Is that the case in Detroit? I’d wager there’s substantially more supply than demand.
> It isn't perfect (massive bubble right now) but seems to work well enough.
If there’s a massive bubble then it seems like that system didn’t control prices.
The bubble mostly affects new home buyers, which are the ones who need the least protection.
Rent is inflation-adjusted and can't be raised at will, so there is a very long delay between market prices increasing and most tenants actually bearing the cost. Everyone living in social housing still has a home, and won't be evicted so that another person can come in to pay 2x the rent. Seems pretty good to me.
I don't know much about Detroit but it seems to demonstrate that the simple supply-demand model does not reflect reality. Prices should have dropped significantly, but instead it followed the same curve as the rest of the USA, with those $500 properties being a localized phenomenon.
So now you (or more generally the government) get to decide who is more deserving of appropriately priced housing? Why do new home buyers need less protection?
> Rent is inflation-adjusted and can't be raised at will, so there is a very long delay between market prices increasing and most tenants actually bearing the cost.
This is precisely the problem with this policy. When price doesn’t feed through to the market, the market can’t adjust. People simultaneously argue that the free market doesn’t work while endorsing policies that prevent the market from working.
> it seems to demonstrate that the simple supply-demand model does not reflect reality
The population dropped from its peak by 1.2mm people. Prices subsequently fell so much that it was possible to buy houses for $500. That’s exactly what the supply/demand model would predict.
"In June 2022, Detroit home prices were up 32.3% compared to last year, selling for a median price of $99K. On average, homes in Detroit sell after 27 days on the market compared to 23 days last year. There were 463 homes sold in June this year, down from 512 last year."
[0] https://www.redfin.com/city/5665/MI/Detroit/housing-market
Agreed that you can find $300k houses (and cheaper). I was just surprised that the nicer areas were still pricy. I mean Indian Village, and the neighborhoods you mentioned, have some nice homes, but those neighborhoods feel like an oasis surrounded by areas that are dealing with very tough economic situations.
Again, I was just surprised at the price for places I liked. If I wanted to take a chance on a neighborhood that might turn around in the next few years I could find some deals (although a lot of those homes need a lot of work).