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We don't need quantitative models if we want the rock to fall. It might be nice to have them, but one of the great things about market economies is that we don't micromanage according to overly complex estimates, and get better results.

Zoning and homeowners are holding on to the rock with a death grip, all while saying "the rock won't fall if we let go, that's fake science, it's far more nuanced you see" as they lie through their teeth to make big profits and immiserate those who don't own land.

The quantitative model will tell you whether building housing of type A of quantity B results in more of a decrease in rent than building housing of type C of quantity D. Then you choose the policy that results in the desired decrease in rent. Otherwise, you risk wasting time in pursuing a policy that only results in a 0.1% decrease.

You do have a strong point, in that homeowners are eager to approve plans that allow for ADUs but disallow anything slightly larger. Homeowners already have housing, don't often need more of it, and like having complete control so they approve plans that allow ADUS with the knowledge that it won't account for any significant new housing, and new housing is directly against homeowners' financial interests.

But in reality, the political choice of "let's build A, or B, or C" doesn't exist to maximize the effect of housing. People overly focus on highly regulating to a specific type of housing to prevent anything from getting built.

Let people decide for their own what type of housing they want, and all of a sudden we'd have enough of it. That's the biggest fear of landlords and homeowners.

Most rent payers aren't concerned with the exact function that will describe the shape of the curve for decline in cost of rent.

They are mostly interested in "rent go down", or at least "rent not go up".

That said, there are people who have studied this. You don't need Newtonian level math to calculate elasticity. Hell, we can look at how rents rise in a constrained market and make a pretty good guess what would happen if supply increases.

There are dozens of papers that have these numbers when you search the academic databases for "rent elasticity"

Lots of places in the world have legally mandated percentage by which rent can increase for a unit per year. It might be 2% or 3%, but it is a fixed number that is fought over politically before being decided. That is the function that you are claiming rent payers don't care about. But they do, as evidenced by elected officials enforcing the number they think will get them the most votes.

That’s completely distinct from increased supply driving down rents through market mechanisms. That process is completely independent of supply and demand in open markets.

People don’t give two shits about politically determined rent caps if rents are dropping through supply increases. I’ve lived in those places you describe and that mechanism creates market distortions that paradoxically drive rent way above the market clearing price for new entrants. In any case, none of those places place restrictions on lowering rent due to competitive pressure.

Notably, though, a significant fraction of people seem to believe that building more housing will cause rents to increase. So it seems like it is still important to point to data suggesting the opposite.

Housing is a unique market, because every single product in it is unique, and prices and rents can vary quite a bit.

In a city I used to live, the city decided to revitalize a section of downtown by bringing down some old small buildings and replacing them with high rises. The resultant effect was a bloom in shops and restaurants in the area. That meant that 1km^2 area became a lot more attractive, landlords jacked up rents, and existing tenants in the other buildings in the area had to move out for people who were willing to pay 2x the rent. Of course rents probably went down elsewhere in the city to compensate.

You will never get this sort of prediction from simply supply and demand. You need to build quantitative and holistic models that make predictions based on a range of factors. Then use those to make policy.

I don't think the predominant factor causing pollies to shy away from increasing housing supply is a lack of understanding that supply decreases prices, it's a lack of political will to decrease prices.

It's harder than you think to argue for a house price decrease when it's the singular asset that most older adults have most of their wealth tied up in.

In a city like San Francisco, relative to the status quo ante easier development is more likely to result in slower growth in home prices, not a reduction in home prices.

But that's not the reason most San Franciscans oppose development. The primary reasons are 1) they're convinced more development will raise prices, 2) they believe affordability must be mandated through price controls or subsidies (e.g. developers dedicating X% of units for below market prices), 3) they insist on bike shedding every development proposal to death, 4) they're convinced private development is inherently inequitable (only "luxury" housing is built).

Pretty much the only group of people in the city worried about housing stock increases reducing prices are developers trying to sell-off new units. But developers are repeat players, and they're generally not the ones lending support to development hurdles. Though, there is (was?) at least one long-time developer who specializes in building "affordable" housing--mostly at public expense, of course--who did aggressively lobby for development hurdles, but carefully crafted so he and only he could easily get around them.

> It's harder than you think to argue for a house price decrease when it's the singular asset that most older adults have most of their wealth tied up in.

The only thing they can exchange it for is another house or an alternate form of housing. Because you have to live somewhere.

But what I have seen is worries about social class and sharing space with new neighbors who act like they're from the next rung down on the ladder. Which isn't all that different from the usual objection to short-term rentals.

Yes, but many people use geographic arbitrage to exchange their house in a supply constrained area for a house elsewhere and enough money to never have to work again. Notably, the more you can work to restrict supply once you already are in the market, the sooner you can move to Costa Rica.

If I could lobby my government to restrict other people’s use of their property in a way that would give me enough money to create a generational wealth in exchange for moving somewhere with cheaper houses, I would be very tempted to be that asshole.

> It would be very hard for policy makers to argue against building more housing, if there was a quantitative model that predicted exact numbers for how much rent fell down given all relevant factors, and this model had been validated over and over again by prediction (not retrodiction).

Policy makers are experts at completely ignoring objective facts, why would this be different?

We don't need to know how much. We just need to know the direction, and stop caring so fucking much about rich people going underwater on their home.