Weekly Wisdom #327 - Housing affordability, infinite upside, best purchases under $500

Housing Affordability, Infinite Upside, Mosquito Drones & Purchases Under $500

​

Happy Monday!

One of the topics that went viral on X/Twitter last week (and is a continuing topic of discussion here in North America, almost everywhere) was about housing affordability, mostly centred around this post:

Barrett Linburg-->

@DallasAptGP

Here's something fascinating happening in the apartment market right now.

The cheapest, oldest apartments (Class C) are getting crushed right now.

But ONLY in cities that just delivered tons of new apartments.

Let me show you the numbers:

Denver: Class C rents down 13.9%

1:22 AM • Nov 10, 2025

614

Retweets

3756

Likes

Read 233 replies

​

It's a long one, but the story goes:

Cities had a ton of new apartments built, including luxury apartments

Renters who can afford it move "up" into nicer apartments

At the bottom, everyone has moved up, supply of the lowest-cost apartments goes up, and the prices drop, making housing more affordable for those that need it

In cities with few new apartments, this doesn't happen, and the lowest-cost housing prices actually went up

This tweet expanded on it:

Crémieux-->

@cremieuxrecueil

This is a good illustration of a general principle:

As you build new high-end apartments, people move up, freeing up supply of lower-tier apartments.

Building luxury housing thus lowers downmarket rents. You don't need to build 'affordable housing' to make housing affordable. https://twitter.com/DallasAptGP/status/1987692410529317208

Barrett Linburg

@DallasAptGP

Here's something fascinating happening in the apartment market right now.

The cheapest, oldest apartments (Class C) are getting crushed right now.

But ONLY in cities that just delivered tons of new apartments.

Let me show you the numbers:

Denver: Class C rents down 13.9%

1:0 AM • Nov 11, 2025

781

Retweets

6040

Likes

Read 170 replies

​

Intuitively it makes sense, though building luxury apartments is often touted as the wrong answer, and there's a call for rent-controlled apartments.

Encouraging "building more" has some elegance: it doesn't require government intervention, it encourages developers to do what they do best, and if that is the solution being offered, it incentivizes work to speed up permitting and so on.

However, there are still concerns, some of the most obvious being:

This doesn't solve things for local buyers if foreign investors or corporate interests are allowed to purchase large portions of new supply

It can cause infrastructure challenges that will cause an increase in costs short-term, if not planned for properly

It doesn't address the tendency for prime real estate to become unaffordable, meaning that workers who are important for cities functioning—city workers, hospital workers, non-profit workers, etc.—can often be priced out

And of course, it doesn't immediately address those that are unhoused, or still can't afford the lowest tier of rentals

However, I would argue that government intervention is probably more effective at addressing each of those issues:

Adding restrictions for foreign ownership/tax implications for owning multiple residences/etc. (like Vancouver has done some of)

Effective infrastructure planning, which can be eventually be subsidized by the increase in taxes paid by having a higher density

Tax incentives/subsidies/etc. for specific types of workers, or housing specifically targeted at those individuals (for unhoused as well)

There's also a sort of negative spiral that occurs when development is impeded enough: developers simply go elsewhere, and when the original city tries to get things moving, they have a hard time because there's no local developers available.

If you invert the overall question, and ask instead "what would guarantee an increase in housing prices?" there's a very clear answer: keep supply low.

Encouraging more development seems like a logical place to start.

Have a great week!

Graham

​

Links

📚 Book Notes: Antifragile - Nassim Nicholas Taleb - The book I go back to re-read the most, it was Taleb's books that first taught me about non-linearity and how to apply it to upside and downside.

Especially these days, I need lots of those reminders: the internet and software has the greatest upside potential in the world (but that's hard to remember when you've quit your job!).

📖 Build Update 7: Building the Larsen Trusses & Adding Siding - My latest update on the small shed is about building out the most unique feature of my builds—the Larsen trusses—and adding siding.

This was a very satisfying step, and the first time it really started to look like a completed building!

🚁 Tornyol - Drones that kill mosquitoes. I want some.

🏠 This home in Australia is one of the most beautiful I've seen using this amount of wood throughout. Hard to think of how to make a house feel warmer.

​

Tweet of the Week

​Purchases under $500 that have significantly improved people's lives:

Peter Yang-->

@petergyang

What purchase under $500 has significantly improved your life (or made you happier)?

9:17 PM • Nov 16, 2025

19

Retweets

876

Likes

Read 579 replies

​