Comment by zaptheimpaler | Hacker News Reader

Comment by zaptheimpaler | Hacker News Reader

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Build enough housing for everyone. Build more than necessary so that there's slack and flexibility to move. There's no similar monopoly dynamic with cars or phones or thousands of other goods. We just make a lot of them.

Oversupply will take care of the downstream issues. They will cease to be good investments and become commodities. Rents will have to come down in a competitive market.

Oversupply will have to be on a regional level. A vacant house in a small town doesn't compensate for an occupied house in a city 100km away.

Zoning laws prevent this in the US/Canada in many places. Existing homeowners don't want to change. More houses means more crowding, higher traffic, construction noise, obstructed skylines, more pressure on schools, police etc. We can't accept that argument when weighed against homelessness or poverty anymore. Fuck their skylines, shelter is a basic necessity and it often has to be close to work, shopping, school etc. Living in the middle of nowhere is not an option.

Land needs to be legally switched from an asset into a liability before the market will build housing supply with the same enthusiasm it builds phones.

Land redistribution (which is structurally similar) only really tends to happen after a revolution and that tends to be bloody. Landowners throw resources at violent and politically extreme reactionaries to send off the threat of their rent entitlements being democratically revoked.

So, it's unlikely to happen soon and if it does happen it'll probably get pretty ugly first. The path of least resistance will be a gradual slide into a kind of neofeudalism.

Now convince capital to do it (because most governments won't) with very low potential returns due to oversupply.

https://threadreaderapp.com/thread/1510262323176374278.html

https://news.ycombinator.com/item?id=30891217

Great comment from the above thread: https://news.ycombinator.com/item?id=30897398

All we need is a few people in power to sacrifice short term political gains with regards to homeowners opposition.

Building housing is expensive but we manage to fund the military today. We were able to build a massive countrywide network of roads and highways and train tracks a 100 years ago. So fuck capital too. Of course they don't want to build it, and this is a _necessary_ consequence of making housing not be an investment. It will not be profitable to build. But it will be good for humanity anyways. So it has to be atleast partially funded by taxpayers. That might even mean we all collectively get screwed by high rents and high taxes for a decade while we do that. As long as it actually does benefit future generations, so be it. There's plenty of room for efficiency in building as well so that's not necessarily the only way. Subways cost 10-50x more to build today than they used to and there are hundreds of companies that live off leeching public funds.

Any solution that begins with "All we need is X people to ..." is an almost guaranteed failure.

> We were able to build a massive countrywide network of roads and highways and train tracks a 100 years ago.

Building the first road/train track connecting A to B pays for itself (probably many-fold) in increased revenue from taxes you can collect because such a connection significantly increases the economy.[1] It's not clear that more housing will have that impact.

And for all the people complaining about zoning and NIMBYISM: That's a very local phenomenon in a few cities. Where I live we have neither of these problems, and housing is still a major issue. I'd wager that's true in most US cities that have housing problems. Preaching about zoning and NIMBYism is merely showing a disconnect with the rest of the country and is a red herring.

Solve the incentive problem - at current building prices builders cannot afford to make housing for lower income folks. Either make the cost to build cheaper or, as the parent says, get the government to subsidize building it so they can make a profit.

[1] Fixing up existing roads doesn't, which is why if budget isn't properly allocated for maintenance, you'll get poor infrastructure.

>All we need is a few people in power to sacrifice short term political gains with regards to homeowners opposition.

The wealth of most of our political class is also tied to their real estate holdings. 1/5 of our politicians are landlords in Canada; our housing minister has multiple properties. Make it make sense.

How does Japan do this successfully?

What I wanna know is how does Tokyo do this semi-successfully? People point out the demographic declines of Japan as a whole, but the Tokyo metroplex hasn't been quite hit by that.

I know there was stuff like proposing to pay people to move away, but I don't know if that's a real thing?

I'd suggest the way Tokyo does it wouldn't be acceptable to most people in vastly smaller and less dense cities (i.e. basically every other city in the world), where we have a very high expectation of how much space/land a house should be able to take up.

This is just incentives.

If you reward people for conserving a scarce resource, they'll use less of it.

If you reward people for wasting a scarce resource, they'll use more of it.

There's some natural human value attached to space, but in the current system people are incentivized to own more than they need, because to do anything else would be giving up free money, but the fact that everyone else is doing the same, ruins things for everyone.

Not sure I agree - it's cultural too. If you grow up with the expectation that you'll never own a spacious 3-BR house with a dedicated yard, then you wouldn't think spending your life living in small apartments or townhouses was so terrible. But I admit I'd find it very hard to adjust to even if the reward/incentive for doing so was super high. And the dog would almost certainly agree!

Japan has a completely different view on housing. Houses in Japan are made with the expectation of being torn down [1]. This causes all sorts of secondary and tertiary effects different from the European model of buildings lasting for centuries.

[1] https://robbreport.com/shelter/home-design/japanese-homes-ar...

This is the real answer. Japanese tax law heavily incentivizes building and discourages sitting on land forever and doing nothing with it for one’s own investments (paging California).

Helps that the whole country is on a fault line; nothing is going to stand up for a while anyways so you may as well establish a culture of rebuilding.

I often hear this, but that can't possibly be the explanation, as it was true both before and after Japan had a colossal real estate bubble and crash:

https://gestaltu.com/wp-content/uploads/2016/08/120927-Japan...

Buildings always depreciate, and North America has its fair share of homes not intended to last generations. In Vancouver it's become common for wealthy homebuyers to knock down houses that are less than 20 years old to put up something fresh, but that didn't stop property values from appreciating.

And in China it's perhaps even more the case that homes aren't built to last, and they even have an oversupply issue if anything, as well as a much more advanced population decline than Japan did circa 1990. And yet real estate in China has still attracted so much investment speculation that it's even less affordable, and my guess is it's following the same trajectory that Japan did. Property speculation is a powerful force.

I think a much better explanation is that the Japanese RE bubble taught Japanese speculators a lasting lesson, and the subsequent demographic decline, universal zoning, and widespread availability of mass transit kept it cheap.

China's house market is also affected by different cultural forces. It is almost impossible to marry without owning a house/condo. This forces a ton of young people to buy property who may otherwise rent. Also you are seeing the break up of multigenerational living situations into individual family units as you move from rural to urban living scenarios.

Land and real estate are also a huge income shelters for Chinese elites. They cannot appear too wealthy, so they buy real estate to hide their wealth. Only recently, last 5 years, has China instituted a national real estate registry. I wonder how much of the market disruption of the last few years is due to large players trying to divest themselves.

> This forces a ton of young people to buy property who may otherwise rent.

It's not clear that tilting the rent/own preference toward ownership results in a net increase of housing prices, because for every unit of homeowner demand it adds to the market, it also removes one unit of landlord demand.

Dwindling population

They also never stop building.

And when they do stop, it’s only to tear down a building so they can build another one in it’s place.

Because their population is shrinking rather than growing, and they effectively disallow immigration?

Japan is a deflationary case study.

How does Japan do this successfully in Tokyo (which was until recently, growing in population)?

https://www.asahi.com/ajw/articles/14538387#:~:text=Tokyo's%....

https://japanpropertycentral.com/tag/average-rent-tokyo/

People are OK with leaders making decisions that result in them living in accommodations that people in the US and other western countries would deem unacceptable, mainly relating to quantity of livi by space and storage and usage of personal cars.

In the 50s to 70s when the population was growing a ton and new housing was needed the government funded a ton of public housing (Danchi) to offset the growth in demand.

Things have changed a lot since then but it seemed to have been very successful at fixing the housing crisis of the time.

They let people build things.

Capital will do it, no problemo

The main thing that impedes is is regulatory/zoning limitations

And while I'm mostly in favour of code limits (so, minimum size, insulation requirements, fire-proof requirements, etc) most of the impeding regulations are things like maximum height size, blocking developments based on the "character of the area" (read: NIMBYS complaining) etc

Capital demands a return. If you build to oversupply, where is the return? Government must do this because it is likely unprofitable, but what do you do when there is no will to do it? That’s the problem I believe.

The market never knows when will it oversupply. Especially for something that takes time like housing

That's one of the reasons of past housing bubbles

"Oversupply" is also dependent on the actual target market. Several places lack cheaper housing but have an oversupply of more expensive ones (more bdrs, fancier areas, etc)

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