January 23, 2006

Lies lies and more lies: The Myth of the Housing Shortage

It has become almost universally accepted over the past few years that San Diego is experiencing a severe housing shortage. The presumed housing shortage -- or when the occasion calls for slightly more drama, "housing crisis" -- has served as the a priori basis for untold articles, analyses and conversations regarding San Diego real estate.

Even your mother's folksy platitude that "they're not making any more land" has made a rousing comeback.

But the fact is that there is no housing shortage in San Diego, and there never was.


Wes D said...

And there never will be, at least not in any of our lifetimes.

Out at the peak said...

To make the graph work, you have to multiply by the average speculators' inventory. The average of the hardcore have about 4-5, right? Then somehow apply an easy credit offset to that as well.

With that all put together, you can draw conclusions on how prices got to where they are.

And indirectly, you can prove that is not where prices would or should be when that element is removed.

There will be many post-bubble books that will go into further detail that avid readers already know.

Anonymous said...

Is that "population" as in current population of SD? If so, plotting supply and population doesn't work... because the price increase can be because of demand from people "knocking at the door" of SD from around the country and even around the world.

In other words, the graph doesn't show demand growth.