[wrfrmers]

It's not just the cost of building the house. Utilities and infrastructure (and the taxes to pay for it all) add up. Now, if you were to build smaller, densely, and close enough to amenities that residents could walk or bike to their daily activities, or to public transit that can take you farther away, you save a significant amount on initial AND recurring costs. And what's better, people WANT that! Or, a least, they're willing to eat the downsides in order to benefit from the upsides, including lower costs. But there lies the rub: when these types of places get built, they get offered at market pricing, not in a way that reflects their lower costs. So people say, "Why spend the same for less?" and move to a traditional suburb (or, more likely, put off home-buying altogether).

The problem with housing in America always comes down to the way it was financialized and securitized: too much relies on "line go up, forever". There's no room for new blood/capacity (read:competition), there's no room for "investments" to lose value.

[bombcar]

One of the problems is that the people who need housing aren't buying new houses.

Nobody is going to spend $x on a brand new house without having some say in it, and so those houses tend more and more toward "high end/luxury". After all, why go through the hassle of all the paperwork and building and NOT sell for the highest price you can get?

Same thing happens with cars; the market for car buyers is much larger than the market for new car buyers, but only new cars ever get made. Nobody is making used cars, or even the absolutely cheapest possible, which affects the whole supply.

[bluGill]

Most new houses are only slightly custom. You generally start with a floor plan from the builder, and then choose the color of the walls or other minor details. Sometimes a new house is cheaper than a used one because you can move into a used house much quicker, while a with new house you have to wait for them to finish. Usually a new house is more expensive than a comparable used house, but not by much. Even a fully custom home is generally not much more expensive because your builder will tell you what costs a lot of money (if you ask for 8.5 foot ceilings the builder will talk you into 9 foot because those are much cheaper since precut parts are available), and what is insignificant. Generally walls can go anywhere and are cheap to move around.

[pas]

Market prices is not the problem. The problem is getting these bigger projects through permitting is. The cost savings are lost in litigation.

https://www.noahpinion.blog/p/market-rate-housing-will-make-...

[Miraste]

Charitably, that's a very flawed blog post. Studies of housing affordability in Finland should not be used to make points about America. Finland has a number of legal protections that shield its citizens from the rampant price-fixing, collusion, investor-oriented building, and other predations of the American market.

That's not to say housing construction regulation isn't a problem. It is, but two things can be problems at the same time.

[wrfrmers]

Without reading your link: this is a problem across new and existing builds, so it can't be an issue wih permitting. Housing cost growth has outpaced wage growth for decades. We are reaching an inflection point of unaffordability (unequally distributed geographically, of course). The problem is that market rates must support a number of (often unnecessary or inflated) concerns, including but not limited to permitting and litigation. Profit for a rotating cast of securitized mortgage holders is another major one. Insolvent municipalities that can't see property taxes fall is another.

[HeyLaughingBoy]

> they get offered at market pricing, not in a way that reflects their lower costs

Well, duh!