COME SEE THE RENT-SEEKING INHERENT IN THE NEW URBANISM?

I shy away from the sort of polemical disquisitions about how the self-styled progressives want people living in small apartments along streetcar lines, in good Pruitt-Igoe or khrushchoba fashion.

Recently, I came across the heirs of Leon Trotsky coming to grips with the rent gradient in Sydney, Australia.  "Amid a general cost of living crisis which is acute across all essentials, including food and utilities, rising housing costs are pushing hundreds of thousands or possibly even millions to the financial brink."

I could have noted that the rising rents in the capital cities of Australia were the manifestation of rent-seekers bidding up the rents and dropped the mike, couldn't I?

A protracted property boom means that house prices remain at unprecedented highs, with the median house price in Sydney, the country’s most-populous city, now pushing $1.5 million. With stagnant or falling wages, home ownership is out of the reach of broad layers, especially younger people.

Rents, however, are also skyrocketing. Figures released by the property group Domain for the June quarter and the last financial year show unprecedented annual increases, as well as a continuing acceleration of rental costs.

Across the country’s capital cities, median asking rents for houses increased by 11.5 percent over the 2022–23 financial year. Slight falls in smaller cities, such as Hobart and Canberra, masked far greater increases in larger population centers.

In Perth, the Western Australian capital, median asking house rents increased by 16 percent, from $500 a year ago to $580 now. In Melbourne, the increase was 13 percent, Sydney 12.9, Adelaide 12.5 and Brisbane 11.5 percent. Some 6.1 percent of the yearly increase in Sydney occurred in the June quarter alone.

The hikes were even starker in apartments. That is significant because the apartment market caters to lower-income people who cannot afford to rent a house.

In that "slight falls in smaller cities" is evidence of internal migration, affecting the rent gradients.  Who, pray, is bidding up the housing prices?  That ought not be difficult, dear reader.  "To the extent that people are willing to pay a premium for the opportunity to walk to work, that rent gradient is going to get steeper."

That's so much bourgeois formalism.  The very policies that mandate more high-density housing are, to the properly jaundiced view, a grift.

In New South Wales, the newly-elected Labor administration is centering its housing policies on a campaign for the further watering down of restrictions on property development. Premier Chris Minns has outlined a vision of more and more high-rise apartment buildings, especially in inner-city areas.

The transparent aim of this, and other policies, is not to increase housing supply so that rents go down. Instead the purpose is the opposite: to do everything possible to ensure property developments and high-end investors continue to rake in profits on the back of deepening social misery.

Whatever.