The housing market is a rigged game - Prof. Steve Keen
tl;dr - the existence of mortgages makes housing unaffordable.
https://profstevekeen.substack.com/p/the-housing-market-is-a-rigged-game
@GuerillaOntologist I agree it's a rigged game, but he wants to lay all the blame on the banks, even though he mentions in passing government deregulation, greedy landlords, and investment firms. He even throws in tenant rights in Germany as the reason they don't have the issue. I'd give the article more merit, if his solution addressed all the causes. (and if it wasn't on Substack)
@lwriemen To wit:
"The main factor making housing unaffordable in the USA–and most of the rest of the world–is too much mortgage lending by banks. This is not just a US phenomenon. It is common to every country that has deregulated its financial sector."
"But in Germany, tenants have long-term rights...This takes the pressure off renters, making them less willing to take on enormous levels of mortgage debt in the first place, because they have security as renters."
@lwriemen To make it clear: Without strong government regulation of the mortgage market, banks will facilitate unsustainable increases in home prices. Without strong tenant protections, people will feel compelled to accept those increasingly large mortgages in order to have a sense of security in their home.
He may not have spelled out a policy proposal in this article, but there are a number implicit in what he writes.
@lwriemen My tl;dr should have ended with "ceteris paribus". But I think your critique is unfair. He was looking for the answer to a very limited question - does an acceleration of new mortgage debt lead to increases in home prices. The evidence points strongly towards "yes." He doesn't mention gov't deregulation in passing, he states it as a main cause of the increase in mortgage debt. And he credits Germany's tenant protections as the reason they haven't experienced the increases others have.