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There's something fundamentally strange about how prices have spiked and inventory has tightened since Covid. Where I live in rural New England, prices are up 5

There's something fundamentally strange about how prices have spiked and inventory has tightened since Covid. Where I live in rural New England, prices are up 50–100% in five years. And this is on pretty poor quality homes. Yes, low interest rates led to a surge in buying and bidding wars that spiked the baseline, but when people say "the real problem is there isn't enough housing" that feels incomplete to me. Of course supply has been an issue for a while, but home prices nearly doubling in five years doesn't look like a normal supply story -- it's not as if we suddenly created 20-50% more qualified buyers in that time. I guess the lack of churn, with people hanging onto those sweet 3% mortgages much longer than usual, is probably part of it. But I really don't have an answer for the current state of home buying. I make great money but if I was to buy a house the quality of the house I got in 2018 with the same % down payment I would be looking at over 40% of my take home going to a mortgage, PMI and taxes.

nradov 10mo ago
Prices spiked in large part because the government printed an enormous number of dollars since 2020, thus triggering asset price inflation. https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL
- eigen 10mo ago
  I'm sure you read the footnote that goes along with the spike in 2020 where the definition changed. and looking at the numbers, I see declining increaes over previous 5 year periods 39.1% increase from 2010-06 (8628.1) to 2015-06 (12004.6) 30.8% increase from 2015-01 (11787.8) to 2020-01 (15416.3) 21.0% increase from 2020-06 (18140.6) to 2025-06 (21942.4).
  - nradov 10mo ago
    Yes, I read it. Even accounting for definition changes there has been a significant expansion of the money supply in recent years (and not just M2).
munificent 10mo ago
> it's not as if we suddenly created 20-50% more qualified buyers in that time. We don't create buyers quickly, but mobility means that a large number of buyers can show up in one concentrated area much more quickly than housing can adapt. One piece of the US real estate puzzle is that automation and outsourced killed agriculture and manufacturing jobs. Those are the kinds of jobs that have some natural incentive to be spread across the US. Ag, because farms literally take up a lot of space and are spread out, and manufacturing because factories tend to be close to raw materials, ports, or other local resources. When you get rid of those jobs and replace them with information work, you create a feedback loop with no dampening in it. People want to go where the most jobs are, so they move to the cities. Businesses want to open where the most workers are, so they start companies in cities. The next thing you know, all the small towns are filled with dirt cheap empty houses because there are no jobs. Meanwhile, every metro area is bursting at the seams.
- jrowen 10mo ago
  This makes some sense to me. The solution to housing often put forth is to build more affordable housing. In the context of people wanting to move toward cities where jobs are this makes sense. But it seems like there is a larger problem of just having tons of housing inventory that is out of reach or untenable to most people. What are the more basic numbers of how many units exist in the country vs. how many people there are? How many second, third, investment, vacation units are there, how many sit empty most of the time? (I'm mostly not talking about true "country"/vanity houses far away from economic centers that will always only be accessible to the rich) It seems to me that rather than just "build build build" we could do a lot to reconfigure the existing supply to make it fit the people better? Why is there so much "unaffordable" stock out there and continuing to be built? It kinda feels like the affordable housing issue is just a red herring for the larger wealth inequality issue.
  - munificent 10mo ago
    > we could do a lot to reconfigure the existing supply to make it fit the people better? The problem is that housing and infrastructure is, you know, actual giant physical objects. It takes a year of planning and millions of dollars to move a road. You can't tear down a block of single family homes and put a denser apartment building in there until everyone living in them sells. You need to run sewer, power, and roads to make a new neighborhood, and even then you will still have to deal with the impact to nearby schools, traffic, hospitals, etc. Making places for people to live is, like, many orders of magnitude more effortful than anything we do in the software world. > It kinda feels like the affordable housing issue is just a red herring for the larger wealth inequality issue. Yes, this is certainly another piece of the puzzle. For every 100 people who can't afford a thing, there's still 1 rich person who can, and increasingly, rich people are the primary source of profit for businesses. So businesses target them more and more and we end up in today's world where it seems like "no one can afford what's being sold". It's because unless you're one of the wealthy minority, you're simply not a market participant at all. Related: https://www.nytimes.com/2025/08/28/opinion/disney-world-economy-middle-class-rich.html https://www.nytimes.com/2025/08/28/opinion/disney-world-econ...
ww520 10mo ago
House value has gone up along with other assets since Covid because a lot of money have been printed. A trillion here and a trillion there, pretty soon we're talking real inflation. Real estate is the real inflation hedge.

nradov 10mo ago

Prices spiked in large part because the government printed an enormous number of dollars since 2020, thus triggering asset price inflation. https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL

eigen 10mo ago
I'm sure you read the footnote that goes along with the spike in 2020 where the definition changed. and looking at the numbers, I see declining increaes over previous 5 year periods 39.1% increase from 2010-06 (8628.1) to 2015-06 (12004.6) 30.8% increase from 2015-01 (11787.8) to 2020-01 (15416.3) 21.0% increase from 2020-06 (18140.6) to 2025-06 (21942.4).
- nradov 10mo ago
  Yes, I read it. Even accounting for definition changes there has been a significant expansion of the money supply in recent years (and not just M2).

munificent 10mo ago

> it's not as if we suddenly created 20-50% more qualified buyers in that time. We don't create buyers quickly, but mobility means that a large number of buyers can show up in one concentrated area much more quickly than housing can adapt. One piece of the US real estate puzzle is that automation and outsourced killed agriculture and manufacturing jobs. Those are the kinds of jobs that have some natural incentive to be spread across the US. Ag, because farms literally take up a lot of space and are spread out, and manufacturing because factories tend to be close to raw materials, ports, or other local resources. When you get rid of those jobs and replace them with information work, you create a feedback loop with no dampening in it. People want to go where the most jobs are, so they move to the cities. Businesses want to open where the most workers are, so they start companies in cities. The next thing you know, all the small towns are filled with dirt cheap empty houses because there are no jobs. Meanwhile, every metro area is bursting at the seams.

jrowen 10mo ago
This makes some sense to me. The solution to housing often put forth is to build more affordable housing. In the context of people wanting to move toward cities where jobs are this makes sense. But it seems like there is a larger problem of just having tons of housing inventory that is out of reach or untenable to most people. What are the more basic numbers of how many units exist in the country vs. how many people there are? How many second, third, investment, vacation units are there, how many sit empty most of the time? (I'm mostly not talking about true "country"/vanity houses far away from economic centers that will always only be accessible to the rich) It seems to me that rather than just "build build build" we could do a lot to reconfigure the existing supply to make it fit the people better? Why is there so much "unaffordable" stock out there and continuing to be built? It kinda feels like the affordable housing issue is just a red herring for the larger wealth inequality issue.
- munificent 10mo ago
  > we could do a lot to reconfigure the existing supply to make it fit the people better? The problem is that housing and infrastructure is, you know, actual giant physical objects. It takes a year of planning and millions of dollars to move a road. You can't tear down a block of single family homes and put a denser apartment building in there until everyone living in them sells. You need to run sewer, power, and roads to make a new neighborhood, and even then you will still have to deal with the impact to nearby schools, traffic, hospitals, etc. Making places for people to live is, like, many orders of magnitude more effortful than anything we do in the software world. > It kinda feels like the affordable housing issue is just a red herring for the larger wealth inequality issue. Yes, this is certainly another piece of the puzzle. For every 100 people who can't afford a thing, there's still 1 rich person who can, and increasingly, rich people are the primary source of profit for businesses. So businesses target them more and more and we end up in today's world where it seems like "no one can afford what's being sold". It's because unless you're one of the wealthy minority, you're simply not a market participant at all. Related: https://www.nytimes.com/2025/08/28/opinion/disney-world-economy-middle-class-rich.html https://www.nytimes.com/2025/08/28/opinion/disney-world-econ...

ww520 10mo ago

House value has gone up along with other assets since Covid because a lot of money have been printed. A trillion here and a trillion there, pretty soon we're talking real inflation. Real estate is the real inflation hedge.