The key impact of new construction isn’t the price of the new units themselves – it’s that high-income people who can afford to move into them move out of their current, older homes. The people who move into the newly vacated homes then vacate another round of homes and the game of musical chairs continues, a process known as “moving chains”. Even expensive new homes result in shorter inspection lines and lower prices at the bottom end of the market, a finding that’s been repeated in studies of cities around the world.
No that was exactly the reason why I thought more apartments would help at any price point, and this is essentially the basis of supply side economics.
For whatever reason, people want it to be more complicated than “2463 households need 2463 houses”. I mean, at the nitty-gritty level it is, but at scale that’s the sort of complexity that cancels itself out if you just leave it alone enough, as all the Western countries do last I checked.
You see a weird sort of symbiosis between affluent NIMBYs and some of the less sophisticated antipoverty activists, sometimes. In a housing crisis, would it be better to build small apartments rather than luxury apartments, given a fixed square footage? Yes. Are luxury apartments still houses? Also yes. Both groups want to ignore the second bit, but for completely opposite reasons relative to the first bit. Sometimes, they work together and manage to get no houses built at all.
