> housing costs go down, but the cost of existing established housing does not — what goes down is the cost of having, e.g., a 2-br unit in a neighborhood — specifically NOT the cost of an existing 2-br detached house, but of a 2-br condo newly built in that neighborhood, where that type of housing did not previously exist.
The argument for why existing housing goes up rather than down even though the housing supply is increasing is that a developer will pay you more so they can replace your house with condos. But that only applies to houses that are now zoned to allow them to be replaced with condos.
> The reality is that most of those people are just priced out, and not moving into the neighborhood — they’re not in a position to “bid up” the prices of the existing houses because they can’t afford it.
Priced out of what? Living indoors? They live somewhere now. Demand will be reduced there if supply is increased in the place they actually want to live and they move.
> But that only applies to houses that are now zoned to allow them to be replaced with condos.
Literally what I’m talking about and what is often fought against. But really any development constrain, zoning or not, has this effect.
And: Priced out of the whole area in many cases — folks are absolutely leaving NYC and the SF Bay Area for cheaper locales. Just ask anyone in the Central Valley, Portland, or Pittsburgh.
The argument for why existing housing goes up rather than down even though the housing supply is increasing is that a developer will pay you more so they can replace your house with condos. But that only applies to houses that are now zoned to allow them to be replaced with condos.
> The reality is that most of those people are just priced out, and not moving into the neighborhood — they’re not in a position to “bid up” the prices of the existing houses because they can’t afford it.
Priced out of what? Living indoors? They live somewhere now. Demand will be reduced there if supply is increased in the place they actually want to live and they move.