When will Millennials be able to afford a home & how to fix the housing crisis | Bryan Caplan 

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I don't know. These times have occurred, historically. But, it wasn't pretty. Best case scenario; unions, and regulations, along with government subsidies could pull the "nose up" out of the dive we're in. Worse case scenario... I would rather not get into that. If you research the time of the "Robber Barons," you'll find a strong correlation. My hope is that this gives you some hope.👍😊. Or, at least a direction to look toward. Be well, JJ

Loooooser!

If it is any consolation, I am 78 and will probably die before long, so you can buy my boomer home. What an ass Kaplan is.

Nailed it!

Make more money or move to a place with cheaper housing prices.

Agreed. People pushing deregulation are usually acting as propagandists for multimillionaires and RWs. Always take what they say with a pinch of salt...

Because increasing the supply of a product (homes) is the most efficient means of decreasing prices and increasing the quantity supplied, with the bonus of punishing those investors you mentioned.

@@toddlyman9439This is one of the most reasonable comments I’ve seen on this thread. Unfortunately people probably won’t understand.

All of that is wrong. He addresses all of it in his book. You should read it

Progressivism in a nutshell

i have left leaning sensibilities but the economics denialism among a large contingent on the left is pretty bad. Advocating rent control is akin to thinking the Earth is flat. Nothing this economist said was "libertarian" or "right wing". Zoning laws and permitting in big cities are the standard answer for why home prices have outpaced what would be expected in a competitve market. It is maddening reading these comments. Too much Noam Chomsky. Not enough Larry Summers and Christina Romer or Austan Goolsbee.

My mother built her own home on a lot she purchased. She lives alone. Her house has 5 bedrooms! She built this big because she was convinced that it made it more sellable in the longterm. But, because it is so big, she now will have to sell it at the point when it becomes too much for her to manage (including all of the stairs), instead of happily aging in place with her perfect view and location.

​@@michaelenquist3728 I live in a beach town where there are so many homes sitting empty for half the year as Air BNB vacation rentals that they can afford to let sit empty all that time because they're charging as much as I pay for my house monthly as a weekly rate. This also inflates how much homes cost to buy for regular people. There are so many livable homes and apartments sitting empty in the US.

I get the idea of this, but it's rough right now with such high mortgage prices. It massively brings down what people can afford. If they're forced to sell now, only those with tons of cash will buy

@@crzyprplmnky that's the point. If the tax is high enough, sellers will be forced to lower prices because the financial disincentive to allow homes to remain empty will be too expensive.

Oh so you get to tell people when and for how long they should occupy their own homes that they paid for? 😂

@@Jackmerius_Tacktheritrix5733 no. It is only a tax on "empty dwellings." Your home is not empty if you live in it. This would only be a tax on landlords and corporations that own multiple unoccupied properties. Does that make sense? Feel free to ask a follow up question.

Libertarians live in a world of bad effects they hate but never want to know or learn the cause of those bad effects....

And people just trying to survive and keep a roof over their head wrote those regulations in their blood and paid for them with their life.

He said the regulatory burden of safety regulations is minor and barely mentioned as an issue in his book. Love the hyperfixation on hating libertarians though, very productive.

@@toddlyman9439 comment sections are typically meant for "hyperfixation". Were you expecting a dissertation about libertarian delusion? Those can be found all over the internet.

Our current regulations on housing make it a living fucking hell both in terms of prices but also in how unnecessarily spread out and ugly they make American cities. It’s better to listen to the actual arguments than the political label behind the guest. He gave clear reasons as to why regulations around parking minimums, zoning, lot coverage, set backs, are in almost all cases, more harmful than helpful. Rather than do the lazy thing by characterizing him, try and actually criticize his claims.

This started before rates for high. It’s a supply and demand issue caused by government regulations and a bit of lagging supply chain regulations.

Housing regulations like zoning and planning laws began in the 1960s and have increased steadily from then. The fact that your 1950s neighbouring house is so close proves Bryan Caplan right. You need to read the book instead of getting emotional

@@damiendeecee wah wah the government. Sounds pretty "emotional"

If people weren't in the realty business, they don't understand or know what they're talking about.

@@andrewrobinson1479 You obviously don't know too much, or you'd understand how housing regulations halved they number of houses you could have sold per year

You are right. But, there is another element that seems to be affecting these prices, as well. The conglomerates that are now buying up houses and treating them like they're a stock to be played with. These are people's homes. Do owners have the right to make money? Yes. Should they have gone back to the "Robber Baron" technique of owning everything and raising prices to squeeze everything out of the folks trying to make a living? No. And, the person trying to be a single home owner gets stuck with the prices the "market" has created. I've said this before in a recent post elsewhere. The choice people really have to make is this: Is it better to own a small piece of a thriving economy? Or, is it better to own a large piece of a dying economy? In a dying economy, historically, the pitchforks eventually walk the streets.

77% of the residental land in Denver is zoned for single family homes.

Even in a debt based system, supply and demand is the only thing that sets prices. If your city has housing extremely above the cost of production, it means your city is by definition over regulated either in the ability to get a permit, or in the artificial supply of land the government has provided to be developed.

And a tiny home lot in my little cow town in the US is more than $650/month.

@@RatedArggg oh my god, really? My 2 room appartment costs me 2000 dollar a month in Europe.

You would get a 2 room appartment for 450'000 dollars in Switzerland. If you want a single family home, you have to pay over 2 million dollars.

70% of the residential land in British Columbia is zoned for single family homes. Meaning it's illegal to build apartments, duplexes or townhouses on most land.

Well BC has totally opened up development around the skytrain so if regulations are the problem this will surely fix it. Of course, at least in Vancouver, that is not the problem. 25% of new builds in 1999 went to investors. It is well north of 50% and that is the problem that plagues any city with investors.

Robinson, and your government wants to start bringing in hundreds of thousands more immigrants per year to compete with Canadian citizens for that scarce housing.

Cool.

A terrible idea. The government will build crap. We've already been there. Quality and efficiency comes from a free market. Deregulation is the answer.

Ur wrong

@@wade2bosh what am I wrong about?

Interesting, can you link to a paper on this?

Usa has the most strict codes in the world

Berkshire Hathaway, Blackrock, other US hedge funds and corporations, and also foreign billionaires, corporations and mobsters are buying about a third of US homes right now. Young families can’t compete with Berkshire Hathaway or Russian or Chinese mobsters and billionaires.

​@@freeheeler09Thank you! I actually just wrote about this in one of my posts, too. 😊

@@JJLom777 can I read the post? Curious about it

I won't sell my property to someone from those groups. Actually, I will give it away first.

Prices are not set arbitrarily by anybody. Prices are established by supply and demand in a market. If a landlord asks for a rent that is significantly above the market price he will get no interest from prospective tenants.

Thank you!!

Very good point.

Interesting that Medical, Education, and housing are the ones that are the most out of control and also the ones that the government most has their hands on 👀

No. Some costs outpace wages, like medicine, tuition, housing, infrastructure development. And in other cases wages outpace costs, like for food, electronics, clothes, cars etc. So it's not out of control costs in general.

Wages have kept up with the cost of living, overall

All that free stuff you voted for. The bill came.

@@ohedd Wages are outpacing food, clothes, cars? Are you out of your mind?

Rent control is great if applied correctly, he draws a wide brush without even identifying features.

@@stoneneils No, there is nothing good about rent control.

@@WildBill99x Results are in Bill. You've got massive homelessness and gen-z stuck with mom and daddy. We don't. Everybody here is still out on their own by 20-21. One job only. Our landlords are still all rich as hell...which is why you doin't hear them complaining. This is an argument, try coming back at me like an adult. I dare you.

@@stoneneils Who is we? Rent control is an economic disaster. Rent control is the reason that it is very difficult to find an apartment in New York and why they are in poor condition. Rent control prevents the market from working to meet demand. It creates problems while solving nothing. And it is something that government has no legitimate authority to do. Read some intelligent commentary on it, perhaps by Thomas Sowell.

Rent control stands almost by itself in its awfulness. Rent control aims to give lower income people access to more affordable housing. But the result is less access to affordable housing. So you can basically end the debate right there. The only way in theory to make rent control work would be subsidies for landlords and builders but the odds of that getting designed correctly are zero percent.

Has this worked for Florida?

I lived on the 25th floor and it was traumatizing as hell. I neede binoculars to see if my friends arrived.

@@stoneneils how life changing /s

@@damiendeecee Not really, maybe for a small towner who's never lived in the city..

Caplan was my professor and I told him the same thing when we met for lunch last time.

Yes!

No. Supply and demand tell the whole story. House flippers don't buy any more than 5% of houses.. Or less. Organisations only buy houses because the supply is so limited. If house prices halved, they would sell their holdings

Everything is always pumped w increased credit production

You hit it right on. There is a great video from Johnny Harris out there pointing this out. He points out a progressive community voting Democrat turning around then fighting zoning reform in their city. It's like they say they care about others as long as it is not in my backyard,

Zoning abolition would be better.

Anyone who is educated and an expert is going to be at least in the middle class? Should he bring a high school dropout and ask them how to fix housing?

​@@Alexander21025Honestly, I think maybe you're both correct. And, they're good points. 👍

@@Alexander21025 David should bring a normal person who lives in reality day-to-day (or even better, a group of people like that from all across the country) to ask the economist questions about how they plan on fixing the dire situation on the ground, instead of only having the economist provide sermons from their ivory tower.

The fact you watched the video twice and came to this conclusion only means that you most likely have a below average IQ and should stay out of politics.

I live in under rent control and universal healthcare in Canada and there is one problem.its great....everybody i know is broke but nobody i know is stressed out at all. We can forsee all our costs.

Skyscrapers would only be built where it makes sense to build, no one is going to be building a skyscraper in Gary Indiana

Right. Creating fairly high density does not require anything higher than 3-4 stories generally as long as you have those fairly close together. Of course liberalizing land use in LA,SF, NYC and Boston would likely lead to skyscrapers but elsewhere I would doubt it

Nah you're just a nimby and want to keep people homeless due to high housing costs

You people seriously need to take an economics class or at least read economic literature

Agreed! But there are affordable houses our there.The problem is that banks won’t loan on distressed homes. And, few families have the money to buy and then fix up a distressed home. But if you can scrape together the money for a POS. And if you are willing to sacrifice a few years of weekends and vacations and every extra cent you have to fix up a home. And if you are brave enough to learn new skills. You can get into the housing market the hard way.

@@freeheeler09 yeah I have no option to buy. I can't only rent and at this time the rents are astronomical and especially if you're on a fixed income.

@michelled8408 Check out articles in Propublica and NPR that cover the price fixing and collusion scheme used by large-scale apartment property managers (a la OPEC). For a fee, RealPage’s software (YieldStar) will allow apartment property managers, often in competition with each other, to have access to what the going rate is for rent. Those who have this software subscription keep rent about the same. Hence the price fixing and collusion. If rent goes up in some apartments, the other apartment owners most likely will increase their rent as well. YieldStar software is not good for renters since renters cannot haggle with property management. Property managers may prefer to have vacant apartments and keep rents high so that renters will have no choice but to acquiesce to their price demands to rent an apartment. This is just one of the awful reasons the rent is so high.

Is this a genuine question or a rhetorical one? If it’s the former, the reason he is saying there should be more high-rise apartments, multi-family homes, greater levels of density in cities, etc. is because there is considerable demand to live in highly productive areas like cities. If supply is prevented from responding to demand by regulation, then many of those who would otherwise have been willing to live in the city can only live a bit farther away in the suburbs. But what does that mean? The housing in the suburbs is now being bid for excessively and the cost will rise there. If supply is similarly constricted in that area then supply won’t be able to respond to that either and the issue will be exacerbated, but we can leave that to the side for now because you specifically asked about the logic behind “high-rises.” Let’s hold all else equal and say we allow for more construction in the urban areas. This would alleviate some of the bidding for the suburban homes and bring down prices at selling time, because those willing to live in the midst of the city would now be able to and would no longer be forced to bid against those like yourself who don’t find living in higher density areas appealing. That would not entirely solve the problem but it would alleviate it to a non-trivial degree. If you would like some research on the effect of land-use regulation on housing prices I would be able to send you some sources.

@@michaelenquist3728 I dunno, regulation by people who aren't greedy. Sounds simple and idealistic and it is. That's why it won't happen.

How do we fix greed?

How was he as a professor?

Same with his rent control notions..i live in a city where every rental is controlled. Trust me, they keep throwing up new ones all the time..nobody is walking away from a viable site.

Surfside was subject to heavy regulations and regular inspections. How’d that work out? He’s not saying do away with inspections. He’s talking about shifting the standards and responsibility to the private sector. Your doctor’s expertise isn’t rubber stamped by a government employee that knows nothing about medicine, it’s judged by the AMA, a private organization.

@@stoneneils. Rent control is a net negative on society. Did you not listen to the video at all?

The first 5 minutes of building inspections save lives.. websites building inspections don't. The economics of extremely clear

@@Jackmerius_Tacktheritrix5733 You really really REALLY need to stop taking your advice from RU-vid videos. Its going to discourage you from moving anywher, trying every career, and dating literaly any woman lol. If rent control is a net negative on society why are we talking about YOUR country's homelessness all the time and nobody elses. None of us have nearly your problem because all of us have some form of rent control..just like universal healthcare. I'm 54 and myself and half my buddies are semi/retired already, we can predict our costs 20 years into the future.

So, in the past, people sold houses and rented lower than they could actually get? Saying it is greed is just lazy

@@Alexander21025 I'm talking about greedy landlords not normal ones. Besides in ALL states you can't afford rent unless you work two like jobs. Take your far right nonsense and scram.

@PhantomQueenOne I am not right wing. You are just making a bad point, and instead of thinking, you attack me. 95% of landlords throughout all time want to get the most they can get. Do you have any evidence landlords are more greedy now then before? Maybe it is more to do with market forces and not just people being greedy. Because they were always "greedy".

​@@Alexander21025Though I don't want to get between this, I think they're really just boiling it down to the most basic truth. There is such a thing as enough. There's no harm in making a profit. But, if the profit is only causing harm? Yeah. That's an issue. And, I do believe it needs to be dealt with. Soon. I mean, if one really thinks about it, most of the world's ills can be put in the basket of "greed," or "ignorance.". Even "want" usually stems from another's greed. So, there's no need to suggest laziness. But, perhaps they could have explained themselves better. Or, you could have just asked them to.

@@Alexander21025 Maybe they are asking more than the market can bear? You shouldn't have to work two jobs to afford a cheap one bedroom apartment in a crap area of town. It's about the money!

Why is real estate an investment? Why do corporations own homes? Have you considered that housing regulation is causing those prices to go up so they can invest in them?

@@SolarxPvP The tail doesn't wag the dog... sheesh.

@@SolarxPvPyou scream Regulation as corporations just outbid you by an extra 100k because they know people are desperate for a place to live and will pay whatever they have to. Besides now that home is worth 100k more in their portfolio and the rent more than pays for everything including “regulation” and profit.

@@trappedinamerica7740 The reason people are desperate is because of housing regulation strangling supply production. Blackrock has admitted they target markets with the tightest regulations because they know they won’t need to compete with new inventory. Sure, regulate hedge funds from buying homes, but quit using them as a scapegoat for the fundamental problem which is the regulations causing artificial scarcity and market distortions.

Increase supply and the motivation to buy a home purely as investment decreases. Making it illegal has for more uncertain outcomes

No one can rent out a house for a "crazy amount." They can only get the market rent. Asking for a rent above market means nobody will show up to rent the house. People in the market to rent can easily find out what the market rent is and will recognize a place where the asking rent is too high. Landlords do not set their own prices.

Everything you said here makes sense. I think people think rent control is a quick fix. It’s not. I laid out everything you said in a post earlier and I was called a jerk for saying I want people to be homeless. Both scenarios produce homeless people. Scenario 1 rent too high. Scenario 2 rent control keeps people currently who are in apartments from getting priced out. Bad if you are looking for a place because they don’t exist. Government subsidy for high density housing is the solution with built infrastructure for public transportation. That’s our ticket out of this mess. Also restrict wall street from buying single family homes. The people who want rent control are not thinking about the economics behind what can do to supply of housing which is the very reason why we are in this mess in the first place.

You sound like you are very smart and informed.

@slydog81 no just good parenting. I had wonderful parents. They taught me the value of a dollar at an early age They taught me hard work and no play made for a dull day So I worked hard and played harder

Breathed in a lot of those lead fumes didn't you meemaw

@coldsnap999 what are you talking about I was raised with parents who taught their children how to make good decisions and work hard if you wanted something. How old were you when you were able to purchase your first house How old were you when you got your first paycheck paying job I was 14 because I wanted a car when I turned 16 and I knew my parents weren't going to purchase me a vehicle when I turned 16 I purchased a 1963 4 door Chevy Impala What did you do for yourself at 14

Right! What would be the problem with house price control? Or car price control? Or major appliance price control? There are many things that people have trouble affording -- why not just have the government set prices for everything at a level everybody can afford? We could solve everybody's money problems with such commonsense approaches if it weren't for the elites and their BS excuses.

What's wrong with rent control is that capping prices below the market price leads to shortages. Setting minimum prices, as in the minimum wage, leads to surpluses, as in surplus labor, aka unemployment. Setting minimum or maximum prices is also a violation of the right to contract. Two parties making a agreement on the price of an exchange, privately and voluntarily, is within their rights and government has no legitimate authority to forcibly alter the terms of their arrangement.

Nobody said that. Nobody wants to give up their homes because of interest rate dynamics and supply and demand.

@@keymold4405 At 10:30 and the next few minutes, Caplan talks about deregulation so skyscrapers can be built. He said that most people think the problem is SELFISH homeowners who don't want to see the value of their property decrease. Kaplan said it's not "just" that. In short, his plan is 1) deregulation 2) getting people out of their beloved single family homes so developers and investors can have the property, and 3) building skyscrapers. At 12:00 he callously brushes off the homeowners who don't want to move. "Well," he says, "a lot of people do." Unscrupulous developers are infamous for forcing people out their homes by any means necessary.

Do you have the right to maintain your property value by using force to stop others from building something so you can artificially inflate its value?