Affordable housing will never be a thing with a corrupt construction industry. Big changes needed all around.
Who ever needs proof probably doesn’t live in this country
I’m in NZ, and the other day I was actually idly wondering what house prices were like in the US.
Based on this: it turns out the same nominal price, about $1m in whichever country/currency. We generally approximate USD/NZD as 0.50 (so double it to get NZD).
We’ve priced my generation and my children’s generation out of housing here, sounds like it’s twice as bad there.
From what I read it’s across the board. Every western democratic state: unaffordable housing. It’s too eerie. It’s like these nations move lockstep into the exact same issues. Yet for one class it’s not an issue at all. If you own property you’re wealthier than ever before. Don’t own though? You’ll never own.
I think it’s market manipulation from software companies. I’m too lazy to write about it now, but where a market seemingly looks ‘free’ (different ‘markets’ in different nations with many vendors) they’re all using the same software. Computer says nudge the price up a bit here and there… eventually every house is worth a million plus, regardless of what western nation you visit. Cory’s written about software’s impact on labour markets. Same ideas. Go read him if you want.
A good example is perhaps airbnb: pushed housing costs up globally and it very quickly became problematic.
I think history will not be kind to today’s governments. Software companies run amok and just fuck up everything for everyone but a very small number of people.
Meanwhile in China…
This is why USA fear and hate mongers against AES and even capitalist states that heavily regulate business and/or nationalize certain industries to see some if the wealth benefit average citizens without joining an alliance or being a US lackey.
the only issue with that theory is that the cost (excluding labour) of building a new house has roughly followed the price of housing
Can you explain what you mean? The bulk of the cost of ‘housing’ is land, which has been exploited speculatively.
Asset classes in Australia have been inflated enormously due to national monetary policy (dictated by the Americans [ie why other American vassals have the same problems]) and asinine domestic-policy to create a class of “little capitalists”. The national government’s current plan is to increase labour’s share of GDP so that the ballooned valuation in assets re-aligns with wages. The house still costs a million dollars, but your salary has increased. The nominal costs are still large, but the real costs have decreased.
(Everyone agrees that housing costs need to come down. The point of this path is to hide the reality: the housing bubble needs to fucking pop, but if voters’ paper-wealth decreases they won’t vote for you. If the speculative valuations continue to increase alongside wages that increase faster then–politically–everyone’s content. This is not possible in reality, but that’s the show that’s being sold. [JFC Japan never ‘recovered’ from their housing bubble.])
Labour’s share has been trending down for decades. Without any large scale changes from the federal government I don’t see how it will suddenly change course. There’s no plans from the government other than “AI” will somehow reverse the trend or domestic manufacturing will come back. A lot of rhetoric but nothing of substance.
Of course the cost of building will match existing valuations (the land has to be purchased at market [ie inflated extraordinarily] prices). Who the fuck would buy a million dollar shit heap when it costs $350,000.00 to build? Builders ‘benefit’ from legacy valuations on land as long as the market can bear it. The greater benefit falls to the land owner though if their land has appreciated dramatically in value for no fucking reason, which it has.
So if the increased costs of a new build is not the labour, but the speculative value of the land… that’s just more proof that the market’s being manipulated. Material costs haven’t been a major factor. The major factor is land valuations–which aren’t real and are prone to manipulation.
Again, try to understand why Airbnb had a global effect on increasing housing costs. Suddenly local-markets became global-markets. That’s a huge fucking mistake.
