The other issue is the new housing that is being built in my inner city is very expensive to rent. They are capitalizing on the shortage of housing so being closer to work isn’t the cheaper option. The areas outside of town are older houses but are often much cheaper. Way too much investment purchases happening. People who don’t ever intend to live in a house just make money off of it. And I’m not against investing but we are getting to the point now that large swaths of the population are struggling to get by. If housing eats up all of ones money they certainly are not going to be contributing to the greater economy which can’t be good for all other sectors.
These concerns: 1) high housing prices of new housing, and 2) non-resident investor ownership of housing, 3) housing costs eating up all the incomes of those with less income, all result from the same cause: too little housing and intense opposition to more housing from those who financially benefit from the shortage. So there's a great solution to stop all these problems: legalize more housing to be built, but with some caveats. We should make the approval process more clear and with less bribery and discretion, and it can happen faster so that there's not a multi year delay between securing financing and actual start of construction, in which time costs change and financing options may expire.
Those who are hardest hit by housing shortages are those with the least. And those who benefit the most are those with the most skin in the financial land-ownership game. And when those new luxury apartments are stopped, that isn't turn hurts those with the lowest incomes the most, because rather than the high incomes financing new building, those high incomes chase whatever else housing they can find, which raises prices all over, in addition to kicking out those with lower incomes in a game of musical chairs. And since in a market economy, if we only trickle out a tiny supply of new housing, that newest supply will only go to those high incomes, since newer housing is generally far more desirable than old housing that is worn down. So complaining about the high cost of new construction, without complaining about the ever rising cost of the existing housing stock, is tremendously damaging to housing affordability.
I also favor a controversial option, but I think that there should be state- or federal-level agencies that build housing countercyclicallt, to ensure that when there's a construction downturn, that labor can continue to be employed, and the workforce remains steady, competent, and capable. The boom bust cycle for construction drives up construction prices significantly by labor shortages followed by labor shrinkage, which is hell on labor's personal lives too.
