I didnt mention anything about the average number of occupants per home. What i did say was that, if 100 homes go from being rented to being sold, not all 100 homes will go to previous renters, for the reasons I mentioned above. Doesn’t that make sense?
If the average number of occupants isn’t changing, then cohabitation and second houses are irrelevant to this discussion.
To whom is the apartment being sold?
If it’s another landlord, then supply and demand haven’t changed.
If it’s anyone’s former tenant, then both supply and demand are reduced by 1 on average, so rentals don’t get more expensive.
Perhaps you can find some statistics to back up your general point? If you’re right, then we should see the opposite correlation - higher homeownership with higher rents.
The average number of occupants doesn’t change because everyone will still be living somewhere (excluding homelessness but we can ignore that). However, that does not mean cohabitation and second houses are irrelevant.
Some people who were previously cohabiting (not renting) will buy homes
Some people will buy second (or third, etc) houses.
Both of these scenarios are excluded from your example above. As a consequence of them, some renters will have to start cohabiting (or become homeless). The fact that there are more people who want to rent their (own) place then there are rental units will drive up rental prices.
Using a 1994 law change, we exploit quasi-experimental variation in
the assignment of rent control in San Francisco to study its impacts
on tenants and landlords. Leveraging new data tracking individuals’
migration, we find rent control limits renters’ mobility by 20 percent
and lowers displacement from San Francisco. Landlords treated by
rent control reduce rental housing supplies by 15 percent by selling to
owner-occupants and redeveloping buildings. Thus, while rent control prevents displacement of incumbent renters in the short run, the
lost rental housing supply likely drove up market rents in the long run,
ultimately undermining the goals of the law.
It does remove another renter, though. The market would only be tighter if they reduced supply by more than demand.
How does being evicted remove a renter from the rental market?
The new homeowner is the renter removed from the market, not the previous renter.
That’s a big assumption that the new homeowner was a previous renter and not just someone cohabiting or buying an additional home.
Not when we’re looking at large groups of people - there’s no reason to think the average number of occupants per home would change.
I didnt mention anything about the average number of occupants per home. What i did say was that, if 100 homes go from being rented to being sold, not all 100 homes will go to previous renters, for the reasons I mentioned above. Doesn’t that make sense?
If the average number of occupants isn’t changing, then cohabitation and second houses are irrelevant to this discussion.
To whom is the apartment being sold?
Perhaps you can find some statistics to back up your general point? If you’re right, then we should see the opposite correlation - higher homeownership with higher rents.
The average number of occupants doesn’t change because everyone will still be living somewhere (excluding homelessness but we can ignore that). However, that does not mean cohabitation and second houses are irrelevant.
Both of these scenarios are excluded from your example above. As a consequence of them, some renters will have to start cohabiting (or become homeless). The fact that there are more people who want to rent their (own) place then there are rental units will drive up rental prices.
https://pubs.aeaweb.org/doi/pdfplus/10.1257/aer.20181289
Here you go.
That’s an interesting comparison, thanks! I’ll think about this.