And what affordable rental housing exists is increasingly being purchased by investment groups who then squeeze them for every dime, squeezing out the very people who need that housing in the process.
The housing crisis really looks to me like an aspect of the serious wealth inequality problem we have.
This has been dramatically demonstrated in Berkeley, where I live. We have added tons of 0- and 1-bedroom apartments recently. These are very expensive, $3000/mo+. This building boom has caused the price of rent-regulated older apartments to plunge. What had been renting for $2252/mo in November 2018 is now renting for $1688/mo in November 2023. That is a significant increase in affordability of studio and 1-bedroom apartment, effected by building newer, expensive ones.
Edited to add sources:
The discussion is too long for me to recapitulate here, but all of my data in various forms and some visualizations are available here:
https://observablehq.com/@jwb/berkeley-rent-board-data
Also in random tweets such as:
https://twitter.com/Jeffinatorator/status/172890293692602402...
I believe these are visible to non-account holders.
Edit: I think I see where a lot of our disconnect is coming from. We have no rent control here, rent very rarely decreases and is mostly pegged to comparative sq.ft. rentals in the area. Age of the property does not factor as much as location.
Do enough of it and rents will begin to fall below loan maintenance, causing even more sales and more price drops.
"We" are not a rich country, unless by "we" you mean the 10% of the population that is rich. I feel well compensated, I'm well within the middle class and consider myself lucky. I cannot afford a home, in the current market, in a location with the services and locality of my industry. I live in Florida. Vrbo, Airbnb, and properties purchased by institutional investors have directly increased my housing costs. That is objective, not subjective. Call it anecdotal all you want, the populated parts of the state have seen their housing options obliterated.
If we're going to use statistics for anything, let's look at it in the affirmative instead. How many homes are owned by the family living in them? The most recent data for Florida is for 2015-2019. Here are the owner-occupied housing for the most populated counties, starting with the one I live in.
Hillsborough County - 58.6% Miami-Dade County - 51.2% Orange County - 55.4% Broward County - 62.1% Palm Beach County - 68.9% Duval County - 56.7% Pinellas County - 67%
The National Average is 64.8%. In my county nearly half of the housing is not owner-occupied. As a nation, nearly a 3rd of available housing is not owner-occupied. I bet this is worse now, as this information is pre-pandemic and from the very beginning of the most recent housing rush.
https://www.census.gov/quickfacts/fact/note/US/HSG445222#:~:.... https://www.census.gov/quickfacts/fact/table/US/HSG445222 https://www.florida-demographics.com/counties_by_population https://www.census.gov/library/visualizations/interactive/ac...
Edit to add some relevant information: https://cdn.nar.realtor//sites/default/files/documents/2023-...
Also, to be quite honest, your allusions about shadowy Asians has the whiff of racist tendencies.
The problem is that it's not legal in most parts of most cities.
Just stating that Americans love their yards/privacy and it's not so simple to fix.
Well, ok then - we want affordable housing, let's build affordable housing. Nothing's perfect. Some people prefer denser housing in a more desirable place, and some prefer more space in Cyanide Springs, Oklahoma. Both should be a choice, but currently, we limit the denser housing options way too much.
And now the Fed can’t even get the guts to lower inflation by raising interest rates because of what it’s done to the housing market.
This kind of thing happens over and over and over again, all across the US and it adds up.
Houses are built by developers whom by definition only build a project when it's a sound investment. They immediately stop building when this isn't the case.
What people who buy homes are told, though, is to essentially 'buy and hold' because it's a "good investment" that will gain value over time, even if they are not building anything or adding any value to the dwelling they inhabit.
Where I live, during the recent runup in prices, the median home gained something like $100,000 of value in a year, which is significantly more than the median household income.
https://oregoneconomicanalysis.com/2021/03/16/who-benefits-f...
Ideally, I think, home prices would be fairly stable - neither appreciating a lot, nor dropping in value. Boring. That would also make them a 'bad' investment for corporations looking to make a buck by buying and holding.
Do you expect people to buy and sell their home? It’s their home, why would selling (in the short term measured in decades) be the goal?
People primarily buy homes to live in. Any benefits of price appreciation, and/or political interests of those nearing their end of life and want to downsize/die are secondary.
Think about this in the context of any other good. No one worries that if we build more cars, they'll all be purchased by rich car collectors. Yes, when more cars are built, a few very rich people with many cars will buy more. But the increased supply also make it more economical for everyone to buy more cars.
As I said, at other times in this thread, the only incentive we have as an and an economy in the United States, is agreed.
As I said, at other times in this thread, the only incentive we have in this economy and in the United States, is greed.
Secondly if a person owns a home and rents it to a second person, I'm fine with it.
If the capital appreciation is zero, then it's just the rental income, which is offset against the cost of maintaining the property and the opportunity cost from the capital outlay on the property. That's not a major problem though, as the rental price won't be able to get too high as people will simply rent or buy elsewhere (as you've reduced the other barriers to building more property)
Of course you can get rid of the appreciation by simply taxing the land (which is the thing that mainly appreciates -- the building itself typically depreciates), and get most of the way there.