It’s so foreign to me that I have a hard time even believing it and I can only vaguely describe it. But, effectively, houses don’t appreciate in Japan and they don’t like moving into houses other people have lived in before. It seems wasteful at first, but they also build very different types of homes. And, their homes are more optimized for the particular people living in them. And, the economy seems to greatly benefit from the adaptability this provides.
But, please do your own research. I have visited and seen it for myself but still have a hard time comprehending all the differences.
Mostly the foundations are not as I'd expect to see them in the UK (where I'm from). If you remove the Tatami flooring, there's a thinish piece of wood, under that there's Earth.
So what it comes down to is that because many houses are made of wood, and because of Earthquakes, houses kind of get structurally unsound over time. At some point it's just more economical to pull the house down and build a new one than it is to renovate it. This is my understanding anyway.
I don't understand planning permission in Japan well, but it seems easier to get than I'm used to seeing (in the UK). Perhaps that helps depress land value.
People seem to find moving not wanting a house someone has died in weird. I think it's more understandable with houses that last a relatively short time... deaths, and suicides that have occurred in a house need to be declared when the house is sold. It decreases the value of the house somewhat.
Somehow all of this has contributed resulted in much more (to my mind) reasonable housing prices, at least outside central Tokyo.
I've just bought a house in Japan (with my wife) so a lot of this stuff is on my mind. If anybody would like to talk further, my email is in my profile.
I've also heard that Japanese homes aren't built to last and that they get rebuilt rather frequently by Western standards, although I'm not sure how true that is.
As a result new buildings get built all the time and everything is nice and newly renovated everywhere you go, including the subways.
One great example is stepping into the Ginza subway line, which is the first subway line in Tokyo (circa maybe 1920s or 1930s), and comparing it to the dungeons of some older NYC metro stations or London’s tubes.
The country's most holy Shinto shrine at Ise is ceremonially torn down and rebuilt every 20 years.
Most other temples need parts of the building (like the roof) replaced every now and then, and have burned down a few times over the centuries.
There's really only a handful of temple buildings that have parts that are more than 500 years old.
As for the architecture, it’s very creative! Neighborhoods don’t really have the conventions of conformity like we have. Each house is free to be whatever it wants, but they are all very small compared to American houses. Most norms in Japanese culture seem to favor the group, cooperation and environments of mutual respect.
I do remember pointing out that a few (very few) of the houses looked pretty old and they told me those people have probably lived in them since they were built and just haven’t wanted a new one.
Did you read the article?
As noted its also typical to modify a family home over time - maybe one child moves out and another starts a hair salon in their old ground floor room (yes the planning rules allow this)
Demolishing a home is also related to historic cultural use if timber where in the west the wealthy built out of brick and stone for the ages
In e.g. San Francisco, more than half of the city is zoned to only allow detached height-limited single-family houses or sometimes duplexes, with businesses restricted to designated commercial streets. When you add wide streets with several wide lanes, generous street parking, parking requirements for buildings, long skinny land parcels with (often unused) space for a small yard in the back, etc., land use overall is incredibly inefficient even if you want to preserve the “local character” of low buildings.
Look at the sea of light yellow zones in the zoning map, http://default.sfplanning.org/zoning/zoning_map.pdf
And among cities in the region SF has higher density and more flexible zoning than most.
If we upzoned the Richmond, Sunset, and Marina neighborhoods from pale yellow to orange and purple, and added better transit, we could easily double the population of the city without anything taller than low-rise apartments.
See e.g. the Google Maps images in this article  discussing Australian vs. European cities.
Just as another explanation why Paris can be SO dense, with buildings that aren't incredibly high - Buildings are packed in close to each other. The height of the buildings are a signature architectural element of Paris, broken only by the Tour Eiffel.
Businesses many times occupy the ground floor, with apartments up top - relatively normal in European cities, but against many zoning laws in the States.
The layout of the city certainly doesn't make owning a personal car all that, say, automatic of a choice. Paris is not a large city. When living there, I may have used the metroonce a month, but mostly just rode my bike to where I wanted to go (cheaper! and usually faster...). You could easily walk half the city in a relatively short amount of time (as I was oft to do after a party!). High speed trains could whisk you to many bordering countries in just a few hours. Ah! Paris: un joli désordre!
Do they have better soundproofing or am I just too noise sensitive?
I lived previously in a 100yr old brick walkup building in NYC. It was like my neighbors were all roommates in one house. That apartment almost drove me insane with the amount of neighbour noise I would hear at all times.
Concrete really is such a fantastic building material and yet people want to build their houses out of timber for some reason.
Informing the neighbors or inviting them to the party also works. If you are really pushing it you buy them some flowers and ask if it wasn't to much trouble the day after. If you have a normal relationship asking if the neighbors can tune it down a bit shouldn't be a big deal either.
Think bedrooms large enough to fit only a bed in a corner and a foot of space between the bed and one wall to allow access to it. Or a kitchen measuring 4x5 feet including appliances.
Most Americans aren't willing to accept those living conditions.
How an Average Family in Tokyo Can Buy a New Home
new apartments built are not priced affordably because banks and investors want their interest back quickly and have promised surrounding neighborhoods they will price accordingly to keep out the riff raff. in turn, dilapidated apartment complexes from the 60's go for about the same rates because these property owners know there is no "better offer" in town.
this doesnt even cover the 73,000 homeless people in Los Angeles county we cant seem to find a place for because no beach city wants to house their own unsustainable numbers of homeless, and no desert community is within a radius of health and welfare services required by many transients.
Then there are the haters. people like the Aids Healthcare Foundation who ran a 6 month campaign to defeat city legislation for new affordable housing. Why? Mike Weinstein doesnt want any development to obstruct the view from his penthouse.
My husband and I live in LA and love it. but honestly, its bittersweet. We will never truly own anything more than a latte here.
Wasn't there a pledge to spend over $100 million on this issue last year? Not to mention a new tax w/ HHH.
But yeah, LA is bittersweet. Great weather and lots to do but the lack of a true center, unaffordable housing, and the slow, expensive build out of public transit leaves a lot to be desired.
At my age, I don't care so much about housing in my current situation (to be honest, given the schools here, I would go elsewhere), I would just like half my income not to go to rent (this is in a rent stabilized building - my recent bout of unemployment would've seen me joining the other flood of folks leaving since it wouldn't have covered market rate rent).
Goes for transit as well. Because the homeowning / wealthy won't pay their fair share of taxes, those of us in the lower brackets who will really benefit from public transit also have to take on that burden at the sales tax level.
Even when cities do undertake to provide services rather than shifting costs, their capacity to provide those services is only a tiny fraction of the national demand. And it's functionally a national or at least regional market because the homeless tend to be a very mobile population due to lack of fixed housing or employment. So you get cities like Portland, OR, where they provide extensive services, but the downtown areas where the services are located have been inundated with homeless people, which has been extremely detrimental to businesses in the area, has strained public safety resources, and damaged the quality of life of many local residents (eg a couple years ago a homeless man made a tent home on the sidewalk outside my apartment and then would scream at the top of his lungs for hours every night for months, making it impossible to sleep, presumably because of some mental illness).
In some ways, it makes zero sense for San Francisco to spend any money at all on the homeless, because it's one the most expensive places in the nation that we could be housing and providing assistance to the homeless population. But homeless people have rights, including the freedom to travel where they want. So they will continue to be attracted to cities that treat them well, at a disproportionate expense to locals (who ironically tend to be the ones most sympathetic to their need), while NIMBYists contribute nothing and experience no detriment. While also generating homeless people at the same rate as the more welcoming areas.
All of which is to say that we need some national policy here, otherwise a few cities will continue to shoulder the burden while most will skate along as free riders. A functioning mental health system would be incredibly helpful, for example, because then mental health services wouldn't be limited to a few locations.
$275M last year, $305M this year. Absolutely no accountability for the spend and no metrics to figure out if it's actually doing anything. It's a complete waste of money.
But it's from 2016 so it probably grew since then. A lot of the money goes to social housing towards 'ex' homeless people.
I mean, if in City A the cops hassle homeless people and the only support offered is bus tickets to other cities, while City B offers good support and humane policing, I'd take the bus ticket from A to B - who wouldn't?
If you give them the money then all the money goes to the people it's supposed to help and there is no cut for the middle men. But the middle men are the ones with the ability to successfully lobby for programs to exist.
It's the same sort of thing as low income housing subsidies. Landlords lobby for them because they pretend to address high rents when their actual result is to keep rents high. Or even increase rents by stimulating demand without increasing supply.
The primary issue is: if you directly give the homeless people $40,000, the people in the lower and lower middle 1/3 economic tier are going to ask why they're not getting that kind of help - cash thrown at them - despite the fact that they're working two jobs and at least paying some taxes.
To which the obvious solution is a UBI. Which would then solve the equivalent problem with all the programs aimed at the working poor.
Which is why we should tax land, not the improved value of land (property tax). And not labour.
The American idea of a perfect life is to have a nice house with a huge yard that the kids can frolic/play in. A big house with a big garage. And of course in a nice school district.
Basically its supposed to be an ideal environment for raising kids. Which is weird because me and all my friends grew up in heavily urbanized areas living in apartments (outside the US) and all turned out OK (well almost all).
It probably also has to do with the independence of not having others live across the wall.
In Italy, we essentially had no yard at all, and they were mostly ok - often we'd take them to the park where all the other local kids went, and they loved it, because almost always they saw someone they knew.
My question was why the above poster doesn’t consider condo ownership “true” ownership? The condos on my block run between $500,000 and $3m, and the single family homes on the same block start at $3m and go to $7m. If I don’t buy one of those single-family homes, why does the poster not consider me a true homeowner? That was my specific concern with their remark.
In mine 6/10 are owned by property developers so a combination of law changes and greedy developers could lead to me losing what I thought was a lifelong asset. If I'd bought a house and land instead (not that I can afford it) then nothing short of imminent domain laws could force me out.
Edit: The offer is "developer salary" so I assumed it would be OK for a rundown but safe rental somewhere closeby.
Getting a 30-minute commute to Venice is going to be materially more expensive, but on a dev salary (assuming $100k-$150k) you should have no trouble affording a place. If you're working in downtown Culver City you'll have way more choices at all price points because you can live almost anywhere between downtown LA and the beach and still get there in under 30.
I found a study about supply and demand for housing, but am struggling to find it. There's a post here which seems credible enough, related to the topic:
Doesn't that imply that there is a shortage?
Look at how Denmark do it:
"Unless you have lived in Denmark for a period of at least 5 years, you must obtain permission from the Danish Ministry of Justice (Justitsministeriet) to buy property. However, this restriction does not apply if you are an EU-citizen, and if the property is to be used as a permanent residence."
Seems reasonable to me. Maybe stop shell corporations based in tax havens from owning property as well? Seems they benefit from the income while paying that the government doesn't even get.
A shortage of housing? A shortage of ways to launder money? A shortage of safe assets that beat inflation? A shortage of network connected land?
Emulate Tokyo is good advice, but not easy. There's a reason Tokyo is Tokyo and everywhere else looks nothing like Tokyo.
This has the pernicious effect that it undermines people's belief that increasing supply/housing density will lower prices. After all, why fight for something you don't think will benefit you?
Instead, people who believe such things prefer policies of government intervention, like social housing, taxes on empty properties and suchlike.
Initially it probably did, but once the ball get's rolling it just implies that there are people willing to buy. That can be other investors in a bubble.
in the absence of supply constraints, if the price goes up this creates an incentive to build more houses, which will balance out any increased demand. there is also good research that shows supply constraints do matter in the UK - http://personal.lse.ac.uk/hilber/hilber_wp/Hilber_Vermeulen_...
1. They don't like secondhand homes, they rather rebuild it. So houses are not a good investment vehicles.
2. They values good business practices in housing. (I don't have any data to support). Few months ago I was finding a room in Tokyo, the agent told me people usually live in the same place for years without rent increased. It's not usual to raise the price because it's considered rude and it's something the yakuzas do. It's an entirely different story in Hong Kong where I came from. HK people almost always increase the price so much that people are forced to move every 2 years. AFAIK there is no rent control in both HK and Tokyo.
: "the ratio of used homes circulating in the entire housing market remains below 15 percent, substantially smaller than in the United States and European countries." https://www.japantimes.co.jp/news/2017/12/26/national/japans...
Another reason for general dislike of second hand houses is that these houses are poorly designed. Older houses in the Tokyo area (Kawasaki included), from even ten to fifteen years ago have have a raft of design problems from lack of insulation to using too low cost of materials. The first and third house was a bespoke build and I was met with bewildered architects when I specified designs that they considered appropriate only for Hokkaido (northern island that get cold air from Siberia). Other crazy things I had to make them modify was moving the fresh air intake vent away from the fuel cell generator, that doubles as hot water boiler which has a backup burner. They didn't seem to realize that a backup burner exists. There were a number of other mistakes that I pointed out that seemed to have left the builder in a puzzled state. I made my sales guy work for his pay. Walking around the new development area I'm in, I could point out any number of usability flaws that most of the house have. If these were missed, most likely a large number of technical flaws crept in as well.
The second house was second-hand. (ha!) Very bad decision under somewhat forced circumstances. Very cheap specc'd floors that scratched easily. Practically no insulation. Poor air control, with vents pulling in air directly from the outside with no filtration or pre-conditioning. One of the reasons for moving on.
And while I'm here, the first place we bought (place 0 in Japan) was a room in a mansion (aka an apartment). We bought this new, upgraded to durable floors. I was lucky to have been able to sell the place five years later for nearly the same price as I purchased it. Unlike California, the all buildings depreciate to nothing in 30 years. The HOA (home owners association) is only run professionally for the first 10 years. The next 10 years is a hand off to the residents. From what I now understand, while under professional management, the fees while high are spent well and banked for renovations to be done every decade. But the pattern is that after the second decade, under home owner control, the association votes to cut the fees. The association quickly runs out of money and the building falls into disrepair, accelerating the depreciation. The apartment becomes nearly worthless and difficult to sell, leaving people with 35 year mortgages under water. Nuts.
I've also been in rental apartments and they have been cheaply made.
Regarding rentals, I think the attitude is that the owner would rather deal with someone who is known to pay rather then having to deal with an unknown entity. It's a risk averse culture.
HK rents seem to have followed the general cooling of the market recently, at least among my circle of friends. My own rent has actually gone down since I moved in a few years ago.
Theoretically massive inflation would be able to fix this, except that would screw over everyone who's using the US dollar outside of California.
People in big cities, even though they don't produce more or better work than others, get paid a lot more to account for the housing bubble, essentially increasing their buying power tremendously compared to people living in smaller cities.
Imho we should give up on the idea of maintaining large cities as aesthetic monuments or something. It's bad enough for cities like London that have a decent population density, but places like LA where people just won't give up on the American suburbia model of housing is just insane.
Cities aren't just a place to hang out and look at pretty buildings, people need to live there, work and transport within reasonable cost and time constrains. It's a very practical issue that needs to be solved. Living in a big city isn't just a luxury, it's a need too for many people.
Firms do not pay people more when rent is higher out of the kindness of their hearts, they do it because it’s worth the greater expense to them, because the workers are more skilled and more productive. Some of those higher wages accrue to landlords.
They find the tangible and intangible benefits of a central HQ to be worth the price. They have so many small offices across the country that they could easily spread out their workforce nationwide and get out of the expensive Bay Area... if they felt it would provide value.
If you really believe in the "markets will fix it" rhetoric about workers wages (not to mention the wage=merit idea) then why don't you let the free market fix the housing bubble by allowing taller residential buildings? Right now, almost all of the extra wage ends up in the hand of land owners. That can be fixed, so the wages will actually reflect how much value the workers produce, not how exclusive the area they live in is and how much status they have.
Companies pay more money because they have to, if they want to get the people everyone else also wants to hire. That’s why the Steve Jobs wage suppression agreement happened. And then Facebook said hell no and wages rose, at companies that made enough per employee to pay the new market price.
High population density and low rents sounds like a great combination. If you know it a developed country that lasted please tell. I’d hold out more hope for high density and Georgist land value taxes so that the economic rents accrue to the government/citizenry not the property owners, insofar as it’s rent, not a return on investment.
As far as people being worth $500k, companies that pay that much will either get more in return, or go out of business.
LA is a city, it has less than 4 million people on 470 sq mi of land, New York is a city and has more than 8 million people on 300 sq mi of land. NY is is 3.5x more dense than LA (28k vs 8k per sq mi).
LA just isn't very dense. Look at either the data or the pictures.
What you did was reference a source that looks at places that in a way that nobody talks about. i.e. comparing arbitrary statistical areas which take some high-density location, then put it in a statistical area with a quarter of the state which is extremely low-density rural area.
Feel free to look at the data:
This is sort of what you look at when you take LA data.
And then compare it to something like this for NY, density of 1.7k:
Which is nonsensical in the ordinary sense of the word NY. Rather, use this, density 28k:
Or say Manhatten or Kings County, 70k and 35k density, respectively:
LA just isn't very dense, nor are most cities in and around LA. 9 of the 10 most dense places in the US are in the NY MSA, including NY itself. The other 1 is in California called Maywood. It's the densest place in the US, outside of NY, and it has only 27 thousand people and its still less dense than NY's 8 million people.
On the spot.
Prices are not dropping even when thousands of units are hitting the market every month. The reason is because foreign buyers like to park their money out of their country so it won't get confiscated.
When there are multiple real estate agents all of whose promotional material is in Chinese in an English speaking country you have to be willfully blind not to see cause and effect.
And, furthermore, exporting housing services is a huge, underrated opportunity: http://www.slate.com/blogs/moneybox/2013/05/19/exporting_hou... . We should be doing a lot more of it.
I can't give you a citation on who is buying the units because that is obfuscated by design. If the people trying to hide their wealth put their names on the deeds they have just made sure they stay alive in the dungeon until the sale was finalized.
So all you have is a gut feeling.
Thousands of units hitting the market each month is a LOT.
Seeing three separate real estate agents having nothing but Chinese brochures in their offices tells me they aren't expecting locals to be buying from them.
>Thousands of units hitting the market each month is a LOT.
This has been going on for close to 10 years now.
Not "thousands per month" for the mysterious city you live in.
For comparison, in 2017 Seattle got 10k new apartments which was enough to match the growth caused by Amazon's hiring and generally keep the prices sane.
So a thousand a month for the city the size of Seattle is good enough to counteract one of the biggest population growths.
I see 5 50+ story building completed in the last three months, with another 4 being build. Prices are not dropping. Buildings are not being occupied.
Well in fairness, even with all else being equal, units entering the market doesn't imply prices dropping. It only should imply prices being lower than they otherwise would be.
How do the Japanese build wealth, then? Buying a desirable home in a solid market is pretty much the only way for an average person earning the median wage to make it into the middle class.
Rising housing prices have played out the same across the Anglophone world. It's not sustainable as a means to get the lower classes into the middle class, because the higher prices rise the more debt they need to take on to join the game.
Housing is something people consume. It's durable, but so are cars and imagining them as being a gateway investment to the middle class because they will cost more in the future should be just as silly as for housing.
But when you're talking a capitalization period on the order of the average person's lifespan, it becomes a new class of asset in my mind. You can't treat something which will pretty much guaranteed always exist until the day you die the same as a usable good.
You've basically snuck in a tautology in your question. 'Breaking into the middle-class' in the US has simply become synonymous with owning a house, without really asking whether owning that house actually provides people with material benefits to begin with.
Like Switzerland, Germany or South Korea among some other countries Japan is very much a nation of renters. This has arguably saved them from some very grave problems.
62% of households in Japan own their own home. This is ~10% above Germany and ~1.5% below the US.
I'm literally speechless to this
There's also low-cost index funds and ETFs...cheaper, lower barrier for entry, more diversified, more liquid. The government won't seize them for non-payment of property taxes in case of unemployment or health issues. I'd argue they're a better choice than a home for an average person to build wealth.
Index funds and ETFs have been around since the 70s - nearly 50 years.
The US gov subsidizes real estate investment with long duration fixed mortgages.
Besides, GP stated that real estate ownership was the "only way" for Joe-sixpack to get into the middle-class. Homeownership may well have financial and tax advantages but it's by no means the sole way to build wealth.
I could, tomorrow, go buy a duplex, triplex, or quad with only 3% down and immediately rent out all units except the one I’m living in. Usually a much higher cash on cash return than index funds when done properly, your co-tenants are paying your rent, and you’re getting to depreciate an asset annually on your taxes that is most likely appreciating.
How could you tell people not to take advantage of such a good deal?
But that's not something an average person does. The poster I replied to was speaking of real estate wealth building solely in terms of buying a house, living in it till you retire, then selling it at an appreciated value and going live in Florida or wherever. (or alternatively change house every 10 years, rolling the appreciated property value into a bigger house every time)
What you're talking about is the work of a real estate investor, and is far more time-consuming and involved than buying a few index funds on Vanguard. Researching properties, finding and screening tenants, performing or managing repairs is a non-trivial amount of work.
You're trivializing the work of getting into landlording (maybe you're already doing it so you underestimate how much work it is for someone who has no experience doing it). If it really was that easy to earn better than index fund returns, everyone would be doing it and the returns would naturally come down.
> While not the sole way to build wealth, it’s one of the most accessible ways for anyone who isn’t already wealthy and intends to live somewhere more than a few years.
I don't even agree with that. To buy a single share of an ETF you need $50-100 max to spare. To put even 3% down on a property that you can rent out, you're talking thousands of dollars + decent credit for getting a mortgage on the property.
My point is that almost always, real estate values in the US go up. So if you need to live somewhere, and the government is going to give you cheap money to do it, you’d be crazy not to.
Yes, it’s not as easy as opening a Vanguard account and buying a share of a mutual fund. But it’s also not terribly difficult.
Your market investments did fine if you could weather 2008. If you had to liquidate, you got wrecked.
As long as the mortgage is covered, I can hold a property indefinitely.
I'm mid 30s, and have invested in real estate since my early 20s.
> Buying a desirable home in a solid market is pretty much the only way for an average person earning the median wage to make it into the middle class.
Not true. You, too, can ascend from poverty if you don't fall into the finance-everything lifestyle of the (former) American middle class.
People need to stop treating housing with the expectation that the value of a house should grow and grow and grow, because that's part of how we got to all this NIMBY bullshit.
Buy an index fund.
Yes but you don't have to pay the same amounts. There's a reason "rent-or-buy" calculators exist.
Rent, 4 or 5 year economic slump and people are out of a home.
Ownership doesn't lead to this. Even mortgages have more forgiveness for late payment than most rental agreements.
Multi-generational property ownership also helps. Buy a good house now, and your kids/grand kids have insurance against economic downturns.
I rented a 1.3m home in CA for $3,500/month, made no sense to buy at that level other than a forced savings program.
There are a couple of other important factors. Between 1988 and 2013 (the part documented by the graph), the population of the country grew by only 5 million people. Tokyo's population grew from about 11 million to about 13 million in that time -- so it absorbed almost half of the total population increase of the entire country. Although I haven't looked, I'm willing to bet that Osaka absorbed the other half. So it's quite a bit easier to focus the government when all of your growth is in the same place.
Furthermore, if we look at the population increase and compare that to the household increases in the graph, something is pretty apparent. Population increased by 2 million and households increased by 2 million. What that means is that Tokyo was overcrowded in 1988, with large numbers of people living in the same household. As new residences became available, they spread out. It's especially important to understand that in the early nineties, prices were getting cheaper, so that made it easier for people to move.
So while building new residences is important, there are a whole host of other factors that led to Tokyo's success in this regard. Personally, I think the resolve to avoid real estate bubbles, even at the cost of economic growth is huge. One last thing I really need to point out because it's confusing for people who don't live in Japan: "Tokyo" usually refers to the prefecture of Tokyo, not just the city. There are parts of Tokyo prefecture that are decidedly rural, so it is doubly difficult to compare it with cities in other countries.
The chart shows a comparison of increase in population vs increase in price, for four regions: San Francisco, London, "Tokyo", and the central district of Minato-ku. While the first three are vaguely defined since they could be either city limits or metropolitan areas, there is no such uncertainty about Minato-ku.
Minato had a much larger percentage population increase than SF or London but a much smaller percentage price increase.
I read last year that some towns will actually GIVE foreigners a house if they promise to live there a certain numbers of years.
I think stories like this couple well with one also from this week on HN:
Why Cities Boom While Towns Struggle
I remember hearing a lot of talk about "the need to promote de-centralization" when I was a kid, but I don't remember hearing a single valid reason for it. It's always someone else that needs to move back to the countryside, not the speaker.
Suppose for a moment that everyone of the 7 billion people wanted to live in a single city. Taking it to the extreme. It doesn't work. Land prices would make everything unaffordable, there wouldn't be enough space to produce goods and provide space to live and work. The best thing in such a situation would be to say, let's have substantial people move away from this particular city, to live and work somewhere else where natural resources (land, what's on and under it) is abundant.
To me it seems pretty obvious that this is the position that some price cities find themselves in.
You can sort of look at a heat-map or height-map of population density. This map essentially expresses demand for that land, and that expresses the cost of the land. In that sense, population density to land can be viewed as interest rates to debt. The smartest thing to do in a debt situation is move high-interest debt to low-interest debt. Redistribute your debt to where it is cheap. Similarly, we ought to redistribute our demand for land to where it is cheap, which means moving people around. In that sense, the above comment makes sense to me.
I'm not advocating for some kind of forced migration or anything, but companies and governments should inform, educate and incentivise this redistribution in a soft manner. Introducing (progressive) land taxes is probably part of the story.
For example, I've heard a lot of talk this past year about german housing policy with Berlin cited as the best example. It rarely mentions that Berlin's population peaked before the war, reunification and other things that aren't housing policy. I'm not saying that Tokyo's housing policies are not good, just that there's likely a lot of context to their successes.
Housing can be pretty complicated and nuanced. Policies don't translate well from one place to another. Where I live (dublin), house prices are effectively a derivative of bank policies. Whatever banks will loan the median person becomes the median house price. Now that we've had boom, bust & boom again... it's very easy to see how these two things track.
In a less supply constrained scenario I think bigger houses, not cheaper ones. Another big part of the story here is a near unanimous objection to development in general, more out of conservatism than NIMBYism. So, stasis biased.
Anyway, my point is that it's complicated. The dynamic in Dublin is different from Austin or Berlin, and policies exist within these contexts. It sounds like NIMBYism is a big factor in california. I imagine that the economic & population growth in these cities is another big factor.
This is because a bunch of young people can get together and live together in this hypothetical bigger house.
Twice the size IS half the cost if twice as many people are living there.
And there's enough space in the housing market to allow for ultra-precision housing alternatives like capsule hotels.
If you need to commute in, there's an astonishingly good public transit system.
The same youtube channel has an excellent multipart series on homelessness in Japan that's absolutely worth watching. Here's the episode on housing the homeless: https://www.youtube.com/watch?v=kBPyN3LE65g
Let's not idealize foreign countries, please and thank you.
As an American, I've lived in western Europe, eastern Europe and spent months in Japan. There are some things these places do worth idealizing.
Americans should travel more and replicate the best parts.
I hope you realize that the vast majority of the country isn't as privileged as we are when it comes to being able to afford to travel, or even to get time off in the first place.
Yet those people will vote and otherwise support bad policies with their uninformed-ness.
Japan has little litter even though there are few trash cans in public.
In the NYC subway, there is a ton of litter in the tracks even near a trash can.
Maybe it is the West that is actually idiosyncratic?
There is no objective measure by which individual aspects of one culture can be judged better than another, unless the majority of people from every culture involved in the comparison have agreed to certain principles, e.g. slavery is unacceptable.
The litter example simply illustrates a different cultural norm in a very homogenous society. The US is profoundly diverse and individualistic.
Besides, the NYC has litter, when Tokyo transit has men reading rape comics on the train. Japanese culture is not perfect, nor is any culture.
Those who litter when there's a trash can nearby are not demonstrating individualism. They are demonstrating a profound LACK OF CONSCIENTIOUSNESS.
These same people vote too, you know. The nuts have taken over the nuthouse.
Similarly, if you loosen the limitations to development, don't be surprised to see prices come down.
How I Used Eve Online to Predict the Great Recession (2013) (gamasutra.com)
[+] I realize that number is surprising, and I would have found it surprising up until ~3 weeks ago, but I can assure you that this product is presently commercially available in Tokyo, including to people who do not exactly smash Japanese banks' definition of "desirable client."
For every apartmemt complex that gets built, that is X many LESS people who are competing to buy that suburb house that you love.
The suburbs will still exist. But more appartments in the city means that prices go down for everyone.
Ignoring that as a rational choice for many people already in expensive areas is just asking for your proposals to fail.
We very frequently talk about the economic value that could be produced by different housing actions, but policy is not purely determined by economic value. I know more people opposed to upzoning because they like their yards and their space than because they're worried about their property values (denser cities in the US are very rarely cheaper).
In any case, support for NIMBY suggests the current level of financial compensation is insufficient.
Producing enough milk to fully satisfy demand only helps farmers.
My impression is that neighborhood groups aren't generally interested in raising property values, but rather in preserving the less-developed neighborhood in which they have invested and chosen to live.
If they didn't buy the property, they should have absolutely zero say about what kind of housing someone else builds on their property. Central-planning-via-veto (the effective state of USian land use law) is utterly broken in its giving veto authority to the most meddlesome moralistic normies on anything that they might not like, whether it be a cell tower, an apartment building, or bloody clothes lines (not kidding about the latter: https://en.wikipedia.org/wiki/Clothes_line#Controversy_in_No...).
That these people (the Twitter thread here has some prime material https://twitter.com/maelig/status/975219562433015808) have the ability to obstruct the construction of housing (to the point that there are people literally living, shitting, and dying in US streets because housing is so unaffordable) is heinous. This is not how well-functioning societies look like.
It's a hard decision to support legislation or policies that may may hurt double digit percentages of your populace, just because of bad timing on their part.
At the same time, the need for cheaper housing is real. It's just not as simple as rich vs poor.
Furthermore, if housing is expensive, adding to the supply won't crater the price like the economy going bust does: at a certain point, people become less enthusiastic about investing in new housing, so it's a much smoother curve that, realistically, is probably not going to crash prices.
In the end, though, you can't have both housing that's affordable, and also treat housing like some kind of investment that's supposed to keep growing and growing in value.
Sure, but does that mean the family of five that was finally able to afford a home last year after scraping for years should pay for that? They could even be in the same demographic as the original victims of those exclusionary policies.
> Furthermore, if housing is expensive, adding to the supply won't crater the price like the economy going bust does
I'm not so sure, depending on how it's handled. Housing is a free market, and as such it's subject not just to supply and demand, but people's expectations of supply and demand. If I just bought a house and policies were announced that I thought might not just stagnate my house value, but actually reduce it over time, inflation-be-damned, I would be mightily tempted to sell if I had options. Get enough people doing that, and you might have a run-away market drop. The people who mainly benefit from that are those that are poised to take advantage of the situation on short notice (those with money available already and can take advantage of the eventual rebound).
There are obviously ways you could crater the housing market in an area on purpose through policy, so it's not out of the question it could happen accidentally. I'm mainly arguing for people to see both sides and try to prevent that, and soften any blow and be prepared to counter a market that looks to be behaving irrationally.
> In the end, though, you can't have both housing that's affordable, and also treat housing like some kind of investment that's supposed to keep growing and growing in value.
I agree. I just think it's a complex situation that requires nuanced policy and constant attention, and isn't as simple as "build more houses" implies.
I would encourage you to attend some planning hearings, city council meetings, and so on before asserting that. Because it really, really isn't. Look at a zoning map of your city.
They made a bet, they lost it.
Someone else made a different bet and won.
That's how free market works. People are free to make bets and they loose or win based on how right they were.
Trying to enact policies that mess with market forces because you want to protect that person who lost the bet is the opposite of free market and also a bad economic policy.
Economists estimate that lack of housing in California is costing us all a lot. From https://www.wsj.com/articles/californias-housing-costs-hurt-...:
> California’s high housing costs are crimping economic productivity, increasing poverty rates, lowering homeownership, increasing crowding and lengthening commute time
This is the cost of protecting the investment of your hypothetical family not paying "unfair" prices.
Not to mention that your hypothetical scenario wouldn't happen if we had reasonable zoning policies to begin with.
The only reason price of a house could significantly go down due to new construction is that we allowed to prices to go up 10x in the past.
If we were building enough to meet the demand, everyone would be paying roughly the same price and price increases would roughly match inflation, not exceed it by miles.
First of all, I just don't think that will happen. Regulations aren't changing quickly, houses aren't that fast to build, and if prices start to go down, building is going to slow down too.
Second of all, if "the dam breaks", it's only because of years and years of doing the wrong thing, so yeah, it still sucks for whoever gets caught out, but the longer you put off fixing things, the worse it's going to be.
Houses are bought and sold on a free market. Houses are so much more than just an investment to the majority of people that purchase them. If you disagree with that, fine. Feel free to work towards changing many decades, if not centuries, of culture.
> They made a bet, they lost it.
There many are reasons why the government, whether it be local, state or federal might not want to punish people that tried to set down roots to establish stability just because other people decided that was a good market to play in, even if the latter group's thinking has infected the former to some degree.
> That's how free market works. People are free to make bets and they loose or win based on how right they were.
Yes. The problem here is that while a free market is agreed upon by many people to be an effective way to make sure the housing market is somewhat fair, it's also a very dangerous way to allow a very important resource to be handled if there are no controls. Would you argue that bread and meat should be allowed to reach 1000% or more the current price in a short period, or should the government step in to stabilize the market because these are essentials for many people? What about electricity? Housing isn't quite on the same level, but it's important and is not some abstract fungible product to the majority of people.
> Trying to enact policies that mess with market forces because you want to protect that person who lost the bet is the opposite of free market and also a bad economic policy.
No, providing stabilizing controls to markets is not bad economic policy. If you think so, perhaps we should abolish the Federal Reserve, and just let the market do what it wants? How bad can it get? Geez, why did we even start the Fed anyway...
> If we were building enough to meet the demand, everyone would be paying roughly the same price and price increases would roughly match inflation, not exceed it by miles.
Then let's do that, and let's look to make sure we're actually doing that by tracking demand, and prices, and trying to make sure we make informed decisions.
Has a single thing I've said lead to you believe I'm not for that? Because I'm pretty sure I've advocated for exactly that type of thing in every comment.
It's about keeping the market from playing havoc with your populace, whether that's through a large rise or large drop.
The rest of your comment is just an extrapolation of that failed comparison.
And yet the "saving lives" portion of this comparison only works with food, and a select other few items. Do I really have to explain why making a comparison between items and using a feature that only exists within the compared to situation makes for a poor comparison?
Are you saving millions, or even hundreds, of lives by dropping house prices immediately in a locale instead of looking for policies that both create housing (hopefully affordable) while also trying to reduce the most egregious losses from the middle class?
To be clear, again, I'm not against allowing house prices to drop, and I'm not against building more housing. I'm for a considered approach that tries to reduce extreme negative impact for people who would also have a hard time dealing with a large drop in their home price? Because I'm having a hard time understanding why people are so averse to trying to find a best possible option instead of just doing the thing that immediately just sounds like the simple thing to do.
Feel free to have the last comment. On this topic, I think I'm done telling people over and over again how they've ignored the actual point of my argument only to have them double down.
Is that even true though? If an area can become more densely zoned because of higher demand, isn't your property more valuable now? I could probably sell my house with 1-acre plot (I don't have one, just hypothetically) for a lot more if a condo developer were allowed to build on it.
I'm honestly surprised how a comment that essentially says "hey, it's actually a bit more complicated than the caricature often put forth for a solution and paying attention to that and reducing negative outcomes is worthwhile" is seen as so contentious.
We need someone pushing the other way to keep some spaces livable.
There is plenty of very cheap land to live in. The problem is that no one wants to live there because living in dense cities for whatever reason is extremely appealing now.
The price of a house grows exponentially with the minimum travel time to a metropolis from it.
Blaming home owners for this is very useful scapegoating while ignoring the context.
Well most people generally want to do better than that, surprisingly enough.
> The problem is that no one wants to live there because living in dense cities for whatever reason is extremely appealing now
People want a better quality of life, is that not obvious? Not only that but its better for the environment as well. You don't need a car in London, but you definitely do in suburbia.
>The price of a house grows exponentially with the minimum travel time to a metropolis from it.
It becomes exponentially more expensive as you get further away from the city? I don't think that's true, and I don't know what the relevance is to the discussion anyway.
>Blaming home owners for this is very useful scapegoating while ignoring the context.
What context? You've provided none. Home owners aren't the problem, home owners who seek to deny people affordable housing are the problem. It's selfishness, plain and simple.
So you've gone from necessities to Veblen goods. This is as daft as expecting the government to build gold toilets for everyone because the quality of toilets is so much higher when they are gold.
As for your point in suburbia: it's easy enough to build a high-rise anywhere. They aren't being build because people don't want them.
I think you answered the "whatever reason" with your next sentence.
> The price of a house grows exponentially with the minimum travel time to a metropolis from it.
Jobs are in metropolises and people prefer shorter commutes over longer ones.
Having a coffee shop at the bottom of my lift. Having 4 super markets within walking distance. Having 200+ restaurants to pick from. Museums when I get bored, book shops, theaters, cinemas, meetups, hacker spaces the list goes on.
Having to commute for an hour would give me enough time to wake up. My previous job was 5 minutes walking from where I lived, my current one is 8. I take a detour through a park to make it 30 so I can drink a coffee before I get in.
That people are complaining that they can't afford that and making it into an issue on the same level as getting food and drink is ridiculous.
Housing prices are a systemic problem that needs to be addressed. The way to address it is by cutting demand. Build up infrastructure in rural areas so I can actually get decent internet, that bridges don't feel like they will fall down if I drive over them too quickly. Change the regulations so only livable units are built in cities. Change the requirements that non-citizens can't own more than 50% of a dwelling. There is a huge number of tweaks that could solve the housing affordability problem.
10 minutes away: $1,000,000
20 minutes away: $2,000,000?
60 minutes away: $32,000,000?
Where P_0 is the price in the heart of the city, d is the effective distance to the heart of the city and k is a factor to get units matching up.
No, they obviously wouldn't. Look at Houston, where zoning is near nonexistent, and density is similar to or lower than most of the US.
This argument is actually an example of the extreme hyperbole that homeowners will resort to.
To minimize these concerns in the way you do seems non-productive and can only lead to more polarization.
These types of initiatives stem from Agenda 21 https://en.wikipedia.org/wiki/Agenda_21 proponents that, while advocating many admirable things, tend to completely ignore the feelings of the populations they are intent on engineering a radically different future for.
I am saddened that the dream we all shared of allowing small towns to once again flourish, because knowledge workers could be located anywhere on the planet, are being quickly forgotten in favor of ultra-dense citiscapes.
The point of decreased property values is even mentioned in the article as desirable and here you are saying it isn't. The objective here is to make housing affordable, not the preservation of wealth centres.
Don't want none of them other demographics moving here to increase the crime, and marginalize the culture.
I think they're not the racist one here.
I wasn't calling it "explicitly racist", I was calling it "vaguely racist" because, while we all new what they were implying, They didn't come out and say it. Ergo "vaguely racist".
Nobody is talking about "neoconservative demographic shifts" causing problems in cities in this article. The demographic referred to is "poor people".
But please continue being intentionally obtuse for the purpose of calling me a racist.
> I wasn't calling it "explicitly racist", I was calling it "vaguely racist" because, while we all new what they were implying, They didn't come out and say it. Ergo "vaguely racist".
You're saying that "poor people" can't include Caucasians and Asians, then?
Midwesterners are quite notable for being both neoconservatives and poor, along with (generally) being majority-white. He could have easily been referring to them. What made you associate "Poor people" and "Racist"? Poor people are a demographic.
No, they aren't, especially the former.
And economically, they're on average more poor than a lot of areas. See "County Level Poverty."  And if you're comparing wages between the two, Midwesterners make significantly less on average than those on the West Coast.
Although I was moreout giving an example and sticking with it for the sake of the main argument to begin with.
This person is not describing gentrification, in fact, they're describing being avidly opposed to the opposite of gentrification.
Demographic shifts forced on an area by an unelected bureaucracy are almost guaranteed to be detrimental to the lifestyle the residents enjoyed prior to the shift. Whether that is gentrification pushing up property tax, low income housing pushing up crime rate, large influx of practitioners of non-tolerant religions who verbally and physically assault resident women dressed to western standards, or even large influx of young western professionals who don't respect the religion that was previously dominant in the area before.
Neighborhoods are a sum of their parts, and those who choose to live in them, choose them because they like them the way they are.
Overriding the wishes of those people to push your own agenda can be necessary for a city, perhaps, but should never be dismissive to the point of blaming and shaming the original residents to assuage your own guilt.
Are you sure?
> A large influx of people into your area is almost guaranteed to [lead to] possible demographic shifts that marginalize your culture.
Gentrification sure sounds like an instance of that, and I've been hearing about techies pushing out hippies and artists for about as long as I've been old enough to pay attention. The fear of cultural change in SF is a constant enough thread in SF that a knee-jerk reaction that it's racial seems like an uncharitable reading.
It was always a futile dream, mostly propagated by people who themselves enjoy small towns and certainly not "shared by all". It turns out that many knowledge workers actually like big cities for the leisure options, health services, people and neighbourhood diversity, much bigger selection of potential life partners, and high availability of jobs.
As for leisure options, a beach shared by 1M other people is not much of an option. Living in Colorado has orders of magnitude more leisure options for instance.
It is definitely less conveneient to have to move out of your house and wait for something bigger to be built.
Speak for yourself. My quality of life has been very positively correlated with population density. It's why I'm settling down on the east side of San Francisco, and I'm eagerly awaiting the new development there.
This is why many people (not me!) support draconian immigration restrictions.