[Qwertious]

>and bringing too many people into the country via immigration.

In a functioning economy, more immigration will just result in more housing being built, as long as the immigrants are working. Especially since the cost of housing construction is largely the cost of labor. Immigration is a distraction from the core inability to build more housing.

[mrkstu]

"In a functioning economy" is doing a lot of work here. Here in reality the parent comment is 100% correct.

[Qwertious]

My point is that immigration is a distraction from the nonfunctioning economy.

[Tiktaalik]

Exactly.

Can I create a small company of a half a dozen new immigrant trades, buy single family homes, tear them down and build new fourplexes? Nope this is largely banned (though ever so slowly changing in some areas).

The severe regulation has distorted the market and created a housing shortage that is legally prevented from being addressed no matter what available new immigrant talent is at hand.

[cudgy]

And yet the non-functioning economy might be a result of the excessive immigration. Which one is easiest to address?

[Qwertious]

>And yet the non-functioning economy might be a result of the excessive immigration.

It's not. If you have a narrative for how immigration could explain why there's record-high home prices and yet there isn't a corresponding spike in construction, then please post it. Because this is pretty obviously a problem of suppressed supply.

[cudgy]

I’m not implying that immigration is the only reason for higher housing prices. My opinion is that 0% interest rates and loose credit are the primary reason.

However, simple supply/demand would suggest that immigration AND 0% interest rates both affect demand quickly while supply requires securing land, building homes and getting approval to build homes takes significant time. Migrations are happening at a faster rate than housing can be built so it definitely has an impact on prices.

[rhubarbtree]

On HN and on tech twitter I often see this statement: “the reason rents are high is because we don’t build enough houses.”

But I don’t think that’s really true, I think that’s very simplistic. The missing observation is that housing has become an asset class in a way it wasn’t in the past. Large numbers of people purchase houses to rent seek as landlords, and the only limit to the demand for rent seeking is the ability of those landlords to borrow money. So a major determinant of rent is now the ability to borrow money, the interest rate, and the number of people wanting to be rent seeking landlords.

Increasing the housing supply by the amount physically practical in say the course of a decade is probably unlikely to make much difference to rents if the primary driver of rent prices is the ability of rent seekers to borrow to buy the new properties. First time buyers can’t compete on borrowing because they have smaller deposits or less access to capital, so they are forced to rent, which means the rent seekers can continue to buy up properties.

In the UK, buy to let mortgages have become a substitute for pensions for the baby boomer generation. Encouraged by the government, housing as a yielding asset has essentially taxed the young to pay for the boomers retirement.

Whilst housing can be used as a rent seeking asset, it is very unlikely building new houses is going to lower rents. Landlords will simply always be able to outbid renters, so rent will remain at the height of whatever the renters can afford, I.e. extract the maximum rent possible. There is an endless demand for housing from rent seekers, provided they can rent out that property.

Couple this with the fact that the government in the UK at least has used the property market to hide the reality of the economy - that the economy is basically collapsing - there is so much vested interest in maintaining the status quo that no regulation will be introduced that will cause rents to drop, such as limiting the access of rent seekers to capital, or preserving properties for owner buyers etc.

Tl;dr - rents are expensive not because there is too little housing, but because we need them to be expensive.

[brailsafe]

Yep. One might ask what happens if you don't have a functioning economy? Well, this kind of state. A massive failure for anyone but those who don't have theirs.

[oezi]

Housing is an inelastic commodity. Increased demand will take considerable time to lead to additional supply.

Over-supply is even harder to reduce because housing is amortized over 20 or more years.

Developers are well aware of the cyclic nature of the housing market and thus reluctant to invest in many cases.

[dghlsakjg]

What's funny is that I would bet money that immigrants to Canada have a higher employment rate than Canadian citizens as a whole.

I say that as a member of both groups.

[lostlogin]

The continual drive for growth is a problem though. By definition it isn’t sustainable, yet we keep adding, consuming, growing.

[brailsafe]

Why is a drive for growth bad? Seems like the double-speak of saying growth is bad while happily profiting off of and simultaneously restricting it is whats bad.

Growing up in a prairie city I heard this sentiment from people who simply don't like other people constantly, and I'm like "When did you try growing, you stagnant deteriorated shithole!?", and sprawl doesn't count. They hate ambition, they hate people, they hate taxes, and have no interesting ideas. They hate traffic, but refuse to do anything but drive. Their healthcare system and infrastructure is failing, there is no new economic activity happening; get busy growing or get busy dying. It doesn't work though if you stop for 70 years and then try to catch up.

[lostlogin]

A lot of what you say here I agree with. I'm not sure that I'd define maintenance of infrastructure as growth though, and I too hate sprawl. Growing the economy is great, but only if done in such a way that it's sustainable. Growth or death is too simplistic, perfectly captured by the grandparent comment. Bringing in immigrants to generate growth when you can't house the current population seems crazy. Things don't have to get bigger to be successful. You could make a business and have zero employees and make a living. Does it need to be a massive company that's growing? There is always a limit, and something will eventually prevent growth, so why does it have to be an external force?

Where I am we are trashing the waterways and the land in pursuit of money. You can't swim in most our rivers anymore - the recent numbers look good though, as the government redefined 'swimmable' and now it's 'safe', despite the contaminants. https://www.nzgeo.com/stories/explainer-new-swimmable-water-...

[epistasis]

Trying to house the people we have is in no way a "drive for growth".

[lostlogin]

The context was that immigration was being encouraged, while not having enough housing. Immigration being used to fuel growth.

Housing the people is great, but encouraging immigration while being unable to house the current population is not.

[epistasis]

That's at best a less-than-complete view of immigration.

For immigrants themselves, it is usually an issue of self-determination and freedom.

I can't say I'm fully privy to the immigration debate in Canada, but framing it as an issue of "growth" could not be a complete view of the advocates of immigration. Especially with the level of acceptance of refugees in Canada.

The not enough housing aspect is completely incidental to immigration. In my city, the overriding reason that we have not built enough housing for even our own children is that people show up to block any environmentally friendly housing proposal, largely arguing against growth. In other words, using the framework you are right now! And it's a rather twisted version of the "we can't have growth" framework because it ignores the underlying reason for not allowing growth: environmental sustainability. So instead, the only housing that gets built is the most environmentally disastrous type of housing: sprawl far away from the locations where people need to be for their jobs and everyday life, causing massive environmental destruction.

I would argue that there are few more counterproductive ways to talk about the environment than to bring up a "need for growth." First of all almost nobody actually cares that much about growth in 2025 and secondly it has disastrous consequences when the rubber meets the road.

[lostlogin]

Are we both arguing against the growth we see at this time?

[throw5959]

Everybody cares about growth. The world will end the minute we finally stop growing. The entire economic system and society will unravel

[dns_snek]

I don't care about growth, nor do most people I know. We don't need to endlessly consume to be happy. The world won't end when this economic system unravels either, it's not the first and it won't be the last one to fail.

[epistasis]

Do recessions unravel the economic system? Is the UK ready to collapse as a system after an extended period of stagnation?

I guess it depends on your precise definition of "growth" but I am having trouble finding one that can fit with your assertions.

[summeroflove20]

"as long as the immigrants are working"

And their family members, and the money they work for stays in-country and is not sent overseas.

Not commenting on your stance of the costs of construction, that's ridiculous to be left there on its own.

Get more out, to get a reality check.

[brailsafe]

Cost of housing is influenced by much more than labor and raw material.

[thereisnospork]

In our current, over-regulated market: yes absolutely. In a healthy market, cost of low-end housing should approach the cost of labor + raw material (plus necessary overhead for e.g. inspections, plus a reasonable risk-adjusted return on construction). Cost of materials/labor simply slides/scales with additional stories / more difficult terrain.

Land/space, while not an infinite resource, is hardly limited on the scale necessary to house people outside of extremely small niches. Views of central park are always going to be expensive, but there are a lot of square miles <45minutes to times square where someone would very profitably build and run (e.g.) an SRO if they were allowed to.

[Ekaros]

Also in healthy market bottom end should be housing build decades ago and already fully paid for. Now it would mean large mid-rises. But still, entirely reasonable standard of living when you are not been brainwashed into needing expensive wasteful single family buildings.

[cyberax]

In a functioning economy, people won't be feeling pressure to move into a handful of population centers.

Canada has PLENTY of free space for construction, and modern construction is pretty cheap and efficient. But economic forces are concentrating the growth in a few areas. Well-intentioned efforts to force "affordable housing" and "walkable neighborhoods" make these forces even worse.

The root cause fix is to stop the economic forces that pack people into ever smaller areas.

[amanaplanacanal]

People have been moving from rural areas to cities since the beginning of the industrial revolution. People want to improve their economic lot, and that is the most likely way to do it. I didn't know of it is even possible to stop that in a capitalist society.

[BlueTemplar]

And even before, but cities used to be much more deadly.