Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:MYOB. Other people deserve housing too. NIMBYs like you are why there is a housing shortage.

Thanks, real estate developer. Please tell us all about how replacing homes for families with luxury condos costing nearly $1 million a pop is going to fix everything.

You're asking how increasing the housing supply will fix the housing shortage.

At least in theory, increasing the supply would push prices downward. But if it actually did reduce prices, that would encourage more people to move here, which would put upwards pressure on prices. I don't know how those two factors would compare. It might be that you just end up where you started, except with more people here, instead of Philadelphia or wherever they would have lived otherwise.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:MYOB. Other people deserve housing too. NIMBYs like you are why there is a housing shortage.

Thanks, real estate developer. Please tell us all about how replacing homes for families with luxury condos costing nearly $1 million a pop is going to fix everything.

You're asking how increasing the housing supply will fix the housing shortage.

At least in theory, increasing the supply would push prices downward. But if it actually did reduce prices, that would encourage more people to move here, which would put upwards pressure on prices. I don't know how those two factors would compare. It might be that you just end up where you started, except with more people here, instead of Philadelphia or wherever they would have lived otherwise.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:MYOB. Other people deserve housing too. NIMBYs like you are why there is a housing shortage.

Thanks, real estate developer. Please tell us all about how replacing homes for families with luxury condos costing nearly $1 million a pop is going to fix everything.

You're asking how increasing the housing supply will fix the housing shortage.

Anonymous wrote:

Anonymous wrote:So we have hit a couple of spaces on NIMBY bingo.

1. Don't add housing in my rich neighborhood, go gentrify somewhere east of the river, or else you are racist

2. Supply and demand don't apply to housing

3. When you say that adding housing supply is good, you are just like supply siders under Reagan, so I don't have to listen to you


But "its all about the Fed" is a new one.

Only on DCUM would people act like the Fed is no big deal. The Federal Reserve is the most important player in the entire economy. People in the housing industry watch the Fed like a hawk because interest rates have such a profound effect on housing prices. Don't believe me? Go to a mortgage calculator, and mess around with the interest rate feature. If interest rates go to 6.5 percent, which, historically, is a pretty normal rate, your monthly mortgage payment would be roughly double what it is today. You don't think doubling someone's monthly mortgage bill might have an effect on prices?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:So we have hit a couple of spaces on NIMBY bingo.

1. Don't add housing in my rich neighborhood, go gentrify somewhere east of the river, or else you are racist

2. Supply and demand don't apply to housing

3. When you say that adding housing supply is good, you are just like supply siders under Reagan, so I don't have to listen to you


But "its all about the Fed" is a new one.

Only on DCUM would people act like the Fed is no big deal. The Federal Reserve is the most important player in the entire economy. People in the housing industry watch the Fed like a hawk because interest rates have such a profound effect on housing prices. Don't believe me? Go to a mortgage calculator, and mess around with the interest rate feature. If interest rates go to 6.5 percent, which, historically, is a pretty normal rate, your monthly mortgage payment would be roughly double what it is today. You don't think doubling someone's monthly mortgage bill might have an effect on prices?

Anyone who suggests that there is *one* factor that determines the price of real estate, whether it be interest rates, supply of new builds, number of people moving to the DC area, or the price of tea in China, isn't worth having a having any sort of discussion with.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

I know this is like a religious belief for some, and that no amount of evidence can change your mind, but economics is more complicated than you think. There's an entire paper, put out by Federal Reserve economists, debunking this whole idea that increasing supply is going to cut prices. But I'm sure you know better than they do. What do some of the brightest economists in the world know anyway, right?

link please[/quote

https://www.federalreserve.gov/econres/feds/files/2018035pap.pdf

"Our results suggest that the rent elasticity is likely to be low, and thus marginal reductions in supply constraints alone are unlikely to meaningfully reduce rental burdens."

Oh good grief.

We estimate a neighborhood choice model using 2014 American Community
Survey data to investigate the degree to which new housing supply can improve
housing affordability. In the model, equilibrium rental rates are determined so
that the number of households choosing each neighborhood is equal to the
number of housing units in each neighborhood. We use the estimated model
to simulate how rental rates would respond to an exogenous increase in the
number of housing units in a neighborhood. We find that the rent elasticity
is low, and thus marginal reductions in supply constraints alone are unlikely
to meaningfully reduce rent burdens. The reason for this result appears to be
that rental rates are more closely determined by the level of amenities in a
neighborhood—as in a Rosen-Roback spatial equilibrium framework—than by
the supply of housing.

In this paper, we present simulation-based evidence that the elasticity of rent
with respect to small changes in housing supply within metropolitan areas (henceforth, “cities”) is low. The implication of this finding is that even if a city were able
to ease some supply constraints to achieve a marginal increase in its housing stock,
the city will not experience a meaningful reduction in rental burdens.3

This doesn't say what you said it said. It just says that small increases in housing supply don't meaningfully decrease rents (i.e., rent isn't very elastic) - which is a model result that shouldn't surprise anybody who lives in the real world. It does not say that increasing housing supply won't reduce the cost of housing.

Oh for Pete's sake. This is truly the land of the economically illiterate. In economics, "marginal" does not mean small. Why on earth would these people go through the trouble of analyzing a minor increase in housing supply?

In this instance that is exactly what they did and they said so

Thus, we caution against extrapolating our model’s
elasticities to very large changes to the housing stock.