We don't really have that problem with other goods: is it possible to make cheap and expensive bed sheets, or kitchen scales, bookshelves, or phones? Yes, in all those cases, and there's a financial incentive to do so: people who cannot afford an expensive version will pay for one they can afford.

Where exactly is the difference between those goods and housing? At first I thought land, because the same land could be used for expensive or cheap housing — but that's the case with the raw materials for those other products, and just as in the case of land for housing, not all raw material is equally desirable.

As to your question, we really can't have good evidence one way or the other, because there are too many variables. I'm attempting to reason about it, and am not really sure I have answers myself, but I'm not comfortable assuming that having government take care of a problem makes the problem go away.

The difference is if you want to make a cheap phone the people who don’t want you to are few, but if you want to build a cheap home there are lots of people who will try to stop you.

The presence of the opposing force in numbers is what is damaging.

No - the problem is in the cost

You can make cheap phones in China and sell them in the US

You can’t make cheap homes in Indiana and sell them in San Francisco

Why are there cheap homes in Indiana ? Look at the costs involved: land is cheaper. All the other components: materials and labor are the same

you can build a home for under 10k, nice ones too using earth bags. It's not up to code/zone everywhere and that's the catch. They're not dangerous to live in, and in fact - many are more structurally safe.

Bini-shell homes can withstand hurricane force winds and earthquakes and maybe even lava-flows assuming your door is shut and you don't get completely blocked in and suffocate.

Tiny homes cost about 50k to get and are portable. Yurts can make nice homes too. There's a TON of youtube videos on alternative housing 'ideas' beyond normal builds.

If I had a million dollars I'd build an intentional community with some glamping spots for revenue, and charge like $100/month/family member hoa fee or something, put whatever home you want on it. Camper, tent, yurt, earthbag, earthship, etc. Have to work out some legalities of ownership when people move/etc.

- Put some common buildings and share a lot of things like lawnmowers, 4-wheelers, power tools, etc. Things everybody owns but is really a waste of space when you could just have a community library of these things to checkout when needed. - Outdoor games like horseshoes, frisbie golf, rockclimbing walls, movie screen. - Locate it near Zion national park, or Grand Canyon. - Glamping camp for additional revenue while building things out. - Farming area and rain-capture tech to get the most use of our rainwater. - Solar array. - Commercial Kitchens, with weekly potlucks and volunteer-chef-supplied dinners (maybe tip your chef). ...etc

> Where exactly is the difference between those goods and housing?

The first difference is elasticity of demand. Housing is relatively inelastic in the short term due to land availability, time to build, and government regulation. This simply means that as price increases, quantity demanded does not decrease as much as it would for another good. For example, cereal is pretty elastic with good substitutes. If the price of cereal goes up, a good portion of consumers will switch products. In the long term housing is more elastic as people build more.

So, demand isn't changing a lot with price. And the second difference is that housing is a basic need. Let's make the assumption that housing is a truly competitive market without government regulation. The market will settle at different prices for different qualities of housing. It will be incredibly efficient and maximize consumer and producer surplus (economic goodness). But, people will be left out of the market. A perfectly competitive market DOES NOT guarantee that everyone will be able to purchase the product. It will just maximize consumer and producer surplus.

Okay, so we as a society think that we should provide some government assistance for those that cannot afford housing in this market. We have some options. We could implement a rent ceiling. Unfortunately, and this is well proven, price ceilings create shortages and inequities. Most economist do not agree with price ceilings. https://www.factcheck.org/2009/02/when-economists-agree/

We could provide programs as detailed in this article which effects the supply. As this article highlights, all government intervention WILL create market inefficiencies. The pie will get smaller. I'm not saying that the government should not act, I am simply saying that government interaction is a tradeoff between equity and efficiency in a competitive market without market failures.

I am a proponent of a voucher based system to give a credit towards rent for those in need. This reduces the government intervention on the supplier side. To be clear, these vouchers will slightly raise housing prices, likely not be implemented without exploitation, and make the overall economy slightly less efficient due to the tax. But the vouchers will also reduce inequity and provide people in need with a basic good.

I think a lot of the problem is from too much government intervention. For example, people get a lot of tax breaks as a landlord. This makes it more desirable to buy and then rent out a house. This shifts the demand curve right raising prices and removing some people from the market (it reduces home ownership rates). I think those tax breaks should be removed, especially if the house is not your primary residence or is your second or third home. People will make the argument that this hurts the poor because people won't build for them. But then the discussions above about a competitive market and the voucher system are better in my opinion than giving tax breaks to companies that own hundreds of homes.

Pointing out that primary residents get great breaks does not mean that landlords do not also get tax breaks. They just don’t get those. And of course you pay tax on the income left over after expenses.

About the direct revenue tax. Government can impose a tax on a producer or consumer, but that doesn’t matter. The proportion of who pays that tax is purely based on the elasticities of both the demand and supply curve. Because demand is inelastic, that tax probably is paid mostly by the consumer through rent prices. I don’t live in a place where there is a direct revenue tax on rental income.

There are still breaks landlords get like the 20% pass-through deduction, 1031 exchanges, and interest rate deductions (similar to small business loans - which the government also wants to promote). Keep in mind that if some of these tax breaks apply to other types of businesses, they are still tax breaks for landlords incentivizing people to be landlords vs deciding not to enter the market. That is not a normative statement. I kept deductions for depreciation (which is huge), repairs, employee fees, etc out of the list since they are the expenses you mention.

Ignore the plight of renters at your own peril.

Do you think that Mao had the right idea w.r.t landlords?

it could happen if the regulatory environment were "right-sized" with a heavy emphasis on ensuring clear and concise information to potential buyers/renters to counteract the natural information asymmetry that arises in markets between producers and consumers. this is often a key missing piece to laissez-faire flavors of economics that leave markets more distorted and less competitive than ordinarily regulated markets.

that's not the only condition, but it is a necessary one, to create affordable housing without shoveling piles of tax money at developers. the market must also be made fair and competitive in other ways, and there must be enough volume for prices to equilibriate to new information quickly (which also requires new information to spread widely to consumers, as in the first condition above).