Affordable Housing

Dr. Randall Holcombe has a short, but effective article on the aftermath of the housing bubble and affordable housing. Dr. Holcombe points out that it is simply a matter of supply and demand and that prices are still too high.  One point in particular that he points out that is often neglected is that when we talk about falling prices we often focus on suppliers are hurt, but rarely is the point made that consumers are better off.  Both sides of a market (demand and supply) is necessary to get the full picture.  As Holcombe writes "Keep in mind that every time a house is sold, it is also bought.  The seller who sells at a low price sells to a buyer who buys at a low price.  The disadvantage to the seller is offset by an equal advantage to the buyer, so on net that is a wash.  And, if we really were concerned about affordable housing, the balance, from a public policy standpoint, might tilt to favor buyers who can now buy at lower prices."