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Comment by xenospn | Hacker News Reader

Building more homes to ease the housing crisis is similar to building larger freeways to try and ease traffic congestion. It’s just not going to work.

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This seems to assume that induced demand is a significant factor in housing ownership. Which could be true! Maybe we also need to look at housing speculation. If we build more homes and they’re all bought by housing speculators, the median persons home ownership won’t change.

Induced demand and housing isn’t talked about enough when discussing housing prices. I’m not going to crunch the numbers, but I could see it working out for speculators with nearly infinite funds to buy up whatever new housing supply as a means to artificially keep supply low to keep their stock of real estate overvalued.

People talk about induced demand for housing often enough. It's not as big obstacle as induced demand for car traffic in large metropolitan areas. It simply means that you can't solve housing issues locally. You have to deal with them at a large enough scale.

Speculators hoarding the housing supply sounds like a market failure. If you believe in capitalism, the market will deal with the issue. Non-speculators will show up and build new housing, if you let them. If you don't believe in capitalism, there is always government intervention. The government could, for example, build public housing for 100 million or 200 million people, prioritizing areas with least affordable housing.

For more information on government options I always go back to this link: https://www.shareable.net/public-housing-works-lessons-from-...

Why not? Because they're just going to be purchased by out-of-country buyers and left empty?

or by corporate landlords and rented out. or by already wealthy howeowners leveraging their existing properties to borrow money to buy new properties, or or or or. Or by overwhelming immigration beyond the capacity of the host country, or or or.

There are a lot of social problems that cause building houses in and of itself to not be too effective.

Rented out increases supply. People have been born anyway, with or without the housing.

Look, in terms of supply and demand, we've never had a higher supply of people, and from a propagate-the-species point of view there's no additional demand for people either. I sort of agree that more people overall diminishes the aggregate quality of life, there is more art, music, sports, literature, and everything else created by people than anyone can meaningfully experience anyway, while all of the natural world is destroyed a bit more by each additional person. But adding 2Mm houses will give a bunch of place for people to go to and take pressure off the others.

rented out doesn't revive the american dream, its a way to convert money from people who don't have enough to buy a house into money belonging to people who have more. It also keeps costs high because it turns properties into investments without consideration of people's welfare.

So yes, it may increase supply, but it does less good for society than individual home ownership.

It will if immigration is controlled and purchasing of properties by commercial interest is regulated to make sure people can live affordable before companies become landlords.

It's not a problem with building it's a problem with everything but building.

I suspect the purchasing of properties by commercial interests is probably by far the dominant factor here, with immigration having a minuscule effect in comparison.

It depends where you live. In canada net migration is many many many more times the building of houses, and impacts the demand for houses incredibly. It also spurs commercial buying of houses - if immigration isn't high you might lose money on a house, but if immigration is high and supply is much lower than demand, you're going to make money on rent and then make money on the property too. People who bought houses previously made much more than is possible to make by selling your labour.

> In canada net migration is many many many more times the building of houses

Okay but that doesn’t say anything about immigration versus commercial land ownership, which was my point. You’re saying immigration influences house purchases and I don’t disagree, I’m just questioning the magnitude of that effect compared to commercial land ownership.

commercial home ownership is made less risky and more profitable if supply is far lower than demand, which is the case with overwhelming immigration and a housing construction sector not able to keep pace with immigration.

This just isn't true. Rents decreased in Texas after an increase in supply. Increasing supply will decrease prices. Freeways typically don't cost money so that doesn't apply.

Houses largely don't get built without being presold. Presales are not going to happen without a significant interest rate drop. Interest rates aren't going to drop. This isn't the multifamily market under discussion. Rent prices have significantly more wiggle room under market forces than does new single family construction, the latter which needs to be profitable upon sale instead of over 30 years.

Folks are downvoting cus their feathers are rustled but you’re 100% right on this.

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