There’s less houses per capita than this sort of economy should have, and as a result prices are high (low supply, same demand). What word you want to use for that is up to you, I guess; usually people get what I’m saying so I don’t think “shortage” is a bad choice.
Price is what moderates demand. The higher the price, the less demand there is. Maybe you can eke out a million dollar home, but at a billion dollars I’m sure you are tapping out and moving to the forest to live under a pile of branches. Well, I certainly am!
So long as price is able to rise, rise it will, and demand will keep eroding until equilibrium with supply is found. And I think it is fair to say we have found equilibrium. If you are in the market, there is no trouble finding a home. If you have sufficient transactional value in hand, someone out there will sell you their home, guaranteed.
That’s quite unlike the toilet paper situation we saw a few years ago, where even a million dollars in your pocket wouldn’t necessarily secure you a roll, even though the lottery winners were paying dollars at most. That happened because price gouging laws prevented price from rising. That’s a shortage.
If you ignore the price component then everything is in a shortage. There is always someone who is happy to take more, more, more. Call it that if you want, but what’s the point? What, exactly, are you communicating when there is nothing not in shortage? There is good reason why the formal definition is more succinct.
The thing about putting real economic situations directly in basic economics terms is that it’s impossible. I’d maintain that such an explanation exists, but we’re so, so far from having all the data needed to do so.
What I’m doing here is using comparable economies as a litmus test. Canada has less houses per capita then them, and higher housing prices. This tells a story that can be framed in economics terms, and that I suspect is correct. Why we have less houses is the interesting question, which I can’t yet answer.
Maybe you can eke out a million dollar home, but at a billion dollars I’m sure you are tapping out and moving to the forest to live under a pile of branches. Well, I certainly am!
An interesting digression about this: it would be illegal. The building of permanent structures is very regulated in Canada. It also might be hard to commute to work from crown land, and hunting or foraging is a challenging skill that’s also very regulated.
What actually happens when you’re priced out of housing is you become either a couch surfer, or a homeless person that’s periodically harassed by the police. Our laws basically assume everyone can afford a house.
There’s less houses per capita than this sort of economy should have, and as a result prices are high (low supply, same demand). What word you want to use for that is up to you, I guess; usually people get what I’m saying so I don’t think “shortage” is a bad choice.
Price is what moderates demand. The higher the price, the less demand there is. Maybe you can eke out a million dollar home, but at a billion dollars I’m sure you are tapping out and moving to the forest to live under a pile of branches. Well, I certainly am!
So long as price is able to rise, rise it will, and demand will keep eroding until equilibrium with supply is found. And I think it is fair to say we have found equilibrium. If you are in the market, there is no trouble finding a home. If you have sufficient transactional value in hand, someone out there will sell you their home, guaranteed.
That’s quite unlike the toilet paper situation we saw a few years ago, where even a million dollars in your pocket wouldn’t necessarily secure you a roll, even though the lottery winners were paying dollars at most. That happened because price gouging laws prevented price from rising. That’s a shortage.
If you ignore the price component then everything is in a shortage. There is always someone who is happy to take more, more, more. Call it that if you want, but what’s the point? What, exactly, are you communicating when there is nothing not in shortage? There is good reason why the formal definition is more succinct.
The thing about putting real economic situations directly in basic economics terms is that it’s impossible. I’d maintain that such an explanation exists, but we’re so, so far from having all the data needed to do so.
What I’m doing here is using comparable economies as a litmus test. Canada has less houses per capita then them, and higher housing prices. This tells a story that can be framed in economics terms, and that I suspect is correct. Why we have less houses is the interesting question, which I can’t yet answer.
An interesting digression about this: it would be illegal. The building of permanent structures is very regulated in Canada. It also might be hard to commute to work from crown land, and hunting or foraging is a challenging skill that’s also very regulated.
What actually happens when you’re priced out of housing is you become either a couch surfer, or a homeless person that’s periodically harassed by the police. Our laws basically assume everyone can afford a house.