 Eclectic thinking on politics, policy and more 2/18/09Housing confusion
Heard NPR report this morning that gloomily lamented the fact that housing starts were down some record amount last month, but I don't understand the arm-waving about this. Don't we need fewer new homes until the housing market in general settles down? When prices have been plummeting and are seeking a bottom, MORE new houses is the last thing we need -- boosting supply would just push prices down even more.
posted by Matt at 10:24 AM
About Me
Matt Miller is the author of The Tyranny of Dead Ideas: Letting Go Of The Old Ways Of Thinking To Unleash A New Prosperity, published by Times Books in January 2009. He is a contributing editor at Fortune and host of public radio's popular week in review program, "Left, Right & Center." Matt is also a senior fellow at the Center for American Progress, and served as an aide in the Clinton White House. His first book, The Two Percent Solution, was a Los Angeles Time bestseller. He lives with his family in Los Angeles. BooksPrevious Posts
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2 Comments:
You're thinking demand-side economics. Yes, a further glut of housing would depress prices more, and there's not much point building a house if the real estate market in free fall would make it impossible for a developer's net revenue to be in the black.
But on the supply-side, fewer housing starts means fewer construction jobs, fewer mortgages, and other cascading depressive effects.
Hey Matt Ive heard you talk a lot about helping sturggling home owners. But what about helping struggling RENTERS? Or struggling FUTURE home owners? I want housing prices to come down! They are too high! My generation helped get Obama elected. Why should we have to pay the debt for a bunch of people who bought overpriced houses and at the same time make it more difficult for ourselves in the process. Help us out Matt! Whose on our side here!
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