Prices have risen by 54% in the United States, 32% in China and nearly 15% in the European Union between 2015 and 2024. Though policies have been implemented to increase supply and regulate rentals, their impact has been limited and the problem is getting worse
Housing access has become a critical issue worldwide, with cities that were once accessible reaching unsustainable price points. Solutions that have been proposed, like building more houses, capping rents, investing in subsidized housing and limiting the purchase of properties by foreigners have not stemmed the issue’s spread. Between 2015 and 2024, prices rose by 54% in the United States, 32% in China and by nearly 15% in the European Union (including by 26% in Spain), according to the Organisation for Economic Co-operation and Development.
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Salaries have not grown apace with real estate prices. In the EU, the median rent rose by 20% between 2010 and 2022, with rental and purchase prices growing by up to 48%, according to Eurostat. Underregulated markets are wreaking havoc, and in the United States and Spain, 20% of renters spend more than 40% of their income on housing, while in France, Italy, Portugal and Greece, that percentage varies between 10% and 15%, according to the OECD. Many countries have created programs aimed at increasing the future supply of public housing, but their effectiveness has yet to be determined and analysts say that results will be limited if smarter regional planning decisions are not made.
The prices are set by banks. The only limit on what somebody can sell you a house for is what the bank is prepared to lend you.
If the interest rates go down, the price goes up. If the term lengths go up, the price goes up. Prevent lending, and the landlords will buy it up because normal people can no longer afford them.
The system has been fucked for way too long, and in order to fix it, you’re going to have to upset a lot of people who have put their money into their home.
I don’t know where you’re from but in my European country the banks are actually verifying if you are able to reimburse and you cannot borrow above some threshold. Maybe that explains why the prices increases are lower here ?
In the UK there’s a soft limit of 4.5 times your income.
This is the amount they’re allowed to do with no oversight.
But 15% of their mortgages per quarter can be over that, and as far as I can tell there’s no real upper limit, although they’ve been offering 6x mortgages in some places.
The entire economy has prioritised pumping mortgage money around, and so nothing will be done. The only real lessons from the last big crash was to limit bad borrowing a bit, and that is crumbling away too.
I don’t see any short term fixes that wouldn’t get their political parties booted out and replaced with a party that promises to pump the house prices again.