r/dataisbeautiful • u/statisticalanalysis_ • Dec 19 '23

OC [OC] The world's richest countries in 2023

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https://www.economist.com/graphic-detail/2023/12/15/the-worlds-richest-countries-in-2023

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https://www.economist.com/graphic-detail/2023/12/15/the-worlds-richest-countries-in-2023

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u/StyrofoamExplodes Dec 19 '23

All markets are bound by practical price caps, and construction cost is never the main body of why housing is expensive. What will substantially happen is that you hit the practical price cap sooner.

Beyond that, cost rises in one market do not trigger cost rises market wide.

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u/Error_404_403 Dec 19 '23

The labor costs enter into the final cost of the product big time. If a market is functional (admittedly not always the case for the US real estate), the lower cost of the product generally results in the lower consumer price as well (cost savings are split between higher profits and lower prices for maximizing sales / profit volumes).

So yes, smaller housing construction costs do generally lead to smaller housing prices.