Price supports for housing

It may take a little "cross-disciplinary" thinking to get it -- seemingly ignored here and here and here in posts on the "housing bubble" -- but one key thing about hot housing markets is that most of them exist in areas with intense growth management, areas in which it is difficult to build more housing.

So discussions of the "housing bubble" can't ignore the de facto price support provided by growth management. The converse of a discussion of the supposed "housing bubble" is the discussion of "affordable housing."  Download my article on affordable housing.  I offer my thinking on why "affordable housing" has never gained much political traction and why there is no likelihood that we will eliminate or even lessen the growth management systems which provides price supports for housing. The gist of my article is that no one (who already owns a dwelling) really wants prices to go down or even stabilize. That's the genius of "the ownership society."  Discussing ratios between renting versus buying is pleasant but not meaning ful unless factors in the psychological impact of growth management.

I drafted the talk in 1997 and it still makes sense to me. In fact I like it so much I will post it here entirely next week.

Comments

[clew]

Are you familiar with the Battle Creek Neighborhood Partnerships? By repute, they work by helping people buy into outright decaying blocks and then requiring and assisting them with neighborhood rescue. Said to work, bit by bit. Many of their strategies sound like familiar City Comforts; houses can't blank out on the street, sidewalks get maintained, etc.

The book I found them in would say that helping people who are nearly not destitute is a practical use of aid money because one can get them over the asset-accumulating edge, and then they're not only not needy, they generate good for others (even renters in a neighborhood are better off if crime gets chased out). Owning Up covered other kinds of asset-building; skills, markets, plain old cash... its take on how existing homeowners would benefit is that the country spends plenty on subsidizing middle-class asset accumulation, with good reason, and if we were willing to do the same for poor people's asset accumulation more of them could get off the ranks of the 'truly destitute', even through the first downturn.