What Can Be Done About The Housing Market?

Drifterwood

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25% fewer people. So war, famine, or pandemic on a Black Death scale. Or eugenics as a global policy. Failing all of those, nothing changes.

One wonders why anyone bothered to start this thread at all.

You consistently fail to understand my points.

Population falls when people have fewer kids.
 

Drifterwood

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Population growth slows when people have fewer kids. You don't get a 25% reduction--not on a voluntary basis.

It's what they are looking at in China. They abandoned the one child policy but many, I'm tempted to say the majority are choosing only one child. The maths are quite simple, two generations is what it needs.

It's another divide that we are going to have to face, those countries that can not stop spiralling populations, and those that can. When they start (continue) marching north to your southern borders, what will your citizens vote for? What will the Europeans do in a similar situation?
 

Klingsor

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It's what they are looking at in China. They abandoned the one child policy but many, I'm tempted to say the majority are choosing only one child. The maths are quite simple, two generations is what it needs.

We'll see, when and if they actually start reducing their population:

China’s population still growing, census shows—but barely

Moreover, even if the population actually starts declining, that carries its own problems, since "fewer and fewer people in their working prime will have to support a rapidly growing cadre of elderly . . . The top-heavy age pyramid has policymakers worried that China may grow old before it grows rich." In addition, "Entrepreneur Liang Jianzhang, who’s also an applied economist at Peking University, has long warned a shrinking population will lose its innovative prowess."

It's another divide that we are going to have to face, those countries that can not stop spiralling populations, and those that can. When they start (continue) marching north to your southern borders, what will your citizens vote for? What will the Europeans do in a similar situation?

It's unclear to me how the vote of citizens in *my* country will affect population growth in countries to the south. I would think the same applies to Europeans.
 

Drifterwood

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We'll see, when and if they actually start reducing their population:

China’s population still growing, census shows—but barely

Moreover, even if the population actually starts declining, that carries its own problems, since "fewer and fewer people in their working prime will have to support a rapidly growing cadre of elderly . . . The top-heavy age pyramid has policymakers worried that China may grow old before it grows rich." In addition, "Entrepreneur Liang Jianzhang, who’s also an applied economist at Peking University, has long warned a shrinking population will lose its innovative prowess."



It's unclear to me how the vote of citizens in *my* country will affect population growth in countries to the south. I would think the same applies to Europeans.

There's always a fear game being played when financial interests are threatened.

We have been gluttons on what we thought was a free lunch. It's rather tragic that you are quoting a Chinese entrepreneur lamenting the possible loss of innovation prowess if we stop breeding our way to disaster.

If you miss my point completely, then I am sure it is unclear. The comment was about the consequences of unsustainable populations and what you will vote to do about them when they face you. These consequences and the appalling situations they will create can be avoided, but only if we act now.

It reminds me of the answer to the question, when is the best time to plant a tree?

Twenty years ago.
 

Klingsor

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There's always a fear game being played when financial interests are threatened.

We have been gluttons on what we thought was a free lunch. It's rather tragic that you are quoting a Chinese entrepreneur lamenting the possible loss of innovation prowess if we stop breeding our way to disaster.

If you miss my point completely, then I am sure it is unclear. The comment was about the consequences of unsustainable populations and what you will vote to do about them when they face you. These consequences and the appalling situations they will create can be avoided, but only if we act now.

It reminds me of the answer to the question, when is the best time to plant a tree?

Twenty years ago.

Perhaps your comment would be clearer if you would specify the options you foresee me having to "vote" about when confronted with unsustainable populations. Or to avoid such a situation, what specific plans might be implemented if we were to "act now."
 

Drifterwood

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Perhaps your comment would be clearer if you would specify the options you foresee me having to "vote" about when confronted with unsustainable populations. Or to avoid such a situation, what specific plans might be implemented if we were to "act now."

Not at all. I don't see the problems in isolationist terms. Although in the US case, the issue is more gross over consumption per capita rather than excess population numbers. In terms of sustainable consumption you have a relative population approaching two billion, such is your per capita consumption.
 

wallyj84

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I have been thinking about this for a while and have come up with a theory as to why the housing market is messed up for new buyers and how to fix it.

I think the housing market started to break in the 90s. That is when the idea of becoming a landlord as a get rich quick scheme from books like Rich Dad Poor Dad really started to take off. From there we got the house flippers and foreign investors flooding the market and driving up prices. Finally in 2008, the secondary mortgage market blew up in our faces and the housing market crashed. This should have been a wake up call to the dangers of financializing the housing market, however the government decided to double down and convinced hedge funds to buy homes as a way to keep home values from dropping. This has led to the current situation where hedge funds are buying up properties left and right and pushing normal people out of the market entirely.

If we had the same home cost to income ratio we did in the 50s, the average home would cost in the 100k range. In the twisted world we live in now average home price is in the 250-300k range, if not higher.

I think a lot of our problems stem from bad housing policy. How much of the homeless crisis is because housing is just unaffordable? How much worse is poverty thanks to the high cost of housing? I think a lot of problems could be solved if we made affordable housing a priority.

I propose that we stop treating housing as a commodity and investment vehicle. Foreign investors and hedge funds should no longer be allowed to buy homes as investments. House flipping will be legal, but have a heavy tax to discourage the practice. Same with buying property to rent it out. You will get a heavier tax burden the more homes you rent out. This will have the affect of decreasing demand. Next step is to increase supply. I think through tax breaks and subsidies we need to make home building much less expensive to incentivize more home construction. If we increase the supply and lower the demand home prices will fall to something more appropriate for new buyers.

What do you guys think?
 

Klingsor

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I have been thinking about this for a while and have come up with a theory as to why the housing market is messed up for new buyers and how to fix it.

I think the housing market started to break in the 90s. That is when the idea of becoming a landlord as a get rich quick scheme from books like Rich Dad Poor Dad really started to take off. From there we got the house flippers and foreign investors flooding the market and driving up prices. Finally in 2008, the secondary mortgage market blew up in our faces and the housing market crashed. This should have been a wake up call to the dangers of financializing the housing market, however the government decided to double down and convinced hedge funds to buy homes as a way to keep home values from dropping. This has led to the current situation where hedge funds are buying up properties left and right and pushing normal people out of the market entirely.

If we had the same home cost to income ratio we did in the 50s, the average home would cost in the 100k range. In the twisted world we live in now average home price is in the 250-300k range, if not higher.

I think a lot of our problems stem from bad housing policy. How much of the homeless crisis is because housing is just unaffordable? How much worse is poverty thanks to the high cost of housing? I think a lot of problems could be solved if we made affordable housing a priority.

I propose that we stop treating housing as a commodity and investment vehicle. Foreign investors and hedge funds should no longer be allowed to buy homes as investments. House flipping will be legal, but have a heavy tax to discourage the practice. Same with buying property to rent it out. You will get a heavier tax burden the more homes you rent out. This will have the affect of decreasing demand. Next step is to increase supply. I think through tax breaks and subsidies we need to make home building much less expensive to incentivize more home construction. If we increase the supply and lower the demand home prices will fall to something more appropriate for new buyers.

What do you guys think?

An astute and thought-provoking post, Wally.

And here I was expecting your theory to involve small penises. ;)