[jdavis703]

In practice I don’t think this works for an green field city. Filtering takes decades to occur. In the meantime new housing will always be more expensive than a low-income worker can afford. If the city wants service workers they’re going to have to subsidize their initial housing.

[swiley]

One alternative is to pay workers enough to afford housing. It’s surprising how rarely people mention that idea. It’s very likely thee d of “worker+housing shortage” which is just a very roundabout way to say “massive inflation.”

[nicoburns]

Probably becayse the inflation has been disproportionately in housing only. Less true now since covid of course, but housing is still a separate problem to be dealt with.

[nostrademons]

If there are more houses built than people who want to live in the city, housing will be affordable for everybody, because an unhoused worker will just buy the vacant unit next door for less if a developer tries to gouge them.

The reason new construction never works like this is because developers only build housing when there's already a severe shortage of housing in the metro area. They respond to price signals, and the price only starts going up when you have multiple bidders bidding for the same home. And why wouldn't they? If they built housing in places that already had an abundance of housing, they're making an economically foolish choice and will go bankrupt. When you observe that developers never build affordable housing, you're observing the effect of selection bias: in a region where there are enough houses for everyone and hence they're affordable to the average worker, developers aren't going to build even more new houses.

You can observe this throughout the Rust Belt: there are more homes than people, so prices are very affordable, but developers would need to be insane to build even more houses (outside of specific neighborhoods or suburbs that are locally hot). Also when you get a macroeconomic crash in the middle of a housing boom: the houses get completed, they sell for dimes on the dollar, but nobody has jobs anymore so they can't afford to buy them,

[postingawayonhn]

I don't think that's necessarily true.

Raw cost of housing is essentially the cost of the land + the cost of the building.

In established cites the cost of land is high and developers tend to build expensive buildings on that land. Low-income workers than move to older buildings as they're cheaper (expensive land, cheap building).

In a new greenfield city the land will be very cheap (for whoever established the city) so that can keep the cost of housing down (cheap land, expensive building).