https://workableeconomics.com/
Explains it all pretty well
And apparently we can thank the Petro dollar system for gutting US manufacturing.
Inflation and central bank policy is separate from this. If you have a highly inflationary monetary policy, landowners will still reap the benefits of inflation in increased rent, and they will still turn a profit on mortgages, which are paid back in dollars that are worth less. The main difference is that they'll also have a LVT that grows with inflation, and so they face continuous pressure to keep the land is uses that generates the most economic value (rent). But unexpected inflation is effectively a discount on their purchase price, if they pay with borrowed money; this doesn't change under a Georgist system.
Take a look at the hand-soldered circuitry in an old TV or radio and it's obvious why those things were so expensive.
Good luck trying to lower property prices. This is a case of what’s good for the country is rarely good for the people making these choices. People living outside a county don’t decide what it’s policies are but still suffer from it’s policies.
Moreover the reason why more housing has become investments is because capital costs of the housing market has increased. If local governments and fiscal policy try to make housing prices increase forever, then eventually house capital costs become high enough that only corporations or co-ops can own them.
Not true; if housing prices continue to increase, then even without rent it becomes a reasonable investment. But that's just it; people need a place to live, so with housing becoming harder to purchase due to higher competition, more people end up renting, becoming this negative feedback loop.
>> Moreover the reason why more housing has become investments is because capital costs of the housing market has increased. If local governments and fiscal policy try to make housing prices increase forever, then eventually house capital costs become high enough that only corporations or co-ops can own them.
So local government and zoning can be part of the issue, sure, but again, 1/4 of the homes sold in the past year were to institutional investors looking to rent them out. Those homes -could- have gone to a family; instead they became rental units. Relevant when we are talking about home ownership.
As to fiscal policy, I sort of agree with you, but not quite. It's less fiscal policy (after all, both a potential homeowner and a business can float a loan), but the scale at play. An investment company can get millions loaned out to them just by dint of being a business with cashflow, and so can pay well over appraisal. Homeowners can't; the loan there is made on the basis of the property as collateral. That innately means they're not competing on a fair footing.
Only if other investments with the amount of capital needed for housing don't produce better results and you can guarantee that there will be buyers of the property post appreciation. There are very few (but they are there) housing markets where real estate has appreciated faster than stock markets or other asset classes and can offset taxes in selling the home. If you're using housing purely as an investment vehicle there's also the risk of a downturn causing real estate prices to decrease due to the low liquidity of housing (compared to, say, a fund).
This will never happen.
The only way to get affordable housing is to build a lot more housing than is currently being built. But that means:
* Higher density living
* A sustained decrease in residential property values
Both of these would be very unpopular with voters. The second point would also probably cause some serious economic problems, as a lot of peoples' and businesses' decisions are based on property values generally going up faster than the rate of inflation.
Want to solve it? Scrap democracy (so no one gives a damn what people want), or scrap market economy (so the Party will provide free housing to everyone). I'd much rather stick with expensive rent.
/s, but history shows that this is how things usually end.
Everyone is competing to ensure they are not at the bottom. But:
- will the pressure rise slowly enough to simply pressure those at the bottom to have less children.
- will the pressure rise cause those at the bottom to explode. IE riots in the streets etc
I think the second option as more likely. By definition, those in power are out of touch with those at the bottom.
Even moving from per-district to at-large city council members is enough to improve things, though we seem to be moving in the other direction there.
To see what that looks like on steroids, China's economy is at real risk of recession due to property developers running out of cash and failing to build promised developments. (Most apartments in China are purchased before construction starts, so you can buy a house and not end up with one in the end.)
You'd prefer to create excess misery to satisfy a sense of vengeance? Versus just solving the problem?
Having the option to rent is a good thing, being forced to rent when you don't want to is a bad thing. Hopefully we can accommodate both.
I rent out one single family home that I couldn't sell when I moved and a 4 unit building where I currently live in one of the units. I never understand these comments. The 4 unit building could be torn down and made a SFH or I could build 14 units which my city desperately needs. If you keep adding rent control and payment vacations and eviction moratoriums and taxes it will be a SFH.
I think your dream is every property is tenancy in commons, but that is legal now and not popular. The reason is zoning. Rich people can compete with two families easily and by limiting the number of units that is all they need to compete with. Much more difficult to compete with 10 families if the lot is zoned for 10.
Anyway, these policy suggestions are maniacal. Go buy and build housing and you'll see how much work it is. Make a startup that makes TiC and construction easier. Go change zoning laws.
I do think his idea about high taxes on a 2nd+ home makes sense. The only problem with it is that it doesn't apply globally, only nationally. You'll have rich people have a palace in the US, Spain, and Australia instead of 3 in the US.
For my own life and approach to this, I moved around a lot and lived in austerity saving up money for a home. I don't want zoning laws to change at all because there's already too many multi-tenant buildings. Pull up the sex and gun offender maps, it's disproportionately those people. And I'm currently a tenant myself (while obeying the laws and having a clean record).
I'd rather see taxes on 2nd+ homes than zoning change. We already built 'out' with suburbs and have plenty of land available for developers to build on and make money. With the internet we no longer have to all live in a city either. It seems to me like his idea, minus the global snag, is generally on the right track.
But I am not a fan of multi-tenant housing near whatever home I purchase, just because of the sort of short-sighted people that often make up renters. They should be in homes anyway, not renting, in an ideal scenario.
I'm my county there are 65k people. It's also the largest county by size in Utah Iirc, in my city which is the biggest city in the county there's around 40k.
When we had to move it was horrifying and scary trying to find a place. There seemed to be no vacancies. Someone posted a listing on Facebook marketplace and there were 20 replies in under 5 minutes.
However, the are 400 apartments that used to presumably be college(we're a college town) or regular residential homes.
So the irksome thing is the fear of being homeless is very real even if you have money to move to another place, there aren't any. But there's 400 places that could be available which would raise supply if short term rentals were banned or taxed steeply enough that revenue for short term might only be 500 more per month instead of 3000 more.
This is happening everywhere not just my part of fantasia.
Although in my experience people are convinced there's "vacant houses" absolutely everywhere based on not seeing the lights on at night. It's not true and this is not a major contribution to the housing crisis.
Scroll down to price and tax history.
This house has been on the market for at least 15 months and has had its price slashed by over 3 million dollars and nobody is nibbling.
It's become a bit of a running joke around here, trying to guess if it's still the most expensive listing in the local paper each week.
As an aside, the local papers are really just pages and pages of real estate ads with a few paragraphs of news sprinkled here and there. Can literally rip out half the pages and not lose a single line of news.
Metro Detroit has low housing expenses because the government provides no services. Even if we assume low crime, if a middle class family were to move to urban Detroit, because Detroit has been deliberately designed so all the rich people live in the suburbs, that family will have no decent schools to send their kids to. So they will basically be trading their child’s education and future for a cheaper rent.
That’s almost always a terrible decision. And that’s before we consider the fact that the governor of Michigan probably doesn’t give shit about Detroit or Flint or the fact that those families are drinking lead in their water. L
But there's apparently a lot of people who simply don't trust it because they're been lied to for too long.
The parent claimed that prices in Metro Detroit have gone up and become unaffordable.
The leading cause for people not wanting to live somewhere is almost certainly the ability to find work (relatively) nearby. Large amounts of crime are only really a problem in sufficiently large cities (obviously with exception) and particularly poor ones, both of which stem from a lack of sustainable income:CoL ratio.
In the same place, the government mandated regulated power simply decided that they were not going to read my meter because of a "dog behind the gate" (there was no gate). Their solution was to have me pay an "estimated" charge that was several times my monthly income.
It's absolutely unlivable long term to be some place like that.
Fundamentally it's just the same thing as any other city service: they have no actual obligation to provide any service. Your recourse is to move to another jurisdiction, which I did.
As in all industries, so long as we refuse to consider alternatives, they'll hold all the power to raise the price. It happens with brands like Apple, it happens/happened to big brand name cities like Miami, Austin, San Francisco ...
As for sustained decrease in residential property values, yes, that is the real problem. Voters who own homes won't vote for policies that let everyone else have a cheaper home. It is going to need to happen in some other state, and that state will need to draw away so many workers that California house prices fall anyway, and then maybe the policies will change.
Rail scales better, but that's also not really getting a move on anytime soon, and in any case rail scales better if density is high development and nearby.
Smelly? The presence of volatile compounds interacting with your olfactory receptors that trigger certain aversive reactions is a poor justification for destroying a natural habitat.
"As a young engineer, I remember sitting in a city council meeting where a senior colleague presented my analysis on the massive backlog of road maintenance the community was facing. My estimation was that the city's capital budget needed to be increased by five times just to keep from falling further behind"
"Analyses of new developments suggest that a minimum of $20 in private wealth is needed to sustain, for the long term, each dollar of public infrastructure investment. A ratio of 40:1 would provide an optimal buffer for future uncertainty. Yet, when we examine modern North American localities, it is common to find ratios of 1:1 or worse. That is, in the current development pattern, it takes one dollar of public infrastructure investment to create one dollar of private wealth. That’s a formula for economic disaster."
https://www.strongtowns.org/journal/2018/8/22/the-more-we-gr...
The same effect scales to other services anyway. You need more cops to cover 50 square miles than 10 square miles and if the areas is low density it’s producing less $ / square mile in taxes so they can’t afford it.
Strong Towns just cherry picks data to support their preferred political narrative. I actually agree with some of their recommendations, but let's not be fooled into believing that they're doing high quality analysis.
Density + public transportation save a lot, on both counts. You may not be a fan of Manhattan, but 1/10 of its density, aka low-rises, already make proper urban infrastructure sustainable.
So much property value is tied up in this assumption we need to be close to jobs to work and it's all a lie. Many of the jobs that do require an in-person presence are only located where they're located because the assumption is the jobs need to be there to serve the workers who don't need to be there in the first place. I don't think any part of how we're making cities actually makes sense, because they're designed for the world of 2020, and not the world of 2030.
People have this mindset that's outmoded, they think about how to get the workers into offices. The thought now should be how to get goods and services to the workers.
https://www.bls.gov/emp/tables/employment-by-major-industry-...
Most jobs are not office jobs and cannot be done remotely.
But the article is talking about factories, blue-collar jobs that require actual physical presence.
I do some work with blue collar industrial clients now and again as a favour. I work remote and contract out the various things I can't do remotely to an MSP or various local installers. A factory has an accounting department, it has managers pushing paper all day (although these usually can only be hybrid remote positions), that sort of thing.
You certainly need to build a freaking road to the facility and arrange for the transport of workers but honestly congestion on these roads isn't as much as an issue as disrepair and maintenance because of the heavy trucks driving across them. Talk to anybody running anything industrial and they want to hire some white collar people to automate some stuff to either cut labor costs or expand the business, hopefully the latter, and these people are likely to work hybrid.
I guess you are right and I should give more consideration to industrial uses of transportation infrastructure which are just as relevant as ever.
Besides that, low density suburbia is a very artificial post-WW2 invention, traditional villages were dense enough.
And once again, the growth ponzi scheme strikes
We need to find a way to never be in this situation again. For example, create Special Economic Zones where by law housing construction is expected to constantly be happening, and it is impossible to prevent it by law.
If you ask people if they support a constitutional right to free speech, they'll probably say yes. If you ask them if someone should have a right to say some specific disagreeable thing, many people will say no.
Similarly with NIMBYism, people say they want houses built and support candidates who say they'll fix the housing crisis, but if you ask them about some specific planned development close to them, they say no.
I have no idea what the will of the voters actually is on this issue. Everyone agrees there's a problem, but most people are against all solutions.
Source? I think most people are going to understand that speech you disagree with is part of freedom of speech.
Is Fred Phelps holding a sign saying "Fags die, God laughs" at a military funeral protected speech? It was non-obvious enough that it went to the Supreme Court, meaning a lot of people thought he had no right to say that.
Do you have the right to burn a US flag in protest? There literally were laws banning that until the Supreme Court said that's protected.
I don't think it'd be hard to find people who are still in favor of a flag burning ban, or who want to ban offensive speech near funerals.
I don't have statistics but anyone who was around for those examples knows there were plenty of people on both sides.
Density is unavoidable. But residential values can freeze or barely grow in nominal terms. That won’t cause a crisis.
Public housing built to be sold at an affordable price, not let to wards of the state, maybe with an aim at redeveloping blighted areas, is a model I’m fond of. (See Roosevelt Island.)
I think the main issue I have with it as a proposal is that the fiscal resources required to sustain such a program only exist at the federal level, and it's not ethical to embark on such an endeavor if there is no solid 60-vote bloc in the Senate and poor people are at risk of getting the rug from pulled out from under them. (See how our current housing authorities are doing to know how that plays out.)
Some USA resort towns and counties do it. They are flush with vacationer tax dollars and short labor, so local gov't builds housing mainly for workers.
The feds don't have the funds to do this, though the feds can borrow from the future apparently indefinitely.
Some USA ski towns have tens of millions banked and are using that to build.
Am interested in learning why you think USA feds can do these local housing projects. Feds run massive fiscal deficits.
https://www.rbth.com/history/333420-socialist-communal-citie...
There is more than one architype of public works projects
perhaps I take a broader definition of public works than you do.
Also, say a city or state government wants to build a low-cost/low-income housing (or take historical examples if you will), the type of undesirable stuff the parent was talking about. Who do you think actually does the building work? Is it government employees, or is it sub'ed out to private builders and contractors?
And if it is government workers, can you please explain why say the Army Corps of Engineers would be better or worse at building a bridge than say a private contractor? Which of the two is more incentivized to cut corners and do things on the cheap wherever possible?
You're taking an incorrect definition of "public works". Words have meaning: "Public works are a broad category of infrastructure projects, financed and constructed by the government, for recreational, employment, and health and safety uses in the greater community."
Suburbia was not constructed by the government, and is not for recreational, employment, and health and safety uses in the greater community. It is for the use of a private owner.
Suburbia is by definition not a public works. QED.
>Who do you think actually does the building work? Is it government employees, or is it sub'ed out to private builders and contractors?
Many times it's a mix of both. Cities and states employ thousands of plumbers, electricians, etc. Nonetheless, if you get a house constructed by WestCoastHomeBuildersLLC, but they subcontract a large percent of the actual construction out to subcontractors, you'd still say your house was built by WestCoastHomeBuildersLLC. That's who you'd go to for warranty issues, for construction progress, etc. Same applies for the government and public works.
>And if it is government workers, can you please explain why say the Army Corps of Engineers would be better or worse at building a bridge than say a private contractor?
For the same reasons private industry is better at building practically... everything.
>Which of the two is more incentivized to cut corners and do things on the cheap wherever possible?
Government for sure because they can save money and face zero liability issues down the line. Insanely impossible to be fired so you can be lazy and cut corners all day and you'll still keep your job, and they projects are constantly cutting corners to save on materials. Then after you poison (Camp Lejeun) thousands of people you just shrugg because no one goes to jail.
We also need laws against large scale speculative home purchases. An individual having a vacation home/rental unit or two is one thing, but home flippers and large scale property rental corps are a big problem.
If housing prices are rising in the area then generally (not always) there's more demand for housing than supply. Increased density generally leads to increased economic activity (more housing = more residents = more commercial activity = higher tax revenue.) Viewing the housing market in isolation is a mistake.
> But if all you're doing is making housing more financially affordable, you're going to have to deal with the fact that Peter's financial savings is Paul's lost rent-seeking, and Paul is generally a pensioner that votes.
Yes and that's the problem. Veto powers in most residential politics tend to be strong and so Paul's veto generally overrides Paul's demand.
Sure, as long as you believe you must never change the laws around housing. In that case, you can stop the whole conversation there.
On the other hand if you wanted to actually do something you could pass a federal law or constitutional amendment giving individuals the right to posses no more than one home without undue restriction. For example, construction codes simply get more and more strict across the nation each year. For the simple reason that the industry lobbies for it, as it increases their opportunity for profit. There's no actual need for this as it isn't like humanity hasn't been building homes for thousands of years.
Total non-worker consumption is equal to the unconsumed portion of total worker production, the worker-to-retiree ratio is getting worse each year, and total productivity gains are stalling. Working-age adults have to get squeezed somehow on pain of retirees voting different policies, and housing/rent/mortgage is the least flexible in terms of household budget and least politically obvious pathway for it.
Next to that, the maximum price is largely defined by how much people can and are willing to borrow with a typical income for the location and the type of building.
And with location being in short supply, locations (and houses) go for maximum price. With rent going up, maximum price will come down, to keep total price the same.
This is the main factor, and it's a result of the monetary policy of the last decades.
Since this number has been increasing compared to wages, it's becoming less sensible to build apartments for rental. But at the same time, those are needed to increase density and availability of affordable housing in attractive cities.
It's a mess.
To get low house prices we would have to destroy Fintech of house loans which will not happen.
It is staggering. California in 1990 was 29 million. In 2020, it's 39 million. If this is not staggering, I don't know what is.
> The EU-27’s population is projected to increase from 446.8 million in 2019 and peak to 449.3 million in 2026
The situation in China is apparently similar[1]:
> China’s population will peak in 2022 due to negative natural growth
[0] https://ec.europa.eu/eurostat/statistics-explained/index.php...
[1] https://www.ft.com/content/28a1f975-8374-4b87-b2ba-2e60ddf20...
This was popularized by 70s books like Cities as Growth Engines and The Population Bomb, which IIRC also caused China to ruin their demographics by introducing the one-child program. It was recently parodied in movies by that Thanos guy. It is not your new idea that everyone else is ignoring.
Literally you just have to build more housing. It's fine to say this.
The basic idea is to tax not the house, but the underlying land value.
Sweden does this through various policies. The main outcome is that finding a rental apartment is virtually impossible.
i don't think it'd actually be that unpopular IF it comes with decent public transport + walkability + mixed use and such, like in europe.
I HIGHLY doubt it is possible to do in the near term in the US.
I work daily with people from Boston. I think downtown is not that different in terms of willingness to have similar lifestyle.
I think many don’t know how good density living means and it would be totally doable also in the US, not overnight. I guess there is still a big of a perception: Without your big house and garden your are nothing/« you didn’t make it » . Once this is gone I guess it could go fast.
European cities also aren't that dense, generally speaking. Building high is an exception and only pushed recently, in places with infrastructure already present.
Buildings 5 stories high get similar or higher density than anything but the most extreme high rise neighbourhoods and are a better place to live. Easily get to 15k per km2 without highrises.
In many major European cities, a place like that will cost a lot more than nice house in the suburbs. In fact we ended up moving to a house in the suburbs in large part because because we could not afford an apartment like that.
A new City for the Wealthy, with modern infrastructure.
Another new City that is designed for Manufacturing, with new housing and infrastructure based on those needs.
From my window, I can see across the Delta Vacaresti, a wildlife reserve that was once a neighborhood that Ceausescu just had time to raze to the ground for some new insane scheme before his people shot him. Across the way, I see three massive multistory residential blocks going up, crowded together like pedestrians on a metro train at rush hour - only one side of the front-most block has any view of the Delta, while the others literally live in each other's shadows, lacking sunlight.
By contrast, communist design principles designed a whole neighborhood, with schools and hospitals and doctors, with the 'megablocks' seen as small cities in themselves that needed dedicated support systems.
Just because you see it in a sitcom doesn't mean it's true. Or to quote the guys who did the big bang theory: "We went to the apartments of real physics post grads and they were too depressing to put on television."
But that's a big problem. If housing prices go up faster than inflation, then eventually most of our costs of living will be housing. And here we are, apparently.
I think it's also a big problem that housing costs are ignored in inflation calculations. I think that has lead to the rise in housing costs in general having been ignored. And now it's become a problem.
for example, a peculiar thing has been happening in baltimore. average housing prices have been steadily going up while the population is actually shrinking. there is a glut of supply citywide, with entire blocks sitting vacant. but the competition over units in a few cool neighborhoods is enough to totally offset that.
we could provide satisfactory homes and services to everyone in america, if we made it a priority. but we will never be able to build enough supply in the most desirable neighborhoods. people just need to get over that.
USA is non-uniformly populated. The middle of the country is nowhere as dense as the coasts. Our goal as a society should be better land use across the whole country. That would require incentives on the government level.
You do realize that the government created the inflation problem, right? The high amounts of stimulus spending plus years of deficit spending created this situation.
The day before the invasion we were looking at 6% inflation with everyone expecting it to get worse.
It appears that no sensible politician is willing to admit the problem let alone propose comprehensive solutions.
No government has ever managed to repeal the Law of Supply & Demand. Because it's The Law. Communist countries never succeeded at that, either.
A couple of obvious examples of failure are rent control and anti-gouging laws.
In this case, I suspect your facts overlook the fact that population growth is not even across a country. Population growth has grown a lot in places that are more attractive to live in, and declined in areas that are less attractive. For example, in Spain, I read about many abandoned villages going for a song because the population moved to the big city.
In the US, population declined in Detroit and rural areas, and grew in the cities. Housing prices followed those trends.
Let's say they go from < 1% to > 10%?
If we're unlucky, the interest rates are not allowed to increase for fear of falling house prices.
And when interest rates go back up, it gets even harder to finance construction.
The cheap mortgages distorts the price signals, making the market less efficient.
Why? What's driving this? Was it the historically low interest rates, which have now just rocketed in Australia back up to > 5% ?
Who will fuel the next property boom to pay for it? Feels almost like some apex has been reached and it's going down from here.
Especially as like others have said, it doesn't seem like the developed world is growing rapidly enough to sustain the demand. Immigration might help fuel more demand, but then pressure is taken away from real estate elsewhere, which would incentivize people to stay put, besides, it's not like immigrants often land in the developed world with 2 million dollars to spend on a shack in a remote location.
It's fascinating to say the least. Interesting times ahead for property speculators and I guess, everyone...
All these things do is force rents higher.
https://www.seattle.gov/housing/renters/know-the-law#renters...
The feds can step out of real estate manipulation by removing the mortgage interest deduction.
That one tax deduction doesn't matter, not when there's a shortage. It's already the most people can afford to pay.
In one place I lived, the cost of developing a plot of land for single family use was almost $70k, and that was not an expensive state like California.
And then mortgage rate hikes have to be considered. Buyers are walking away from contracts and homes being built because rate hikes made the homes unaffordable.
Less government is the solution, not more.
Investors buy a quarter of all stock and have an incentive to lobby for keeping supply low.
The solution is more government regulation reducing the number of units big investors can own, building small public housing units throughout their cities (not big projects), and making investing in property less appealing for big players via rent control, landlord tenant laws, zoning up, etc.
They also centralize poverty, which has effects on the local area. The workers in those buildings need to travel all over for their work.
Small, two to four story apartment buildings can largely be managed by handymen. They can be distributed throughout a city, placing them in communities that can support them. The people who live there can work in their local communities.
Beyond that, their initial capital costs are lower, and it's easier to find land that is zoned for 4 story buildings than 40 story buildings.
> Isn't Amazon cheaper than your local electronics store?
Cheaper? Maybe. Better? Absolutely not. Amazon might save me a couple bucks, but the hassle and time dealing with quality control issues, poorly managed inventory, lack of local experience, etc makes the dollars I save disappear I into increased headaches.
The thought of renting a home from Amazon vs the local bookstore is nightmarish to me.
Even if every regulation was struck from the books tomorrow, housing supply doesn't have anywhere close to the same flexibility. It's limited by the availability of undeveloped (or redevelopable) land, and just as importantly, by the location of that land. You can't just create more land next to the metropolis of your preference. There are practical and physical limits.
The above comment saying corporate investors lobby for reducing supply isn't true though. It's individual old NIMBYs and small time developers who lobby for that. Big companies like BlackRock are passively investing because it's so easy when the local government already wants to help them by restricting supply, but they don't individually show up to city council meetings and lobby for this stuff.
You really can defeat them by showing up. No California YIMBY policy has lost someone an election yet.
(Or they could stay in place - California requires this to be possible through "right of return" laws.)
Many types of housing are simply not feasible to build and operate except by large investors (e.g large apartment buildings), and banning entire categories of in-demand housing artificially restricts supply and drives prices up.
Imagine if we banned CPUs built by large corporations. Do you think that would make CPUs cheaper or cause massive shortages and drive prices up?
New housing is expensive because of safety regulations, environmental regulations, and zoning restrictions. Those categories are listed in increasing order of negotiability: some zoning makes obvious sense (e.g. separating industrial areas from housing), but housing density mandates seem less defensible to me; meanwhile, I don't particularly feel like relaxing safety unless something can be demonstrated as clearly irrelevant due to age, or requiring gross overbuilding. I invite someone more fluent in the subject matter to enlighten us with the relative impact of each factor.
The problem is that a house is seen as in investment vehicle. Buy a house, its value will always grow, they said. So people who bought houses expect their values to grow, and loathe their values to go down even a little bit.
Now the value (aka cost) of a house has grown so much that it's unaffordable for large swaths of regular working population, even well-paid. Cheaper housing is badly needed.
But cheaper housing also means that "value" of existing houses will go down! Either from being next to a cheaper house, or from a general downturn on the housing market (aka housing becoming more affordable). Every house owner will hate that! And these house owners are voters.
Now life savings of an old lady from the working class depend on a young family from the working class being unable to afford a similar (or any) house. We're in a pretty bad situation here :(
Well, problems with electricity, water, and wildfires destroying towns? Transportation problems and a housing crisis? Never mind, Silicon Valley and Hollywood will fill the state coffers all right!
Tides turn slowly, but they are turning; I'm afraid Californian voters are heading towards a series of rude awakenings.
>Why is there a carcinogen warning on the rental car?
>Am I the only one bothered that an in-laws car was broken into in his own driveway in a residential zone in the middle of the day?
>Does nobody else see there’s a guy shooting a deuce on a bus stop?
>Did I really just spend 15 minutes in line for 6oz of soft serve ice cream?
>The first thing you discuss with your middle school class is pronouns? Not, like, here are the fire escapes? Or maybe, this is what we’re going to study?
>Why do all these 40-somethings dress like teenagers?
>Well, I guess no outdoor wedding photos… too much smoke… everything a few miles away is on fire.
>I guess there are just tents at basically every intersection. Huh.
>You’re paying 3K a month to live in a 60s era cracker box? Bummer. My mortgage is less than a third of that for twice the house and five times the land.
Permanent residents seem to have this defense mechanism where they just act like it isn’t happening. I’m pretty happy with flyover county. Given how easy remote work is now, I really don’t get why so many stay. Other than programming from the paid mouths in (info/e)ntertainment beating the drum of urbanization and ‘oh it’s just the zoning’
None of your points ring true at all for a 42 year old born and raised here.
I hate the housing costs as much as anyone.
I've been offroading and riding dirt bikes for 20+ years. Without a doubt, fire roads in the mountains are falling into disrepair. When they do clear them, they do so so lazily that it for sure will alter their response time if they ever need to use them. And that's just one tiny example.
I think OPs list was pretty accurate, just a little exaggerated but I think you know what he means.
That's not an alternative to the problem of bad regulation, it's the reason for the bad regulation. "Seen as an investment vehicle" doesn't mean "the corporations" are hoarding them, it means every old person is counting the house in their net worth, and the government tries to prop them up while at the same time providing affordable housing for the poor. This causes the "missing middle" effect, where there isn't anything in between for those of us who could theoretically buy something unsubsidized.
Stand alone, with no gun to its head, capitalism auto decays into the neo-feudalism of the guilded age. And alot of the gullible citizenry supported this return to nothing.
Additionally, the standing of unions went down over time, as a combination of legitimate unions-gone-rogue scandals, anti-union legislation being enacted and union-protection enforcement being reduced.
The result was that the capitalist owner and leadership class enjoyed absurd amounts of net worth gains, and the worker class was left unemployed or with stagnating wages at best. To prove that: CEO payments exploded 940% since 1978, S&P went up 707%, while average worker pay went up only 12% [1] in the same time frame.
Workers are not greedy for simply needing enough money to rent or own a home! In the same time frame, average US-wide rent has gone up from ~200$ to 1100$ [1] - that's a 450% increase. In "hot" areas such as SF, the development has been even worse [2]. On top of that, other necessities of life such as groceries have also continuously gotten more and more expensive [3], not to mention more expensive to obtain as neighborhood grocery stores closed down in favor of large malls.
We're talking about bare survival here. The costs of living have exploded for decades, while wages have been stagnant. People couldn't set aside money as a result, and now we have over half the US population unable to cover a 1000$ emergency without going into (even more) debt [4]. Wanting more money is not greed in these conditions.
[1] https://ipropertymanagement.com/research/average-rent-by-yea...
[2] https://medium.com/@mccannatron/1979-to-2015-average-rent-in...
[3] https://www.usinflationcalculator.com/inflation/average-pric...
[4] https://www.cnbc.com/2022/01/19/56percent-of-americans-cant-...
Try reading with your eyes, not your ideology.
This is why when economists say wages are linked to productivity it is true, but only in the same way my cars theoretical top speed limited to the speed of light...
Additionally, widespread and unchecked propaganda has brainwashed the public into believing that unions are bad and that the most evil word you can say in public is "socialism".
As productivity has increased, so has availability of credit. Servicing debt is soaking up our increased productivity. I don't think it's just a coincidence that the FIRE sector has grown so spectacularly.
We should always remember: If a company could, they would have free labour. Expert professional volunteers. That's how a company can maximize their profits. So every single year, every company is, unless forced by laws, wage competition (from other companies) or by force (unions), behind rationalizations, pushing for, unconsciously, getting close to that ideal of free labor.
Also remember that today, free labour has a limit. They can't really pay zero, because people have mortgages, etc. So actually, the modern "zero" is when the workers have zero profit, ie, savings, or even go into constant debt, and have the government pay for it with subsidies.
And this is exactly what we've been seeing the last decades.
I wouldn't assume the issue wouldn't be resolved better by the local/state/federal government stepping out of this area more.
1. There is a problem. 2. Government steps in to fix problem. 3. Government creates two new problems by fixing the first one. 4. Repeat x 2
It's not that the factories are being cheap (at least not in all cases), but the gov has to step in and bring real estate price under control, this is often the biggest economic gap that hurts our generation.