An interesting essay on today’s housing crisis – thanks daytrip!
But the pushers of market-friendly solutions, and even most affordable housing activists, miss a central point in the housing debate: we already have enough housing in this country.
The problem is not supply. It’s that the supply is owned by the wrong people.
From downtowns to suburbs, there’s a glut of vacant housing and land owned by the rich. The one neat trick to solving the housing crisis: give the things owned by the rich to the poor.
The richest neighborhoods in many cities are also some of the most vacant. If you walk around Midtown Manhattan or Downtown Brooklyn on a weekday evening and look up at all the residential luxury skyscrapers that have cropped up in the last decade, you might notice they’re relatively dark.
In the stretch of Manhattan between Park and Fifth Avenues and 56th and 59th Streets, 57 percent of apartments were vacant at least ten months a year, according to a New York Times analysis based on data from 2012. Buildings from 60th Street to 63rd Street were also only around 50 percent occupied.
Across the country, even in smaller cities, downtowns are being filled with tall, expensive, and often empty apartment buildings. The apartments in the flashiest of these buildings, like the towers rising along 57th Street in New York (now sometimes called Billionaire’s Row) are often bought by the LLCs of the uber-rich, and they’re used more as investment opportunities than as places to live.
So why do we keep building so much vacant luxury housing? It’s a simple function of how capitalist land markets work.
With demand for housing high and government intervention and spending on affordable housing low, land prices have no reason to drop. If a developer buys a plot of land in, say, Cleveland for $1 million, there’s no reason the lot next to his or hers will be sold for less per square foot, and so whatever developer purchases that land will have to build something that extracts $1 million, plus profits, in rents or sales.
This is not a new phenomenon — it’s one of the central theses of Frederick Engels’ 1872 treatise, “The Housing Question:” if there’s no purposeful depression of prices on land, housing prices have no reason to become cheap. The land at the center of cities will always go up, until they are unaffordable to everyone but the richest.
Read full article here:
We had a correction in 2008 when prices were coming back to normal. But the housing market had to be “saved”, so the crooked politicians created all sorts of tax credits, loan mods, and 0% interest rates. Almost 10 years in and interest rates are still near 0%. So where did all this cheap money go? “Saving” the housing market of course, so we’re back to 2007 prices. This time the lunacy is not contained to the US but spread to the rest of the planet (https://www.economist.com/blogs/graphicdetail/2017/03/daily-chart-6). Now the next generation of crooked politicians are willing to “save” us from the “saved” housing market.
Reminds me of an op-ed I read written by billionaire Nick Hanauer:
Money Quote: “If we don’t do something to fix the glaring inequities in this economy, the pitchforks are going to come for us.”
http://www.politico.com/magazine/story/2014/06/the-pitchforks-are-coming-for-us-plutocrats-108014.html
Nick Hanauer also did an excellent TED video: https://youtu.be/q2gO4DKVpa8
This has been tried before, Take the land from the rich white farmers and give it to the poor black people (well that’s what the politburo said). Members of the politburo sold the agricultural machinery to South Africa, the irrigation pipes as scrap metal to china, the locals burned the trees for firewood and the only thing keeping the local population from famine is bags of vitamin enriched corn meal from USAID. The country? Zimbabwe and its leader, Robert Mugabe, has the cheek to call Americans nasty names.