Address cost of housing to bring inflation back down

[Yo_Mama_Been_Loggin]

By Ben Harris / For the Los Angeles Times

Recently released government data hammered home what we have known for at least a year: A national housing shortage, not broad-based price increases, is driving inflation.

Inflation over the past year was 3.1 percent — far less than in 2021 but still high enough for the Federal Reserve to keep interest rates elevated. However, unlike the inflation we saw soon after the onset of the pandemic, the more recent bout was overwhelmingly driven by the rising cost of what the Consumer Price Index classifies as “shelter,” including rent actually paid and the estimated rent that could be charged for owner-occupied homes.

Since the start of last year, most prices have risen very slowly or not at all. The price of goods — the tangible things we buy — remained essentially the same, rising just 0.1 percent. Food inflation, a source of post-pandemic pain for many households, was less than 3 percent. And other categories of prices actually fell: Household energy prices are down 2.4 percent, and the price of cars has fallen just over 1 percent. All told, for everything other than housing, inflation was just 1.5 percent — low enough that if housing prices had grown at historical rates, the Fed could have declared victory.

But housing costs have not grown at historical rates: The two-year price increase came in hotter than at any point in the past four decades. This lopsided picture tells us a lot about who is most affected by inflation and how it should be addressed.

https://www.heraldnet.com/opinion/comment-address-cost-of-housing-to-bring-inflation-back-down/

[MichMan]

1. Federal 35% capital gains tax on all housing sales would help

People shouldn't be able to make tens of thousands of dollars in profit just by occupying a house for a few years.

[LisaM]

2. Reining in short term rentals would help.

Same with regulating corporate ownership.

Airbnb drives up rents and takes inventory off the market (so does VRBO). Until people wake up and boycott them, those issues will continue.

[KT2000]

3. Yes - yes - yes!

I would love to see a class action suit against short-term rentals. That is the most predatory business model. It privatizes the profits and socializes the cost - to neighbors and the lost neighborhoods.
Their target homes are medium priced so workers are pushed out of the market. That has worked very well in my community - not enough workers anywhere, especially medical workers. Then, the free-market freaks look to the government to subsidize housing.

Bulk buying by corporations often leaves the home vacant.

[LisaM]

4. I can't get my friends to boycott Airbnb.

This is especially true of my friends who owns their own houses or condos. They absolutely distance themselves from what they do to me as a renter when they use Airbnb. It's hurtful, though I try to get past it.

[KT2000]

5. They should understand

that when they are using Airbnb in neighborhoods, they are not welcome there by neighbors. They are imposing on someone else's neighborhood and changing its character.

I too am emotional about this issue. Actually it was the beginning of the end of my relationship with my sister-in-law. Having one is all about easy money and using them is imposing on neighbors and the housing supply.