I see an affordability metric of "30% of income" I believe, but there's more to it than just that.
Is it nice if an 18 year old working at McDonalds can afford a home? Certainly.
But there's a world of difference between him being priced out of the market and a full-time well-compensated employee of a large company being priced out.
(Basically, going with mean/median household income may not be the best metric - rate and price drops WILL help but won't be "enough". And the "costal cities" mentioned should just be abandoned; there's no hope and nothing will make them affordable. Instead, all sorts of "subsidies to rich people" should be stopped; once those cities have nobody willing (illegal or no) to do the "grunt work" they'll figure out how to fix the problem. As it is, "affordable housing" is usually just subsidizing the rich people so they can have employees to make their food, etc on the cheap.)
>And the "costal cities" mentioned should just be abandoned; there's no hope and nothing will make them affordable.
This will basically never happen because the reason why they're expensive is that they're desirable. Supply and demand. Expecting otherwise makes as much sense as "Nobody goes there anymore. It's too crowded"
>Instead, all sorts of "subsidies to rich people" should be stopped
examples? If you're talking about "affordable housing" programs, aren't those usually means tested?
> If you're talking about "affordable housing" programs, aren't those usually means tested?
In the dumbest ways possible and usually not continuously. One of my recurring points of advice to founders in New York is to use your year of no income to score a stabilised apartment. More directly, affordable housing is usually used to justify broader construction restrictions. This is why the largest landowning families in New York and San Francisco tend to support them.
Other than that, the OBBBA tax cuts, mortgage interest deduction, carried interest deduction and conservation easements should each count as subsidies for the rich.
>One of my recurring points of advice to founders in New York is to use your year of no income to score a stabilised apartment.
Does this actually work? Aren't the waiting lists years long? Otherwise you don't really need to be a founder to score a rent stabilized apartment. 4 years as a broke college student should be plenty.
> Does this actually work? Aren't the waiting lists years long?
Yes. I didn’t get it, but a founder I worked with did.
Sometimes one gets lucky. And sometimes you spend more than a year broke as a founder. There are also all kinds of head-of-the-line options depending on your race, parents’ college status, et cetera.
> 4 years as a broke college student should be plenty
You typically have to be a resident to apply. I think they may also explicitly ask about college enrolment.
That's not quite an accurate statement about supply and demand. It's supply of the thing relative to demand for it. So a pretty niche product can be very expensive if supply is even more limited.
So it's entirely fair to say that we should be figuring out how to decouple jobs from these costal cities. Lots of people wouldn't live in NYC if Wall Street was out in Topeka, Kansas instead.
>That's not quite an accurate statement about supply and demand. It's supply of the thing relative to demand for it. So a pretty niche product can be very expensive if supply is even more limited.
Yes, veblen goods exist, but given that coastal cities also happen to be the most populous cities, and such cities have underbuilt their housing supply for decades, it's pretty obvious that the current housing crisis phenomena is simple supply and demand.
>Lots of people wouldn't live in NYC if Wall Street was out in Topeka, Kansas instead.
What's preventing Topeka, Kansas from becoming NIMBY and choking off housing supply after it becomes a desirable place to live? After all, silicon valley isn't in new york, it was in California.
Yes - they are means tested. But why do "poor people" need to live in (insert rich city here)? Why can't the city be entirely filled with millionaires?
Because someone needs to work there. So just as Walmart employees being eligible for EBT allows Walmart to pay employees less so does affordable housing indirectly subsidize the city.
Without those artificial bandages on the problem, the costal expensive cities would run into a crisis - everyone is a Google or Apple employee, and there's nobody to do any work for under $100/hr. Either they'd have to pay baristas $100/hr, or they'd have to go without, or build a high-speed commuter rail that could bring them in from Bakersfield where prices were reasonable.
(By abandoned I mean "stop trying to fix it" and just let the prices go insane.)
>Because someone needs to work there. So just as Walmart employees being eligible for EBT allows Walmart to pay employees less so does affordable housing indirectly subsidize the city.
1. How is giving food stamps to walmart employees a subsidy for walmart? Are those people suddenly not going to consume food if they quit walmart? If not, what difference does it make whether they're employed by walmart or not? If the person was not working at walmart and was instead washing windshields at intersections, does that mean that drivers are being subsidized by the EBT?
2. This feels suspiciously like an acceleration argument, ie. "welfare is just a tool of the bourgeois to keep the proletariat from rebelling. We should get rid of it so the proletariat gets angry and starts a revolution!"
>Without those artificial bandages on the problem, the costal expensive cities would run into a crisis - everyone is a Google or Apple employee, and there's nobody to do any work for under $100/hr. Either they'd have to pay baristas $100/hr, or they'd have to go without, or build a high-speed commuter rail that could bring them in from Bakersfield where prices were reasonable.
> How is giving food stamps to walmart employees a subsidy for walmart?
If you consider the purpose of a having a job is to pay the bills and buy food, then you're allowing Walmart to not hold up their end of the bargain and then use tax money to fill in the gap.
I can already predict your counterargument, because it's one I see a lot on Hacker News. You'll claim "Well that's the wage the worker agreed to", but that's a highly naive point of view. It ignores the fact that workers at the bottom of the economic ladder have zero leverage. They have to take what they can get. Walmart is abusing that position to pay as little as possible while our tax dollars are picking up the slack.
>If you consider the purpose of a having a job is to pay the bills and buy food, then you're allowing Walmart to not hold up their end of the bargain
No, that doesn't follow. The "purpose" of running a restaurant is to make money from serving your clients, but if your restaurant sucks and you can't make the numbers work out, you can't blame your customers for "holding up their end of the bargain".
>and then use tax money to fill in the gap.
Being employed reduces the amount of money the state has to subsidize compared to the counterfactual where the person is unemployed, so with that framing, walmart is actually helping the state out.
> It ignores the fact that workers at the bottom of the economic ladder have zero leverage. They have to take what they can get.
They have zero leverage because the supply/demand for their labor is not in their favor. If you characetrize this imbalance as "abuse", does the opposite hold? Are the AI researchers "abusing" poor Zuckerberg, who has to pay 9 figures for white collar employees that usually cost 6 figures? Since we're in a thread about housing prices, are all the boomer home owners "abusing" the poor millennial/gen-z home buyers, by charging 7 figure sums (the market price) for homes that they bought for 5 figures a few decades ago?
I might consider the mortgage interest tax deduction to be a subsidy to the rich, considering how much you have to be making to buy a house and how much interest you need to be paying to make it worth itemizing your deductions.
The mortgage tax deduction is basically useless to anyone BUT the "well-off" or above anymore, given the SALT limitations and how big the standard deduction is.
In a functioning economy, that would have zero bearing on this calculation. Your compensation should be based on your value, not the economies of scale of the corporation you happened to get yourself into.
> But there's a world of difference between him being priced out of the market and a full-time well-compensated employee of a large company being priced out.
I mean, the only difference is between who you consider worthy of having a household. Only "well-compensated employee" like us? Or also people working as fast food cooks and helpers?
A person who working full time in a legal job? Yes they should be able to afford housing. As much as people look down on McDonal employees, these are full time paid jobs. And people working them need to live somewhere.
Is it nice if an 18 year old working at McDonalds can afford a home? Certainly.
But there's a world of difference between him being priced out of the market and a full-time well-compensated employee of a large company being priced out.
(Basically, going with mean/median household income may not be the best metric - rate and price drops WILL help but won't be "enough". And the "costal cities" mentioned should just be abandoned; there's no hope and nothing will make them affordable. Instead, all sorts of "subsidies to rich people" should be stopped; once those cities have nobody willing (illegal or no) to do the "grunt work" they'll figure out how to fix the problem. As it is, "affordable housing" is usually just subsidizing the rich people so they can have employees to make their food, etc on the cheap.)