I have read many positions stating that we must build more houses to solve the housing crisis. Something about the supply and demand model for housing does not feel correct. For example, look to the places where every square inch of land has been built upon … Manhattan, the Bay Area. The cities are extremely crowded and houses very expensive. Why didn’t all that building cause prices to fall?
The book "Why Can’t You Afford A Home?" by Josh Ryan-Collins - a researcher at University College London’s Institute for Innovation and Public Purpose – is about the phenomenon, which he dubs "residential capitalism." It explains why many people cannot afford to buy a home.
The "housing crisis" needs to be understood primarily as a product of the banking system, not a function of construction volumes - it represents a market failure, not a supply-demand imbalance.
Another reason we seem to never have enough homes for people is due to our population crisis. If we cannot control overpopulation, and with land always being the finite, nonreproducible resource that it is, land values will only increase over time. The real estate industry claims it needs a "20-year supply of land” as if land can be manufactured. This is an impossible mandate to hold to.
Perhaps it is worth being a bit more creative in our approach to housing people, given that we cannot seem to control population growth. Maybe high-rise apartments in a central urban area, with small affordable units, would be a solution.
Albany (March 9)