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Comment by intopieces | Hacker News Reader

> disincentivizes investment in housing.

Great! Housing shouldn't be an investment anyway. There's no reason it has to be; there are plenty of places -- like Japan -- where houses are depreciating assets that expected to be torn down when the owners leave.

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> There's no reason it has to be; there are plenty of places -- like Japan -- where houses are depreciating assets that expected to be torn down when the owners leave.

Japan has a declining population, which means that rural housing actually can have zero buyers for it, where the population is lower than the number of houses. One in seven buildings in Japan is actually vacant [0].

If their population was increasing faster than housing construction, then housing would actually increase in cost.

[0] https://www.bloomberg.com/news/articles/2019-04-29/japan-s-s...

Rent is cheap even in Tokyo compared to virtually any American city. I'm living in a city of 800,000 and early 30s families have no trouble buying a new house if they want to. It was this way even before the population started to decline. People tell me all the time that rent is so expensive in Tokyo, because it's... about $100 more a month. Prices are fairly uniform here.

The reason prices aren't high is that nobody wants to live in an old house. "Old" being 15 years old or more. Even with renting apartments, if it's older than 7-8 years old, agents will almost warn you that the property isn't exactly fresh and sparkling, but it's still not bad. If it's a pre-90s house, it's considered basically unwanted and they'll all but try to give it away. Meanwhile, 90s homes in the US are still marketed as pretty new, and demand seems to be higher for older homes than newer ones. America also has loads of empty houses. It also has loads of property owners who refuse to lower prices because their ego is worth more than their property. Apparently about 1/8 American homes are currently vacant, and the population isn't declining. Price and desirability are the problems.

All real estate is sold in a market. The fact that prices may be too high in some places in the U.S., right now, do not change that Japan and America are both subject to supply / demand mechanisms. Foreign investment in U.S. real estate is much, much more common than Japanese real estate.

Japan, is also no stranger to real estate bubbles, having experienced perhaps the worst real estate bubble in modern history in the 90s:

https://www.investopedia.com/articles/economics/08/japan-199...

"At their peak, prices in central Tokyo were such that the Tokyo Imperial Palace grounds were estimated to be worth more than all the land in the entire state of California."

Yes, all housing markets are subject to supply and demand. The point I was making was that declining population has zero effect on Japan's non-rising home prices, since home prices have remained stable for decades now and even when the population was still rising. The main regulator is that there's almost zero demand for used homes, and it drops to actual zero as the years go on. The real value is in the land its on, which if you're planning on buying property in somewhere like Roppongi, it's still going to be insanely expensive. But for renting or buying elsewhere, it's not.

Yes, it should be. Housing is a highly capital intensive process and done incorrectly, often by government, can lead to disastrous consequences:

http://www.indianapolisrecorder.com/news/article_b27a7cf6-1d...

https://www.reddit.com/r/UrbanHell/comments/5gx86v/russian_a...

https://commons.wikimedia.org/wiki/File:Petare_Slums_in_Cara...

Your evidence is one poorly-written newspaper article, a reddit disaster-porn post, and some random picture of Caracas?

Authenticity of the reddit post aside, do you have the slightest knowledge of urban development in the Soviet Union, or like, anywhere, or do you just regurgitate links?

A lotta shit got built 'cause you need to house a lot of people after your country's major urban centers got basically raized to the ground, the surrounding countryside along with it, alongside continuing rural->urban migration. Ain't particularly easy to do that well while also trying to recover your economy from a massive fucking brutal invasion.

Yes, Khrushchevkas aren't exactly marvels of architectural longevity; they were never intended to be. They were supposed to last maybe 30-40 years at best, and they're still standing. Sure, they're shoddy and they look like shit now, the countries that built them lacked the capital to replace them as intended--that's another history lesson, but whatever. You mock them for carrying on shambling well past their intended use? They should be lauded for lasting as long as they have, with what limited resources and tight constraints under which they were originally built.

Point is, you want the government to cheap housing and fund it as such, it does so, and the output sometimes ends up surpassing your original goals! You put funding into producing good housing and government can do that too! You ever been to Singapore? You ever hear about the sprawling abject rotten slums of Singapore, that dominate the whole of the nation? No? Curious that.

Would be really fucking strange to hear that a government could build a lot of good housing for its populace and still succeed economically, I suppose, but hey, they did it: https://en.wikipedia.org/wiki/Public_housing_in_Singapore

I thought they did that due to construction quality and social stigma relative to reusing housing? Contrast that with Europe.

Do you have any additional info?

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