I'm not sure it's possible to expand the housing supply. Inflation has made the cost of constructing new housing almost impossible. In fact he even has a graph comparing cpi to case shiller. I would argue that case shiller correctly models inflation where as CPI has been neutered and is no longer an effective model of inflation.
Basically we're at a point where used housing is actually far more valuable than list price because it would be absolutely impossible to rebuild any used house for anywhere near the amount it sold for.
al_borland · 1h ago
It seems like incentivizing marriage and families again would go a long way. When everyone thinks they can and should be single, the housing requirements double.
I live alone in my house. It was built in the late 1940s. This house likely housed couples with children, 3-5 people, instead of the 1 it holds today.
Coupling up would reduce housing demand, and should in turn lower prices as availability increases.
Ancalagon · 1h ago
thats kicking the can down the road for an even worse crisis when all those kids grow up in 20 years
al_borland · 53m ago
Can you elaborate on that? Are you saying we're doing kids a favor by having them grow up with single parents, because that will force more housing to be built, so they can grow up and be single parents too? Is this a good future for them?
I get the population will still grow, and we will likely still need some amount of housing growth over time, but we don't need nearly as much as we think we do.
We also don't need to avoid the middle of the country. The population has been moving to the coasts, while the Midwest has lost a ton of people since the manufacturing moved elsewhere. With a lot of companies, there is no reason they can't be in the midwest where there are a lot more affordable homes, and a lot of space. We should be looking to draw people from these HCOL areas to help bring back these cities. It seems like a win-win situation.
wahern · 22m ago
> We should be looking to draw people from these HCOL areas to help bring back these cities.
This is one of the arguments for high-speed rail. The primary reason to move to a HCOL city is employment opportunities. The rapid growth of rail, both street cars and commuter trains, early last century allowed metropolitan regions to expand by allowing people to work downtown but live further away, dramatically easing housing pressure. The advent of the interstate highway system originally had a similar effect, though later also a fracturing effect, especially outside the few cities capable of holding their core.
High-speed rail promises to achieve the same thing, just as it has elsewhere around the world. Certainly it's a promise CAHSR is selling, and a major reason we should strongly support it. And it's one of the primary justifications it runs through the Central Valley rather than taking the shortest route between SF and LA. It puts Central Valley cities squarely into the SF and LA metro regions, not only creating opportunities for existing Central Valley residents, but allowing people to move further out, reducing housing pressure. You simply can't achieve the same thing with bigger airports and more flights, not until flying cars become ubiquitous.
lurking_swe · 35m ago
this assumes immigration rate stays constant. nobody said it needs to…
lif · 1h ago
Now, strictly based on anecdotal, however, might there be a grain of truth to:
developers mass-producing cheap, inhumane housing, set on tiny parcels designed to maximize developer profit MEETS most potential buyers/renters have zero interest in that crap
?
throwmeaway222 · 2h ago
All those things declared an emergency REALLY ARE to more than half the population. All the TDS aside, yes.
I think the main thing we need to do is make a federal property tax for any unused house or rental. Something that billionaires can afford, but only for their personal homes - and something that will basically force all landlords to sell immediately. Every actual real property will be forced onto the market in seconds and everyone will be able to buy a house that needs one for pennies on the dollar. It will be amazing. Let's start with 1000% per hour.
Nevermark · 50m ago
Source of these ideas: Economist Henry George.[0]
When land is taxed, but the property on it is not, and rates are normalized to maintain neutral tax flow due to the change:
1. Someone who owns land with little productive development, will see a large tax increase.
2. Someone who owns the adjacent same-sized plot, with higher value development, will pay the same tax, instead of a prior much greater tax.
So development isn't taxed, making development more attractive, as it will have a higher return.
Much greater incentive to usefully develop land. Much greater disincentives to holding relatively less usefully developed land.
Also good alignment:
(1) a land tax, taxes the exclusionary asset, paying a tax on essentially rents the land from the community. Which makes sense.
(2) Not paying a tax on development, removes a wealth tax on any land owner from any financial scale.
(3) That wealth tax on wealth disincentivize development, relative to other investments.
(4) The lower property taxes on less developed land, that we have now, means that high value property wealth tax, is subsiding the returns of Lower development land owners.
(5) And that imbalance accounts for lands use as a financial instrument, instead of land + use, as the investment. Holding land prices up, while subsidizing non-development holding.
The elimination of most land-price driven investment, would reduce a massive amount of artificial demand, resulting in more supply and lower prices, for those who wanted to make returns by further developing the land.
What do you do about all the homeowners who are now paying for a home that has lost value? They just take a walk? What about the sellers who can't sell their house for what they owe now? They just take the same walk? And the banks and mortgage backed securities, even the stable ones, are now worth jack? What about the 401K accounts that now lose 20% or their value because it was all piled on housing related funds unbeknownst to the investor?
It amounts to a mass seizure and redistribution, except those who were seized from still have to pay back what they borrowed, so it's even worse!
recursive · 44m ago
Affordable housing seems in direct conflict to the interests of those using their home as an investment or store of value, strategically or not.
As a home owner, I think the best move for the country as a whole probably doesn't align with the financial interests of the current home-owning class.
The idea of a home as investment seems to inevitably cause this kind of conflict.
Ericson2314 · 7m ago
You are right we have a stupid set up, but actually there is an easy way out:
a lot of SFH get turned into dense apartments, and a lot of homeowners get rich as hell because they own the land.
We should have a LVT, so the landholders don't get too rich, but it can be a bit lower than ideal (which would mean that conversion to apartment is break even because future earnings - cap ex and taxes net out)
jvanderbot · 14m ago
That's only part of the problem. It doesn't need to be an investment, but causing a purchased item, one that is almost exclusively purchased with loans, to plummet in value burdens purchasers for decades with needless payments. Might as well just garnish wages and redistribute to your chosen demographic
Ericson2314 · 5m ago
We're gonna bail these leveraged-to-the-gills normies out, with profits to them, on the condition that SFH ownership society is destroyed — never again.
Only condo homeowners, and people living in truely rural areas "irrationally", will remain.
dragonwriter · 1h ago
> Something that billionaires can afford, but only for their personal homes - and something that will basically force all landlords to sell immediately.
Not possible, because if its a tax an unused homes or rentals, what it would force people to do is either:
(1) make it qualify as “used”, or,
(2) destroy the residential structure on the land to preserve the value of the underlying land, which would no longer have an unused home or rental on it.
(Of course, you’ll never get the Constitutional amendment needed to carve out a new exception to both the prohibition on unapportioned direct taxes and the takings clause of the 5th Amendment that you’d need for that, so its moot anyway.)
panny · 2h ago
>Localities rather than the federal government must have the final say in zoning laws and regulations.
Zoning in Japan is at the national level. Japanese houses are WAY cheaper than American ones, while being of better quality at the same time.
codingdave · 2h ago
What criteria do you have in mind when you say "of better quality"? They are not built for longevity, which is also why they are cheaper. It is a completely different approach to what a home is.
And FWIW, homes in the USA have a massive variety of quality. Generalizations about such things are going to be flawed.
ggm · 2h ago
I may misunderstand it but Japan has two important differences:
Firstly, a significant number of houses are one family lifetime. People clearfell and rebuild routinely. The marginal value of a home is different when it's lifetime is constrained. Not all houses by any stretch, but its far more common.
Secondly Japan's population is shrinking. It's further along a pathway the developed economies share absent immigration. Thus, there is far more housing stock to head of population.
There is a third reason and it is perhaps more relevant: Japan's zoning laws are bizarre. You can put a house up next to a tire recycling plant, and have a Zen temple across the road and a sofa factory operating out of your front verandah. Nobody seems to care. California take note.
Basically we're at a point where used housing is actually far more valuable than list price because it would be absolutely impossible to rebuild any used house for anywhere near the amount it sold for.
I live alone in my house. It was built in the late 1940s. This house likely housed couples with children, 3-5 people, instead of the 1 it holds today.
Coupling up would reduce housing demand, and should in turn lower prices as availability increases.
I get the population will still grow, and we will likely still need some amount of housing growth over time, but we don't need nearly as much as we think we do.
We also don't need to avoid the middle of the country. The population has been moving to the coasts, while the Midwest has lost a ton of people since the manufacturing moved elsewhere. With a lot of companies, there is no reason they can't be in the midwest where there are a lot more affordable homes, and a lot of space. We should be looking to draw people from these HCOL areas to help bring back these cities. It seems like a win-win situation.
This is one of the arguments for high-speed rail. The primary reason to move to a HCOL city is employment opportunities. The rapid growth of rail, both street cars and commuter trains, early last century allowed metropolitan regions to expand by allowing people to work downtown but live further away, dramatically easing housing pressure. The advent of the interstate highway system originally had a similar effect, though later also a fracturing effect, especially outside the few cities capable of holding their core.
High-speed rail promises to achieve the same thing, just as it has elsewhere around the world. Certainly it's a promise CAHSR is selling, and a major reason we should strongly support it. And it's one of the primary justifications it runs through the Central Valley rather than taking the shortest route between SF and LA. It puts Central Valley cities squarely into the SF and LA metro regions, not only creating opportunities for existing Central Valley residents, but allowing people to move further out, reducing housing pressure. You simply can't achieve the same thing with bigger airports and more flights, not until flying cars become ubiquitous.
developers mass-producing cheap, inhumane housing, set on tiny parcels designed to maximize developer profit MEETS most potential buyers/renters have zero interest in that crap
?
I think the main thing we need to do is make a federal property tax for any unused house or rental. Something that billionaires can afford, but only for their personal homes - and something that will basically force all landlords to sell immediately. Every actual real property will be forced onto the market in seconds and everyone will be able to buy a house that needs one for pennies on the dollar. It will be amazing. Let's start with 1000% per hour.
When land is taxed, but the property on it is not, and rates are normalized to maintain neutral tax flow due to the change:
1. Someone who owns land with little productive development, will see a large tax increase.
2. Someone who owns the adjacent same-sized plot, with higher value development, will pay the same tax, instead of a prior much greater tax.
So development isn't taxed, making development more attractive, as it will have a higher return.
Much greater incentive to usefully develop land. Much greater disincentives to holding relatively less usefully developed land.
Also good alignment:
(1) a land tax, taxes the exclusionary asset, paying a tax on essentially rents the land from the community. Which makes sense.
(2) Not paying a tax on development, removes a wealth tax on any land owner from any financial scale.
(3) That wealth tax on wealth disincentivize development, relative to other investments.
(4) The lower property taxes on less developed land, that we have now, means that high value property wealth tax, is subsiding the returns of Lower development land owners.
(5) And that imbalance accounts for lands use as a financial instrument, instead of land + use, as the investment. Holding land prices up, while subsidizing non-development holding.
The elimination of most land-price driven investment, would reduce a massive amount of artificial demand, resulting in more supply and lower prices, for those who wanted to make returns by further developing the land.
Land's use as "gold" is incredibly wasteful.
[0] https://en.wikipedia.org/wiki/Henry_George
It amounts to a mass seizure and redistribution, except those who were seized from still have to pay back what they borrowed, so it's even worse!
As a home owner, I think the best move for the country as a whole probably doesn't align with the financial interests of the current home-owning class.
The idea of a home as investment seems to inevitably cause this kind of conflict.
a lot of SFH get turned into dense apartments, and a lot of homeowners get rich as hell because they own the land.
We should have a LVT, so the landholders don't get too rich, but it can be a bit lower than ideal (which would mean that conversion to apartment is break even because future earnings - cap ex and taxes net out)
Only condo homeowners, and people living in truely rural areas "irrationally", will remain.
Not possible, because if its a tax an unused homes or rentals, what it would force people to do is either:
(1) make it qualify as “used”, or,
(2) destroy the residential structure on the land to preserve the value of the underlying land, which would no longer have an unused home or rental on it.
(Of course, you’ll never get the Constitutional amendment needed to carve out a new exception to both the prohibition on unapportioned direct taxes and the takings clause of the 5th Amendment that you’d need for that, so its moot anyway.)
Zoning in Japan is at the national level. Japanese houses are WAY cheaper than American ones, while being of better quality at the same time.
And FWIW, homes in the USA have a massive variety of quality. Generalizations about such things are going to be flawed.
Firstly, a significant number of houses are one family lifetime. People clearfell and rebuild routinely. The marginal value of a home is different when it's lifetime is constrained. Not all houses by any stretch, but its far more common.
Secondly Japan's population is shrinking. It's further along a pathway the developed economies share absent immigration. Thus, there is far more housing stock to head of population.
There is a third reason and it is perhaps more relevant: Japan's zoning laws are bizarre. You can put a house up next to a tire recycling plant, and have a Zen temple across the road and a sofa factory operating out of your front verandah. Nobody seems to care. California take note.