Primarily by not allowing construction of new housing supply.
We will see how things go in California! Maybe the anti NIMBY dream of style sky high SRO arcologies will come true and everyone will be living in communal peace in their bleak windowless cement efficiency. My bet is prices continue to rise for as long as people move into the region and developers don’t buy into the egalitarian view of affordable housing any more than they ever have.
Japan is the one place in the world that freely allows density, and Tokyo has not seen rising prices. Note that though Japan's population is shrinking, Tokyo's is rising. Unlike North America, new housing production has kept up with population growth.
https://www.wsj.com/articles/what-housing-crisis-in-japan-ho...
https://resources.realestate.co.jp/buy/how-much-does-an-apar...
Utopia!
Thanks for pointing out that prices are rising, I may have misspoke. But the key point is that relative to other major cities Tokyo's prices are not rising anywhere near as fast. The chart from 2000 to 2019 was basically flat, and even from the lowest point maybe a ~15% rise
I expect even the current rise is dwarfed by rises in comparable cities
What way would that be?
All producers of goods and services maximize profit. That doesn't explain the unique housing sector price developments.
It is obviously incorrect to say that prices are guaranteed to rise but I don’t think that’s what anyone claims.
I think the general claim is that policies around housing tend to prop prices up by restricting supply (zoning, permitting, higher building costs due to various regulations like stricter codes or safety standards as well as stuff like parking requirements, giving old properties lower taxes) or subsidising demand (loan guarantees, buyer assistance, etc). That is, governments choose housing policies that keep prices high at cost to taxpayers instead of policies that reduce house prices, which is what is meant about governments not wanting them to fall. Also, if house prices fall and the people think the government is responsible, the government probably gets voted out.
The reason that loan assistance for people (ie not including companies) causes house prices to go up is that it means for a given house price, mortgage payments will be lower so more people will be able to afford that price. Instead people tend to pay for the most they can afford and (for a non-silly definition of afford) and so they end up paying more because they are competing for the same houses.
Zoning IMO is a red herring. Developers have no interest in driving property prices down with their marginal developments. They will develop in a way that sees prices stable or rise, which is favorable to them as property investors. People betting zoning law repeals will magically result in vast Soviet style SRO arcologies housing everyone affordably will be disappointed that the Victorian single family home torn down and redeveloped as a duplex is developed as a four story duplex with twice as much space, with each duplex roughly the same price as the original single family home. There also won’t be a massive selling of existing property because, well, NIMBYs like where they live. Ultimately we will just have less Victorians that will never be rebuilt and a handful more luxury duplexes.
But I’ve seen nothing that guarantees anyone pricing continues to rise or that their home investment will make them rich. What it does do is force savings by allocating a portion of their loan to principal growth. Even if it doesn’t grow at all or even declines, it’ll be worth a lot more later than the latte they forwent 20 years ago.
If you want guaranteed returns, buy treasuries.