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Comment by HarHarVeryFunny | Hacker News Reader

I'm seeing house prices around me skyrocket in last couple on months - houses selling almost immediately at well above asking price (e.g. 200K above in multiple cases), and this despite already high prices and horrible affordability.

I can only attribute this to FOMO.

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You may also be able to attribute it to a lack of supply, in that specific case

Or speculators and flippers, perhaps even foreign capital, buying up all available supply, because houses are financial instruments, not places to live.

You misunderstand cause and effect. They have become financial instruments because there is insufficient supply for the demand.

Unfortunately others with that level of economic ignorance tend to advocate for policies that fail to fix this and either 1) pick a few lucky winners and fuck everyone else over like rent control or 2) make things even more expensive by subsidizing house purchases or creating risk like the 2008 mortgages.

We need regulators and legislators who aren't bought and paid for.

Unfortunately, in areas where density drives value increasing supply also appears to increase demand.

Move someplace affordable isn't seen as a solution in part because it's not an intervention, it's just something people can do.

Jevons Paradox. Build 2x the thing, whether it's roads or houses, demand only gets worse.

Now I bet that expanding a road not by extra lane, but by ten of them, would exhaust all the "latent demand" and then some. Similarly, if the supply of housing were to increase tenfold, perhaps we'd run out of speculators?

Then again, leverage means they can probably absorb infinite supply - just keep loaning and buying to keep the pyramid scheme going.

Austin built enough to drop rent actually

If it was just supply (low) vs demand, then people logically would have bought earlier before prices went up.

This seems like panic buying (FOMO) - people buying because prices are rising and they don't want to risk them to get worse, or maybe they see it as a perverse sign of value (like people buying momentum stocks).

I guess it's possible

Maybe I'm just jaded from being in Seattle too long where "200k over asking despite already high prices" has been a regular thing for like... 10+ years?

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