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Monday, January 23, 2006

 

Why Do Houses Cost So Much?

Randall O'Toole:
"If this happens, you can blame urban planners for creating the bubbles. Throughout the United States and much of the rest of the developed world, home prices are rising fastest where planners have imposed rules aimed at slowing or controlling growth. Planners call this growth management, of which smart growth is a recent variation. By preventing homebuilders from meeting the local demand for housing, growth management leads to sharply increased housing prices. This in turn attracts speculators who have shied away from the stock market. As a result, housing prices in many areas have risen far above the true value of the homes."


Is this a plausible analysis?

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