Over the past few years, developers have rectified the situation; a great deal of new housing is coming on the market. Which means the end of double-digit rent increases and housing appreciation in those cities. But we seem to have reached the end of “making up for lost time” and headed toward “glut.”
She speaks of the NY city and DC markets in particular. I admit I have wondered about the wisdom of developers treating Bethesda like beachfront property, with all the high-rise condos they are building.
But I am skeptical of her view that the shortage of housing in these urban markets is about to abate. Nationally, the rate of housing construction remains well below the normal rate of family formation. When I talk to people involved in real estate, they say that it’s not local demand that is driving prices anyway–all the talk is of “foreign money.”
But the main thing is that I do not believe that the supply of housing is really elastic in NY, DC, LA, or SF. The restrictions on development are still formidable.
County executives and mayors of cities talking about “smart” development in the midst of a prolonged drop and housing development is a mystery I have not understood. Do they really think that stopping progress, insisting on higher density, throwing up roadblocks in front of people will actually result in affordable housing and better environments for the average person?
I don’t have detail to support a comparison, but I would gather that Seattle metro faces issues similar to NY/DC/LA/SF – though likely not of the same magnitude.
re:George- It’s important to always remember that cities and governments and policies do not reflect unified views of anything. Rather, they reflect some form of the combined views of various entities. They are generally self contradictory. I suspect that large segments of the influential parts of population of say Seattle have zero interest in or are somewhat hostile to “affordable” housing – see the bans on manufactured housing. So the political system will often do one set of things (that make housing costly) which most people one way or another press for, while talking a lot about ineffectual programs to make various lobby groups happy (“affordable housing” vigs on developers – which sometimes backfire when the developers balk at the whole project.)
Government types and planners like to talk about density out of the hope of solving their infrastructure financing issues and to appease certain envrionmental groups. It’s not clear to me that anybody else actually favors that kind of density. And apparently the cores of cities are getting *less* dense…