korrents

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Shortages and Spillovers: How People Misunderstand the Housing Crisis

Daniel Herriges · 29 May 2024 · strongtowns.org ↗

5 korrents from this piece

Daniel Herriges did not write this page.

Every claim below was made in this piece, quoted word for word and numbered in the order the piece makes them, so you can read it there rather than take our word for it. The sentence above each quote is our reading of the claim, not their wording. Each quote was checked against a stored copy of the page at build time; where the two differ, the quote is the fact.

  1. Our reading

    Rents rise when vacancy is low and stabilise when vacancy is high, which makes the vacancy rate the housing metric that actually predicts prices.

    Their wordsEmpirical data drawn from many different regions clearly shows that, on a metropolitan scale, rents tend to rise when vacancy rates are low and stabilize when vacancy rates are high.
    Interesting

  2. Our reading

    The single biggest barrier in the housing market is that most neighbourhoods are legally forbidden to add any housing at all.

    Their wordsThe biggest barrier of all, of course, is that the majority of neighborhoods are not allowed to add any housing at all.
    Interesting

  3. Our reading

    Housing demand that a neighbourhood is not allowed to absorb does not disappear; it floods somewhere else, and that is what a housing shortage actually is.

    Their wordsSo, when housing demand can’t be met in a given place, it doesn’t evaporate. It spills over. It goes somewhere.
    Interesting

  4. Our reading

    How dense a neighbourhood ought to be is a moral and political argument, not an empirical question with a discoverable right answer.

    Their wordsBut understand that it’s ultimately a moral and political argument, not an empirical question of the ideal population or the exact level of housing demand in Santa Monica.
    Interesting

  5. Our reading

    Building a lot of housing in an expensive city will not lower rents there; it lowers them in the cheaper places that were absorbing its spillover demand.

    Their wordsIn fact — and this is a point that is, in my opinion, underappreciated by the pro-housing side — building a bunch of housing in Santa Monica would probably not lower rents in Santa Monica. It would bring more people to Santa Monica, creating lower rents elsewhere in Greater Los Angeles as the spillovers from Santa Monica lessened.
    Interesting