alt Hacker NewsThe price of rent is set by local household wages.
If both partners typically work: rent rises to eat nearly all the gain.
If AI makes everyone 20% more productive: rent rises to eat nearly all the gain.
If minimum wages lift the bottom earners from $7.50/hr to $18.50/hr: rent rises to eat nearly all the gain.
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The only countervailing forces are:
* landlords not wanting as much money (unlikely, although it happens at small scales)
* rent control-type policies
* competition
And as far as I know competition is the only thing that works at scale. Although, people tend to emphasize intralocal competition as where this gets fixed. But I tend to think that the even larger issue is that so many places suck to live in (due to schools, jobs, culture, lack of prosocial governance...) that everyone with options congregates in the good ones.
There's an effect every larger than all of those, though, which is wealth disparity. If incomes differ by fewer orders of magnitude then prices can't vary as much across markets. At the end of the day when rich people can and do buy 2-5 homes and everyone else can barely buy one of course you're going to have problems.
This is an easy problem to solve, regulate the amount of profit you're legally allowed to make from renting land you did not create.
We do this in other industries all the time.
Health insurance is heavily regulated to ensure that there are profit caps (think 80/20 rule) this means that the company is legally compelled to actually spend a certain amount on customers of said product.
Imagine if landlords were compelled to spend 80% of their rent dollars in improving the space or helping the renters.
If you add more lanes to the interstate, people move further out, and the rent rises to eat nearly all the gain.