Comment by horsawlarway | Hacker News Reader

Comment by horsawlarway | Hacker News Reader

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> why can't real estate work the same way?

So I'll tackle this...

Food is highly responsive to market pressure because it is nearly entirely fungible. I'll throw this here for the sake of making sure we're on the same page when I say that

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Fungible: able to replace or be replaced by another identical item; mutually interchangeable.

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So food markets are sensitive to pressure because there is hardly ever anything special about the food any one entity produces. Someone charging too much for corn? Go buy identical corn, that fills exactly the same need from any one of the thousands of their competitors. "Organic" was, in large parts, an effort to make food that is less easily replaced, and is mostly marketing rather than quality or health related (seriously, go google some of the chemicals that we allow to be added to organic food).

In contrast to food - Real estate is very rarely fungible. A specific plot of land has characteristics that often make it very hard to replace. Whether that's proximity to people or locations or features themselves such as soil, water, grade (slope, slant), existing structures, mineral presence ,etc. Non of those are consistent between different plots of land (there's a reason "Location, Location, Location" is a saying).

So no - Personally, I don't believe that real estate will ever be able to be treated in a similar way as the food market. Desire for it is predicated too much on aspects other than mere "acres" of it that you can get.

Imagine if just finding the right steak to eat was enough to make you rich for life, or if that ear of corn was where your family has been buried for centuries, or if that lima bean reduced your commute from a 2 hour drive to a 5 minute walk. I think we'd see pretty insane food prices then as well.

> I think we'd see pretty insane food prices then as well.

All you are saying is "imagine if food supply was more constrained" with more words. Commodification and constrained supply are orthogonal concepts -- the argument here is that increased commodification may lead to increased supply, so long as the market is allowed to act freely.

> that ear of corn was where your family has been buried for centuries,

This argument of "what if your family lived there before" in housing discussions annoys me to no end. We don't live in a feudal society where the right to a particular village is passed down through bloodlines. The fact that your family lived somewhere in the past doesn't entitle you to anything; you're not a Hapsburg monarch.

> This argument of "what if your family lived there before" in housing discussions annoys me to no end.

It's NOT about right - it's about demand. It's not relevant at all if it annoys you, the issue is that people can and do form sentimental attachments to the places where they live, and those attachments influence their willingness to pay (or hinder their willingness to sell).

And no - I'm not saying "imagine if the food supply was more constrained". I'm very clearly saying that food is fungible (you know - the thing I actually said...).

The housing supply is both constrained and non-fungible. The food supply can be constrained or not, but it's fungible as all get out - For the purposes of not starving, a calorie is a calorie, and where it comes from is irrelevant in a broad sense.

> It's NOT about right - it's about demand.

Sure, that's fair. I'm really reacting to arguments about gentrification, where people do talk about "rights" to stay in a particular neighborhood that apparently get passed via genetic material.

> I'm very clearly saying that food is fungible

My point is that the reason "fungibility" is important is actually because it impacts supply: there aren't just 100k houses vs 100k households, there are actually 10k houses with some desirable property (close to where most people work, sufficiently large to raise children, whatever) vs 50k households willing to pay a premium for that desirable property. Your point about fungibility doesn't change the conversation about supply and demand, it's just a partial explanation of the mismatch.

So outside of the context of most of the previous discussion:

> I'm really reacting to arguments about gentrification, where people do talk about "rights" to stay in a particular neighborhood that apparently get passed via genetic material.

What is it that bothers you about this? Basically - my counter argument is: If a person has been living in an area for decades, and that area is now gentrifying, can't it be reasonably expected that person (or their family) were fundamentally a part of driving that gentrification?

It means that person was putting in their labor and money into that location for decades, and that labor and money was key for creating the conditions that are allowing for gentrification (even if the final catalyst was something else - like a company using the stable area for new expansion)

Simplifying - My counter argument is that forcing this person out is robbing them of the fruit of their labor: A nice neighborhood. They were there when it wasn't nice. They worked in making it nice. Now you kick them out because they were working with a lower income to do it (usually meaning they put in considerably more "sweat equity"). Seems pretty unfair to me.

Land has these properties, yes. We will never see mass affordable ownership of desirable land. Fortunately, that is almost irrelevant to housing issues. Legalize building vertically.

There are thousands of homes/apartments around where I live that are about equally attractive for me to live at. Most sold by different sellers. Housing is fungible.

And I bet those apartments and homes carry roughly the same value/sqft...

The claim that housing is fungible is absolute non-sense, though.

If it were, we wouldn't see such drastic market variations, even within relatively close geographic markets (in some cases, literally blocks away)

We also wouldn't see such an intense pressure on evaluating real estate before purchasing (because if it was fungible - it's all the same, right?).

I basically don't know where to go in the conversation if you can't actually acknowledge the argument in front of you, and just say "No".

It's fungible for you, since apparently few dimensions of housing are salient to you. In my experience, this is not the case for most people. Units on the same floor can differ vastly; buildings on the same block can differ vastly; the neighbors you have, the direction a unit faces, square footage, street noise are all examples of factors that matter to many people and which can vary dramatically on a geographic scale measured in feet. Many people don't consider housing fungible to the extent that produce is.

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