By Ryan McMaken
High prices are not the “unintended consequence” of good intentions.
I wonder if homeowners will get rugged once Boomers have less political power than the Zoomers. I'm guessing not, because localities also count on high property values for tax revenue, so the pressure will always be upwards.
Isn’t it inflation and houses are a kind of hard asset.
It's sort of a hard asset, but the fixed supply is more of a government imposition than a physical reality.
Houses could also be considered depreciating assets, like cars
This is manipulated supply and demand. Put more inventory on the market, prices go down. Banks have plenty of foreclosed units, but they are holding them back along with builders to keep the market pricing high and with outrageous profits.
I don't think it's primarily for outrageous profits, although that's a contributor.
Higher prices = higher property tax receipts
Merry Christmas
It doesn't help that the group of people most incentivized to bring down housing costs have zero idea of why housing costs are high to begin with.
And, moreover, the group of people who most desires the right solution (developers and deregulation) are treated with suspicion by the group who would most benefit (young people struggling with housing costs)
Merry Christmas
Houses have gotten bigger and have more amenities than in the past.
This day seems to ignore this fact.
True but I'd be surprised if that was a significant factor. Price per square foot has went up.
I do agree that the range of features hasn't stayed the same. This is why tiny houses are a thing. The low end house really isn't built anymore.
You can say the same of cars as well.
Now this is an interesting topic. Sometime ago I was reading the Ancient City, where Coulanges discusses the economic "cycle" (don't know if I like the phrase) societies go through, where society's older, established, and landed part inevitably begins taking measures to prevent the younger, unestablished, unlanded part from taking resources from them.
Except here, in the 2020s, I think we have only the instinct without the substantial or rational reason behind it.
Because how many of those homeowners truly own their properties, and are not rather indebted to the bank for them? And these aren't income/resource generating properties, like the old Roman latifundia estates; we're mainly talking about older people, or their inheritors, clinging to ownership of relatively modest, solidly middle class homes (by 1990s standards).
In effect, isn't this just an irrational and socially self-destructive species of hoarding?
They may not be landed gentry, but even if they're still paying off their mortgages, nominal property values have appreciated so much that they have significant equity in the properties.
That's what they're protecting.
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https://cryptoquant.com/asset/btc/chart/exchange-flows/exchange-reserve?exchange=coinbase_advanced