Why have housing costs rose so much in the past decades?

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Why have housing costs rose so much in the past decades?

In: Economics

13 Answers

Anonymous 0 Comments

Supply and demand. You can’t make more land, and in fact the amount of land that’s, say 30 min from city center, decreases as population and traffic increases. So people who want to live in certain areas have more competition and less supply to choose from which drives up costs.

Additionally, as more of the world has developed that has driven up costs for raw materials that goes into housing like concrete, lumber, copper, etc. Plus labor costs are higher due to shortages of skilled tradesmen, And those costs are going to be reflected in newly built housing. And even older homes will then get priced with benchmarks to newer construction—particularly ones with recent remodels that again reflect recent costs of materials and labor.

Anonymous 0 Comments

That’s not true everywhere. It’s not true in small towns with declining populations. The people who leave these towns go to places where more people want to live. That means there’s more demand for housing in some areas and less in others. People don’t relocate to the places with cheaper housing, because the well-paying jobs are in places with higher housing costs. The housing market isn’t driven by pure supply and demand, there’s an external factor (the availability of jobs). The price of housing isn’t the only thing that people consider when they buy a house.

Anonymous 0 Comments

Honestly supply demand is a generalization of amy cost issue.

Location has most to do with it honestly. For instance in my hometown I could get a nice sized house for a modest price minutes from my job.

Where I live now? I live an hour from work and still to buy a home youre talking about 300 to 400k for a modest home.

Many homes exist on the market in my current area however because of location the cost is ridiculous with no one buying so they rent them out as means to make income. The cost is too high for those forced to rent able to position a purchase.