The Biden administration announced new steps Friday to ensure access to affordable housing, launching a slew of resources to convert high-vacancy commercial buildings to residential use.
We study the city-wide effects of new, centrally-located market-rate housing supply using geo-coded total population register data from the Helsinki Metropolitan Area. The supply of new market rate units triggers moving chains that quickly reach middle- and low-income neighborhoods and individuals. Thus, new market-rate construction loosens the housing market in middle- and low-income areas even in the short run. Market-rate supply is likely to improve affordability outside the sub-markets where new construction occurs and to benefit low-income people.
Turns out there may be a meaningful difference between randomly cutting taxes from businesses and building a bunch of new housing.
I’m in agreement. Also in Seattle. The median house price in Seattle is over $800,000. Down a whopping 2%. This means you’d have to make over 200k a year to afford your mortgage. How many more apartment units will trickle this down the other 50% or 75% to make it affordable to everyone? People need to be realistic. Bans on for-profit home ownership need to be part of the mix here, not just more supply.
One to four units can only be privately owned, 5 to 8 units can only be owned by a registered company, more than that must be run as a non profit (ideally a state corporation).
People are only allowed to own one property in a 50km radius (meaning that if you own a 4 unit you pretty much have to live in it unless you live in the next city over).
Well they can, it just means that the building management needs to show that all the money they get gets reinvested in the building or put aside for repairs. Non profits are much easier to investigate than private companies because they need to be able to justify everything they spend so they don’t overcharge. If it’s a state corporation? Even better, profits get sent to the government coffers to spend on services and you’re sure that the charges are lowered the next year. That’s how our health protection works for anything related to roads where I live and there’s a pretty good reason why it’s the province where it’s the cheapest to insure a vehicle!
Not everyone wants to own, even when housing was affordable there was still a bit more than 30% renting.
At the point we’re at there’s more competition to own because renting is so expensive that it’s way more logical to purchase, flood the rental market to crash prices there and people won’t buy at a ridiculous price, they’ll simply rent instead, lowering pressure in the whole market.
Disagree with what you’re saying though there is some truth in what you’re saying:
We’re low on supply on housing in major business areas, because we haven’t kept up with house manufacturing for like 20+ years. If we just allow developers to build what they like, yeah they’ll mainly aim for luxury apartments/condos which only the rich will be able to afford. There will be strong resistance from the landlords to drop the property/rent value since the property is constructed to be more luxurious, so we’d need a ton of those luxury homes before medium and low income homes get built or become available (through price drops). That’s why, governments need to require some low income/median income offered units to help house more people with these new units until supply catches up or some other way to ensure that lower income people (non-rich) are able to afford homes.
Overall, making more homes is the ultimate solution to our low supply problem, we can argue of better ways to make more homes, get more average/median people housed, and decrease living costs, while we make new homes. Otherwise, we’ll be here arguing about what to do, and letting the problem continue to fester instead of refining imperfect solutions.
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I know you don’t care about evidence, but for anyone reading who does, here’s a study from Helsinki.
https://ideas.repec.org/p/fer/wpaper/146.html
Turns out there may be a meaningful difference between randomly cutting taxes from businesses and building a bunch of new housing.
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The paper came out before that investigation was opened, so unless the paper is wrong, you’re probably wrong.
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I’m in agreement. Also in Seattle. The median house price in Seattle is over $800,000. Down a whopping 2%. This means you’d have to make over 200k a year to afford your mortgage. How many more apartment units will trickle this down the other 50% or 75% to make it affordable to everyone? People need to be realistic. Bans on for-profit home ownership need to be part of the mix here, not just more supply.
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I’ve got similar ideas!
One to four units can only be privately owned, 5 to 8 units can only be owned by a registered company, more than that must be run as a non profit (ideally a state corporation).
People are only allowed to own one property in a 50km radius (meaning that if you own a 4 unit you pretty much have to live in it unless you live in the next city over).
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If it’s rental then it’s non profit, they can convert them to condos if they don’t agree.
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Well they can, it just means that the building management needs to show that all the money they get gets reinvested in the building or put aside for repairs. Non profits are much easier to investigate than private companies because they need to be able to justify everything they spend so they don’t overcharge. If it’s a state corporation? Even better, profits get sent to the government coffers to spend on services and you’re sure that the charges are lowered the next year. That’s how our health protection works for anything related to roads where I live and there’s a pretty good reason why it’s the province where it’s the cheapest to insure a vehicle!
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Not everyone wants to own, even when housing was affordable there was still a bit more than 30% renting.
At the point we’re at there’s more competition to own because renting is so expensive that it’s way more logical to purchase, flood the rental market to crash prices there and people won’t buy at a ridiculous price, they’ll simply rent instead, lowering pressure in the whole market.
It’s one of the many ways to lower prices!
Disagree with what you’re saying though there is some truth in what you’re saying: We’re low on supply on housing in major business areas, because we haven’t kept up with house manufacturing for like 20+ years. If we just allow developers to build what they like, yeah they’ll mainly aim for luxury apartments/condos which only the rich will be able to afford. There will be strong resistance from the landlords to drop the property/rent value since the property is constructed to be more luxurious, so we’d need a ton of those luxury homes before medium and low income homes get built or become available (through price drops). That’s why, governments need to require some low income/median income offered units to help house more people with these new units until supply catches up or some other way to ensure that lower income people (non-rich) are able to afford homes.
Overall, making more homes is the ultimate solution to our low supply problem, we can argue of better ways to make more homes, get more average/median people housed, and decrease living costs, while we make new homes. Otherwise, we’ll be here arguing about what to do, and letting the problem continue to fester instead of refining imperfect solutions.
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