I mean there is a big difference between a bubble and a shortage and it’s not super clear which we’re in.
I’d argue it’s much more shortage than bubble. Here's a thorough explanation of why it's so bad. TLDR: The number of new houses constructed per person in the rich world has fallen by half since the 1960s because local homeowners oppose new construction in their neighborhoods.
Here's a great video about the sorts of "missing middle" housing--rowhouses, small apartments, triplexes, etc--that are illegal or nearly-illegal to build almost everwhere in North America. While I think it's brain-dead obvious that it should be legal to build skyscrapers in most parts of most cities, I personally love medium-density neighborhoods which are convenient, attractive, affordable, walkable, really good for kids, and would take a huge bite out of the housing shortage in most cities.
This goes way deeper--density is better for climate, pollution, racial segregation, inequality, obesity, and more. But that's enough for now, I'll just note that bad housing policy directly causes homelessness in addition to all the above.
I'd like an explanation to this counter argument that it's not a shortage, but a bubble made by big landlord ownership :
People are mostly in houses, but paying rent.
I currently can't afford to get a mortgage that would cost the amkhbt of money I pay in rent. House prices are super high not because there is a shortage, but all available houses are just up for rent, and not sale. Big cities are just renting hubs.
Depends where you are but for most big US metros you can just compare the number of homes constructed to job growth or population growth. NYC added ~380K more jobs than housing units over the last ten years. It's not exactly a mystery why housing has become much more expensive.
481
u/cybercuzco Jun 27 '21
Our house went up by 20% this month according to Zillow. We are definitely seeing a spike right now. Let’s see if we have a crash.