[laserlight]

> That means there’s an invisible hand keeping prices up, or basically that the market is not free enough.

Nowhere in the economic theory there is a proposition stating that prices should fall below affordable levels, given enough competition.

[Sankozi]

We are not talking about economic theory. We are talking about house prices. Time after time it has been seen that free-enough market can lower the prices to affordable levels.

[laserlight]

Fair, but the thread has evolved into a discussion on the theory. We are definitely in the territory of theory when the invisible hand is mentioned.

[Sankozi]

I took "invisible hand" as a joke. The one with pattern : either (fairies/magic/invisible hand) or (sensible argument/observation here).

[sophrosyne42]

The relative abundance of land compared to other factors of production is, in fact, such a proposition. But when land is restricted through zoning laws this stops holding true. In other words, we must eliminate restrictions on production for the benefit of all people, but particularly the poorest.

[FuriouslyAdrift]

I mean I would love to bulldoze that strip of forest next to Beverly Hills and put in a hog farm. It would provide tons of jobs.

[fc417fc802]

We don't need economic theory for that it's just common sense. Humanity has been erecting structures to live in for approximately our entire existence. The modern economy is mechanized. How could a wood frame structure or a small high rise possibly be unaffordable if the market is functional?

Stop and think for a second. Someone in good health with a willingness to DIY and a sufficiently flexible schedule can literally build their own house from the ground up. It's a substantial time investment but not actually as much as you might think. Housing isn't very resource intensive compared to the rest of the modern economy.

The only possibilities I can imagine to explain unaffordable housing are broken regulations, critical levels of resource exhaustion, natural or man made disaster, and gross economic dysfunction.

[foxglacier]

It's regulations. But before you call them broken, some of it is safety. Safety standards keep rising with technology and the economy as people can afford more. Same with cars. There's also zoning restrictions in some places designed to prevent slums by requiring large residences. I guess that's happening here too.

[cylemons]

Also living standards, ancients houses are dead simple and today could probably be built with usd 5k-10k in a couple months. But most people wont accept a home with no electrity, no lights, no AC, no indoor plumming, etc.

[foxglacier]

Yes that too. We're a bunch of spoiled brats complaining how much we have to work but it's only because lifestyle creep keeps pace with wealth.

[michaelmrose]

The average person would need a MASSIVE investment in time to learn all the skills required in addition to investment in tools. Furthermore people won't lend joe random the funds required in the same fashion as they would for an actual finished house OR constructing a house via a contractor.