The view that a home is an investment is poisonous to the housing supply. It makes people of all political affiliations into raging NIMBYs. Why would they want to change anything or allow any new construction in their area if it might negatively affect their housing price?

I always saw second homes as a recreational expense first. Your first rental property would be an investment.

A second home isn't necessarily an investment, especially if it's a vacation home. It can be just a place you go on vacation.

By making that home unavailable for people who actually need a place to live, you're reducing the supply, thus increasing prices, and contributing to unaffordable housing.

I say that as a Software Engineer who is 39 and has never been remotely close to affording even a first home.

f I build a vacation home somewhere where there wasn't a house, and I neither live in it nor rent it, does it diminish anyone else's supply of housing? No, it doesn't.

You may say that it could have increased someone else's stock of housing. And that's true. But if I built it as a vacation home, then if it wasn't going to be used as my vacation home, I wouldn't have built it, so it wouldn't have increased anyone else's supply of housing anyway.

Maybe we’re too focused on the word “home” rather than “real estate”. That lot you built your vacant vacation home on could be someone else’s primary residence lot. As the saying goes, “they aren’t making any more land” so there is at least a theoretical supply constraint within city limits.

True. Many vacation homes are not within city limits, though.

That's because you prioritized spending your money gallivanting around Africa. You could be the owner of a fixed up fixer upper outside Buffalo or Cleveland if that was what your priorities were.

No, I'm not American. I take it you haven't looked at the housing market in Vancouver or Toronto lately.

The same is happening even in small town now - a friend bought a place just before Covid for $480k, now it's worth $740k. This is a town of 10k people, in the middle of nowhere. Tiny lot, house is almost 100 years old.

Yeah, the common old "cottage" Up North is yielding to 2nd luxury homes which than have to be VRBOed in order to cover the mortgage. Happened to my in-laws lake. Simple cabins displaced and the crowd being far more transient.

Of course they pocketed a seven figure profit, because of the lakefront property, and the 100 year old wood cabin was bulldozed.

>Simple cabins displaced and the crowd being far more transient.

And then the transient occupants party their asses off. And then the Karens pass local ordinances. And then nobody can have any fun.

Yes, 'on the margin' (in economic terms).

This is a collective action problem. If one person decides to not move to Undiscovered Gem, Wild West then there is a large number of others that will.