> If developers build more luxury housing, that'll reduce the price of existing housing, such that it becomes affordable.
If the last few decades have taught us anything, it'd that location (and every social category that location encodes) matters to people more than luxury, or rather a desirable location is the biggest luxury.
This is why a 3 BD fixer-upper in Palo Alto will cost more than a luxury 5 bedroom house in East San Jose.
To have any effect on housing prices I desirable places, you'd have to build gobs more housing in the highly desirable places, but those are usually the places most opposed to new housing development. And if you build a little bit more, because location dominates all, the existing housing would be as expensive as the new luxury housing in that location, because there is always a higher demand/supply ratio to live in Palo Alto than for East San Jose.
By the same token, building luxury housing in less desirable places won't change things unless you somehow make those places more desirable, but that takes a lot more than new luxury apartments. You usually have to change the kind of people that inhabit that location.
We absolutely need to build more housing of all categories everywhere, but it won't have much effect on housing costs until we address transportation, public education, and crime, the massive factors that affect housing costs.
Even if you had no zoning or "organized" NIMBY restrictions, it would be extremely slow to build denser in the most popular "full" residential places: any new construction there requires someone else to sell and leave for that construction to take place. You aren't going to be able to build a hundred-unit tower like you could if the land was empty or was just a vacant old structure.
Targeting stuff that isn't currently residential would be a much easier starting point.
IMO, but more controversially, it goes even further: in the long run, especially with fast transportation and digital communications, it's hard to see certain places ever getting "affordable" given today's wealth distributions. Some locations are going to be in higher demand due to non-human-development related factors (weather, scenery, etc). Others due more to development factors: NYC is more in-demand than if it was an empty bunch of land because we've already done a bunch of development there. (That latter case is especially interesting because it shows how development can both increase supply AND demand, it's not solely something that affects supply.) So if some places are inherently going to be more in-demand than others, and you build more when the market price is currently $X, prices won't fall very quickly at all as you get the people who otherwise want to live there, but couldn't do $X but would do it for $X-1, $X-2, etc, now re-interested in the area!
> Others due more to development factors: NYC is more in-demand than if it was an empty bunch of land because we've already done a bunch of development there.
Agreed, and human development is a major part of that. NYC is a cultural center of the world, which is a result of its human development, and that has a tremendous currency and gravity over and above Manhattan's physical grid.
If the last few decades have taught us anything, it'd that location (and every social category that location encodes) matters to people more than luxury, or rather a desirable location is the biggest luxury.
This is why a 3 BD fixer-upper in Palo Alto will cost more than a luxury 5 bedroom house in East San Jose.
To have any effect on housing prices I desirable places, you'd have to build gobs more housing in the highly desirable places, but those are usually the places most opposed to new housing development. And if you build a little bit more, because location dominates all, the existing housing would be as expensive as the new luxury housing in that location, because there is always a higher demand/supply ratio to live in Palo Alto than for East San Jose.
By the same token, building luxury housing in less desirable places won't change things unless you somehow make those places more desirable, but that takes a lot more than new luxury apartments. You usually have to change the kind of people that inhabit that location.
We absolutely need to build more housing of all categories everywhere, but it won't have much effect on housing costs until we address transportation, public education, and crime, the massive factors that affect housing costs.