Housing affordability myth

July 9, 2026

I would add a ninth myth.

Myth 9 The supply of housing determines its cost. The focus is on the wrong supply and demand equation. The supply of houses determines whether you have a roof over your head and how many others share that roof. Supply and demand for housing finance determines what the roof costs.

Since the 1980s banks have pumped housing debt into the economy. They claim this is in response to public demand for more debt. I’m surprised by this. It seems there is a sub-species of Homo sapiens that thrives on debt. Members of this sub-species delight in working two or three jobs. And they send spouses out to work and have complete strangers parent their children.

I’m surprised by this because I’m a biologist and this debt-loving subspecies doesn’t make any sense in usual evolutionary frameworks. I’m also a biologist mentored by systems biologist Henrik Kacser. Henrik’s focus would fall on the flux of debt repayment through this ecosystem. It becomes apparent that debt creation and debt repayment is not an integrated part of the system, it is parasitic. Bank’s creation of debt inevitably transfers wealth from the PAYG taxpayer to the asset-rich, already wealthy.