A thought that's occurred to me regards housing is a dynamic which seems to affect asset classes generally, and real estate has very much become an investment asset class:
Owners of assets prefer to have those assets appreciate over time.
This applies whether you're holding cash, gold, stock, bonds, loans ... or real estate. Or capital goods, educational degrees, guild memberships, computer language skills, etc.
The basic principle is simple: if the value of whatever it is you're holding goes up, you have more financial wealth.
One consequence is that whoever it is that holds some asset will tend to talk it up or otherwise see that what you own, or have, or control, appreciates in value.
Among the key ways to do this is to control the supply of a thing -- this is what cartels (De Beers, OPEC, Standard Oil), guilds and professional societies (medical and lawyers credentialing organisation), taxi medallion holders, and homeowners do.
If the good is simply an investment asset, and has no productive or consumptive value of itself, say, stocks or bonds, this isn't much of a concern. You may still have problems of asset inflation bubbles, but nobody will be deprived of life nececessities because stock prices are doubling every 10 years.
For housing, both the price and the supply impacts have tremendous effects. Households are forced either to spend an inordinate amount of income on housing, to live far from work, or to crowd (often illegally) into small spaces shared with others.
Among the differences is that the investment asset is what I'd consider a Maslovian good: one that is essential to livelihood. Food, water, shelter, clothing, security.
There are some goods which have borderline properties -- they're both necessary and carry a strong Vebelen status-signalling component, such as college education (depending on the institution).
But generally, this case of treating things people need in order to live as investment vehicles ... seems problematic.
How to not do that becomes an interesting question. A Georgian land tax seems as if it might actually be one of the better options.
Owners of assets prefer to have those assets appreciate over time.
This applies whether you're holding cash, gold, stock, bonds, loans ... or real estate. Or capital goods, educational degrees, guild memberships, computer language skills, etc.
The basic principle is simple: if the value of whatever it is you're holding goes up, you have more financial wealth.
One consequence is that whoever it is that holds some asset will tend to talk it up or otherwise see that what you own, or have, or control, appreciates in value.
Among the key ways to do this is to control the supply of a thing -- this is what cartels (De Beers, OPEC, Standard Oil), guilds and professional societies (medical and lawyers credentialing organisation), taxi medallion holders, and homeowners do.
If the good is simply an investment asset, and has no productive or consumptive value of itself, say, stocks or bonds, this isn't much of a concern. You may still have problems of asset inflation bubbles, but nobody will be deprived of life nececessities because stock prices are doubling every 10 years.
For housing, both the price and the supply impacts have tremendous effects. Households are forced either to spend an inordinate amount of income on housing, to live far from work, or to crowd (often illegally) into small spaces shared with others.
Among the differences is that the investment asset is what I'd consider a Maslovian good: one that is essential to livelihood. Food, water, shelter, clothing, security.
There are some goods which have borderline properties -- they're both necessary and carry a strong Vebelen status-signalling component, such as college education (depending on the institution).
But generally, this case of treating things people need in order to live as investment vehicles ... seems problematic.
How to not do that becomes an interesting question. A Georgian land tax seems as if it might actually be one of the better options.