> More dense construction in urban areas will probably help make single family homes affordable for those who want them.
Probably the opposite effect for SFHs in the urban areas. People usually prefer living in a detached house, especially when raising a family, and those are gradually being replaced by these multi-family dwellings, so the supply of them is actually going down.
> The increased number of multi family dwellings drives up the price of single family houses.
Increased demand for single family homes drives up price of single family homes.
People moving in drives up price of land and dwelling units, obviously because people need a place to live.
The only thing that can move price down is demand decreasing (which will not happen if people are migrating in) or supply increasing sufficiently to accommodate demand.
You obviously live in one of the most in demand places in the US right now, and so almost no amount of supply will keep up with demand to cause prices to stop going up. But at the end of the day, price is always a function of supply and demand.
> Consequently, avoiding new construction either results in depreciation or merely delays the same pattern even by up 15 years.
Places that are not desirable to live in simply do not have construction. Why would people want to invest in areas that they predict will depreciate or stagnate? There is no construction in Cairo, IL, but they are not avoiding construction to prevent prices from increasing.
>when demand outstrips supply adding a different type of supply (like an apartment building) won't depress prices materially (for detached single family residences). they're different market segments.
That's not how the real world works. In the real world, people who want to live in a single family home also want to live in a low density area. No one wants a single family home if there's a bunch of apartment buildings across the street.
> People absolutely want large detached houses, but housing developers want to build densely packed multi-family housing because they're more profitable.
They also cost less per unit, which is a thing people (i.e. new homeowners) like even more.
> - Property values start going down, along with tax revenue, the schools decline, $/student plummets, and all the people with the means move somewhere else.
This can be solved by adjusting the mil rate to generate the original amount of property tax revenue per unit against the lower housing prices.
I also don't see how the cycle is not self-defeating. If there are a hundred low density units and someone builds a hundred high density units near them so the original inhabitants leave and build a hundred new low density units somewhere else, now there are three hundred housing units available. The higher supply reduces the profit in building new condos anywhere in the region. If the cycle repeats then even more housing is constructed. At some point the profit in building new condos falls below the construction cost, because people don't want to live in a condo in the otherwise low density area more than they want to have a much smaller mortgage payment.
That's why I specifically said that a per-unit cost is lower in cities. But units tend to become smaller and smaller over time.
> Taking only construction costs into account, when land is cheap, single family homes make the most financial sense, and dense housing doesn't make sense.
> If my single-family home is the only one in the neighborhood with an apartment building next to it, its value might indeed drop.
People love single-family homes in dense urban environments. A neighborhood that I think is a good example of comfortable density with a good variety of building sizes is Brooklyn Heights in New York City. You can buy a studio apartment for $250,000 or a townhouse for $17,000,000, and everything in between. You would make an incomprehensible amount of money selling your house if your neighborhood turned into Brooklyn Heights.
> Not really. Firstly, it costs a lot more per square foot to build a high rise than a single family home. Secondly, it costs a lot more to maintain it (elevators need constant maintenance, you can't just run to Home Depot to get replacement drain parts, etc.).
Just to clarify: High density doesn't mean high rises. It means traditional developments at 2-5 stories. No elevator, water pump, special power, etc. These places are significantly cheaper than single family homes and provide dense walkable living.
> Mix of home sizes makes them naturally mixed income.
Sadly, I don't think this will last if current trends continue. The town next to mine has a ton of duplexes but it's all zoned single-family now, so you couldn't build those today if you had to.
> The reason we have a housing crisis is because as much as we all love single family homes, they aren't universalizable.
In the US, which has lots of land area, single family homes are the norm:
The majority of the housing stock in the United States is single-family detached houses. Of the total 128.5 million housing units in 2021, about 81.7 million were detached homes and 8.2 million were attached single-family homes. In comparison, roughly 31.8 million units were in multifamily buildings.[1]
The US only has a housing space crisis in over-urbanized areas.
> Yes by increasing density, you are increasing supply of housing units, but you are also increasing the demand for your property
So both remain in balance, prices don't increase and you get little or no financial benefits. Also, a house surrounded by high rises in a very busy street has far less relative value than a house in a quiet street where your kids can play around. Cities bring strangers, crime, pollution, noise, etc.
But if you increase job density without increasing housing density, then you reap massive financial benefits from increasing housing prices.
> There aren't enough homes _where people want to live_ and you solve that buy building more homes _where people want to live_.
You mean, if we had the density of Manhattan or Shanghai, our housing would be as cheap as Manhattan or Shanghai? I'm not sure people would like that (given that those places are more expensive in general). The best example in the states is Houston, but it is horrible sprawl (so housing isn't being built exactly where people want to live, but continues to build outward). Tokyo is the best example internationally, but they have special conditions (housing depreciates since second-hand houses are not popular, decreasing population, liberal definitions on what is needed to call something a home).
> Also, solving housing affordability drives down real estate prices
Solving housing affordability drives down average per unit real estate prices, obviously, but its likely to increase both land prices and as-improved prices on existing detached single-family residential units.
> Hopefully, a declining population will lead to an oversupply of housing.
It won't without policy controls, otherwise, housing units will be redeveloped into other uses (including smaller numbers of larger units designed and managed in a way to foster single-family occupancy per unit.)
> Cost of housing is currently a huge factor in declining fertility.
> the people buying houses in the outer-inner-suburbs that would still be vastly outside their price range without massive help from both sets of parents; these buyers are unfailingly couples.
I suspect there is a big difference between the long term wealth implications of buying a house vs buying an apartment. There are never going to be more houses in outer-inner-suburbs. There is going to be a constant supply of new apartments as we move towards higher density living.
People who have wealthy parents are in the best position to make better housing investments.
> Article suggests there’s a 1:1 relationship between population size and number of housing units needed
From the OP: Over the last 25 years, there has not just been a constant surplus of homes per household, but the ratio has been modestly growing while our living situations have been getting so much worse.
That's the ratio of homes to households, not to individuals. (Also, it's linear, not 1:1, but I assume that's what you meant.)
> When you buy a flat in the center of town, it's supposed to increase it's value for being in the center while town is expanding.
If the town is expanding then the supply of housing goes up along with the demand and prices stay the same, i.e. proportional to the cost of constructing new housing.
Once you reach a certain point you have to build taller buildings which are more expensive to build and then housing prices would reflect the higher construction cost, but this only applies to urban areas and the costs only get really high when the buildings get really tall.
If you converted some of the suburbs to three story buildings that filled the lots, the cost per square foot wouldn't be much higher than it is for single family homes, but there would be ten times more housing per acre. Doing this is prohibited by zoning, which is the real reason why housing is unaffordable.
Probably the opposite effect for SFHs in the urban areas. People usually prefer living in a detached house, especially when raising a family, and those are gradually being replaced by these multi-family dwellings, so the supply of them is actually going down.
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