Comment on What is an average person living in the US supposed to do about corporations raising prices?
chicken@lemmy.dbzer0.com 10 months agoI am not, I intended the person with 300k in this example to represent the whole class of people with less. Your assumption seems to be that the accumulating mass of wealth held by the few is just not in competition for houses, but that begs the question, why wouldn’t it be? You can extract rent from housing to profit on it over time. It serves as a safe investment very likely to increase in value. You can convert it into other forms of real estate. You can have multiple homes for convenient travel.
An important feature of supply and demand is that the weight of demand doesn’t depend on a quantity of people, but a quantity of money. If no one ever had a reason to want more than one house for themselves, maybe it would have more to do with the quantity of individuals, but I think that’s just not the case, they do want more.
phillaholic@lemm.ee 10 months ago
I’m not following your point at all here. I’d you give just me extra money, I can probably buy a house. I’d you give everyone more money then I’m back to bidding against everyone else and the cost of housing just rises. We don’t have enough housing in many areas of the country.
chicken@lemmy.dbzer0.com 10 months ago
My point is that if you are currently bidding against wealthy financial interests as well as individuals just looking for a place to live, then giving everyone money will raise the buying power of those individuals relative to those interests.
phillaholic@lemm.ee 10 months ago
But it’s not going to increase supply, and somewhere around 70% of homes purchased last year were by individuals. Home prices will rise as individuals can bid higher than before.
The only solution is to build more housing.
chicken@lemmy.dbzer0.com 10 months ago
What if you remove individuals who already have a home from that number?
Again, consider relative buying power. Even if you aren’t more wealthy relative to the average person and that stays the same, being more wealthy relative to the wealthiest still gives you greater ability to buy a home. This can be true even if demand and prices rise, and would be true even if it was only 30% of buyers that you’re becoming more competitive against.
That really should be part of it, but ultimately it is not enough. If wealth inequality gets high enough, if the market regards labor as worthless enough, it isn’t going to matter how much housing there is, it will get repurposed as golf courses or something.