In wealthy societies, housing becomes a way to store generational wealth. In the USA, the complaints about high housing prices seem to ignore to how much housing costs in other countries. 10x homeprice to income ratios are very common abroad. There's nothing inherently unreasonable about that. It means location accrues a long time value, and land becomes a more favored asset class.
US is somewhat unique, in that undeveloped land was effectively worthless for the longest time, and cheap horizontal expansion was possible because of the car, still so in the 70s. That is why Americans are fairly unique in thinking of housing as a commodity (it's just some some wood and bricks after all).
The conditions that enabled that though or over. Horizontal expansion (and thus commodification) is no longer sustainable, and we will see an ossification of the urban landscape, freezing value in place. It's a ratchet upwards.
The only way out is boost supply through heavy infill, which is possible in some US metros, mainly the ones with depopulated urban cores (fly-over country basically). It's going to be much much much harder on the coast. Since the average American (who's in their 50s) absolutely loathes what densification seems to imply (pedestrians, cyclists, and mixed income, riffraff), I don't really see that happening at any kind of scale or fast enough to ease pressure on prices.
I agree relative to income, US housing is still one of the cheapest in the world. But abundant land don't explain it as in countries with even more land like Canada, housing is more expensive. Maybe its the substantial carrying cost of real estate in US (high property taxes) which discourages people from using it as pure store of value (like Chinese).
In wealthy societies, housing becomes a way to store generational wealth. In the USA, the complaints about high housing prices seem to ignore to how much housing costs in other countries. 10x homeprice to income ratios are very common abroad. There's nothing inherently unreasonable about that. It means location accrues a long time value, and land becomes a more favored asset class.
US is somewhat unique, in that undeveloped land was effectively worthless for the longest time, and cheap horizontal expansion was possible because of the car, still so in the 70s. That is why Americans are fairly unique in thinking of housing as a commodity (it's just some some wood and bricks after all).
The conditions that enabled that though or over. Horizontal expansion (and thus commodification) is no longer sustainable, and we will see an ossification of the urban landscape, freezing value in place. It's a ratchet upwards.
The only way out is boost supply through heavy infill, which is possible in some US metros, mainly the ones with depopulated urban cores (fly-over country basically). It's going to be much much much harder on the coast. Since the average American (who's in their 50s) absolutely loathes what densification seems to imply (pedestrians, cyclists, and mixed income, riffraff), I don't really see that happening at any kind of scale or fast enough to ease pressure on prices.