Given rental vacancy rates of ~5.8% in the USA in 2022 it is more akin to a hypothetical of building a 12th and 13th house, while an 11th already lies unoccupied.
I am not sure in this more realistic case that building improves matters, unless an unhoused family can gain access to one.
1) You can't take national vacancy rates, RE is extremely local, as is homelessness.
2) Is it easier for unhoused to gain housing when vacancy is 1%/5%/10%/20% ?
For example, Manhattan has 2% vacancy. Even in peak covid dread it never got much above 4%. And you know what - pricing updated very quickly to get those units filled. Lots of tales of people getting crazy deals, including people I know. Of course when the world was no longer ending & everyone moved back.. prices snapped back.
So even a 2% to 4% move can have huge pricing impacts.
Imagine building enough in HCOL areas to move the needle.
1) can you explain why I can't take national vacancy rates, as it was a hypothetical in response to an unrealistic hypothetical? Surely national averages are better than looking at Manhattan of all places? I don't know how to have a reasonable conversation about this global problem using Manhattan as the point of interest.
2) at a certain point squatting sets in. I believe the answer to your question depends on how much capital is held by the rich/poor, and how well property is protected by law enforcement and private security. If you look at the parent comment I was responding to, it mentioned not building so much that it flooded the market.
You can't take national vacancy rates because housing is extremely local.
There's areas of the country with out-migration, lack of jobs, but tons of housing. Post industrial cities in the midwest are like this.
There's areas of the country with high paying jobs, but no housing being built. Areas of NY & CA are like this. It is then no surprise that we have 60k homeless in NYC when even people working for banks or tech can barely afford to live there.
There's also areas of the country with decent paying jobs, but lots of housing.. with lots of in-migration. Sunbelt is like this.
All three of these types of areas have vastly different vacancy rates and homeless rates. Taking national averages confuses the matter.
Quick googling points to vacancy rates of: Manhattan 2%, Boston 3%, SF 7%, Detroit (12% owner vacancy / 7% rental vacancy), Miami (3% owner / 7% rental), Austin (1% owner / 6% rental) etc.
Basically everywhere thats expensive has vacancies around 4% or less while areas that have been building its closer to 8%..
> why do you assume a wealthy family will only buy one house, or could be outbid by a poor family?
I was responding to this post that seemed to assume all new housing will be bought by the rich as like extra homes..
People underestimate how much "trickle down" kind of is real in RE.
In the absence of nice new construction (which seemingly always gets called "luxury"), people with money will move further and further down the market, to buy & renovate. So the option is build more homes to increase supply, or see the dollars chase existing supply & raise its value (and cost).
You were content to talk about a hypothetical where there were 10 houses and 12 families. Now you are discontent unless I discuss luxury accommodation in specific property markets within the US. It's worth noting how close each of the metro averages you give is to 5.8%.
All newly build luxury housing will by definition be bought be the rich. There is no assumption about that. The discussion was whether they decide to hoard, rent out or sell their old residence. The trend (global) is clear, e.g. NY, CA, SF and further beyond. https://old.reddit.com/r/toronto/comments/14zdsia/housing_pr...
The decider onto luxury housing being a benefit is whether the poor can in aggregate afford what the rich want for their old accommodation, increasingly, they cannot.
It's not some sort of conspiracy that nice new construction is called 'luxury', whereas less nice new construction is called 'affordable'.
Given rental vacancy rates of ~5.8% in the USA in 2022 it is more akin to a hypothetical of building a 12th and 13th house, while an 11th already lies unoccupied.
I am not sure in this more realistic case that building improves matters, unless an unhoused family can gain access to one.