The Discrepancy Between Free Market Economics and Housing Choices in the USA
While the USA is often heralded as a bastion of free market economics, one cannot help but notice a stark contrast in housing options compared to countries like Japan. This article delves into the reasons behind this discrepancy and proposes innovative solutions to address the housing crisis in the USA.
Understanding the Discrepancy
In Japan, particularly in cities like Tokyo, the housing landscape offers a variety of micro-apartments and tiny homes that are both affordable and convenient. For example, capsule hotels and small apartments of just 100 square feet are commonplace, providing residents with a high degree of flexibility and low costs. Contrast this with the USA, where strict regulations and high costs make such options less common.
Consider the author's experience in Tokyo. With monthly expenses as low as Y20,000 ($150 USD) for a dormitory-style apartment that includes safety and utilities, the author has the flexibility to live and travel easily. This is in stark contrast to the stringent requirements and high minimum living space in the USA. For example, apt. laws in some areas stipulate that apartments must be at least 58 square meters, requiring individuals to own a car space, which is often unnecessary in urban areas with efficient public transport.
Micro-Apartments: A Potential Solution
The concept of micro-apartments, a term borrowed from Japan, offers a viable solution to the current housing crisis. These tiny spaces can be as small as 200 square feet, yet they offer surprisingly efficient living. In Japan, residents often thrive in such small spaces, which are designed to maximize utility and minimize waste. With thoughtful planning and modern design, micro-apartments can incorporate all the necessary amenities and even offer features like elevators and handicap access.
The author suggests that in a 40-foot by 75-foot space, it is possible to build 10 micro-apartments. This could significantly increase the housing density in urban areas while ensuring that renters pay only a fraction of the cost of a conventional studio apartment. For instance, rents could be as low as $600 per month, significantly more affordable than the $1200 or more that a standard studio might cost.
The Reality of Land Ownership in the USA
It is also crucial to consider the true nature of land ownership in the USA. Despite appearances, there is no truly private ownership of land. Ultimately, the government retains ultimate control over land use and taxation. While one can technically own a house and pay off the mortgage, the reality is that property taxes are perpetual and often exceed the original purchase price. This means that even after a homeowner pays off the mortgage, they are still paying for the land in the form of property taxes.
The myth that Proposition 13 in California stopped the reassessment of property taxes is dispelled here. While Proposition 13 did limit the rate of increase in property assessments to 2% annually, it did not prevent property taxes from increasing indefinitely. In fact, taxes can still more than double in a single lifetime, making true ownership a hollow concept.
Therefore, while the USA may tout free market economics, the reality of the housing market is complex and often contravenes these principles. Innovations in micro-apartment design and a reevaluation of land ownership could provide a more equitable and efficient housing solution for Americans.
Conclusion
The discrepancy between free market economics and actual housing practices in the USA is a matter of public interest. By embracing innovative solutions and rethinking the nature of land ownership, the USA can improve the housing landscape and provide more affordable, flexible, and efficient living options for its citizens.