The Brittle Housing Market: Why the System Is Worse Than You Think - Part 1

To understand the economy, you have to understand human nature. This podcast is powered by A-Cast. How did you end there? It's time for the podcast. And today's podcast is going to be the first of a series of three on the housing market. This is largely going to be about the Irish housing market, but the housing market all over the Western world is broken. Young people cannot get not only a foot on the housing, they can't get a place to rent. The fact is that over the last 20 years in English-speaking countries, in particular, the housing markets have not just not operated, they are entirely broken. So what are we going to do? We're going to do three series with the brilliant professor Ronan of Trinity College Dublin, the first of our series is today. And this is on what he calls the brittle rather than broken housing market. Largely speaking, this is about the fact that the failure in the housing market is not just a failure of price, not just affordability, but it's a failure to build appropriate houses in appropriate places for the demographic outline of the population. We have young people, we've middle age people, we've old people, all of whom want different things from the housing market. And it's going to be much broader than just the housing prices and the rental prices. It's going to be about the unwillingness or inability of our authorities to plan properly, to build properly, to price properly, and to zone properly. It is a fantastic series. I think it's almost the definitive series. Ronan is one of the great brains on the housing market, not just in Ireland, but worldwide. So it is the first episode of this three-part series of the great housing market tragedy is today. And it's going to be on the brittle housing market. Let's go to Trinity College, don't talk to Professor Ronan Alliance. Now, ladies and gentlemen, we have part one of a trilogy. I've always actually wanted to do a trilogy on this podcast. And I think it's like, a trilogy means you really get into shit. You've got loads of things to say. You're loosing to learn. But a trilogy nonetheless, John, this is our first trilogy. Okay. If it twins, we've had two partners before. We've had two sons, but maybe we've never had a tree some John. Here we are. A trilogy. Three sum of podcasts and economists. We have the brilliant Professor Ronan Alliance joining us. Ronan, great to see you. How are you? Listen David, thanks, John. Thanks so much for having me on. It's a pleasure to come on. And as you say, to do a trilogy, if we, if it goes well, we could go to Ortaluga's new trilogy of Trilogy. But let's say one step at a time. Let's see how this goes first. Let's even have a back for episode two. We've got an episode one has to go well first, right? Exactly. So what we're going to do listeners is we're going to say, where are we now? Second part, how do we get here? And third part, how do we rebuild on Ravel and move forward? So Roland, in terms of episode one, you describe the housing market with the word brittle, a brittle housing system. Explain to me why you use the word brittle. And then I want to talk straight away about prices and rents. Yeah, I mean, David, you probably get this quite a bit as well that when we're like everyone cares for obvious reasons, everyone cares about housing. It's the single biggest expense we have. This is pretty much true everywhere in the world. And for obvious reasons, you need somewhere to stay at night time because everyone cares about housing, everyone cares about what they might not call it the economics of housing, but that's ultimately they're interested in the economics of housing. So a question I get asked a lot, especially in Ireland, given what happened in Ireland in the in the 2000s, is, is this another bubble? If you see prices rising and rents rising for 10, 12 years, is this another bubble? And I'm using the word brittle to try and distinguish what we have now, not just in Ireland, but in lots of places around the world, from what happened 20 years ago, because I do think, especially for policy makers, there's a tendency to fight the last war. Whatever happened the last time must be, that must be the single most important thing to prevent from happening again. And you can do it, right? Stop what happened the last time with the loose credit. But this is a different kind of problem. So I'm using the word brittle because if you think about a bubble, what do you think about the bubble, the bubble pops right and you get a sudden reversal. And we saw that in Ireland, we saw that in places like Florida, in Spain, in the UK, you had big reversals in credit conditions and expectations and all of a sudden you get 50% fall in prices or in some parts of Ireland and 80% fall in prices. But that's not the system we're in at the moment, we're in a system where pressure has built up over time. That pressure should have been accommodated. It's gradual increasing requirement for homes and in a flexible responsive system, which we should have, then you wouldn't have any pressure. But in a brittle system, that pressure comes out in all sorts of ways. And I think actually one of the ways you can think about the fallout of a brittle housing system rather than a housing bubble is that in the housing bubble most of this is a financial issue, right, that people end up with too much debt compared to how much their home was worth. But in a brittle system that the following can be political as well, that you can see it, housing becoming this live wire issue because it's infected the society. If you look in Ireland and you look at younger adults, they are the reinforce to stay at home with their parents or to put the up five or six to a SMED or indeed emigrate other countries to try and start their own independent lives. That's what I mean by brittle as opposed to a bubble. Okay, well, I think that's actually a really good distinction because again, you're absolutely right. What people tend to look at is what was the last war and how do we fight the last war and what you're saying is the last war was a credit financial issue more than anything else. This is something more broadly based and probably unfortunately something that's a little bit more trickier to actually solve. So first of all, let's get in. Everyone talks about prices and rents. Is this actually the problem? Should this be the focus? Well, this is what is it? Is it Drucker's law? These management rules for you know what gets measured gets managed? And I think John says that regularly the podcast is the piece of the piece of Drucker of podcasting. And the problem is when we focus solely on prices are overwhelmingly on prices whether that sale prices are rental prices. It's not that that's unimportant. It's that we end up with solutions that don't make sense. So if you were seeing for example rents rising because there's a lack a severe deficit of rental housing. The solution is not to ban rental prices from going up no more than you'd say I'm worried about getting a fever. Therefore, I'm going to stop my thermometer at you know, 38 degrees Celsius and there the problem has been solved. What I'd love to do is actually move the debate a little bit from prices whether they're sale or rental prices to quantities. The real issue here. And it's not just an Irish issue. You see it in across Europe and across other high income countries as well is a lack of housing. The most obvious way it's not the only way but the most obvious way is if you look at the current living arrangements of younger adults. Ask them how do they live and how would they choose to live if they you know of custom availability or not an issue. Not if housing was free but you know if things were just reasonable. And if you look at Ireland about 60% of of younger adults live either with parents or with friends or strangers. And if you ask them how would they choose to live only about 20% would choose to live that way. And the vast majority would choose to either live alone with the partner. And this gets into I mean, I don't run too far ahead. We've got to you know what before you can run. But there's a mix here as an issue of housing mix is that if you think about a society arranged in households of one or two versus society and households of four or five. And this is a completely different kind of housing. And I think that's why this is a pressure that's built up decade on decade. And this is certainly not an Irish or even an Anglophone issue. I've been involved in some work with with Eurofans and those are reported a month ago at looking at the housing arrangements of of younger younger adults across Europe. And this is an issue that you can see in Sweden, you can see in Czechia, you can see in Spain that that younger adults are simply not able to take those important foundational life steps in the same way previous generations were. So let's just explore that a little bit more the idea that this is happening even across the non Anglosphere world. What you're looking about is the shortage of houses across the board irrespective of tax systems irrespective of levels of employment irrespective of levels of inculence kind of real fee medium to high income countries. So what we're saying is that if you're listening to the podcast, you know in Czech Republic, which the new word for Czech I can't get my head around just yet. But I will check you out. Check you out. Check you out. Okay. Right. But if you live in Portugal, all these are domain issues. That's right. Like so Eurofans is this EU sort of like a think tank looking at social policy and associated issues. And they've got really interested in housing. Often they would look at kind of working conditions and but they're really interested now in living conditions. And there's a number called headship and headship is what percentage of a group is the head of their own household. Maybe a slightly out of day concept, right? Because does that mean if you're a man and a woman living together that the man is the head of the household. But aside from that is how many people head up their own household. And if you look at Spain at the moment for younger adults, about 30% of younger adults have thrown household, but about 42% would like to. That may sound like a relatively small gap, but when you multiply that up by just how big that's a shortage of about one and a half million homes in Spain. And these are smaller homes, right, homes for one and two persons compared to where they are currently. And that's true in Sweden. It's true. and it's true and check it. And I'm trying to work with your friend to do this for all EU member states, because I think going back to what you measure, you manage that if you don't understand the scale of the housing deficit, you can't understand the scale of the, for example, political anger around housing, more can you understand the scale of the solution. - So briefly, just, why do you think everyone focuses on the price issue and particularly, you know, politicians, you're talking about that analogy, the folks in the thermometer, not the fever. Is it just because it's easier? Is it just because that's where the acute annoyance, frustration, humiliation, sense of dislocation is, it's in the price. And yet what you're saying is this is a much broader issue. The price is just a signal. - Yeah, I mean, so it's perfectly reasonable for people to be angry about prices going up. You know, I'm not saying that we should ignore prices, ignore rents. Absolutely. In the same way that when you're sick, you're like, okay, I'd really like some, from relief from this fever. But in the case of housing, that the solution won't come from just banning prices from going up or banning rents from going up. The solution, if you're a policymaker, is not to focus on prices per se, but to focus on the solutions that will mean that that housing is affordable. So by doing the right things, you will actually bring down prices and rents so that they are affordable, rather than focusing just on the prices themselves. 'Cause then you end up in these kind of quick fixes. Maybe we can do something overnight that will improve things and they rarely work. Okay, so let's just think who has been affected most? That's cut to the chase in terms of the demography of this. There's two groups that you can think of them as free family and post family. But if you go back to the 1950s, and this is true for Arnond, it's true for it's in most what we call now high income countries. Right, life expectancy of the average Irish man was 65 in the 1950s. And for women, it was a couple of years older. So you play through the life of someone. John's well passed that by the way. (laughing) But it certainly feels. Don't be all in January. If you go through life are the different cohorts that were in Ireland in the 1950s. Realistically, what happened in the 1950s and was you lived with your parents until your early 20s. You got married, you got your own home, you had a platter of children. And by the time the youngest hit 22 or 23, you were 64. And so you've basically got the family home where your parents grew up, your family home. And that's it. As a country. But now do the same exercise. We're not dying off in our 60s. We're dying off in our 90s. We're not getting married to 22, we're getting married to 32 or 35 or 38s. We're not having a platter of kids. We're having one or two or maybe zero children. And you could argue some of that might be because of housing problems. But even if housing weren't an issue, people are having far fewer children. So if you look at the diversity of homes, the family home is still important for the typical person. It's going to be where they live from maybe midterties maybe about 60. But you've got those years before your midterties. And you've got a pretty lengthy spell after you hit 60 or 65 when you're an empty nester. So there's actually two main groups there. That the one that's most politically angry or the group that have no housing solution, other than-- so actually this is kind of where you think of it as not ruthless as the Dutch would say in the homeless sense. But the homeless in the sense they're ruthless, right? They don't have so much to put down their own roots. They're angry because they're being held back. But there's also a second group over 65-ish, right? Not everyone wants to move out of the home that they spent the last couple of decades in, but a lot of them do. And they are being denied their housing choices too. Other countries are better than Ireland at this in terms of independent living and assisted living. But I think all countries have the scale of aging is faster than the scale of policy maneuvering in relation to housing for older people. And how does this sort of manifest itself politically before we just go on? And then we will talk about the data and how we see all these things. The most obvious way is in a majority kind of onerocchipyra society, which is pretty much everywhere. Germany, Switzerland and Austria have our about 50-50 onerocchipyra renter. But everywhere else is a majority of onerocchipyra. What you don't see is what you might have seen kind of classic 1870s, 1880s, New York coalition of renters coming in, they're going to dominate the political system. That's not how it's going to work. Arguably New York is still doing the same, with Mantine in the last mayoral election. But it's marching to its own beat. But most high-income societies, they're majority onerocchipyra. So what you end up with is what Michelle Laras calls the asset-based welfare system. Right? You can provide for your-- That's a good expression. I like that one. You can provide for your own future through housing wealth. But of course, it means that you have to get housing wealth at some point. And there's also a fascinating roots around asset-based welfare, and where the Irish version of that came from. But what we see now is a lot more anger building up across Europe and indeed in North America and elsewhere over the last 10 years. It's getting pointed in all sorts of directions, but a lot of it is what's known as the housing theory of everything. Once you cut back all the layers, it comes down to space being expensive. So before we go on about space being expensive, just let's come back to the term the rootlessness, right? People with outroots. Give me an example of this, let's say, not just in Ireland, but in the States, in Australia. How is it all measured? How does it show up? This is a great question, because it's typically not measured. So this goes back to what's measured gets managed. Is that just to go to Eurostar. Eurostar had a 20-year project to try and align her different countries in Europe measure property prices. And I actually do this kind of work. I go to countries and I help them measure property prices. RPPIs or what they say, residential property price in the States, right? There's a whole sector of people out there trying to get property price in the States working. But until this Eurofan study, and that in turn is based on the Irish Housing Commission work, there was nowhere you could go to say, okay, well, actually, where are we in the countries? So the Irish Housing Commission, this is the body that the government set up. And then the report came in and the government seemed less than entosed by the answers to put it politely. But actually, I don't want to fault that off. I want to focus on that as well, because there's a commission for this, that and the other. Lots of people listen and say, there's a task force for this, that and the other. People like yourself sit down, you do all this work, you think, okay, hold on a second, we've got a structure, we've got a framework, we've set up problems, we've got a set of solutions. We recommend these solutions and the political class, the politicians just say, yeah, yeah, that's nice. Just go off and do that one. I want to come back to that, because one of my issues, Ronan, is that this is an emergency here in Ireland and everywhere. It's a societal emergency. It's a capital stroke, wealth accumulation emergency. It is a day-to-day dignity emergency. And yet, it's not been treated like an emergency. When I say an emergency, I mean, a state gets invaded. It galvanizes all its resources to repel the invader. That is an emergency. It requires and brings all the best brains. It does things that would never do before. It breaks the rules in order to achieve the objective survival. Yep. Yet, this feeling in Ireland at all. And it's not just art, right? And this goes back to the brittle versus bubble idea, right? So that if this is something that emerges gradually over time, so I would date Ireland's housing woes to the 1970s or 1980s, right? And the Celtic Tiger Bubble and Crash is this kind of little roller coaster distraction. Sorry, not little. It's an important distraction on the journey. But it does not fundamentally change that Ireland went from having an inability to create jobs to an inability to create homes, right? All of a sudden, you know, Ireland's able to create jobs like, kind of like nowhere else at the moment. Yes. And has been for the last, most of the last 30 years, and the number of employers gone up a huge amount. It hasn't been able to grow alongside it. And I think other countries are a slightly less extreme version of that. But it's the same pressure that if this is something that builds a decade on decade, rather than month on month, or even day on day in the case of COVID, that the COVID response, right, by policymakers everywhere was, you know, we need to do absolutely everything. You know, do we need ventilators? Do we need masks? What do we need? Right? And let's get it done. Right? And the system at a global level was able to respond. But exactly as you're saying, David, that this is not happening for housing. And I think it's because this is like a decade on, decade things get worse and worse. And you sort of like the frog that's getting boiled in the water, you don't notice until all of a sudden hang in a second, I'm like getting boiled here. And society is getting eaten from the inside out by its traditional reliance on housing for all sorts of things, including your retirement. And then you've got a generation that's being effectively frozen out. And so what you're saying is it's not just there for you. Look at your various different generations that have been affected. So you've got your older, let's say, trading down empty nesters. You've got your first time buyers. Then you've got a whole chunk in the middle who may or may not for a right reasons have more kids, less kids, they want to talk to you. Are you saying that it's not a supply problem? It's not an actual figure of homes that should be built. It's a figure, it's a mix of all sorts of homes that have to be built. Yeah, I mean, I think I would be reluctant to throw out the top level figure. Right? Because I think it gives politicians and policymakers an excuse not to set ambitious targets. you were talking earlier about politicians, you know, these These reports happen and the politicians is going to, "Oh, great. Put it in the shelf. But suddenly all the others and all if we go with whatever we were doing anyway." Being fair to the politicians in Ireland, I do think genuinely they want to solve it. But I worry about the administrative class as in that the politicians come in and say, "We'll do whatever it takes. We believe this is an emergency. We'll do whatever it takes." And then the administrator just say, "Well, is it really an emergency?" Because everyone finds some way to balance things out. And you've, "Oh, sure, you've got some young folk living with their parents." But, you know, everyone has to live with their parents for a bit. And they talk the politicians down from taking the radical actions that are required. And the administrative class is who exactly? I'm not going to name names, but I will name departments. I think the department of housing has to take a lot of responsibility for this. And, you know, on a personal level, I get us. I wake up and I'm going to just stop you. If the department of housing is not taking housing seriously, what the fuck do they do? I mean, you could invite them on and. No, but. Here's what I. It's a very simple question. Here's what I say they do. The top of the 46A, which I know is now the E2, right? Like, if the department of housing is not taking this seriously, there is a WTF. They would point to a whole host of measures that have been taken over the last 10 years. It's like, "We did this, we did this, we did this, we did this, we did this." And to be honest, that's kind of part of the problem in the Irish context. If you keep fiddling with the system without any clear vision as to what it should look like as a system, how does the system operate? What levers do you, as policymakers, have to improve or make things worse in terms of outcomes? And that was the role of the Housing Commission, was to take a step back and say, "How does the Housing System work? How do we make the Irish Housing System healthy?" And there was a series, I think, 84 recommendations. I think 83 were fully agreed by the Commission. 84 was kind of. it was the one with a majority vote or whatever. But basically, the experts are pretty much unanimous about these are the things that need to happen. And unfortunately, page 1 was, "This is a national emergency," exactly as you said, David. This is a national emergency or requires an emergency response. And if you've been working in the department of housing for the last 15 years or longer, whatever it is, and somebody comes along and says, "Everything you've been doing has made things worse, not better." Just at a human level, you're like, "Well, I have a sec. I've been trying my best. How could I have been making things worse?" And I think the problem is that they don't see this as help. They see this as outside interference from a department that's trying to do the best. But do the results not speak for themselves? You know, they can tinker around all they like, but at the end of the day, you know, it's there in front of you. There is a lack of housing and we have a big problem. So no matter how much tinkering you do, the results are not there. Well, I mean, this is, again, at the risk of being local on this one. So the housing commissioner on the produce and estimate of how many homes are missing based on what we were talking about earlier, can missing households, younger people, not being able to set their own households and so on. And that number, as of early 2022, nearly four years ago, now, it was between 220 and 250 times, right? And underbilling since then means you're probably about 300,000 homes. This, by the way, especially for international listeners, this is in a country with about 2 million homes. We're missing 300 times. That's a 15% shortfall in your housing stock. But see how often that number has been used by Department of Housing Officials or by the Minister for Housing since the report. I would say, I'm not going to say never, but I'd say almost never, right? So that number, I would say the Department disputes that they're in one of the parliamentary committees is saying, oh, these are just assumptions that the Commission made. We don't agree with these assumptions. They're like, okay, if you don't agree with the numbers, go into the weeds and tell us which bit you think is wrong. Right. Where did we go wrong in these numbers? That's why I think David going to your, I might have been three or four questions ago. Yes, me this, but we'll get there eventually. You know, that it is about mix, absolutely about the mix of homes. But you have to keep that top level, you have to have some overall target in here. Like that 300,000 number, I think, is a powerful number in the Irish context because it says, okay, if you're a country that's building 30,000 homes a year, you're 10 years short, right? And then you've got to build, you know, at current rates, but actually you've got to try and meet future needs as well. So we estimated that Ireland, which is, as I say, about two million homes needs to build, depending on your assumptions, somewhere between 1.3 and 1.8 million homes over the next generation over the next three decades, say. And that scale, once you've accepted that, go to your point David, I do the accept it or not. But once you've accepted that, things become clearer to see that this is a national urgency, believe as a sort of a defensiveness on the part of policymakers that it couldn't be that bad because we've been trying really hard over the last file. And I don't doubt that they've been trying, but it's the systemic view that's missing. So let's just look at what we are. So we're talking about, because the first episode of this trilogy is to say, where are we at? How do we get here? Because we can come back to that. But where are we at? So you think in a country like Ireland, which may be extreme, but again, we're talking mostly English fear. There's a deficit of about 15% of the housing stocks. So in that case, in Ireland, it's 300,000. I'm not too sure what the equivalent figure in the UK would be or America would be. You might have those figures, not even off the top of your head, but if you have, are not good enough? It's estimated to be something similar. So San Bomenol has kind of used similar methods to try and get us. The idea here is you can household size. If you think going back to the 1950s versus what we think life might be like in the 2050s, 1950s, you've got households of four or five in the 2050s. It's households of one or two and some households of three or four. But the average household is going to have in size. If you think about it with a fixed population, that means twice as many homes for the same population. And then if you do what Ireland is doing and double your population as well, you need four times as many homes at the end of the process as you did at the start. I think this is where Ireland has both important differences in similarities to elsewhere. Every other high income country in the world is on the same journey in terms of household size. It needs to effectively double the number of homes even with the same population. Ireland is the only place. We all know why everyone in Ireland knows why, anyway, with a smaller population in the 20s and in the 1820s. So we're going to catch up on the population front and we've got this additional pressure which everyone else has on falling heads on size. That's why Ireland is a little bit different, but really, as you say, this is a common issue. OK, so we have, we're building 30,000 homes a year. We have a deficit of 300,000. We have a rising population, which is going to add to this. And then there will be bits that fall out that require more homes, et cetera. If you talk to builders, I just want to switch a little bit. A lot of builders say, look, just get out of our way, right? If there is a demand for, let's say, trading down, and you think there's, you know, 50,000 people who are trading down over the next, let's say, four or five years, is there a sense that not only has the system not identified the quantities, but the system makes those quantities even more difficult to achieve. Because there's a lot of people who are in the business who say, look, in the Celtic Tiger, we built 90,000. How homes, it can be done. I just get out of our way. Yeah, and look, we can get into some of how Ireland built 90,000 in episode two of the Star Wars trilogy. Yeah, yeah, yeah. But look, this is not ultimately no matter how much a libertarian might want the government to just feck off, to put it sort of lightly, and let them do what they're doing. There's no housing system in the world that works that way. And there's a very important reason for that, which is that land can only be used once at any particular point in time. It can be reused later on, but at any particular point in time, a specific plot of land can only be used once. Now, you can decide that it's a sort of a whoever wants it most gets it. Some parts of Japan are kind of like that where it's like, look, if this is going to go commercial, if commercial is going to bid highest on this land, then that's obviously what we need or residential bid highest, and that's what we need. And they sort of go, no, the Japanese system is not quite that libertarian, but pretty much everywhere says, okay, we're going to have some opinions, more than opinions, we're going to have some rules around how land gets used. And once you're in that space, then the government has to take some responsibility for how many homes get built. And I think that's the critical distinction, right? So we will get into potential solutions later on, but I'm not here to make a case for deregulation or libertarianism in that sense. You can absolutely have rules. What matters more than the volume of rules is the level of minimum specifications. What matters is the certainty, right? The clarity that if you buy a site, how clear is it when you bought the site, what you can do with that site and when you can build homes, if you're going to build homes in that site? Something Ireland does have compared to other jurisdictions is a lot of uncertainty around if you buy a site, how many homes can you build and when you get to build them? Well, we will look at that. And we're going to look at that in part two, but let's conclude part one by just saying, okay, we've identified that there is a mixed problem, a quantitative problem, which is all reflected in the price. There's a demographic uniqueness in Ireland that might not necessarily be there in other countries, but clearly other countries have similar, if not carbon copy problems. What does success run and look like? So, tank of everyone in the population organized into three groups, right? Three or two groups. This will be the, this will be kind of the punchline, right? And the one hand, this is your ABCs, right? You've got the assisted, right? Those on lower incomes are always in any system. They're always going to need some support to meet their housing needs. Otherwise, they're going to live in substandard conditions. Right? So, that could be if you're, if you're a, um, some sort of right wing, you can't really give up. We'll only do this for the, you know, the poorest five or 10 percent. You could argue, well, actually, it's the, the poorest 35 or 40 percent. That's a political decision, right? How much of the income distribution do we want to support in terms of, of meeting their housing needs? So, that's fine. There's a group there called the assisted, right? At the other end of the spectrum, you've got the coverage, right? They're covered by the market, but they have enough income to meet their housing needs. The problem happens is when you got a group in the middle, right? So, you got your A's and your C's, who's in the middle of B's, the blocks? Who are the B's? Who are the poor out B's? They're the blocks, right? They're neither poor enough to get assistance, nor are they rich enough to be covered by the markets. And being honest, pretty much everywhere has this group. The question is, how big this group is? No, success looks like eliminating that group, not by getting rid of them, but by moving them either into assisted or covered by the markets. Right? So, that you, if you think of this as where is the cutoff for the markets? What is the lowest income point which the market will provide housing? And therefore, whatever that is, then you kind of go to assist below that, or else move that that threshold down a little bit if you don't like the answer. So, visualizing, is the blocked, the young couple living still in the box room of Warner of their parents' home? Is the blocked people who are still living at home, not in couples? Who are the blocking me a picture? As you know, Ronan, I've always like to visualize economics, like to personalize it. Who are these? Give me a picture of these people. You don't like my human distribution function approach to thinking of it. No, no, I mean, you're absolutely right. Like, I would define anyone to be blocked if their current housing arrangements, it doesn't match their preferred housing arrangement. What I mean with that is, I don't think it's an unreasonable thing for someone to say, do you know what? I'm a, whatever, a 42-year-old woman, I just want to live alone by myself. I'm not a tax. Exactly. That seems like a reasonable thing. Or for a 22-year-old student to say, do you know what? I'd like to live with two of the students, not rather than my parents. That seems to me a reasonable, a 22-year-old is a fully voting member of society, right? They could get a mortgage back in the good old days anyway, they could get a mortgage. So, I think anyone who's current housing arrangements don't match their preferred housing arrangements to me is in that blocked group. And that's why those surveys become so important. I appreciate that surveys ultimately, you could see it as cheap talk, right? That people can say, oh yeah, of course I want to home with my own, but that's not really the way the question was set up. And actually, the answer to look kind of reasonable, that 18 to 22-year-olds were the least likely to go, I want to live by myself because they know they're actually quite young, a bigger share of those wanted to live with their parents than 30 to 34-year-olds. So I actually think you can get pretty good answers out of the surveys. It's one of the reasons economists like prices, it's because it's people speaking with their wallets, right? They're speaking with their scarce income. This is what I prioritize, but I do think in this case, with the policies to all the economists that this is one of our quantities really matters. So just last year before we go on to not just where we are, but how do we get it? How do we mix the whole thing up? You know, you spoke about prices there. If, for example, I'm listening to the radio or, you know, in paper, whatever, there's no politicians, if there's a period when prices stabilize, let's say, three or four months, suddenly you'll get the Minister for Housing Command say, look, not quite George Bush declaring victory on the US as what I like. But there isn't an element of a, okay, job done, right? With prices stabilized, that doesn't seem to me to be what you're saying. Exactly. And actually, this came up relatively recently. There's another commentator. There's not a monopoly of housing, or even another couple of housing commentators in Ireland. There was another guy who came out recently with the piece in the Irish Times and he said something like him, you know, exactly that. The prices are no longer going up in Dublin, therefore, supply and demand are in balance. And I think this is where Econ won a won. What some people call Economism, right? You use the basics of economics to make whatever point you believed anyway, you just happen to be using supply and demand to back it up. We never do that. That's why prices fail as a signal, or at least price changes fail as a signal. If you're just looking at increases in rents or increases in prices, then precisely that, at some point, you'll reach a breaking point and prices will stop going up and people will move, leave the country wherever you go. There we go. Prices have stopped rising, clearly supply and demand are now in balance and we're fine, which is why levels matter too. And to get the level of prices or rents back down to everyday incomes, that's where the quantities, what's the actual solution look like here? Okay, so we've established, we have, I like this expression, the brittle housing market as opposed to the bubble housing market. We've identified the various quantities, the block, the ABCs, again, which I think is a very, very instructive way of elucidating what's going on. Question now for the second part of the trilogies. Excuse my Frenchman, how the fuck do we get here? We'll talk to you on Thursday. [BLANK_AUDIO]