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Sock Puppet Twitter
(feddit.org)
Source: https://bsky.app/profile/mugrimm.bsky.social/post/3lmsej4cxqk2n
Tag: Matthew Yglesias
K but also he's an idiot because treating housing like supply and demand applies to it is how we got to a place where nobody can fucking afford them because, clearly, supply and demand does not apply to things people need
It does, but it's a reason to regulate the market. Otherwise there is minimal incentive to build affordable housing. The margins on luxury housing are just too fat. A developer is better letting half of a luxury setting sit empty than selling out affordable space. Same reason there is so little competition for affordable cars.
Regulating the market is taking it out of the free market though, and i am a very strong supporter of that.
https://mises.org/mises-daily/children-and-rights
I mean... It does apply though?... It shouldn't, but it does.
In my comment what I mean by the word "apply" is that resources are allocated effectively, which they are not without heavy regulation, and at that point it is no longer the free market that is allocating the resources.
It's called inelastic demand when price changes have very small changes to demand. Supply and demand are very relevant to this situation.
With inelastic demand a small reduction in supply can cause a large increase in price. When paired with something like housing where new production takes a long time to become available you end up in a rapid inflationary period with the price.
It's a situation where owning the asset and being able to rent it greatly favors current owners who have more then their personal demand. This leads to them being able to buy more and more of the asset and continue to increase price.
The current housing situation in the US is exactly what is predicted. It's why we used to have programs like low cost housing and first time home buyer loans and grants.
Fannie Mae becoming a publicly traded company in 1968 was the beginning of the end of an easy path to home ownership.
Yes, I am aware of how the capitalist system works. And I am aware that it is working as intended. My statement is a statement of values.
Supply and demand are relevant, but the market still doesn't allocate resources effectively and requires regulation to prevent predatory housing prices because of said inelastic demand.
So sure, if you want to make a semantic argument, supply and demand "applies".
Does it efficiently and effectively get housing to those who need it? Absolutely not.
My statement is a criticism of capitalism and the way it works.
In America, the housing problem is significantly contributed by over-regulations. In most areas, it is only legal to build single family homes. It shouldn't be a surprise that we can't build enough homes for everyone with only houses.
That's not the only issue either.
Yes urban sprawl is a problem and apartments would be a better use of space.
Don't forget to reserve a few square kilometres for parking. Can't have enough of that.
Didn't you know? Building cities so people can get around in them easily without a vehicle is oppression
that is called price elasticity, google PED