Enough homes?
posted by hedgehog in The Future, What Is To Be Done |When do we say “enough” to new building construction?
The average occupied American home in 2005 — renter and homeowner, apartment and house — was 1,795 square feet. That’s an 11% increase from 1,610 in 1985 (big PDF).
At the same time, the median number of square feet per person in occupied units rose by 18% to 752 from 633 as the number of people per unit declined.
The current population of the USA is about 302 million. By returning to the cramped, miserable living conditions of 1985, we could house the next 48 million Americans — about 15 years’ worth of growth at one new resident every 11 seconds — without building a single new unit of housing.
By advancing to a more collectively oriented culture in which real estate investment isn’t considered the be-all-and-end-all of middle class existence, by opening up to more coop living or extended family living, who knows how many more could fit while increasing happiness.
edited 5:20 a.m. to correct math errors
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Specifically, the government should stop making mortgage interest tax-deductible. I get the impression that this is one of those policies that every economist thinks is a bad idea, but that would be politically impossible to get rid of. (Kind of like farm subsidies, but maybe we shouldn’t talk about that here.)
The ostensible purpose is to encourage home ownership, since owning instead of renting should anchor people more strongly to their communities. But it probably has no effect on homeownership rates and instead is mostly a subsidy to the upper-middle class and rich, encouraging them to buy bigger houses.
Cultural change would be good too. But in England, w/o the tax break, a lot of people I know are buying apartments instead of houses, and that can be thought of as a more capitalist version of coop housing.
That deduction is insipid. It is based on the idea that real estate is somehow a more important asset class than the others. I can see how a home is a better investment than a stock or bond or Picasso, but that shouldn’t be decided by the government.
The subsidy inflates home prices, making it harder for people who really want to own homes to buy them. Today, people who aren’t really connected to their communities have an incentive to buy, even though they would just as well rent and put the money in high-yield bonds. Meanwhile people who do feel a deep sense of rootedness in place are priced out of the market.
Also, while I specifically ignored second homes in this post, the Clinton Administration expanded the mortgage interest deduction to second homes. It’s marketed as a benefit to the middle class but really it’s a subsidy to the real estate brokers who get to make more and larger deals because the deduction is in place.
what are we going to do with all these big houses, anyway, in terms of energy use? seal off sections to isolate them from the HVAC system? zones. that was the solution of a few people i knew living in big empty nest houses. selling the big house for a larger group of people to use, or taking renters… it seems like a lot of houses are just going to be abandoned. i mean i know people will work to keep them going but it might end up making them as popular as SUV owners are/will be.