matthestMar 19

Austin’s surge of new housing construction drove down rents

https://www.pew.org/en/research-and-analysis/articles/2026/03/18/austins-surge-of-new-housing-construction-drove-down-rents

Austin’s Surge of New Housing Construction Drove Down Rents

After decades of explosive growth, Austin, Texas, in the 2010s was a victim of its own success. Lured by high-tech jobs and the city’s hip reputation, too many people were competing for too few homes. From 2010 to 2019, rents in Austin increased nearly 93%—more than in any other major American city. And home sale prices increased 82%, more than in any other metro area in Texas.

Show threadpclowesMar 19

Its wild how the solution to housing costs is really just:

Build more housing. Keep law and order.

No it doesn’t need to be “affordable”. Yes rent control is a terrible idea.

Just build more housing.

Note: that the US already has plenty of housing and housing costs basically go up in areas of low crime relative to economic opportunity. If you build housing, but allow crime to rise, you have wasted everybody’s time.

Show threadestearumMar 19

New construction has already decelerated in Austin due to falling prices, which compresses already-near-zero margin on real estate development.

So yes, it really is "just build more housing." The problem is: why would you build more housing as prices fall?

Show threadterminalshortMar 19
Because home builders don't make money by buying and selling houses, they make money by building them and selling them.
Show threadnsnzjznzbxMar 19

But building cost > sale value is possible.

Or land ends up better value left as suburban house than developing up.

Or they build where sale cost - build cost is maximized. I.e. different city.

Governments need to build more housing. Make it bland so snobs can price discrimnate themselves to buy builders' homes. Why thrifts by the government home for value for money (and quality).

Show threadvascoMar 19
You think the government knows better how to identify land that is profitable than private builders? Why? Or is this one of those opinions based on "is OK for the state to pay for it because there's infinite money for my pet project"?
Show threadSpivakMar 19

Because government has a unique pricing advantage, they get additional value from the houses they build in the form of all the positive externalities and property tax revenue. So projects that wouldn't be profitable for private builders might still be worth it to the government. So it should be both.

They're just gonna pay builders a sum anyway so it's not like they need to shoulder the full upfront cost anyway.

Show threadvascoMar 19

Do you have example of another area the government has higher profit margins than private industry? I can't. And if I was going to think a government would build housing, it would be in places that are cheap and I could mass house a bunch of people, not in hip expensive cities which is what people want when they talk about this.

But surely soviet style huge blocks of tiny t0 apartments all stuck together is a dream...

Show threadwongarsu

> Do you have example of another area the government has higher profit margins than private industry?

Public transit. Capturing enough money from fares is difficult, maybe impossible, but it's quite profitable if you can capture the value generated by the enabled economic activity and raised property values.

The same really goes for most infrastructure. There's a reason the government operates nearly all the roads. Also the fire departments and police stations

Mar 19 at 4:16amWeb
Show threadraybbMar 19
Likely the same for public schools and maybe universities. Having educated folks in your city increases productivity and revenues and incomes.
Show threadvascoMar 19

Yes and that reason is not because they are better at doing it profitably it's because they are commons that are wildly unprofitable to do well. If you let private industry build roads you'd have nice roads in cities and dirt in the rest of the country.

In this case what people want is the reverse. They want the government to build in Austin.

The government should be involved when market forces won't solve an issue, ie no market will make it profitable to send an ambulance to a town 3h away in the mountains. You don't need affordable housing in the center of Austin just because it's trendy though.