Has any country actually solved the housing crisis?
Has any country actually solved the housing crisis?
So there's a ton of countries that I've heard have had truly unaffordable housing for decades, like:
- The UK
- Ireland
- The Netherlands
And I've heard of a ton of countries where the cost of houses was until recently quite affordable where it's also started getting worse:
- Germany
- Poland
- Czechia
- Hungary
- The US
- Australia
- Canada
- And I'm sure plenty others
- It seems to be a pan-Western bloc thing. Is the cause in all these countries the same?
- We've heard of success stories in cities like Vienna where much of the housing stock is municipally owned – but those cities have had it that way for decades. Would their system alleviate the current crisis if established in the aforementioned countries?
- What specific policies should I be demanding of our politicians to make housing affordable again? Is there any silver bullet? Has any country demonstrably managed to reverse this crisis yet?
People are not ready to hear this, but the problem is that "Housing" is being treated as a market, not a basic human right. As long as governments are full of homeowners who will lose a lot of money should the house prices go down as a result of abundance, the problem will keep getting worse.
In most countries, the middle class is seduced into thinking of buying a house as an "investment".
Crises are going to continue being crises as long as the wealth inequality of people worldwide continues increasing.
Think of it like this. There's a finite amount of money in the world. Right?
The wealth of billionaires has doubled in the last few years. That money came from somewhere. Still with me?
Ok, so... if the wealth of the wealthiest people has doubled, that amount of money they gained was previously held by the less wealthy, but it has now been consolidated into the wealthier people's bank accounts.
So. How do we solve the housing crisis (or any crisis)? Step 1 has to be to undo the consolidation of wealth. Solving crises without addressing the consolidation of wealth is a pipe dream.
Feel free to hunt for legal mechanisms for achieving that. But I think you'll find there are institutions and propaganda preventing those mechanisms from being effective.
What specific policies should I be demanding of our politicians to make housing affordable again?
The answer is Georgism combined with no zoning, but people aren't ready to hear about that yet.
By Georgism I mean a very high tax (80+%) on the unimproved value of land. It prevents land speculation and returns the value of the land to the public. Houses would be incredibly cheap, because you couldn't make money by merely owning land. The only reason to own a house would be to live in it, or to provide a true service for people who would actually prefer to rent.
Vienna has 50% public housing and as a result basically no homeless population.
Austria has, with widespread high quality public housing. https://www.theguardian.com/lifeandstyle/2024/jan/10/the-social-housing-secret-how-vienna-became-the-worlds-most-livable-city?CMP=Share_iOSApp_Other
What specific policies should I be demanding of our politicians to make housing affordable again?
- Ban corporate ownership and excessive individual ownership (ex: > 10) of homes.
- Remove most barriers to building lots of new and higher density housing (ex: four-story multi-unit buildings) except legitimate safety and ecological concerns.
I suppose it depends on how you'd define "solved". If we're talking about basically eliminating homelessness, Cuba has done immense work in that regard. Say what you will about the Cuban government, but Cuba has a near-zero homeless population because the government has built a ton of housing and caps rent at 10% of individual income in that state-owned housing. Cuba is also a country with a tradition of multi-generational extended family homes, so there's a greater chance that you'd be able to move in with a family member if you fell on hard times. Home ownership rate is around 85% compared to 65% in the US. All of this is nothing new, though, so it's hard to say if it's the answer to current issues of housing that's largely driven by corporate greed, but it certainly sounds like it couldn't hurt. Granted, I've seen people give examples of homes that are rather small and spartan, where the walls are made of bare cinderblock and generally aren't very pretty, but that's way better than being homeless even if some of the housing isn't as nice as others. I've also examples of state-owned housing lived in by the same kinds of people, but are really quite nice as well. Whether the US government would ever do this, though, seems unlikely. Not at the scale we'd need and not for so cheap, anyway, especially not with Trump coming to office. I can't really speak for the governments of other countries, however, and I'm no expert on Cuba either, so I could have gotten some things wrong. The US embargo to Cuba since the 90s also means that Cuba has had a more difficult time procuring building materials for the low-cost housing that's helped so many, which has led to an increase in size and number for those extended family homes over the years.
I was impressed with Singapore when i was there a while back: https://en.wikipedia.org/wiki/Housing_and_Development_Board
Would the ruling class want this problem solved if it's the only commodity that can't be produced?
How Britain (Almost) Solved the Housing Crisis https://www.youtube.com/watch?v=jZpLiJdIGbs so we didn't and then we did and then we didn't
China also has a massive homelessness problem, so it's definitely not a "pan-Western bloc" thing. This is despite China executing every landlord and building enough homes, turns out people get assigned to a home in a region where they don't actually live or work...
I live in the United States, and as I understand it the housing crisis is caused by several factors.
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The lowest level of zoning is typically residential single family. This means small scale owners and developers cannot increase supply by taking a house and adding to it. Either by adding extensions, subletting, or even building a mini-apartment building. To add to this, US regulations require apartment units to have access to 2 staircases, in the event of a fire. This is good for safety, but greatly restricts style of apartments to hotel styles, and increases costs, so smaller apartments don't make as much sense. This requirement should be able to be waved in the case of fire resistant building materials.
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Speculative land owning. Some property owners simply sit on properties in developing areas, waiting for its price to increase, and since tax is based on the value of the total property (land+building), a decaying building reduces the cost of owning that land. To fix this, we should be taxing the value of the land instead, punishing speculators, while incentivising people to improve their land (by building housing).
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Overuse of cars. Even when places want to expand housing, the complete and utter reliance on cars as transportation in the US leads to backlash for increasing housing, as the perception is that it will increase traffic. To combat this cities need to rethink their transportation strategies to radically increase things like bus and bike lanes. Even when cities do have buses, the strategy funded by the federal government is abysmal. For example instead of running buses that can hold 15 passengers and run every 15 mins, cities will instead run buses that can hold 50 people every hour, and so these buses run mostly empty with 2-3 passengers.
The main policy changes that we need are less restrictive zoning, tax speculators, and diversify urban transport. But resistance is heavy, many politicians themselves are land holders and do not want to implement these changes, or to anger those that do. Landholders generally have more political voice, power, and wealth.
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Vienna is not as good a situation as it may look. Their public housing stock is only great if you can't get into it. There are waitlists years long, and you have to live in the city already to be eligible to get on the waitlist. Private housing is still expensive.