Hot take: The housing crisis is a finance crisis.
Developers don't just need permission to build—they need the math to work. Right now, it only works when rents keep rising.
Our @jwmason.bsky.social & @mikefellman.bsky.social’s new report explores how we can make stable, lower-rent housing viable.
I'm very excited that my report on housing affordability for @groundwork.bsky.social, coauthored with @mikefellman.bsky.social, is finally out. Today is a full teaching today for me, but I will try to put a post up about it tomorrow.
groundworkcollaborative.org/work/fixing-...
How can a Danish pension fund even invest in US Treasuries when it's liabilities are in DKK???
The Fed bullies the bond market all the time, they just won't for the benefit of Trump.
Denmark or any country's investment in US Treasuries is actually largely irrelevant.
Annexing Greenland would still be an outrage.
M4A works by cramming down on providers. So doctors just move to another state under state level single payor.
That said, if the entire country went on M4A, providers would face a ~20 percent pay cut but would have nowhere to go since US docs would still be the highest paid in the world.
Veteran's Day Post
Are VA Home Loans a Good Deal?
Mostly yes, with some caveats
open.substack.com/pub/precon/p...
Housing production suffers from diseconomies of scale, which helps explains high housing cost.
open.substack.com/pub/precon/p...
I support proposals 2-4 on the NYC ballot, which would make it moderately easier adjust zoning for higher-density housing development. I have to say, seeing how controversial this is among people I know is giving me some new sympathy for the angry YIMBYs online.
New Housing Hell
Tokyo is not a YIMBY dreamland, it's a deflated asset bubble.
open.substack.com/pub/precon/p...
New Housing Hell
I analyze the impacts of the Texas and California real estate tax regimes on housing production.
Spoiler alert:
Cali comes out better than critics would expect.
open.substack.com/pub/precon/p...
New Housing Hell
Stop comparing rent control in Argentina to US Rent Stabilization
open.substack.com/pub/precon/p...
New Housing Hell
Developers are not the enemy of landlords. Landlords are their customers
open.substack.com/pub/precon/p...
She already said she would only serve one term. That's already disqualifying and forces Ds to potentially have to defend an open seat in 2032 years.
New article.
SB 79 brings some welcome changes, but don't expect a building boom.
open.substack.com/pub/precon/p...
New Substack
Wall Street didn't cause the housing crisis, but YIMBYs still get the economics wrong (per usual)
open.substack.com/pub/precon/p...
New substack
No matter what some YIMBYs say, the quantity of buildable land does not determine its price.
open.substack.com/pub/precon/p...
But in order for it to be speculation, land prices have to be detached from rents!
The simple and straightforward answer is that it is not speculation. Land prices are rising because the rent that the land can generate is rising. It's not that deep.
But this is an inherent contradiction, since for some on the left, land "speculation " is driving rents higher
In other words, land prices detach fully or partially from the returns(rents) that land generates. Land prices are higher than what rents would justify.
We could define "speculative" demand as any price above which land provides a return which is BELOW a return (adjusting for risk) that equals returns in other asset classes.
Suppose land prices are anchored by the same zero arbitrage equilibrium condition that anchors all asset prices.
Here, land must be priced such that it does not provide a higher risk adjusted return than other asset classes
JW and I have a paper on housing coming out soon, and we agree on this.
I've thought about how land speculation would drive up rents, and I just don't see it.
Quick thread
