The Folk Economics of Housing

Supply, Prices, and Perception

• Many commenters argue basic supply–demand still applies: more units → lower or slower-growing prices, especially once vacancy rises materially.
• Others counter that people reasonably don’t see this locally: they observe constant building plus rising prices and conclude development “doesn’t work.”
• Several note that in hot metros, new supply mostly slows price increases rather than causing visible nominal drops, which feels like “no benefit” to voters already squeezed.

Investors, Corporations, and Speculation

• One camp says “big financial companies buying everything” is a myth: corporate/PE ownership is a small slice nationally; most landlords are individuals or small investors.
• The opposing camp stresses local effects: in some regions, investor purchases reportedly hit ~20–25% of sales, starter homes get snapped up, and algorithmic rent-setting (e.g., RealPage) feels like cartel behavior.
• Disagreement over whether converting owned homes to rentals is problematic: one side says rentals are still shelter; the other says this sustains high prices and shifts power to rent-seekers.

Zoning, Regulation, and NIMBY Dynamics

• Broad agreement that red tape, minimum lot sizes, and single‑family zoning push costs up and bias the system toward large, well-capitalized builders.
• Homeowners and local politics are seen as central obstacles: residents block density to protect property values, traffic, neighborhood “character,” and to (selectively) limit in‑migration.
• Some emphasize voter “folk economics”: blaming developers/landlords rather than land-use rules, and associating development with higher prices.

“Luxury” Construction and Filtering

• A recurring misunderstanding: people see only high-end new units and ask why we aren’t building “cheap” homes.
• Pro‑supply commenters invoke “filtering”: rich households move into new expensive units, freeing cheaper older stock down the ladder.
• Skeptics respond that this chain is broken by investors holding old units as rentals/second homes and by large houses replacing low‑rent rooming houses or small multiplexes.

Vacancy, Demand, and Market Structure

• Some claim lots of dark units and call for vacancy taxes or forced divestiture; others cite low reported vacancy and argue “empty homes crisis” is overstated and often based on bad anecdotal methods (e.g., counting lights at night).
• Demand is described as highly inelastic (everyone needs shelter) but elastic in space: more sq ft per person, conversion of duplexes to single‑family, and induced demand in attractive cities can absorb new supply for a long time.

Finance, Wealth, and Policy Disputes

• Commenters highlight cheap credit, investor leverage, and tax treatment (capital gains, 1031‑like behavior, homeowner subsidies) as major drivers of prices.
• Some want strong regulation: limits on investor ownership, rent control, vacancy taxes, or even recognizing housing as a human right with legal teeth.
• Others argue the priority should be massive upzoning and public or incentivized high‑density building, plus targeted support for the bottom 10–20% whom markets won’t house affordably on their own.