That’s the outliers at the top right.

Most cities are in the big muddy bunch, and rent/income has risen in the whole bunch because we made them all into failures after 2008.

Now there is nowhere to move to to escape rising rents, so it pushes against household formation.

2/2

Of course, the reason many people claim that higher rates and payments haven’t lowered prices is that rate lock is keeping current homeowners from selling.

I guess this is another riddle that needs solved.

If someone sells a home and buys another one, what is the effect on supply?

Ah. Yeah. You’re right.

The risk-adjusted present value of the interest would be the same, by definition. Right?

Prepaying for the century of shelter at a somewhat faster pace than it is consumed isn’t an “artificial subsidy” by any stretch of the imagination.

4/4

I’m going to type this slowly bc this topic seems to lower everyone’s IQ by 50 points.
Nature creates a tax on housing consumption because in order to produce a day of shelter, you have to also preproduce a century of shelter.

3/

Are property taxes a demand subsidy because they are levied as a payment that rises each year instead of as a lump sum payment covering the life of the home?

2/

Yeah. It’s literally the “First they came for the…” poem in real time.

“Stop overreacting. They’re only taking the people from the first stanza. People in the third stanza are fine.”

Christ, his farts must REALLY smell

It’s complicated. Basically, blocking 1/3 of the buyer market dropped prices everywhere. New homes couldn’t compete. Construction atrophied. Rents Skyrocketed. And now a wounded industry has a long road to travel to get back to previous capacity.

The homeownership rate has been positively correlated with prices in recent years, believe it or not.

😂