At the moment, political and regulatory barriers dwarf technological ones, per Yglesias in The Rent is too Damn High: http://www.amazon.com/dp/B0078XGJXO.
In many areas, building with century-old technologies like steel frames and elevators is effectively illegal. Where it isn't illegal, the approval process is often so cumbrous that it substantially raise the price of building: http://www.theatlantic.com/magazine/archive/2007/11/a-tale-o....
We as a society have chosen to make a lot of housing very expensive.
On the other side of the coin, thanks to deregulation houses are commodities that people buy, sell and trade for profit, which raises their prices and causes volatility in the market.
Is that Atlantic article really comparing the building codes of Dallas and L.A. without admitting one of those cities has to plan for earthquakes and the other doesn't? And that one of those cities is already too big while the other is looking to grow? Where's L.A. going to get the water for these cheap new housing developments?
TL;DR building codes and growth restrictions are a lot more complicated than some rich people wringing their hands and using regulations to make themselves money.
If they were the problem, then you'd have little difficulty building up Mountain View to SF level densities, or SF up to Hoboken (a suburb of NY) level densities. All you'd need to do is copy the safety features for already existing larger buildings (which currently meet safety codes) and build them everywhere.
You just said that if building codes were removed there would be "little difficulty" in doubling the density of San Francisco or tripling the population density of Mountain View? What?
Like there's no logistical issues involved of doubling or tripling the capacities of roads and utilities, figuring out where the trash is going to go, where the water's going to come from, etc. Like there's no reason a city might reasonably decide against unlimited growth.
This is so far removed from reality I don't even know where to start. At the bare minimum, if you're going to call me disingenuous at least make a case of why.
yummyfajitas pointed out that safety has nothing to do with the issue at hand.
Your follow-up post here now raises a bunch of reasonable issues, but none of them are safety-related.
http://m.sfgate.com/homeandgarden/article/What-San-Francisco... goes into what happens to building codes after e.g. an earthquake. TL;DR not much, and I'm sure SF will get absolutely wrecked in the next "big one", people will die because stuff is old and not up to code, there will be public outcry for safer buildings, developers will lobby against it and basically do anything they can to continue to slap apartments up as cheaply as possible while charging $3000/mo for a 500sqft studio, and they'll build even-more-expensive yet not much safer buildings in the ruins. Then repeat.
Eh. I don't believe this is true. For example, in the Great San Francisco earthquake, something like 90% of the damage was caused by fires. Most of these fires were and are caused by unsecured water heaters, rigid gas connections, etc. There are now building codes that improve on these issues -- all water heaters are now strapped, gas connections are flexible, etc. Among other protections that I know of, shear walls are mandated in certain cases, engineering reviews are done, houses are bolted to foundations at more regular intervals, the proportion of various walls that are windows is more limited, etc.
Yes, regulations were slackened in 1906, but
1. Earthquakes between 1906 and now show that regulations DO tighten over time. If developers are trying to lobby against these, they are failing. (More likely, the property owners paying the developers are the ones who would lobby. It benefits the contractor to charge for more work.)
2. Even if we didn't have historical evidence to discount your position, the resources available to the people of that time and the people of our current time are not remotely comparable. Our capabilities for manufacturing and building are dramatically more vast.
More on the evolution of these codes, which further contradicts your view that developers have been able to prevent their strengthening: http://quake06.stanford.edu/centennial/tour/stop10.html
What ought to happen is proposition 13 ought to be repealed, along with the restrictive zoning laws. Then people who are sitting on lots of undeveloped property would have to sell it to developers, because the taxes would be unaffordable otherwise. And developers would put up new properties. Prices would then come back to earth and poor people would be able to live in houses again.
But the prevailing mentality in the US is that houses are investments, not places to live, so don't expect this to happen any time soon. Instead, you can expect politicians to intervene if housing starts to become affordable again, like they did in 2007. ("Oh no! Housing prices DECLINED!") It's basically a giant transfer of wealth from the young to the old. But people are too ignorant of economics to understand how and why it's happening, so you can expect it to continue.
If that was slowly phased out, prices would come down as more houses came on the market, and the houses that those people wouldn't represent such a huge jump in ongoing property taxes.
The people who can't move because of increased taxes would be forced to flee the state maybe?
Housing prices take into account the amount of taxes one expects to have to pay, so if they're no longer locked, and one expects prices to rise, then the price one will be willing to pay will be lower. Also, prices will fall as more supply opens up, since there won't be such a big advantage to sitting on houses anymore, and people are more free to move to less expensive areas. Currently there's a bit of a rent control situation where the low rates can be passed on to your descendants, and there's a big incentive to stay in it rather than selling it and moving farther out, even if the place farther out is half the price. This effect is more pronounced on the high demand areas where prices have risen more.
Over time, the prices would adjust and settle. People may end up paying more tax overall, but we can play with the rate, or we could decide that the schools could use more funding (in many places, they could), and that we should keep the rate where it is. As it is now, the people who are just moving to CA are heavily subsidizing people who have lived here for a long time, and the lack of liquid housing supply is causing prices to shoot up.
In Michigan, it's a bit more complex. The assessor calculates a State Equalized Value (SEV) on which the tax is based, and that cannot rise faster than the rate of inflation, or 5%, whichever is less. I assume lots of states have odd property tax quirks.
It's funny that people accept taxes of up to 40% on wages (things the middle class earns), but can't understand how taxing vast landed estates (things the rich owns) would "help." Suggest thinking this through more clearly.
That's a nice theory, but it's wrong. The city is requiring buildings to get retrofitted with earthquake safe structural foundations. It's every building with greater than a few units, so the rather small 100+ year old Victorian I'm in will be required to go undergo retrofitting by 2017.
There were 1,987 unreinforced masonry buildings in SF in 1990, and all but 158 were fixed by 2013. That's why, all over SF, you see diagonal steel beams inside brick buildings, sometimes across windows. There are now supposedly only 29 unreinforced brick buildings left, mostly ones that are abandoned or scheduled for demolition. A few are still occupied, including some non-patient buildings at SF General Hospital.
In a really big quake, many buildings will be damaged, but structural collapse in SF should be rare. The occupants get to survive.
P.S. Thanks for all the good work you did at Reddit.
Re: reddit, pshaw, I was only there two and a half years. :) Most of the hard work was done before I showed up and after I left.
Even if we assume zero retrofitting of old homes, what about the future residents of currently-new homes which persist for another 50 years?
How tied is this to the business model of banks?
I think part of it is credit (money) creation out of thin air, and it has to go somewhere. Another part is the massive productivity gains of past decades, that also has to go somewhere, and it isn't going into rising prices of consumer goods for the most part.
To me, it seems logical that the ratio between median housing prices and median wages has to be rather constant over time, and if it isn't, there should be a measurable offset somewhere else, especially when the housing is by far the largest purchase 90%+ of people will ever make - yet, I see no proportional offset (of decreased spending) elsewhere.
They can't sell at a loss because all mortgages given were put in books at the 100% repayment price and now they need to wait not only for the house to recover the price lost since the crisis but also to raise in value to match the expected mortgage gain written in books, to avoid negative impact on their ratings
They can claim it as long as they can defend it, and historically that defense has been by force. It should make you feel better that (by and large) we don't need to kill each other in order to reserve a spot to sleep.
What I was getting at are the houses that are bought and the mortgage goes into a CMO[0] or a CDO[1] because the new owner really had no business buying a house in the first place but they're "getting into real-estate" and the bank found a way to get paid for writing really questionable loans. Why are people without money even in the real estate market? (See the 2008 financial collapse for more details.)
And that's just the worst of it, there's still the more legitimate case where people move their wealth into real estate because it's a good medium-term investment. I can't fault anybody for that, but I do believe it raises prices for everybody.
[0] - http://en.wikipedia.org/wiki/Collateralized_mortgage_obligat... [1] - http://en.wikipedia.org/wiki/Collateralized_debt_obligation
* a house in the boonies isn't really a substitute for a house in the city. Every house has demand from people who want to buy it as a home plus the demand of people who want to buy it to rent/flip/scrape it.
If an analysis depends on houses being able to fluidly change land positions I don't think it would be very useful.
Regional considerations for things like earthquake proofing, density planning, etc. can be built into a single overarching engineering standard, just like considerations for different company shapes with different needs are built into a single larger tax code. There's nothing having many different local algorithms can optimize, that wouldn't be even more optimal as many different local parameter values to a single parameterized algorithm.
"Built to code" is the worst legally allowed construction. The equivalent in programming terms is "It compiles".
http://journalistsresource.org/studies/politics/citizen-acti...
That said, people are also living in much larger houses with more amenity's like AC, and dishwashers.
PS: There is a completely reasonable argument that building a new house or apartment complex should pay their fair share of existing infrastructure ~10k-50+k/person in most areas. That this does not happen is simply a form of corruption as zoning becomes a quick way to massively change the value of land after purchase.
No, "what you are paying for" is the artificial scarcity created by restrictive zoning codes and NIMBYs. If the city council let me build on one of the many open fields around I-280 tomorrow, I could get it constructed for a pittance-- and then turn around and sell for hundreds of thousands of dollars.
PS: There is a completely reasonable argument that building a new house or apartment complex should pay their fair share of existing infrastructure ~10k-50+k/person in most areas. That this does not happen is simply a form of corruption as zoning becomes a quick way to massively change the value of land after purchase.
Do you understand how "the existing infrastructure" is funded? It's funded by taxes. And developers pay taxes like anyone else. What they do isn't cheap.
We know it is the correct answer because it identifies how farmland sold by the acre can turn into residential land sold by the 1/4 acre. All because the zoning (and/or approved buildings) changes on that same land, the value changes substantially.
Anything that has such a dramatic change in value is subject to some kind of scarcity, like the difference between a real cezanne and a very good copy.
I believe some cities in Texas have relaxed zoning, and the housing prices are much more reasonable as a result.
Cities like San Francisco and New York are also subject to physical scarcity because of water and topographical features, but it is artificial scarcity that drives prices up.
How do you undo it? I don't think that is possible, simply because there is too much vested interest. Existing owners and banks must keep the status quo or the 2008 problems would look like a picnic. Maybe with some gradual relaxation over time the eventual market structure could be changed. It's doubtful.
I would. Working around a couple centuries of existing infrastructure, dealing with the issues regarding vastly limited space, and of course having to stay compliant with California's ever-changing and ever-more-expensive environmental regulations -- pfft, 10x easily.
Systems get more expensive as they get more complex. Car repair is a salient example.
Nor are SF's roads and bridges really all that complex. Pittsburgh, Pennsylvania, has 446 bridges, and is one of the cheapest cities to live in in the United States. Maintaining two big bridges just isn't that complex, certainly not enough to explain a 10x factor in the cost of living. Sure, SF has a high minimum wage for construction employees, but so does California in general. And somehow it is not that expensive to live in Fresno or Sacramento.
If anything, rural and suburban areas tend to have to maintain more infrastructure per taxpayer, since people are more spread out.
Of course, compared to Silicon Valley, even the suburbs of Tokyo are indeed densely packed -- but then, Tokyo also crams in something on the order of 7x more people into the same area.
1: The price of a plot of land with a house on it 2: The price of an equivalent plot with no house but the right to build a house there. 3: The price of an equivalent plot with not right to build.
In places like SF where housing is expensive 1 and 2 cost within 10% of each other. In places where housing is cheap 2 is closer to 3.
That's what property taxes are, to the tune of ~$500 billion per year in the US! The market price of a dwelling is inversely proportional to the tax rate, so it IS priced into the sale.
Now, inflation on the other hand, they now have a vested interest in, as it makes the loan easier to repay.
This all goes out the window if you're buying a new house every 3 years, of course.
But really in the Boston area it seems like a bigger force (talking with some co-workers) is not wanting poor people to move into their school districts for various reasons. If it were just prices there'd be a contingent who would want to be able to sell their plots to developers for even more than they could resell it for as is.
In practice building with steel and elevators is more expensive than using traditional American methods involving stick framing and low rise construction. The more expensive methods only make sense when demand is high enough to justify the additional costs.
A primary constraint on development density in the US is parking. By the time resources are committed to accommodating residents' vehicles, only higher housing prices associated with 'luxury' class housing make development of a site with dense housing feasible. Again, it's a market dealing with the parking regulations. Parking regulations reflect the body politic's interest in protecting the commons that is our roadways.
There's cheap housing in Detroit. There isn't in Mountain View. That's just the nature of markets.
The price you pay for rent is the price to keep everyone else off of that land for some period of time (or 1000x that to gain the right to 'own').
The idea is that if you can't afford the cost, you should give up that space to someone who can (presumably is making more money).
Resource scarcity is a "hard" problem, and the hard truth is that because something aren't unlimited, not everyone can get what they want.
There may come a day where we can't feed everyone.
Thinking back 20 or 30 years ago, there simply used to be many more kinds of things that people would buy. As a child I had a toy closet full of games and toys of infinite variety. My friend's kids all seem pretty happy with a tablet and maybe some legos and that's about it.
Maybe they are just spoiled...
Teenagers Favor Tech Over Clothes
http://www.nytimes.com/2014/08/28/business/less-prep-more-pl...
Tl;dr teens buy less clothes, prefer tech, and restaurants. Why restaurants ? because of the wifi.
First, I'm currently in the process of remodeling my basement. And, it's quite expensive. What I'm spending on remodeling 1500 square feet is approximately the cost of 5 inexpensive cars. Although some of these costs have come from the building supplies, most of the costs have come from labor. Labor in expensive areas is more expensive.
But, then the cost of land is expensive. There are network effects. Upper-middle income people want to live around people like them. Educated people want to live around other educated people. Educated people want to live in nice climates, in places where they can go out into nature, where they can have ready access to nice shops, art galleries, clean cafes, etc. There are not enough of these types of areas to meet the demand.
Alternatively, one can buy an old house in a rust belt city for $25,000. People don't want to move there. It's cold, the people are less educated, there aren't fancy shops around, no good coffee, no hiking, no pleasant strolls around the neighborhood. There are fewer high-paying jobs.
In a rust belt city, you can build a brand new house for less than $90 a sq-ft. Sure, it won't have the nicest fixtures, but you can.
In rural areas, outside of the rust belt, you can buy an acre of land for $1000. You can build a nice place for under $100,000. But, do educated, upper-middle income people want to live there?
Some possible solutions: 1) reduce the costs of building. Services should pop up that import labor from less expensive areas. The rise of more modular housing, 3D printing of houses, etc. should lessen the costs. 2) create more areas where upper-middle income, educated people want to live. This is harder, because there needs to be jobs, first. It's a chicken/egg problem. How do you get employers to set up shop where there aren't any educated workers?
Even imagining that 3D printing techniques can significantly cut down the cost of new construction (as is starting to happen in China), land scarcity will be the overriding factor. Save building cities on the ocean, we can't escape it.
It strikes me that by combining building high-rise blocks with expanding out into the countryside we could manage it.
The planning situation in the UK (which is a particularly dense country) seems utterly despicable to me at present. The game being played is essentially 'haves' bemoaning the loss of small amounts of countryside while 'have nots' are stuck paying dramatic portions of their income to the former group.
Add to that the long arm of the law (buy a field and stick a trailer on it? expect a visit) and it's almost dystopian.
(please read my comments if you're interested more on the UK situation - others have shown me that in the US rural land is actually affordable, if you have savings)
Excepting the odd toy village project, those areas will never be built on.
And London's so-called property boom is almost entirely a foreign phenomenon, with the world's 1% pushing up prices as part of a speculative bubble.
None of this is accidental. The UK could easily lower prices by building affordable social housing. Even in London, housing densities are lower than they are in many cities in Europe.
But it's far more profitable to ration property ownership, and to create a new landlord class.
As is often the case the underlying problem is political, and caused by concentrations of power that - history suggests - can't be sustained indefinitely.
The idea that people can just 'move a bit further out' is flawed here; we're not the US, running a car is far more expensive, for one.
We might be short on land the majority views as attractive enough to actually live on. Rural Wyoming is by no means short of land, but it's dry, desolate, windblown, and hundreds of miles from any regions with, say, hospitals, or airports, or actual grocery stores, or land that can grow something other than grass, or other frivolities of modern living. The fact that land is divided up into huge ranches is, therefore, not a huge loss for people looking for a little spread of their own; the only way the land could possibly be economically productive is in those huge ranches. A lot of it's owned by the Federal government, as well.
So it's trivially supply-and-demand, and the fact is the US, at least, has a huge supply of land for which there is essentially no demand. It's been allocated about as efficiently as it's going to be. Canada has a similar situation. Does that mean we're not short on land? Technically, perhaps not, but realistically, if the land is effectively unlivable, it might as well not exist for our purposes.
On the gripping hand everyone has a different definition of 'livable', even to the point of some people being willing to live in rehabbed ICBM silos in the wilds of North Dakota.
Pretty far fetched, but if Elon Musk wants to build The City of Tomorrow, sign me up.
EDIT: stegosaurus, for some silly reason HN hides the reply link for the first few minutes after a post is made, but if you click the direct link to my post, you can reply anyway.
California isn't popular because of burgeoning art scenes, cheap rent, low cost of living, and good public transportation. In fact it has none of those things (Well, maybe some art scene). California is popular because girls can wear miniskirts and tanktops in the middle of February.
I don't think they can. China tried: http://www.marketplace.org/topics/world/marketplace-25/china...
I agree with the solution of constructing additional cities to an extent, though I can't speak too much about the US (British here).
What bugs me is seeing endless expanses of land within reasonable commuting distance of places like London that just aren't being used. There really is no need for people to have to move hundreds and hundreds of miles from their families.
I'm not even concerned that much about employment here, because a cheap home on cheap land would free people to work far less and/or simply retire after a few years in the Big City.
So, sort of like Southern California before the boom, then. :-) Except that there are areas in SoCal that couldn't even grow grass. If I recall correctly, several of the early Spanish colonies starved to death.
If you could convince people to move there, the grocery stores and hospitals would soon follow.
I don't like saying things like this, but unless you've experienced a zero-visibility blizzard which went on for hours on end, you don't know what rural Wyoming is like.
I'm from Alaska, by the way.
> I'm from Alaska, by the way.
Coastal or inland? North shore?
I'd still need a job to pay my property taxes, but wouldn't have to bust my ass as much.
But this isn't an utterly imaginably spectacular device. It's merely a run of the mill consumer-grade portable computer according to modern standards.
Your rent would be insignificant compared to, for example, the cost of a truly spectacular computer by modern standards, such as a modern search engine cluster with a price tag of perhaps a half billion dollars not counting ongoing opex.
Only if you want to live where everybody else wants to live. I mean if I really wanted to I could sell my small flat in town and buy a nice enough house for less than 20% of what I got for my flat. The only problem is that the house would be in the middle of nowhere and I don't want to live in the middle of nowhere.
There is no such place where everyone wants to live. SF is desirable to only a very small percentage of the population. Yet it has some of the highest housing costs in the world. All it takes is an imbalance of supply for the demand. If there are only two houses available in a location that 200 people are interested in, they are going to go for very high prices regardless of what the rest of the world thinks of them.
This is a big problem in some areas, where urban regions have a lack of housing despite a construction boom, while rural regions have empty houses available for 20-30% of what it would cost to build a similar house.
If I moved to a place like that, the extra cost in time and fuel in driving myself and (especially) the kids between there and a reasonable city would be much greater than what I currently spend on housing.
That makes much of the in between land non valuable.
New York City has property worth almost a trillion dollars. That would be the economic return if someone could clone the city.
But we can't clone the city. We can only build out along the edges of existing cities. Or try to build dense in the middle and complain about regulations.
Why not grow smaller cities into New Yorks? Because the core of New York was built at a time when we built differently. Cities grow differently now thanks to cars, and it's very hard to build a new old city.
So places in the middle or on the edges of old cities are expensive. There are many places you could live for very little, but who wants to live there?
I don't think you'd have to make it free - you could probably make a tidy profit off of getting services hooked up and then subdividing the land, and still providing people a better place to go.
Property taxes.
The compromise is that your house is in Burnley or Accrington with an oversupply of housing, rather than the South East, with an oversupply of purchasing power seeking to get on the property ladder.
It doesn't really help that much though, unless you're willing to live hundreds of miles from family, friends, potentially split with your partner, etcetera.
The decent spec MacBook chat is interesting if you're a well paid worker, but not really otherwise. I can't see myself ever buying a full price MacBook or a new car unless my situation changes dramatically.
It's not really even the pricing that bugs me as much as the complete lack of understanding demonstrated by the Government. Every single policy is aimed at inflating house prices to the sky seemingly indefinitely.
The cheap laptops and Android devices exist only because the population is manufacturing the devices by hustling 8 hours a day to keep a roof over their heads.
Since desirable land is a limited resource, it's' price will simply rise with people's ability to pay for it.
A ten-by-ten one-roomed shack with a stove in the middle, no running water, no bathroom and no foundation can be had for about a few thousand dollars, and if you put it on an undesirable quarter acre in the middle of nowhere the land will cost you another thousand.
A well-built small home, a few hundred square feet with a well, a septic tank, electricity and the appropriate four or five rooms will cost you thirty to fifty thousand dollars.
The problem isn't just economics or regulations or technology; it's also one of standards and social status. I'm willing to wager that far more people buy a big expensive house because either they want the extra features -- air conditioning, plumbing, and enough bedrooms and bathrooms to qualify as a small mansion -- or because they want to impress their friends, family and neighbors, than do because the market doesn't make small, cheap houses available.
I think the issue is really that the places you want to live are also the places lots of other people want to live--not that the absolute floor on housing costs has risen so far.
In ancient history the people who lived 10 to a house also rarely owned the house or land where they lived. Either they lived in a society with little organized sense of individual property rights (really ancient history), or they were sharecropper tenants on some lord's land. Not so different from young people in a popular metro area today, except that back then there was almost no possibility of ever changing their lot in life.
You really don't need to hustle 8 hours a day to own a house. You need to pick one and live in it for 60 years or whatever and then give it to your kids and then they give it to theirs, etc.
It doesn't jive with modern western culture, but if the first things you did after high school wasn't to pile on x-million of consumption for college, housing, wedding/honeymoon, a whole new set of 'stuff', etc. then there would be little need to work at all.
Your point is taken, but you might want to choose a different example neighborhood.
Even more importantly, mortgage holders and other large institutions have a vested interested in raising property values and will guarantee that polices drive that.
Obviously housing prices can't outpace wages forever so one generation, probably the current one, is going to be screwed with houses that can't raise enough in value and yet have no real retirement security.
At that point, you're looking at long term house price declines which only stop when buying becomes cheaper than renting.
The next 30 years are not going to look like the previous 30 in the west. However, consumer goods will keep getting cheaper.
I disagree with the term "politics" here, because rent-seeking behavior is much broader and can involve other tactics.
If somehow there were a legal mechanism where people on a block could collectively say "No, these people aren't allowed to move in. Go away." Then housing would be way, way cheaper. Nobody would have nearly so strong an interest in driving up prices with artificial scarcity.
Except for the people who own the houses and want to see them appreciate.
I do not necessarily subscribe to that notion myself. My phone is a Samsung Fascinate that was purchased in 2010 and runs Froyo. I have no tendency toward latest and greatest however I do not dictate the market either.
You make an interesting point on housing.
Making consumer goods bombproof when they will be comically obsolete in a decade or two seems like a waste of time, money, and resources.
I'd rather have the opposite, to be honest. Houses are affordable because there are mortgages; most people need lots of hardware in their life and only one house.
Property cannot be instantiated. It is only bought, sold, taken or discovered and there's no more left to discover.
Sure; move to Wyoming. San Francisco Bay Area and NYC do not reflect reality in the rest of the country, let alone the world.
Maybe, but it is also entirely unessential. Nobody has to sell you on the need for a roof over your head.
And while shelter is necessary for survival, most of the walls, rooms, windows, wires, etc. of a modern home are entirely unessential.
(2.63 now and 2.7 in the early 1980s. FWIW, in 1950 it was 3.37. See http://www.infoplease.com/ipa/A0884238.html and http://quickfacts.census.gov/qfd/states/00000.html .)
So something has changed to encourage people to buy larger homes for the same number of people.
In the UK something like 30% of homes are owner occupied with no mortgage. But at the bottom, millions are completely stuck struggling to even pay the rent, never mind even think about saving any money or getting the income multiplier / job security / deposit required to start along that path.
Far more relevant is how accessible the bottom rung is, and whether that top portion (and so the average) are simply propped up by legions of modern day serfs.
In the UK in particular I'd be happy to build a wooden shack on a bit of agricultural land near to some utilities, maintain it well and stay out of others' way. Capital costs would be incredibly low.
But then there are the costs of jumping through regulatory hoops. Or simply being shut down by a judgement that your society says you have to live in a city at ten times the cost, or else.
Our version of poverty is 'death by bureaucracy'. The welfare state has created a situation in which many are simply incapable of fending for themselves - and the results when the state turns its back (google for 'UK benefit sanctions' for more information) are truly despicable.
The average residential size per capita in the UK is about 1/2 of the US. http://shrinkthatfootprint.com/how-big-is-a-house . That Independent (and other sources) go on to point out that the UK has "the smallest properties in Europe following the end of national guidelines in 1980", see http://www.independent.co.uk/news/uk/home-news/rabbithutch-b... . See also http://www.bbc.co.uk/news/uk-14916580 if you want another news source.
While you attribute UK's 77sq.m/person to the "welfare state", the Dutch and Danish welfare states have 115 and 137 sq.m/person. (UK has 255 people/sq.km, the Netherlands 409, and Denmark 128, so it's not a simple matter of density which causes the difference.)
In Sweden, where I live, there's been a huge increase in the amount of space per person. In the 1940s, it was considered spacious for two parents and three children to live in a flat with a kitchen and 2 or 3 other rooms. (See http://poseidon.goteborg.se/sv/Sok-ledigt/Bostadsomraden/San... , "Trots sitt syfte är de flesta lägenheterna tvåor eller treor, vilket räknades som en rymlig bostad för en trebarnsfamilj på den tiden.")
So I don't understand your objection. You have no counter-evidence, you bring up the UK which has the worst history in this regard, and what information I can find does not back your statement that something as broad as "the welfare state" can be the issue for the UK.
I have nothing against the welfare state - I'd rather see a citizen's income than the nonsense mash of policies we have at present, though.
It makes no sense to me that the state should subsidise rental payments to private landlords in perpetuity. We should be building homes and relaxing planning permissions.
In any case, you're derailing the conversation, and my working hypothesis is that you want to talk about your feelings rather than put any interpretable numbers behind it. What is wrong with my analysis enough that it should be considered not "very useful here", which is what you stated. What is your objection?
And while it's true that some are spend without thinking on a house, there are plenty who would prefer a smaller house.
There are certainly companies trying, depending on your definition of "mass produced". http://www.bluhomes.com/our-process
Doesn't seem much cheaper than conventional housing, but they are built inside, so your framing isn't getting rained on before the house is done.
The problem is that in the US a manufactured home is usually considered substandard, low class or otherwise undesirable.
In 'ancient history', it's fairly well known that people lived in ridiculous conditions, ten to a house and so on.
But what strikes me is that in recent years (say, the last 50 or so), housing has rocketed out of proportion around the Western world whilst other goods have become basically irrelevant.
I could buy 1,000 decent spec laptops for the price of a modest home. Or over a hundred thousand cups of Starbucks coffee. The car I have outside? Sixty of them and I could get a bargain basement flat.
Renting? A brand new Android flagship for the price of a months' rent. An utterly imaginably spectacular device.
I'd much, much rather live in a world in which a laptop was a huge expense that I could only literally afford once every few years, but to be able to afford to put a roof over my head without hustling 8 hours a day.
Will we ever get there?