State housing has a place, but I think they really need to fix the demand side of investors. There should be significant deterant to holding residential property in large scale. While options are varied I think a progressive asset tax of total property owned. Something like 0.5% per million starting on the second million. Maybe some principle place of residence reduction. So most people can have a house even a second/third house without occuring holding tax but you stop people sitting on $10m+ in residential property, which is quite a low threshold really. And stop investors dropping billion plus amounts into the market. Then some rule about top marginal rate for obscured ownership like overseas owners and trusts etc to stop shenanigans there.

It comes down to that line about residential property has to be good for residents or good for investors, you can't have both.

First home? 3% real estate transaction tax, or 1% if renovating up to high energy savings specs.

Any other home? 12% real estate transaction tax.

That's roughly how it works in the Flanders region of Belgium from 2022.

Many people want and/or need to rent. How would this not just drive up rent 9%

Agree, and would propose increased property taxes for amount of time a property is empty, I think this would increase liquidity in rental markets.

Even if it's being rented, I think the tax should still be there. We want people to own the places they live in

The state building affordable and midrange housing does have precedent in Finland, where municipal employees build the majority of homes, leaving the upper mid-range and high end homes to be built by private developers.

They do tightly manage where each type of residence is built, from what I hear the goal is to avoid the creation of exclusively wealthy or poor neighborhoods as their existence damages society.

The market has shown it's ill-equiped? I don't know how you came to that conclusion.

There are zoning codes everywhere, environmental review, city permits, etc, that the small amount of successful projects will of course be the minimal low hanging fruit. Literally all of this problem is "the state."

Let people build buildings on their own land. It will supply far more housing than any state backed affordable housing and will break the housing-as-investment pitfall by breaking the supply-constraint that causes people to treat it that way.

>> Let people build buildings on their own land.

All land is owned subject to the laws that govern its potential uses. Land that is open to more uses is more valuable than land that is not. Land that can be subdivided is worth more than land that cannot. Allowing people to build more houses on "their own land" is a wonderful gift to land owners. It increases the value of their property. But that exacerbates the problem. A trend towards greater freedom to develop real estate means it is, yet again, only a more attractive investment vehicle.

Rather than "let them build", perhaps we should consider "thou shalt build" or "thou shalt rent". Laws that demand certain real estate owners do X or Y could not only increase the number of rental units but also diminish the attractiveness of unoccupied or unused real estate as an investment vehicle.

If you want to diminish attractiveness of unused land, a land tax might help. Much better than the state trying to micromanage what gets done. Just set the right incentive structure.

Um, people building more houses means more supply which means lower prices. Nobody has yet managed to repeal the law of supply and demand.

The problem is that in high demand areas, it can be profitable for people to buy property purely as speculation without ever having people live there.

As I pointed out earlier, this problem is solved by adding building supply to balance out the supply-demand imbalance causing property to appreciate and be a source of speculation. No one will "invest" in real estate if adequate supply causes no price increases. Any ad-hoc state involved bandaids like rent-control, foreign ownership laws, etc. are unnecessary.

Land and Real Estate has other aspects of the demand aside from just "a roof over your head" though. Location and other factors play into it in a big way. For instance if you have a parcel of undeveloped land at a lakeshore, the supply isn't "all land available in the region", it's "All land along that lakeshore" which is a much smaller supply. And lakes are generally a desirable place to live, so the demand is likely high.

It doesn't really matter that there are exceptions where some areas are naturally more desirable because land isn't fungible. What matters is that there are available housing units approaching the limit of construction cost pricing so that people can have a place to live without being affected by luxuries like "wanting a lakefront home."

My point isn't that there aren't some exceptions it's that there are tons, maybe literally hundreds or thousands of factors into the supply/demand equation here.

what kind of internet is available in the area? How close are you to grocery stores? Is there a HOA that you have to pay dues to? What's the weather like? Is the home up to date or is the wiring and plumbing likely to need a lot of work? How big is the lot? How walkable is the neighbourhood? Is it near a smelly dump? What's the crime rate like? What are the schools in the area like, how close are they? How much access is there to transit?

It's not as simple as just "Build more housing" society also has to adequately service the people who want to live in that housing. If our lower income housing is all just bare minimum roof over your head and no access to anything then no one will want to live there, which also means that supply will not affect the demand on housing that has better access to amenities.

Internet infrastructure, closeness to grocery stores, homes being up to date, walk-ability, close schools, access to transit, are all improved by building more dense housing.

We can also be quite certain that providing the bare minimum housing pulls in demand from those more luxurious options (wants) to the more economically practical option (needs), because the bare minimum option was never available. We'd be giving people more choices and at least some would take it.

Then if you have so many people that "demand" a certain standard of luxury housing, then they will have to compete and pay the premiums for the actual limited resources like lakefront property or great schools (living near other like-minded wealthier people). That's the realities of scarce resources, and is fine, since there's not much we can improve there. But the major gap is providing the bare minimum of housing which we are currently not doing.

How do you add building supply when there is no undeveloped land? There are no empty lots in high demand areas.

You'd have to increase density, and most places it will be difficult to displace people from their homes to tear them down and redevelop them.

Make other areas more attractive?

It's a common fallacy to look at a heavily regulated market and blame "the market" in general. What makes it worse is supposed "free market" advocates that instead selectively deregulate in their favor. But the market can be corrected by selectively deregulating in favor of the disadvantaged too. It just doesnt happen very often due to the nature of the of the people in power.

The market will always favour the advantaged. Correcting that out means getting rid of the market

> But the market can be corrected by selectively deregulating in favor of the disadvantaged too.

Only to the extent that existing regulation favors the advantaged more than the market naturally does, which tends to make that approach quite limited in potential.

"The market has shown it's ill-equiped? I don't know how you came to that conclusion."

Well, we could start with the fact that there are roughly 25 empty housing units in the U.S. for every homeless person.

Housing a very basic human need.

Better yet, the state needs to get out of the way of the private sector building things and let it create more supply. A friend of mine wanted to tear down and rebuild an old house he bought. Spent a year and a half trying to obtain all the permits and gave up. And that's a regular house on a plot of land that he already owns, the "easy" case. You can imagine what kind of insane bureaucratic hoops one would need to jump through to build anything that's "affordable" and therefore a little bit unconventional. My house tripled in value in 10 years. There's simply no way a glorified wooden box costs $2M. The "state" (and the restriction of supply) is the reason why.

The market is ill-equipped? Prior government interventions in housing are driving most of the price inflation and investment.

Every time they come up with a new way to help people buy houses they just further drive up the price.

> I think the market has shown quite clearly it's ill-equipped to deal with the problem

  1. Step one: Prevent market from functioning through excessive regulation 
  2. Step two: Blame the market

Edit:

Step 3: Downvote and run away

> The state needs to build a slew of affordable housing.

These have never worked and are full of pervert effects. It's at best a band aid.

> I think the market has shown quite clearly it's ill-equipped to deal with the problem.

> I think the market has shown quite clearly it's ill-equipped to deal with the problem. Housing needs to be built for the purpose of housing people rather than the purpose of making profit.

That's a cool political slogan, however nobody will build a housing without a profit and nobody is entitled to other people's labor.

Making sure that houses are not left empty and sane zoning rules are more likely to result in viable changes. Absurdly low interest rates are also to blame.

You started by dismissing the proposed solution out of hand and then went on to attack a strawman.

You do end with a couple ideas of your own, but overall I find this comment more disingenuous than not.

I merely pointed obvious problems in your argument. Then your reply to my comment make accusations but has no substantive explanations at all, which also means it can be dismissed as such.

It wasn't my argument. I was explaining why I downvoted your comment, which I probably should have been more clear about.