Comment Rescue: On “Affordable” Housing

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81 Responses

  1. Avatar Will Truman
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    says:

    This sort of touches on why, apart from ideology, inequality is viewed so differently in different quarters. There’s a lot more “zero sum” to it in San Francisco than there is in Montana. It also goes back to my view that density exacerbates the consequences of inequality.Report

  2. Avatar Kolohe
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    says:

    We *had* a speculative bubble in residential housing. It collapsed, rather spectacularly, as everyone should remember.

    The NYT did a series of articles a few weeks ago on big money using high end real-estate holdings as a way of squirreling away assets (both the legal and ethically dubious). But I’m going call shenanigans that a *region’s* real estate market is being significantly maladjusted these days because speculators are buying too many McMansions and McPenthouses that are just sitting vacant. The builders are building occupied housing, more on that in a moment.

    I’m not at all dismissing your ‘poor’ argument. What the market has found in major metro areas is maximum profits for the 2/2 (1/1 for the priciest metros) $450-650K condo/townhouse near the city center (but in the ‘gentrifying’ neighborhoods) and similarly priced 2500-3000 sqft single family detached houses 20 or more miles from the city center. Double income households making 100K can afford this, but no one else can.

    And the (smart) Boomers are sitting in their empty nest paid off inner ring suburb homes bought in the 80s for another 20 years. The advanced Xers, much fewer in number, had the first shot at those other Boomers that would be snowbirds. Which leaves the larger generation under 30 looking at relatively slimmer pickings. Plus significantly different rules than those that existed in 1969. (‘libertarian reluctantly calls the fire department and is glad lead paint isn’t allowed anymore’).Report

    • Avatar j r in reply to Kolohe
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      says:

      I think that @kolohe has it right here. It’s not that people have gotten individually poorer. If anything it’s the opposite and lots of people have gotten richer (while others have stagnated).

      The problem with housing is that the market may be optimized for dual-income families, while people are forming families later and, outside of the relatively wealthy, less frequently. So you’ve got a lot of single income folks trying to compete with dual-income households or dual-income households with kids competing with dual income households with no kids.

      The effect is that lots of people end up feeling that suitable housing is just outside of their reach.Report

      • Avatar aaron david in reply to j r
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        says:

        It doesn’t help to reduce the amount of housing available:http://blog.sfgate.com/ontheblock/2011/03/30/why-so-many-vacant-homes-in-san-francisco/
        One in twelve in SF…Report

      • Avatar Saul Degraw in reply to j r
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        says:

        That article is three years old but it is a bit right. Tenants in Common are a horrible idea but there seems to be a moratorium on converting TICs to Condos because renters are afraid about what that will do to their units.Report

      • Avatar LeeEsq in reply to j r
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        says:

        A lot of houses are vacant because banks are buying them as assets and just sitting on them until they could find an appropriate buyer or renter from their point of view. Banks don’t have the incentives to sell or rent as quickly as possible as an ordinary seller or landlord might have.Report

      • Avatar DavidTC in reply to j r
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        says:

        @j-r
        I think that @Kolohe has it right here. It’s not that people have gotten individually poorer. If anything it’s the opposite and lots of people have gotten richer (while others have stagnated).

        It depends on how you look at it. More money chasing things results in inflation. Which is sorta a useful way to look at what happened to the housing market. I’m not saying it’s exactly the same as actual inflation, but it’s pretty close.

        If there was an increase in the price of a basic necessity, but people’s wages stagnated…then people technically *did* get poorer, relative to purchasing power.

        Of course, for a decade or two, we didn’t bother to notice this, because everyone could still get houses, even people who couldn’t afford them. This…uh…was a stupid plan.

        @leeesq
        A lot of houses are vacant because banks are buying them as assets and just sitting on them until they could find an appropriate buyer or renter from their point of view. Banks don’t have the incentives to sell or rent as quickly as possible as an ordinary seller or landlord might have.

        You will not find a better example of the decadence of the rich than their treatment of housing, and their utter uncaring about how they are *casually* hoarding things that people desperately need.

        It’s essentially the third millennium’s version of ‘lighting cigars with hundred dollars bills’.Report

      • Avatar j r in reply to j r
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        says:

        @davidtc

        It depends on how you look at it. More money chasing things results in inflation. Which is sorta a useful way to look at what happened to the housing market. I’m not saying it’s exactly the same as actual inflation, but it’s pretty close.

        This is not quite right. I think that you are trying to say is that more money in the hands of some people increases their willingness to pay, which shifts the demand curve for that market. And that in turn changes the supply curve. This is true for any given market, but what we have to remember is that there is not one big housing market. Rather, there are a number of discrete housing markets, which affect each other, but which do not share the same supply and demand conditions.

        Take for example, the building just constructed in NY at 157 w. 57th st, along what has come to be not so affectionately known as Billionaire’s Row. Buildings like this reflect the rising demand for units at the high end of the New York real estate market and increase the price that people who want to live in that neighborhood have to pay. It does not, however, directly affect the market for middle and low-cost housing units, because those units where never going to be built in that neighborhood anyway. Going from a millionaire’s row to a billionaire’s row doesn’t price out the middle class and the poor, because they were already priced out long ago.Report

      • Avatar DavidTC in reply to j r
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        says:

        @j-r
        This is not quite right.

        It’s not really inflation, like I said. In fact, if it was inflation, it’d be better…wages would have gone up to match.

        I think that you are trying to say is that more money in the hands of some people increases their willingness to pay, which shifts the demand curve for that market. And that in turn changes the supply curve.

        …and if you change the phrase ‘some people’ into ‘people’ and ‘that market’ into ‘all markets’, you’ve just described what causes inflation.

        What stops it from being actual inflation is that it’s limited to just a few groups of people.

        Sadly, those group of people *have the same construction industry* as the rest of us. So, of course, the construction industry wanders off over there and stops doing things for the rest of us.

        Thinking about how the concentration of money is interacting with inflation is rather interesting, in fact. So much money ending up in the hands of the super-rich is actually taking it *out* of the market (Because no one can actually spend that much money), slowing normal inflation. But all that money in their hands is causing the prices of the thing the rich do buy, as luxuries, to go up. (Which is normally fine, but causes problems when the rich buy *houses* as luxury items.)

        This is true for any given market, but what we have to remember is that there is not one big housing market. Rather, there are a number of discrete housing markets, which affect each other, but which do not share the same supply and demand conditions.

        Take for example, the building just constructed in NY at 157 w. 57th st, along what has come to be not so affectionately known as Billionaire’s Row. Buildings like this reflect the rising demand for units at the high end of the New York real estate market and increase the price that people who want to live in that neighborhood have to pay. It does not, however, directly affect the market for middle and low-cost housing units, because those units where never going to be built in that neighborhood anyway.

        But those middle and low-cost housing units *were* going to built somewhere. But someone decided investing in that building would be better, and now they won’t.

        Or, alternately, now billionaires will buy into the building, which means millionaires will get some other building somewhere else and kick out the upper-middle class, who in turn will get condos in some gentrified neighborhood, and the poor people that lived there…now can’t afford housing.Report

    • Avatar Patrick in reply to Kolohe
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      says:

      We *had* a speculative bubble in residential housing. It collapsed, rather spectacularly, as everyone should remember.

      It’s back.

      Well, at least in California. I won’t speculate on the rest of the country. Prices in many of the California markets that I’m looking at (not central valley) are back up above the long-standing normal ratio of housing price to mean per capita income that we saw from about 1960 until about 2001. From 2001 to 2007 everything went bonkers. From 2007 to 2009 we saw some correction in many markets.

      Now we’re back to the same out-of-whack proportion of average income to home price value.

      Meaning that the folks who are buying the houses are either folks who don’t live here or people have somehow managed to qualify for loans that are as dicey as what we had in 2006. Anecdotally, I don’t think the second is the case.

      This is probably a consequence of a confluence of the bailout and foreign investment. When everything was set to implode, the bailout money went straight to the capital class. So they didn’t lose their relative investments that they would have lost if the market actually crashed and we had a recession… they had maintained paper wealth… but they had nothing to invest it in. You can only park your cash in Treasuries for so long before the itch to actually make money with it again makes you put it… somewhere.

      Which more or less matches my impression of the last four years of investment markets… commodities, housing, the stock market, goldbugs, commercial real estate, everybody is running around trying to guess where they can put their paper wealth such that it won’t depreciate relative to inflation. We’ve seen microbubbles in everything.Report

      • Avatar DavidTC in reply to Patrick
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        says:

        @patrick
        Which more or less matches my impression of the last four years of investment markets… commodities, housing, the stock market, goldbugs, commercial real estate, everybody is running around trying to guess where they can put their paper wealth such that it won’t depreciate relative to inflation. We’ve seen microbubbles in everything.

        Are you saying the super-rich *don’t* wander around creating tens of thousands of jobs each by hiring random people to do things? And instead just put their money in exchanges where they’re essentially gambling against other rich people? Or buy investments and sit on them? Or actually *harm* society by buying real estate and sitting on it, reducing supply and thus increasing cost of other real estate?

        What are you, a communist agitator or something?Report

      • Avatar Patrick in reply to Patrick
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        says:

        Not all of them. But some of them.

        And, given your broader point that the amount of liquid capital available for the folks who aren’t in the 1% has dropped relative to inflation over the last ten, fifteen years… there aren’t enough folks buying stuff at the broad bottom to encourage the rest of the super rich to invest in anything.

        I remember at one point a post over at Modeled Behavior where the crux of the argument was, “Tax incentives to provide an incentive for folks to buy capitalized equipment for their industrial enterprises will do nothing, because our manufacturing base already has more capacity than we’re currently using. We have the ability to make more stuff than people are buying”, or something to that effect.

        Money exists as a medium of exchange. When sufficient amounts of it gravitate to an insufficiently large chunk of folks, it starts to fail to do that job.

        Think about the Modeled Behavior post for a second: you could make things, but nobody’s buying the things that you can make. So you sit idle rather than lose money making things that nobody will buy at a market price.

        That’s just not supposed to happen for an extended length of time in a market based economy. Folks will prioritize *something* that can be bought with their marginal income.

        (and we do still see some of this, but it’s not broad-based at all)Report

      • Avatar Jim Heffman in reply to Patrick
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        says:

        “Folks will prioritize *something* that can be bought with their marginal income.”

        These days I’d imagine that they’re prioritizing debt reduction (or, to be market-reductionist, they’re buying the peace of mind and reduced stress that results from minimizing the risk that comes with debt.)Report

    • Avatar Troublesome Frog in reply to Kolohe
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      says:

      And the (smart) Boomers are sitting in their empty nest paid off inner ring suburb homes bought in the 80s for another 20 years.

      Especially when California gives them “never sell your house to a younger growing family” tax incentives so strong that nobody can refuse them.Report

  3. Avatar Tod Kelly
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    says:

    Whoever CR-ed this DavidTC’s comment, thanks. This was great.Report

  4. Avatar Christopher Carr
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    says:

    I know more about this than most people: I was just involved in a project for HUD. I have to disagree: the rent market is getting more expensive. Whether a true assignment of blame or not, this has been attributed to Airbnb. As for buying, there are a variety of new standards that just went into place in the past year or two, including new, tougher standards for what can qualify as verifiable income, that takes the decision to issue a mortgage away from the lender and gives it over to an algorithm that excludes a surprisingly large number of people. In my opinion, this problem is going to get a lot worse before it gets better.Report

    • Avatar Saul Degraw in reply to Christopher Carr
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      says:

      Well that prediction makes me feel doomed.Report

    • Avatar Troublesome Frog in reply to Christopher Carr
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      says:

      Whether a true assignment of blame or not, this has been attributed to Airbnb.

      Absent some solid data, that sounds absolutely ridiculous.Report

    • Avatar DavidTC in reply to Christopher Carr
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      says:

      I have to disagree: the rent market is getting more expensive.

      …? Who are you disagreeing with? HUD?

      Interesting thing about rentals: At the same time that the construction market has (following the rules of the market) migrated away from rental construction, the declining economy has resulted in a lot of poorer people with extra space to rent out rooms they would not have considered before. (I’m not talking about Airbnb here. Just in general.) Or have roommates, when before they would have rented entire houses. And, of course, the existing rentals are still there, and there’s not a lot of hoarding on them….keeping rentals off the rental market makes no sense. So the idiotic real estate market has not affected rentals quite as much. (Of course, it often means now people are living in spare rooms instead of an apartment.)

      As for buying, there are a variety of new standards that just went into place in the past year or two, including new, tougher standards for what can qualify as verifiable income, that takes the decision to issue a mortgage away from the lender and gives it over to an algorithm that excludes a surprisingly large number of people.

      It is very easy to make this about ‘Those poor deserving people can’t get a house. We need to make sure they can get a house.’. I know, I’m on the left, I hear it all the time.

      But people who can’t afford houses probably should not be buying houses. The problem is, literally, that they cannot afford a house. They are not paid enough. That is the problem. Getting people loans to get into houses they can’t afford *causes* problems, it is not a solution to any problem. It is an anti-solution. Give them free houses, give them subsidies rent, give them money, whatever. Don’t give them access to a *loan* and say it solves things.

      Now, there may be some problems in ‘how we verify income’, but that’s almost a side issue. That’s what higher down payments are supposed to be for, and the premise is people with income that’s hard to prove will just have to save for a few more months, and it all works out. Any damage from that is very minor compared to the *massive* damage that was just caused to *millions* of people that made house payments for years but then lost their house because they did not technically earn enough to pay for it.

      Likewise, any damage from ‘computer algorithms’ is probably more than outweighed by reducing the completely absurd racial bias that still exists in loan. Mortgage issuers at this point can barely be trusted to tie their own damn shoelaces, I’m all for having something with actual *intelligence* make the decisions.Report

  5. Avatar Saul Degraw
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    says:

    Re: Stopping Damn Inequality

    1. I remember that during the early and mid years of the Great Recession, there were a lot of arguments about how much inequality was good (to have incentives for hard work and innovation) and how much inequality would bring on the revolution (this number was never determined). Many people agreeing that some degree of inequality was needed except a few. There was a huge and unresolved debate about how much inequality was needed though.

    2. I think most people do care about inequality but the problem is that we will never agree upon what is the best way to solve inequality. Liberals and the left generally think you need to sometimes legislate to money’s detriment and also have at least New Deal levels of Progressive Taxation. The Libertarian-Conservative method of addressing inequality is by complete unregulation and the free market and allowing competition-competition-competition. I think most debates about inequality usually end up resembling Trench Warfare at the Somme using these two points roughly. “The Free Market will just create a more unequal society” or “You are causing inequality by having too many damn regulations and making it much harder for people to set up their own businesses.”

    3. I can think of a million variants on this including debates we had about whether Market Anarchy favors Unions or not. Yes it was easier for people to found unions before the Wagner Act but it was also easy for bosses to ignore many unions and they often did.

    4. The debate in #2 will continue until we have a post-scarcity Star Trek economy or we are all extinct.

    So that is the problem in a nutshell. We will never agree about how to end inequality and to a different extent we argue how much of a problem inequality really is.Report

  6. Avatar LeeEsq
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    says:

    The concepts of different homes for different stages of life seemed to have disappeared from the real estate market. During the mid-20th century, even before the great post-World War II economic boom, there seemed to be lots of different housing types available. SROs for very poor single people, slightly fancier apartments for better off single people, starter homes, and all the way up to mansions for the rich. Some of these types of housing have been rightly or wrongly regulated out of existed but other times, developers just stopped building them because the money is in big houses or luxurious condos. Any sort of lesser housing isn’t worth the time.Report

  7. Avatar Damon
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    says:

    There’s a lot to this.

    Real income has been stagnant for a long time.
    Costs to live continue to trend up.
    Unemployment..REAL unemployment is quite high.
    Gov’t stats hide these facts as the formulas are intentionally gamed.Report

    • Avatar Brandon Berg in reply to Damon
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      says:

      Unemployment..REAL unemployment is quite high.
      Gov’t stats hide these facts as the formulas are intentionally gamed.

      I hate to be the one defending the government, but they do publish alternative measures of unemployment that cover all the things that people claim the government is hiding. Specifically, table A-15 of the monthly BLS employment report. I’m too lazy to look it up now, but IIRC discouraged workers are less than 1% of the population, and involuntary part-time workers are about 5% of the labor force.

      People who claim that “real unemployment” is 20% are several years out of date. U-6 peaked at around 18% at the height of the recession, but is now around 11%.Report

      • Avatar Damon in reply to Brandon Berg
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        “hide” was perhaps a sub-optional choice of word. I was trying to make two points:

        1) The gov’t has many statistics and they are fairly clear on how they derive these numbers. However, stats widely disseminated via broadcast news don’t contain any of this nuance and don’t provide a very clear picture of the actual status. The proxy isn’t that good. It’s like looking at the S&P for how the economy is doing.

        2) You cannot just rely on the statistic because the gov’t will periodically change the definitions or make corrections to the formula, which they disclose, but, again, few actually read these disclosures.

        A quick search on U-6 found this: “What is the definition of “U-6 Unemployment Rate”?

        The Bureau of Labor Statistics releases a bunch of different unemployment numbers every month.

        The unemployment number that is most often used in the media (and by the government) is known as the “U-3”. This number was 8.1% in February of 2009.

        The “U-6” is considered to be a broader measure of the unemployment situation in the United States.

        The “U-6” includes two groups of people that the “U-3” does not:

        1. “Marginally attached workers” – people who are not actively looking for work, but who have indicated that they want a job and have looked for work (without success) sometime in the past 12 months. This class also includes “discouraged workers” who have completely given up on finding a job because they feel that they just won’t find one.

        2. People who are looking for full-time work but have to settle on a part-time job due to economic reasons. This means that they want full-time work, but can’t find it.

        Two pretty important groups of people, no?

        The “official” unemployment number is the “U-3” – this was 8.1% in February.

        The “U-6″ was an eye-opening 14.8% in February.”

        From this guy: http://www.davemanuel.com/investor-dictionary/u6-unemployment-rate/

        When it’s commonly reported that the unemployment rate is U-3 and honestly, it’s really U-6, stats don’t match facts on the ground. That’s why there’s a lot of “unease” in the economy. One of the reasons is that people hear one number and experience the other.Report

      • Avatar Troublesome Frog in reply to Brandon Berg
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        says:

        However, stats widely disseminated via broadcast news don’t contain any of this nuance and don’t provide a very clear picture of the actual status.

        I think part of the problem is that those stats weren’t originally designed for broadcast news viewers to read as a distillation of “how the economy is doing.” They were designed for economists and policymakers to use. The fact that they’re being broadcast to an audience that has no way of putting them in context is probably more of a problem than the metrics themselves.

        It’s a little bit like if you got a weekly letter with your average blood glucose level for the week in it but no other data (and maybe having some talking heads who majored in communications provide their theories on what it might mean). Sure, that’s a number doctors use for some stuff, but you might want to at least take a trip to Wikipedia before you assume that’s your “health number” and believe that you’re being given a stream of really useful information.Report

      • Avatar Damon in reply to Brandon Berg
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        says:

        @troublesome-frog

        Whether or not it’s a good proxy is irrelevant now…it’s used as one.

        Whether the receiving population understand what is being provided is another thing. Most of the business people I work with understand the metrics and have already discounted them. After all, another user of this data is business. The broadcast media could certainly begin reporting on U-6 if they wished or they could explain when they happily announce that U-3 “employment rate” went down that it was only workers falling off the reporting thresholds. But that’s not going to happen. It doesn’t fit the narrative.Report

      • Avatar Troublesome Frog in reply to Brandon Berg
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        says:

        @damon

        Whether or not it’s a good proxy is irrelevant now…it’s used as one.

        I’m not sure what to make of this. Does that mean that the government is doing the wrong thing by collecting those statistics and releasing them? Should it alter the statistics so they mean what non-experts think they should mean instead of what they currently measure?

        Most of the business people I work with understand the metrics and have already discounted them. After all, another user of this data is business.

        I don’t think I really know what this means either. The metrics are used by a lot of people who find them perfectly useful because they know what they measure and how to use them. Maybe I’m thinking of a different set of metrics, but I don’t understand why somebody who understood them would “discount” them unless they simply didn’t have a good use for them. That’s fine if they don’t, but I don’t see how that reflects on the general usefulness or accuracy of the numbers.Report

      • Avatar Damon in reply to Brandon Berg
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        says:

        @troublesome-frog

        I like to think of a lot of these stats like the Dow Jones. At one time it may have had some use as a proxy, or an actual value, of the market, but no longer. But the ups and downs of the DJ are reported on the nightly news. It’s custom and it’s become a proxy for the stock market, even though more accurate representations are available.

        The U-3 is the most commonly reported unemployment rate, yet the data isn’t really what most people would think of if you asked them what the rate would have. And when this rate is reported as going down the conclusion is deceptive. The assumption is that the actual rate went down, not that folks fell off of the counting.

        And don’t get me started on the CPI BS….Report

      • Avatar Troublesome Frog in reply to Brandon Berg
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        says:

        @damon

        I’ll admit that I don’t know anybody who has a real use for the DJIA as a proxy for anything, but the unemployment numbers (U1 – U6) are all useful for people who know what to do with them. Not sure where the author gets U-6 at 14.8% in February. As far as I can see, the BLS has it at 11.4 or 11.0, depending on whether it’s seasonally adjusted. In any case, over the past year or so, declines in U3 were roughly matched by declines in U6, so at least recently the movements haven’t been particularly misleading. At least, it doesn’t appear to be a case of people out of U3 and staying in the U6 basket. They’re not perfect metrics, but I don’t know of anybody who has more useful ones.

        Likewise the CPI is an extremely valuable statistic for a whole variety of uses and, I’d argue, a pretty useful one for households in general. Unless you believe like Kim and ShadowStats that the whole thing is a conspiracy and that we’re all really twice as poor as we think we are and consumers and financial markets just didn’t notice. If that’s where you’re going, I think the track records of the indexes are long enough that you can pretty easily eyeball the numbers and see which one has diverged more from reality. Most of the “alternative” metrics don’t really pass even a cursory examination if you crank through examples over 20 years or so.Report

      • Avatar Damon in reply to Brandon Berg
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        says:

        @troublesome-frog

        I seem to recall many instances where the U3 and 6 were out of whack back during the big 08 crash. And on a intuitive basis, it makes sense that a person moves through the metrics as they are unable to find a work. And again, my issue isn’t with the metrics being provided but with the misunderstanding that goes with them.

        And here’s my issue with the CPI: Taking out two main drivers to my real cost of living, energy and food, is nothing but a smack to my intelligence. Additionally, telling me that when I can’t afford steak I’ll buy chicken and that doesn’t have an impact in my life or lifestyle is equally bogus.Report

      • Avatar Troublesome Frog in reply to Brandon Berg
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        says:

        The CPI does include both food and energy. You’re probably thinking of the CPI-C (core), which is not what you get in the news reports. Core CPI is more useful than headline CPI for monetary policy questions because it measures prices that don’t revise as often, so it better reflects future inflation expectations. If you see an uptick in the headline CPI, it’s a good idea to check to see what CPI-C is doing to help decide whether it’s trend or noise.

        As for steak vs hamburger, that’s a common misstatement of how the weighting works. The specific example is wrong because steak and hamburger are in completely different categories, although substitution between different types of steak would be normal. But that doesn’t necessarily mean substitution to a less desirable cut if the price goes up–the substitution may be toward a more desirable one because the price difference is smaller. The goal (not always reached, but the goal) is to keep “satisfaction” constant while modeling the real behavior of people optimizing their baskets.

        In any case, to hear people talk about it, you’d think that steak and gasoline were all people purchased. There was a big flap over the price of chicken a while ago and much hand wringing over the CPI being nonsense because of it, but you’d to eat a ridiculous amount of chicken for it to really drive any problem with the overall metric. Like, a crazy amount.

        It’s not a perfect process because products and preferences don’t stay the same (for example, the median cell phone bill was $0 in 1990), and it may produce weird results depending on what you want to use the data for, but that’s why they produce a bunch of different inflation and price indexes these days.

        I’m onboard with the “people don’t know how to use this stuff” claim, but the idea that it’s some sort of a scam just doesn’t bear scrutiny. The datasets are useful for people who know how to use them, and that’s as intended.Report

  8. Avatar Creon Critic
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    says:

    And, despite me being pretty far on the left, the solution isn’t to try to legislate the market to act ‘better’

    I’m not sure if this counts as legislating to make markets act better or not, but a pied-à-terre tax has been proposed in NYC – one proposal is for an annual surcharge of 0.5% to 4% on apartments worth more than $5 million. Unfortunately with Republicans in charge of the NYS Senate, the proposal is not likely to get far in the near future.

    For urban areas facing affordable housing crises and the absentee uber-wealthy buying real estate, maybe we can tax our way to a smaller problem. And there are plenty of luxury NYC hotels that would be happy to have billionaire guests for the few days of the year they spend in the city.Report

    • Avatar Saul Degraw in reply to Creon Critic
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      says:

      @creon-critic

      I heard about this proposal. I am not sure it is going to work because many extra apartments might not be in that range. They could be studios or 1 bedrooms worth a lot less but I guess the Russian oligarchs are not buying modest one-bedrooms.Report

    • Avatar Saul Degraw in reply to Creon Critic
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      says:

      It doesn’t necessarily take oligarch levels of wealth to have a pad in NYC. I know firmly upper-middle class lawyers who live and work in other states but have pads in NYC. They aren’t at the level you are describing.Report

    • Avatar DavidTC in reply to Creon Critic
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      says:

      @creon-critic
      For urban areas facing affordable housing crises and the absentee uber-wealthy buying real estate, maybe we can tax our way to a smaller problem.

      NYC is the same issue as San Francisco: The problem there is, at least partially, caused by the *laws of physics*.

      I understand a little where people are coming from, but the actual fact is that land in a city is scarce, and when something is scarce and the poor and rich both want it, the rich end up with it. That is how markets work. That is how they always work.

      All this ‘I can’t afford to live exactly where I want and have to buy a house a mile away’ sob stories are distracting from the fact that many people can’t afford houses *anywhere*. If the rich owned *all of* Manhattan and no one worth less than a million dollars slept anywhere on the entire island, but everyone else had *affordable apartments in Queens and Brooklyn*, it would all be perfectly fine, economically. I mean, we’re not actually running out of land *on the planet Earth*.

      I understand there are some *cultural* issues in all this, and I feel for it, but in my book, a neighborhood has no more a right to keep being ‘a poor neighborhood’ than it does being ‘a white neighborhood’. And the people driven out might not be able to find affordable housing elsewhere, but that’s because poor people *can’t find affordable housing*, period, end of story.

      The only way to reduce this is to stop having so many idle rich that want to own so expensive houses, and so many of them.

      But, despite all that, I have no objection to what New York is trying to do, because I have no objection to taxing the rich. At all. Especially when it comes to people who don’t live there…what, are they going to not live there *more*? They might give up their apartment and move, but that is, in fact, the entire damn point, so, hey, that worked.

      Although, as I said on a comment that didn’t make it over to this discussion, what they should actually be taxing is *unoccupied* residences. If there is not an adult that lives in a residence at least 200 days a year, the owner (Who does not have to be the same person as the resident) pay two times as much property tax. Yes, I might even want to apply it to apartment buildings and whatnot, although maybe switch to ‘occupancy that averages more than half’ for them. (I wouldn’t, however, extend it to hotels. Hotels in no way cause housing shortages.)

      But New York should be aware that is what is going to actually happen is that those apartments will be split in half or thirds, and *slightly less* rich people who actually live in New York will move into them. As long as the profit margins on building expensive housing is higher than those on cheap housing, and as long as there is a demand for expensive housing, expensive housing will continue to be the only housing that is built.Report

  9. Avatar Brandon Berg
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    says:

    The basic constraint here is the pigeonhole principle. If there are more people who want to live in a given place than there are housing units available for, they’re going to have to be rationed one way or another, and some people are not going to get what they want. There’s no way around this.

    Now, in a command economy, the government can decide who gets to live there and charge them low rent. But command economies suck, both theoretically and empirically. In a market economy, the result is that prices rise to the point where enough people either literally can’t afford to live there or decide that it’s not worth it. This has to happen for the market to clear, regardless of income distribution.

    Which is to say, short of the government imposing rent control and picking and choosing who gets to live there, unaffordable housing is the inevitable outcome of 2n households wanting to occupy n houses. Inequality has nothing to do with it. I know that song is popular this week, but this is getting ridiculous.Report

    • Avatar Mike Schilling in reply to Brandon Berg
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      says:

      Then the obvious solution it for everyone to have more children. Once there are an infinite number of people in the U.S, we’ll be able to fit 2n households into n houses with no problem.Report

    • Avatar LeeEsq in reply to Brandon Berg
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      says:

      There is a another solution besides a command economy or letting the market run wild, public housing. It has a bad rap in the United States but other countries have managed to build great public housing. In Vienna, 600,000 people live in apartments built by the city government.

      https://en.wikipedia.org/wiki/GemeindebauReport

      • Avatar zic in reply to LeeEsq
        Ignored
        says:

        The government does build low-income and affordable housing via Community Development Block Grants (CDBG) that typically are awarded to states who, in turn, award money to non-profits to build and manage the housing.

        I would argue that one of the problems here is the size requirements — a bedroom for each child, meaning that we end up building a lot of three and four bedroom apartments. Another is that these units are clustered together, so that people reinforce one-another’s habits, particularly the habits of dependency, and that residents of these units face a certain amount of stigma for being ‘moochers.’Report

      • Avatar Brandon Berg in reply to LeeEsq
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        says:

        For one, this does turn that particular segment of the housing market into a command economy. More importantly, it’s not a solution. If the government is renting the apartments out at below-market rent, there must be more people who want to live in those apartments than can be accommodated, so the government picks and chooses who gets to stay. Note that the article to which you linked points out that residents are not necessarily poor, and that there are allegations of corruption.

        Furthermore, unless the government built apartments that would not otherwise have been built (unlikely, unless the reason they wouldn’t have been built is that the government wouldn’t have allowed it), this does nothing to increase supply. Presumably some people living in those apartments would not otherwise have been living in Vienna, and some who would be sharing apartments with roommates are now living alone, which means that there’s an increase in demand, which drives up prices on the remaining market-rent units.

        So they end up making housing cheaper for those who are connected or lucky enough to get rent-controlled units, while making housing that much more expensive for everyone else.

        Again, the only way to make housing affordable for everyone is to build enough supply to accommodate everyone who wants to live there. Otherwise people will necessarily be either priced out or forced out.Report

      • Avatar LeeEsq in reply to LeeEsq
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        says:

        Brandon Berg, you have no evidence that government housing programs only work for the connected or lucky besides your own beliefs. According to the wikipedia article, one-third of Vienna’s population lives in Gemeindebau. This means that hundreds of thousands of people live in government housing. Most of these people are not connected or lucky, they got the housing through the proper channels. If you have a sufficient stock of public housing than you don’t need connections or luck to get it.Report

      • Avatar Troublesome Frog in reply to LeeEsq
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        says:

        I think I would define that one third as at least “lucky” because it’s able to get limited housing below market rates. If the government has “sufficient” housing stock for everybody and nobody is excluded, then the government rate would match the market rate. If it’s ever below the market rate, that means there are people who would like to get those units but can’t.Report

      • Avatar DavidTC in reply to LeeEsq
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        says:

        @brandon-berg
        Again, the only way to make housing affordable for everyone is to build enough supply to accommodate everyone who wants to live there. Otherwise people will necessarily be either priced out or forced out.

        If only I had a magic wand that could make the number of bank-owned houses five times the number of homeless people.

        Wait. I *do* have a magic wand, I got it from the shop down the street that had disappeared when I went back. (1) *waves it*

        Well, look at that. It appears now there *are* plenty of houses that physically exist, well more than people could possibly inhabit (And somehow my magic has made this true retroactively.), and the reason the poor aren’t living in them is that the super-rich *don’t care enough to let them*. Better to let them sit empty.

        As I keep saying, in an actual correctly functioning market, if the supply of X *outnumbers by a factor of five* the people who might actually want to buy that thing, prices plummet! Like, duh. That statement is not actually up for dispute, it is the basic premise of supply and demand.

        The housing market, however, is completely broken. It’s broken by speculators, it’s broken by the rich hoarding houses for their own use, it’s broken by the rich paying *way* too much for their houses and causing no one to make houses for anyone *except* them. It’s broken by people and banks manipulating prices for a decade. It is completely, utterly, broken.

        And note by ‘broken’, I mean it doesn’t produce an outcome that other markets would produce, roughly something like everyone owning a house of roughly the quality they can afford somewhat near-ish where they want to be. Granted, houses are time-consuming to produce and the distribution is sucky, but it should be *somewhat* like other market outcomes, roughly, a little laggy but close to it.

        It’s not. It’s not even vaguely close.

        1) Not due to magic, it was turned into a luxury condo.Report

      • Avatar Kolohe in reply to LeeEsq
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        says:

        ” It’s broken by speculators, it’s broken by the rich hoarding houses for their own use, it’s broken by the rich paying *way* too much for their houses and causing no one to make houses for anyone *except* them”

        And again, that’s not supported by the data nor casual observation of what’s being built. Plus, construction employment has still not fully recovered from the 00’s peak (i.e. unemployment nadir), (though it’s close).

        And for pete’s sake, the best possible wealth distribution scheme would be one where the uber rich paid for a lot of construction labor that they really didn’t need. It’s the very model of Keynesian stimulus. I mean, if you like, we can spend that money instead on B-29s and deuce and a halfs, but we’re kinda sort on Nazis these days.Report

      • Avatar DavidTC in reply to LeeEsq
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        says:

        @kolohe
        And again, that’s not supported by the data nor casual observation of what’s being built.

        Dude, what I said is literally what that article claims: ‘He also sees more builders starting to construct a larger volume of less-expensive housing, after spending the past three years catering mostly to better-heeled buyers purchasing more expensive homes.’

        That article claims what I’m describing exists but is *slowly going away*. (And the writer is careful to point out that this sort of optimistic thinking happened last year, also, so let’s not assume the situation is fixed until it’s actually fixed.)

        I was explaining why the housing market is *currently* broken, the history that led to this point, where the rational decision is overpriced rich-person bait houses instead of, like normal, providing products for all levels of the market. I was explaining that markets that have the idle rich wandering around in them start behaving completely bananas, which is pretty sucky when those markets involve things people need to survive.

        I never said the situation was *permanent*, or that it couldn’t fix itself. Jeez.

        Now, I actually think it’s unlikely that it *will* fix itself while the idle rich continue to roam through it, but who knows. Maybe the rich have given up their housing speculations, and will move on to purchasing all the water rights in Utah and building giant fountains to spray the water into space, because they’re the rich and can do anything they goddamn can afford.

        And for pete’s sake, the best possible wealth distribution scheme would be one where the uber rich paid for a lot of construction labor that they really didn’t need. It’s the very model of Keynesian stimulus. I mean, if you like, we can spend that money instead on B-29s and deuce and a halfs, but we’re kinda sort on Nazis these days.

        Well, yes, if the construction market was infinitely agile and could instantly expand to whatever size it needed to be. That would be awesome if rich people just started building a bunch of pointless things.(1)

        Or, to hilariously quote that article that says exactly what I was saying, ‘“I’m not sure that builders have the communities, lots and products that will work from a pricing perspective” even if entry-level demand soars.’

        In reality, of course, the construction industry is an existing finite size, as is the amount of money that people are investing in new construction. Everything directed towards building pointless crap for the rich is not directed elsewhere. It’s pretty much a zero-sum game there.

        And, of course, as yourself confusingly pointed out (Somehow thinking it diminishes my point?), construction employment has fallen. Which, uh, makes it even more important when resources get poorly directed into pointless crap instead of actual cheap houses for people to live in.

        1) It’s the new American economic model! Tickle-down economics at long last! The rich are *finally* rich enough to randomly and irrationally shower normal people with money for no real reason, and all it took was, uh…them buying stuff we actually sorta needed to live in. Hrm. Not really sure that worked out as planned.Report

      • Avatar Kolohe in reply to LeeEsq
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        says:

        Dude, the article doesn’t say at all what you’ve been saying, though what you’ve been saying has evolved over the week so I have no idea what the bottom line is anymore.*

        The article says before the part you quoted

        Many such buyers have been sidelined in recent years by tepid job and wage growth, strict mortgage-qualification standards and mounting student debt. Each aside from student debt is starting to improve.

        It’s talking about the specific conditions of the last few years and a *demand* side problem. The entire housing market collapsed (along with half the economy) and builders just built for who could pay cash. It was not and is not a supply side problem of rich folks crowding out other, non rich folk real estate investment. The statement “spending the past three years catering mostly to better-heeled buyers ” is *effect* not cause.

        Now, again, if you want to aim a little more downmarket, that building construction and renovation is almost exclusively in properties that require a minimum of 2.5 – 3.5K month in rent/mortgage and the market doesn’t clear for people making 60K or less in big metro areas, that’s an idea I can get on board with. But not with idea that the Romneybots of the world living in their 7 houses with car elevators are the ones skewing the construction market. Not now, not during the Great Recession, and not really at any time in US history.

        *”Rich people aren’t really soaking up housing” even though that the thesis of the original comment rescue – “Producing more houses will only ‘reduce’ housing prices relative to poor people if the houses are produced faster than the people who own massive amounts of them are buying them” – and other commentsReport

      • Avatar DavidTC in reply to LeeEsq
        Ignored
        says:

        @kolohe

        It’s talking about the specific conditions of the last few years and a *demand* side problem. The entire housing market collapsed (along with half the economy) and builders just built for who could pay cash. It was not and is not a supply side problem of rich folks crowding out other, non rich folk real estate investment. The statement “spending the past three years catering mostly to better-heeled buyers ” is *effect* not cause.

        Ah, yes, the mysterious demand side problem where *people don’t need houses anymore*. Ever since that blue meteor passed over the US and rendered a third of the population impervious to heat and cold and rain, no one needs houses!

        Or maybe the argument is that people are demanding housing that is literally too cheap to provide? Because it’s literally impossible for builders to provide housing that cheap.(1) No one’s ever built tiny track housing for a $100,000, or tiny apartments people can rent.

        Wait, no. Builders used to do that *all the goddamn time*, back before the 90s. And NOW THEY DON’T.

        Why? Because the profits are in the huge houses, and builders *didn’t want* to go back to cheaper houses.

        If the market’s demand switches from a certain price point to a lower price point, (one that used to exist, and is certainly still possible) and the suppliers do not follow along, causing shortages, it is, almost by definition, a supply side ‘problem’. If the market starts demanding crappy fast food for $5, and there used to be such things but now the only thing being sold is fancy steak dinners for $35 and the market persistently fails to open a few McDonalds, it’s a *supply side problem*. The market is failing to supply what is actually demanded.

        Although as I pointed out, it’s not actually a ‘problem’ in the market sense. The market is behaving rationally. The construction market fighting over the scraps of the wealthy makes more sense than them going about their business supplying the large ‘cheap housing’ market, because the wealthy have a fuckload more money. But ‘rationally’ and ‘supplying a wide berth of the market’ are not the same thing.

        And I have to point out that if banks aren’t giving people loans, *that is also a supply side problem*. It’s a problem in the supply of loans. Duh. (And, again, one that is perfectly rational, so I don’t like to call it a ‘problem’. Banks haven’t actually needed to give people loans for a long time. They can make money other ways.)

        1) As I mentioned in my original post, there are, indeed, some poor people who literally cannot afford housing. At no point am I saying a demand side problem doesn’t exist, because some people are not actually making enough to buy any housing…I’m pointing out there is also clearly a supply side problem that also exists.

        *”Rich people aren’t really soaking up housing” even though that the thesis of the original comment rescue – “Producing more houses will only ‘reduce’ housing prices relative to poor people if the houses are produced faster than the people who own massive amounts of them are buying them” – and other comments

        The ‘people who own massive amounts of houses’ in that is *not* talking about ‘rich people’. At least, it’s not talking about the same sort of rich people, and they aren’t really ‘people’, they’re companies. (You will notice my first post didn’t even *talk* about ‘rich people’, except in regard to San Francisco and what’s happening there. You will also note the two are a bit disjointed and confused because it’s a damn *comment rescue* of two random comments and not actually an article I planned to have put up as a perfect explanation of what is going on.)

        Those are two different groups screwing things up. The first group is wealthy people (Although not particularly only ‘the rich’. Let’s say ‘The upper middle class and up’.) accidentally controlling (via spending money drunkenly) what is *built*. (And this used to be the entire middle class, back when banks let middle-class people pretend they could afford super-expensive houses.) *This group* is screwing up the construction market, causing only expensive houses to be built.

        The second group is banks and investment groups, controlling massive amounts of *pre-existing* houses and basically refusing to let people live in them, because if they hold them for just a *little bit* longer, surely they can get more for them. (This is astonishingly stupid and counter-productive behavior, but they’re fucking *banks*, what do we expect?) *This group* is screwing up the resell market, causing huge swathes of existing cheaper houses to stay off the marker.

        Both those groups exist because there is too much money chasing real estate. Some of it is people over-spending on their own real estate, some of it is people hoarding existing real estate, but it’s basically the same concept.

        I am not entirely sure of why all that money is in real estate besides ‘it has to be somewhere’, but other people in this discussion claim it’s something to do with other investments being particularly bad right now, and that sounds reasonable to me.Report

    • Avatar LeeEsq in reply to Brandon Berg
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      says:

      San Francisco is a desirable place to live because it is the anchor city of the booming tech industry and because it is an interesting city with lots of things to do and see. This attracts a lot of people who are earning good incomes in the tech industry and have money to spend on the necessities and extra stuff. The tech and finance people need services though; grocery store clerks, nannies, bar tenders, wait staff at restaurants, yoga and gym trainers, Uber drivers, and all the artists and entertainers that make San Francisco a great place to live. These people are earning less money than the tech people but still need a place to live but can’t afford top dollar.

      I suppose we can have these people live in the far out suburban cities with cheaper rents and have them do gruelling commutes to and from work every day by many means possible. This solution seems unjust because what they save in rent they lose in commuting costs and time. It also seems to be economically inefficient to require so many people to live this far from their workplace. We can remove all the regulations regarding habitabiltiy and have people live like working people did in the early 20th century, in slums with five or ten to a room and filthy rooms without much in the way of utilities at that. I don’t think anybody is going to really stand for this though. Affordable housing requires some sort of government action.Report

    • Avatar DavidTC in reply to Brandon Berg
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      says:

      @brandon-berg
      The basic constraint here is the pigeonhole principle. If there are more people who want to live in a given place than there are housing units available for, they’re going to have to be rationed one way or another, and some people are not going to get what they want. There’s no way around this.

      Yes.

      Which is to say, short of the government imposing rent control and picking and choosing who gets to live there, unaffordable housing is the inevitable outcome of 2n households wanting to occupy n houses. Inequality has nothing to do with it. I know that song is popular this week, but this is getting ridiculous.

      Except that my comment, the premise of this, wasn’t about the lack of affordable housing in San Francisco, which, as I myself said, is an idiotic red herring. If the rich want to live in a specific place, the poor can hardly stop them, and if that place physically runs out of space, it will be just the rich there.

      What *I* am talking about is about the lack of affordable housing *everywhere*, because the profit margins on building housing for the rich (which they do not need any more of) are larger than profit margins on housing for the poor.

      It is entirely reasonable to have a system that means the poor don’t have a chance to get housing in certain places. It is slightly less reasonable, and an actual problem, when the poor can’t get housing *anywhere*.Report

      • Avatar Will Truman in reply to DavidTC
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        says:

        I’m not clear how you are defining “everywhere.”

        The Bay Area? Coastal California? California? The United States? The developed world?Report

      • Avatar DavidTC in reply to DavidTC
        Ignored
        says:

        Everywhere, in that sentence, was basically just ‘the US’, although a better definition might be ‘Within commuting distance of where we expect poor people to work’.

        I.e., you can’t really point to affordable housing in Iowa and say ‘It exists! See!’ If San Francisco expects to employ a hundred thousand low-wage workers to operate the city, it needs to be able to house those people somewhere near-ish.

        And, yes, that’s deliberately very vague. The point I am making is that none of this has any thing really to do with location…if rich and poor people both want to live somewhere, the rich people win, obviously. That’s fine.

        The problem is not the rich are pushing out the poor people, it’s that the poor people are being pushed out to *nowhere*. No one is watching them move out of San Francisco and building cheap houses next to it for them. No one is building cheap houses at all, because building the fifth home for some super rich guy, or a new house for some upper-middle class guy, is much more profitable.Report

      • Avatar Will Truman in reply to DavidTC
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        says:

        Thanks. Except I don’t have to point to Iowa (though I could). I can point to the vast majority of the country, including some very large cities. The “luxury condo” problem applies to relatively few places. Even Seattle has to work to prevent micro-apartments from being built. To say nothing of DFW, the Twin Cities, Atlanta… which is to say nothing of Sioux Falls, Wichita…

        There simply aren’t enough rich people to soak up the housing “everywhere.”Report

      • Avatar DavidTC in reply to DavidTC
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        says:

        Rich people are not really soaking up housing. I don’t even know how that would work outside of weird situations like San Francisco and New York. (Which is why they are completely dumbass problems for the left to worry about.)

        The super rich are probably using 1000% of the houses that everyone else uses, but considering how few of them there are, that cannot actually be causing a problem.

        Banks, OTOH, *are* soaking up housing. They’re just sitting on inventory as it slowly decays. (And not getting repaired or replaced.)

        What rich people are doing in general is causing different things to be *built*. They are spending money like drunken sailors, so of course everyone is constructing things *for them*.

        In markets, things should be produced and sold in roughly comparable amounts to the amount of money people have. There are $15 cell phones and $500 cell phones. There are $2 hamburgers and $20 hamburgers and $200 hamburgers. There are even $200 cars…and if you couldn’t get used cars for $200, the market would start selling electric motors mounted on bicycles for $200, or something like that.

        Obviously, every sort of product has a minimum cost and the price can’t be lower, but other than that, the market should produce things aimed at the entire market, from the rich to the poor.

        That…hasn’t happened in housing for more than two decades. No one builds cheap apartments. No one builds $50,000 houses, outside of ‘microhouse’ stunts. I.e., by people operating outside the traditional construction market. Cheap houses are entirely possible, there’s a *huge* demand for them, and we *used* to make them. And now they don’t quite ever seem to be made in any quantity.(1)

        Why? Because of the drunken sailors spending huge amounts of money on their second condo in a Miami highrise. (This one is slightly smaller, but has a better view!)

        They aren’t really hoarding houses…they’re sorta hoarding *the construction market for houses*.

        1) And, no, libertarians, it’s not due to housing regulations. I’ll give part of the blame to them, but I feel I must point out that if developers do not like regulations, they almost always can get them changed. During the housing boom, in my state, developers essentially *took over* entire county governments, and not a single one of them said ‘I want to build cheaper houses, but these rules stop me!’Report

      • Avatar trumwill in reply to DavidTC
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        says:

        It seems difficult on multiple fronts to build housing below certain thresholds. At some point, you’re competing with mobile homes (for houses) and converted motels (for apartments), and the further down the economic latter you go the more you have to worry about non-payment (and even if you could get regulations changed, which I am not convinced of, there are costs to doing so) We may have some common ground on that latter part (or maybe not, since I don’t think it’s an issue of banks soaking up housing). Otherwise, the situation you describe is not the situation seen in the various places I’ve lived (towns in the four digits all the way to metropolitan areas in the millions of people).

        I mean, I agree that the distribution of wealth plays a role, but to the extent that it does, outside of select areas, I don’t think it’s about the wealthy so much as it is about the middle class who can soak up demand that might otherwise exist for lower-cost housing. Which cuts against some favored narratives.Report

      • Avatar Kim in reply to DavidTC
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        says:

        David and will,
        Actually, nearly everyone builds cheap apartments, or dwelling places for the chronically poor. Even France. Hong Kong. England.

        We might do a bit better to ask what’s wrong with us, that we force folks to live in slums?Report

      • Avatar j r in reply to DavidTC
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        says:

        I mean, I agree that the distribution of wealth plays a role, but to the extent that it does, outside of select areas, I don’t think it’s about the wealthy so much as it is about the middle class who can soak up demand that might otherwise exist for lower-cost housing. Which cuts against some favored narratives.

        Yes. This is what I was getting at in my comments above. The very rich are almost never in close competition with the poor for housing. Even when they are competing in geographically close neighborhoods, the kinds of housing that they are bidding on is very different. And in the case of gentrification, it’s usually young people who have a fair amount of disposable income or the ability to call on parents for help, but who are not particularly wealthy themselves.

        I’m no expert on this, but my guess is that the market for very cheap housing looks a lot like the market for very cheap financial services. The cost of just putting up a clean, well-constructed and safe building of modest one and two-bedroom apartments is likely so great that the rents needed to recoup the investment would put those apartments out of the reach of the poor. And that’s not because the rich have gotten richer. It’s because the basic level of housing that you have to provide, both by law and convention, has gone up. You cannot really run a flophouse anymore. It wouldn’t be up to code.Report

  10. Avatar DensityDuck
    Ignored
    says:

    “markets cannot distinguish the *life or death requirements* of the poor to have a damn $100,000 house from the idle whims of the rich to own their fifth $1.5 million dollar estate ”

    Actually, it’s not “fifth 1.5 million dollar dollar [sic] estates” that are being built in SF. It’s the same condoes that would get built in any other city. The issue is that there are more richer people who very much want to live in SF than there are people of less means, and so those people get pushed out simply because buyers want to sell to whoever gives them the most money. And “I Live In San Francisco!” is worth more than the actual house to a lot of people, at least if the ones I know personally are any indication. (One guy paid more than my mortgage each month for someone’s spare bedroom. He commuted to San Jose, which is about 2 hours away. I asked why he did that and he said “oh I couldn’t possibly live in San Jose, there’s nothing to do down there”.)

    Builders could build cheap houses, but they’d be bought by the same rich people who are buying the expensive ones; or they’d be bought by lower-income people who’d turn around and sell them at market rate; or, if you wrote a telephone book of rules about who could buy the place and how long they had to own it, then now you’re picking individual poor people to be winners and how come you didn’t pick those other people you god damn racist? (Oh, and if you make a “no renters” rule, they’ll just put it on AirBnb.)Report

    • Avatar DavidTC in reply to DensityDuck
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      says:

      Does anyone else find it odd that people seem determined to make my comments about the housing market into comments about San Francisco, when in fact the only thing I actually said about San Francisco pricing was that the complaint of people wanting affordable housing *in that specific location* are silly? Literally my only mention of that city is to *dismiss* complaints about the cost of housing in it.

      And these people then ‘disagree’ with me by saying exactly what I said, that the poor do not have any right to live at a *specific* location. Well, duh. It’s almost like I literally just said that.

      My point is that the poor do have a sort of generalized right to affording housing existing *somewhere*. Hell, it’s not even a right…it’s just something that logically *should* exist. It *did* exist once. it is perfectly possible for it to exist, and society *needs* it to exist.

      If our housing market no longer provides such a thing, if it is not able to supply housing anyone but the rich, it has failed as a market. Which it, uh, has.Report

      • Avatar Jim Heffman in reply to DavidTC
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        says:

        We keep talking about San Francisco because that’s what the post you commented on was talking about.

        “My point is that the poor do have a sort of generalized right to affording housing existing *somewhere*. ”

        If you’re not talking about the problem of affordable housing in a specific location, then why are you even talking? It’s always going to be possible to move someplace else where the houses are cheaper, which is why so many people are moving to East Oakland these days.Report

      • Avatar Will Truman in reply to DavidTC
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        says:

        That’s why I want to know where “everywhere” entails.Report

      • Avatar DavidTC in reply to DavidTC
        Ignored
        says:

        We keep talking about San Francisco because that’s what the post you commented on was talking about.

        DenstityDuck, quite specifically, quoted *my comment* and pretended I was talking about San Francisco.

        If you’re not talking about the problem of affordable housing in a specific location, then why are you even talking?

        I am fairly certain I don’t need your permission to talk, but I was talking, on the last post, to point out that *that post was wrongheaded*. That was, quite literally, the entire premise of my comments that were rescued: Everyone is talking about affordable housing in this specific location, when in actuality the problem is something else, and the entire San Francisco discussion is completely silly. (And caring about San Francisco makes the left look pretty stupid when talking about affordable housing. It’s rich hippies vs. richer yuppie nerds, all of whom can afford housing within easy commuting distance.)Report

  11. Avatar Jaybird
    Ignored
    says:

    This is an awesome comment, DavidTC.

    Is this phenomenon also applicable to health care?Report

    • Avatar DavidTC in reply to Jaybird
      Ignored
      says:

      @jaybird
      Is this phenomenon also applicable to health care?

      …I do not quite understand the context there.

      Do you mean that, just like the wealthy are ‘hoarding’ house construction (Because the profits for them are huge), they could be hoarding…medical research?

      I’m not entirely sure that works…I think most of the profit in medical research isn’t really due to the ‘wealthy’, it’s due to all sorts of random aliments that, thanks to insurance, are very profitable to treat. So we get everyone curing erectile dysfunction and high blood pressure, but no one trying to treat the…diseases of the uninsured?

      Not really sure where that analogy is going. If you want to make it, you’re going to have to make it yourself. There’s a lot of skewed priorities in medicine, but I’m not entirely sure they have much to do with the wealthy per-se.Report

  12. Avatar KatherineMW
    Ignored
    says:

    That’s a great description of the housing and inequality problem. Fits Vancouver extremely well as well.Report

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