this post was submitted on 28 Aug 2023
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[–] [email protected] 1 points 1 year ago* (last edited 1 year ago) (3 children)

It literally was affordable just fine when it was treated as an investment before, back in the '90s. It's always been treated as an investment. What happened is we stopped building enough of it.

If you stop making enough food, people starve.

If you stop making enough housing, people go homeless.

Population growth of adults has gone up, while housing production of bedrooms has gone down.

I don't get why this is complicated.

I thought the pandemic gave everybody a very harsh lesson about what happens to prices when we stop making stuff (two words: chip shortage) but I guess lessons are hard.

[–] [email protected] 13 points 1 year ago* (last edited 1 year ago)

The only way it makes sense as a financial investment is if population continues to grow and homes values continue to rise above inflation - it's inherently unsustainable.

Seriously, a simple though would show how bad of an idea financializing a basic human need is.

Homes are infrastructure.

[–] [email protected] 10 points 1 year ago (1 children)

No, this is revisionist history. The 90s were part of a nearly 15 year period when house prices were flat in Canada. For quite a few years your return would have been negative. People in the 90s were not thinking of their house as their retirement account.

We did stop making enough housing, but it’s precisely that artificial scarcity that is making people treat it as an “investment”. If we make enough, it will not be treated primarily as an investment anymore, which is how it should be.

[–] [email protected] 1 points 1 year ago (1 children)

The 90s followed the extremely high interest rates, which were why housing was flat. People couldn't easily buy in, so demand was reduced.

[–] [email protected] 3 points 1 year ago

But that just further corroborates the point: when housing was at its most affordable it was not considered a good investment.

It’s also important to note that housing remained flat even when interest rates went down, partially because of a healthy stock of non-market and market housing.

[–] [email protected] 5 points 1 year ago (1 children)

It literally was affordable just fine when it was treated as an investment before, back in the '90s.

Yes, that's how investments work. They are less money at the beginning and then grow over time. If you want apple stock to be affordable like it was in the 90s you'd need to harm the investments of everyone who has already bought it. If you want housing to be affordable you need to hurt the property values of everyone who already has a house.

[–] [email protected] 2 points 1 year ago* (last edited 1 year ago)

Not necessarily. They also can give income, so a taxi company can invest in a taxi even though cars depreciate, because they get returns on it that way.

I don't know why we don't have enough houses, but it's not because you can't make money as a landlord.