people are worked up about pieds-a-terre, Airbnb's, etc., we know we are in a shortage context. In order to get out of that context, we have to stop objecting to every home on moral grounds. And the corollary is also true When we are not compelled to judge every home on moral grounds, we will not be in a context of deprivation.
One example is that supply skeptics in NYC will point to pencil towers full of empty condos as a reason why building new luxury units doesn't solve the affordability problem. But, Florida and Arizona have always had multiple more empty units than NYC does. I swear half of Canada is in Phoenix in the winter. We didn't care about all those lightly used homes because we were not in a state of deprivation, we let every type of home get built, and we didn't feel compelled to morally nitpick them.
Sorry, gonna have to disagree. There are over a million vacation rentals in the US, and most of them were taken out of the housing supply recently. Work-from-home policies created a big jump in household formation and second homes—all purchased in the last few years.
A contractor friend of mine says new builds are costing $400-$500 per square foot. It’s virtually impossible to build affordable supply in many cities with current land values and construction costs.
I don’t see affordability returning until the next recession, unless a serious attempt at curbing demand takes place. Which will trigger a recession, of course.
Makes sense. That seems like a different (and less strong) statement, though? “No feasible future” seems pretty strong.
That is, stricter regulations about inefficient use of housing might not work and might even be counterproductive, but I don’t think they outright prevent increasing housing supply?
It’s definitely a claim that requires considering 2nd and 3rd order effects and the decades of transitions and changes that such a durable asset goes through. That, in addition to the points I made in the previous comment mean that it’s not realistic to think of an issue like “Banning Airbnb’s will free up some units now, and that one isolated rule can’t hurt supply that much on its own.” But on several levels, targeted policies don’t happen in isolation.
A non-PC comment:
This guy says there are 20 million illegal immigrants in the US.
https://thehill.com/opinion/4423296-matthews-illegal-immigrants-double-under-biden-and-thats-just-the-start/
Others say about 11 million illegals in the US, although that is a bit of an aging number, and most think tanks/academics tend to be liberal-globalists, and underplay any problems with immigration.
(Three-quarters of econ grad students in the US are foreign-born...which might also lead to biases).
So, if the US is short 10 million housing units but has 20 million illegals...
Housing in Japan is affordable, in part due to stable, or slowly declining population. Similar to regions of the US with slowly ebbing populations.
Rents in Sapporo about $400 a month for a unit in Los Angeles that costs about $2,400 a month.
People in Sapporo have higher living standards than people in Los Angeles.
LA has a slowly ebbing population.
If that L.A. population decline is sustained for a couple generations...you might see some results on house prices.
I can't imagine such a thing, and as they always say, "the weather." I suppose if crime and homelessness and a general sense of chaos persists...
Maybe some small declines for a while, but if prices cool...the population will stabilize.
Insight into the percieved housing shortage:
https://spotifyanchor-web.app.link/e/YF26J3RhmJb
You're not being shrill--the math is solid on this and the fundamental demonstration is the way in which all housing unit prices have appreciated at a higher rate than CPI over the last several decades. My personal metric is the resale value of "junk" houses on the outskirts of metro areas---these assess and sell for prices that don't make sense unless you account for the broad based scarcity of housing units everywhere. I happen to own one of these s--theaps and if I sold it I'd make a profit because someone will be desperate enough to buy it even if I don't fix the plumbing, electrical, septic, siding, kitchen, bathroom, etc.....
You quip on Twitter that reacted to the Marginal Revolution comments section was cynical and accurate. The path to housing abundance is all uphill everywhere.
> There is no feasible future with affordable housing that doesn’t also include a lot of new vacant and seasonal homes and homes used lightly by people of means
Why is that? It's an interesting assertion to make, but I don't see the logic.
Good question.
First, sort of like the notion of "full employment", there is some minimum number of vacancies required for the housing market to function - for people to have places to move into, buyers to have homes to choose from, etc. We are millions of units below that functional number, nationally.
But, more subtly, the causation goes the other way. People only become concerned about luxury or inefficient uses of something when they are in a condition of deprivation. So, as long as people are worked up about pieds-a-terre, Airbnb's, etc., we know we are in a shortage context. In order to get out of that context, we have to stop objecting to every home on moral grounds. And the corollary is also true When we are not compelled to judge every home on moral grounds, we will not be in a context of deprivation.
One example is that supply skeptics in NYC will point to pencil towers full of empty condos as a reason why building new luxury units doesn't solve the affordability problem. But, Florida and Arizona have always had multiple more empty units than NYC does. I swear half of Canada is in Phoenix in the winter. We didn't care about all those lightly used homes because we were not in a state of deprivation, we let every type of home get built, and we didn't feel compelled to morally nitpick them.
Sorry, gonna have to disagree. There are over a million vacation rentals in the US, and most of them were taken out of the housing supply recently. Work-from-home policies created a big jump in household formation and second homes—all purchased in the last few years.
A contractor friend of mine says new builds are costing $400-$500 per square foot. It’s virtually impossible to build affordable supply in many cities with current land values and construction costs.
I don’t see affordability returning until the next recession, unless a serious attempt at curbing demand takes place. Which will trigger a recession, of course.
Makes sense. That seems like a different (and less strong) statement, though? “No feasible future” seems pretty strong.
That is, stricter regulations about inefficient use of housing might not work and might even be counterproductive, but I don’t think they outright prevent increasing housing supply?
It’s definitely a claim that requires considering 2nd and 3rd order effects and the decades of transitions and changes that such a durable asset goes through. That, in addition to the points I made in the previous comment mean that it’s not realistic to think of an issue like “Banning Airbnb’s will free up some units now, and that one isolated rule can’t hurt supply that much on its own.” But on several levels, targeted policies don’t happen in isolation.