[astrange]

> Bigger, denser cities are more expensive. That's because they're more in demand.

It's mainly because they don't build enough housing. There's no fundamental reason it would happen otherwise; they use land more efficiently and have lower energy costs than suburbs do, and that should matter more than the higher competition.

Of course, there's also a selection effect; more interesting things to spend money on causes people to spend more money. (That's why people who earn more per hour tend to work more, not less.)

[majormajor]

> It's mainly because they don't build enough housing. There's no fundamental reason it would happen otherwise; they use land more efficiently and have lower energy costs than suburbs do, and that should matter more than the higher competition.

Ok. So why does that happen? It happens basically everywhere in the world: the dense cities are more in demand and more expensive than the middle of nowhere.

If nobody can build "enough housing" in their cities, to make their cities as cheap as their rural land, I think that tells us something. We can' simply take demand entirely out of the picture, since adding more supply is both (a) a lagging process and (b) a process that itself helps promote more demand by necessitating more service business, more jobs at those businesses, etc. I.e., if you make the land more attractive to everyone, everyone who wants to use that land for their business or residence has more competition for securing a spot on it.

[jrumbut]

> Ok. So why does that happen? It happens basically everywhere in the world

This is a great observation, if a problem is occurring all over the place maybe the solution isn't simple.

The cool stuff in these cities is highly centralized and just building more housing a little further out doesn't spread it automatically.

If you build a high rise apartment tower in Yonkers it might not sell. Move much loser to Manhattan and you run into all the problems of building in an area that's already pretty dense.

[astrange]

It doesn't happen everywhere in the world. It mostly happens in Anglo countries because we're bad at land use law.

Tokyo is the main example that isn't in this situation.

[klipt]

Are cities still more expensive than rural areas if you adjust for income of the inhabitants?

Maybe cities are just more productive economically, so people earn more, so they can pay more.

I think where having more housing helps though is making your city more diverse. If you have fancy housing for doctors and grungy housing for artists, your city will have a better art scene than if you only have fancy housing.

[majormajor]

IMO this is actually part of the problem. How do you serve both the residents doing well, taking advantage of the opportunities, and the ones at the bottom of the totem pole? Very few places have active plans to address that, and some of the methods that do exist (like rent control) tend to be unpopular.

If you're in a city that's doing well, you have a lot of residents with money to spend. Enough to incentivize a lot of development aimed at those residents. But that jut further chokes out anything that would only serve those with incomes in the lowest percentiles.

Building housing helps, certainly, but there's a differnence between "building housing that keeps the growth engine running" and "building housing that keeps the bottom-tier population served and keeps people from being pushed into homelessness" (especially when redevelopment is financially most practical in cheaper parts of town which can cause more displacement of more economically precarious people - replacing that grungy housing, for instance), and I don't think market-based approaches will ever be enough since the financial incentives to serve the bottom of the market naturally are much smaller than to serve the middle or the top. And I think this is demonstrated by how the densest first-world-cities across the world often have affordability issues.

[klipt]

The sad truth is you can't build grungy housing. At least no sane developer wants to.

Grungy housing was new fancy housing - decades ago.

I guess if the government is willing to build Soviet style grey blocks then you can have new but modest, relatively cheap housing.

[majormajor]

Yeah, and big low-income housing projects have been tried here. But concentrating poverty like that doesn't work well.

But the "just build more" path of least resistance is to bulldoze today's grungy housing to build tomorrow's new housing, and most of the time that doesn't make it easy for the existing displaced residents find enough replacement grungy housing at rates they can afford.

So I think there needs to be something more than just laissez-faire building.

[astrange]

That's called "right of return". Give the displaced people their home back.

Although if they were homeowners before, they probably didn't mind selling their house, seeing as they did it.

[astrange]

Housing isn't expensive because it's grungy or not, it's expensive because the supply is less than the demand.

Some physical factors that might matter are underlying land value, single stair laws and similar things making building layout worse, how many 1br vs 3br units there are… not whether it looks old or not though.

You can't identify affordable (subsidized) housing from the outside in cities where it exists.

[z3t4]

Theoretically it should be cheaper to live in a dense area as more people can share utilities like water, electricity, food stores etc. First there is a worth in the house itself depending on the standard, then there are artificial market rates that is the biggest worth in big cities as people do seem to want to live there, mostly because of job opportunities.