Feels like its common to over complicate the housing problem right now. Won't supply and demand also determine incomes? We debate over it but the culprit of large economic realities is always this supply and demand issue. Feels like I'm constantly hearing complaints about incomes not rising enough for people to buy homes and that homes are too expensive for new buyers. I'm not disputing that they are unaffordable for most young home buyers but I still feel like basic economics have to apply right?

(TLDR: This whole thing is driven by supply and demand so the trend won't change unless the supply or demand does.)

On this board it feels like the main complaints are for Utah though they apply to many places. I totally get that. I thought Utah prices were ridiculous ten years ago and the last couple of years they are just plain silly. That said are we not just seeing more demand than supply? There are fewer builders, fewer homes, Utah has scarcer quantities of land owned privately, it a younger population, highly educated population, attracts families, has a favorable economy, business friendly, boasts many outdoor activities, is the central hub for a world religion, its clean, like Denver but cheaper, near California but cheaper, diverse landscapes, has had a higher birthrate than the rest of the nation since forever, etc etc. To me this all seems like major reasons for there to either be less supply or more demand. I just don't see this changing. Add to it that money was extremely cheap over the last decade and it was practically a place of normality during the pandemic and its almost a wonder homes are not more expensive than they are.

Now you got people who bought homes on sub 3% loans and its no surprise they are not selling even if they do move. Instead they capitalize on supply and demand by holding real estate and supplying to the demand others have for housing. I myself just counseled a family member to rent their old place and not sell. When I'm hearing people are not getting paid enough in Utah to afford housing I'm hearing that they want Utah so bad that they are sticking around even though they can't afford it right now. Sounds like demand to live here is high enough that the desire to be here trumps even a solid living elsewhere. To be clear I'm not trying to argue Utah is the greatest place on earth to live but that the demand to live here is significant. Its now a place that people move to even when the know they can't afford to live here.

I have lots of empathy for those who cant afford a place where they want to live but I just don't see how we expect that to change naturally. This has been a problem since forever. I grew up in Hawaii and would absolutely love to live there again but I just don't see that happening. The space (supply) there is limited and there are all kinds of built in barriers to increase the supply of housing while the demand to live there is massive. Its so massive that multiple families will live in a 700 sqft home to do it. Utah is far from that but its also no surprise that people are renting out basements here like crazy. The Fed keeping loan rates low has actually worked against the people looking to buy now but has certainly helped many of the families who were getting into homes for the last decade. I don't know what to call that except luck and bad luck and government intervention. Not to be political but politics changed supply and demand over the last decade. In economics there is always a reaction to every action and we are in the reaction phase. This has had an impact everywhere but above all in the places where demand was already high to begin with.

To me this outcome is a big challenge for many who lost the lottery in timing but simple in how it has happened. The thing that will get us out of the same problem will still be driven by supply and demand but at least part of the trouble is where the supply of homes will increase when the jobs most people want are desk jobs not construction ones. Supply and demand works with jobs too. It will not surprise me if in 30 years the guys who decided to build homes in their 20s are all upper middle class and most college graduates are lower middle class. Its already happening! Shoot, if I had the education I have now but in my father's day I would likely be in very high demand and upper middle class just based on my training alone. That's one of the reasons I was encouraged to get more education by mentors growing up. As is, supply has increased in my vocational expertise and demand has not paced it so I am making a solid middle income but unless I compete at the highest levels of my industry or disrupt it I will never have the opportunities that were available 30 years ago. Ironically I probably could have done much better for myself, given myself more earning years and much less debt if I would have pursued plumbing, electric, HVAC or even many types of construction which were all discouraged in my day. That is because those jobs are in demand and have too little supply.

Nothing is going to change in high demand markets unless supply or demand shifts. You have to move to a different market where supply and demand has a different trajectory or find a vocation with demand high enough for you to make a good living in a high demand housing area. Outside government intervention will of course be an option but it will likely cause as many problems as it fixes, which is what we are partially dealing with now.