[1] is a bit noisy because it's monthly data, but if you give it a 12-month moving average, it definitely seems like housing availability was substantially above current levels from about 1973-1992.
I'm curious if there are any theories besides wage stagnation that caused that change?
Regardless, landlords set the price. They always had the opportunity to post ridiculous prices, and they bring them to the price people accept. They dont have to go to the edge of what someone would accept. But they do.
The same tech worker (or whoever a local municipality happens to be pointing fingers at) would pay $1200/mo in one area, or $7500/mo in the other area. A wealthy class of people have always existed that can pay rent or mortgage or own at pretty much any price.
The landlords are the greedy ones - the neighbors and corporations that were already there for the most part. I’m not arguing for anything (in case someone mistakes this for a rent control argument), just have been in enough cities to hear it all.
If that was true, apartment pricing would be flat or even trending down, as landlords would compete on price.
But they don't. Instead, landlords fight against the construction against additional housing so they can limit supply and increase prices.
I had a 900 sq foot, 2br, 1 bath apartment in the suburbs in 2012 that was $800/month. Each annual lease renewal was a higher price. When I moved out in 2015, the price was $950 at the time. If I had renewed, it would have been $1,100/month. That apartment now is $1,500/month. In less than 10 years, that apartment has doubled in cost.
Rising prices do not indicate a competitive market.
Supply and demand is a factor. You can talk about it. It is not a unique enough factor to this time period. I feel like you wanted someone to acknowledge that.
Perhaps property sales and rentals should require attestations about who offered what price and we can use that data to consider deterrents or levies on those who moved the price up from the prior owner or tenant. Sure there are some prospective occupants that will say a higher price just to skip the queue, I dont think they are really the majority of people even when well funded transplants descend upon a town. I think the majority just take whatever the landlord offers.
> I think the majority just take whatever the landlord offers.
Taking the price offered for a particular property is not the same as ignoring prices. Apartment shoppers search for the combination of quality and price that best satisfies their preferences. I have a hard time imagining an alternative. Would that be going to an apartment search engine and simply picking the first result, regardless of quality and price?
When I go to the grocery store, I don't negotiate with the cashier. That doesn't mean grocery stores aren't competing with each other.
Yes and the shoppers find one, the trend is that the unit they find and pick - no matter what the shopper lands on - was rented higher than the last time, because the landlord set it higher than the last time. This didn't have to occur, the landlord could have done the prior price, the lower price, even in the face of demand and people willing to close quickly at the new higher price.
Why would the landlord choose to rent at below market rates? I think we've drifted from the question of whether the rental apartment market is competitive.
If a landlord chooses to consistently rent below market rates, for whatever foolish reason, then they'll probably wind up selling the building to someone who knows what the market rate is. It might take a while, but it'll happen eventually.
> If that was true, apartment pricing would be flat or even trending down, as landlords would compete on price.
It is possible to have rising prices in a competitive market. For example, the automobile market is competitive and experiences rising prices. When I was shopping for an apartment not long ago, I saw several signs advertising discounts. This is evidence that landlords compete on price. However, lack of advertised discounts would not be evidence of a monopoly.
Uh, source on the housing shortage in the 1970s being even remotely close to this level?
Because, yeah, demand outstripping the heck out of supply is the "deflection" I'd pick.