The Supply Thesis: Scarcity vs. Agglomeration
15 tier-5 · 8 tier-4
Erdmann's foundational argument lives here: what looks like demand-driven 'superstar city' premiums is in fact a scarcity tax imposed by blocked construction. Across these pieces he separates genuine agglomeration value (small, and only appearing in cities that have already stopped growing) from the regressive scarcity premium that dominates US housing costs, repeatedly showing that expensive cities are slow-growing places that exported their poor rather than magnets pulling everyone in. The cluster spans his 'Facets of the Housing Crisis' and 'Expensive Cities Aren't Attractive Cities' series, the price/income visual models, and the core claim that supply has to be 'ridiculously low' to produce the affordability pathology we observe.
TIER 5
Dec 14, 2024
Erdmann builds an original visual model (population growth vs. price/income ratio, 2002 vs. 2024) to argue that demand never makes a city expensive; only supply restriction that affects migration does, moving cities left (slower growth) and up (higher prices). He uses LA and Phoenix to show that high price/income ratios reflect displacement and supply deprivation rather than amenity value, framing the conventional 'superstar amenity' view as a Ptolemaic error. A clean, reference-quality statement of the core supply thesis.
supply-vs-demandprice/income modelLos Angelesagglomeration mythdisplacement
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Dec 16, 2024
Building on Resnikoff's reply to Waldman, Erdmann dismantles the 'tsunami of demand' thesis with data showing Closed Access cities have been the slowest-growing in the country and never had unusual in-migration, only abnormally low growth. The Phoenix-vs-LA permit and price/income comparison (Phoenix built ~10 units/1000 yet still got expensive after the post-2008 collapse) is a sharp empirical argument that supply, not specialness, drives costs.
Closed Access citiesPhoenix vs LAYIMBYWaldman debatesupply thesis
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Dec 16, 2024
A rebuttal to Steve Randy Waldman's 'geographic inequality' fatalism, arguing his only real test for a city being 'special' is that it's expensive, which is circular. Erdmann uses income-vs-population-growth scatter data across 50 metros to show Closed Access cities are economically unremarkable and expensive only because they stopped growing, while dozens of affordable 'superstars' (Austin, Denver, etc.) already exist.
Closed Access citiesWaldman debategeographic inequalitysupply thesisYIMBY
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Dec 17, 2024
Erdmann quantifies how regressive out-migration inflates Closed Access city incomes: removing the poorest residents from LA's average raises it ~0.8% per 1% removed, implying ~24 of the 31 percentage points of the Closed Access income premium is displacement, not agglomeration. The model reframes 'superstar' cities as average places that exported their poor, with San Francisco the marginal-family-impoverishing exception, a substantive original decomposition.
Closed Access citiessuperstar citiesdisplacementincome inequalitymigration
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Jan 23, 2025
A landmark rebuttal to supply skeptics who claim there's no housing crisis because rent inflation has merely tracked income growth. Erdmann shows that rents matching nominal income growth for 25 years is itself the anomaly, since structures have no fixed supply and rent inflation historically ran below general inflation, and demonstrates the regressivity with Zillow data showing the poorest ZIP codes' real rents up ~40% while the richest stayed neutral. A clear, quotable distillation of his whole thesis with strong reference value.
rent inflationagglomerationHenry Georgeregressive housing costssupply skeptics
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Mar 19, 2025
Responds to Tyler Cowen and Alex Armlovich on the supply-skeptic NBER paper by arguing that economists conflate genuine agglomeration value with scarcity-driven regressive price inflation, and that scarcity vastly dominates. Marshals the 'cosmic coincidence' that agglomeration value only appears in cities that have stopped growing, and contrasts New York's (10x poor-ZIP price/income) with Phoenix's worsening (now 6x) to argue prices are set by displacement-avoidance reservation prices, not newcomer demand. A landmark, deeply argued conceptual essay distinguishing the two forces.
agglomerationscarcitysupply-thesisprice-income-asymmetrydisplacement
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Jul 1, 2025
An original conceptual essay arguing that stable market segments are a product of functional markets, and that blocking step-change development forces continuous change to turn $900 apartments into $1,200 apartments (with the same tenants on inflating land) rather than into cheaper ones. Via a thought experiment he concludes building high-rent units reduces displacement, and that converting $900 homes to $1,200 homes is the single largest driver of excess US real-estate value. A distinctive framework with lasting explanatory power.
market segmentationfilteringland inflationdisplacementsupply thesis
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Jul 11, 2025
A full free essay rebutting the claim that fixing zoning would depopulate the rest of the country into superstar cities. Using the Tracker's shortage estimates (~4M of 15M homes in the Closed Access cities) plus a Columbus-as-average-metro benchmark, he argues most would-be residents are former displaced residents, that high Closed Access incomes are largely a compositional artifact of having expelled their poorest 17 million, and that real incomes net of rent are similar to the Midwest. A signature analytical piece with original estimates.
Closed Access citiesmigrationagglomerationshortage estimatesincomes
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Jul 21, 2025
A landmark summary statement of Erdmann's supply thesis: since 99% of stock is existing and depreciates ~2%/year, builders cannot make homes unaffordable; only land can inflate, and only when building is blocked. He frames a seven-sided affordability debate, shows that a merely marginal shortage couldn't produce the observed rent/price pathology, and argues only a 'ridiculous' shortage forces families to trade down faster than depreciation. High reusable value as a compact articulation of the whole framework.
supply thesisland vs structureaffordabilitydepreciationClosed Access cities
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Jul 28, 2025
A rich free essay walking through a gallery of charts that show the opposite of conventional wisdom (Fed rates vs. Phoenix prices, ZIRP vs. Atlanta low-tier prices, homeownership flatlining during ZIRP, superstar-city depopulation vs. price inflation), arguing the data is reliably inverted because problems caused by supply are blamed on demand. It closes with original analysis of Census Housing Vacancies data, decomposing the ~20-million-unit shortage roughly evenly across vacant, renter, and owner households. The combined demand-vs-supply diagnosis plus the trendline shortage framework gives it lasting reference value.
supply thesisFed/interest ratesZIRPhousing shortageClosed Access cities
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Aug 1, 2025
A counterintuitive supply-thesis essay arguing that in a healthy market more housing supply keeps prices flat (not falling) because functioning cities like 2000-era Phoenix show price appreciation unrelated to construction pace, while the recent supply-lowers-prices charts only reflect a market healing from the mortgage-crackdown overshoot. Erdmann distinguishes rent effects (~1.5% per 4 permits/1,000) from land-value-driven price moves and argues high incomes in slow-growing inelastic cities are a failure, not success. A sharp, original reframing of the YIMBY supply-and-prices argument.
housing supplyhome pricesland valueelastic supplyYIMBY
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Oct 28, 2025
Erdmann builds an arithmetic case against the urban-economics claim that broad upzoning raises total land value, showing that the compositional gain in amenity/agglomeration value ($28K) is dwarfed by the scarcity lot-premium decline ($153K) that new supply unlocks on every lot. He argues economists systematically misattribute post-2008 scarcity value to agglomeration value, which axiomatically denies supply's power to lower prices. A landmark conceptual argument that distinguishes two sources of land value and shows building cannot raise aggregate real-estate value under shortage conditions.
agglomeration valuescarcity premiumupzoningland valuesupply thesis
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Nov 14, 2025
Erdmann's ResiDay interview writeup laying out his core framework: the century-flat Case-Shiller line was no accident, and supply-constrained markets are distinguishable from bubble markets because shortage pushes the steepest rent/price inflation into the poorest neighborhoods and forces perpetual outmigration set by 'the leavers.' His hot take: a slow-moving perpetual building boom is coming where prices moderate as construction rises, killable only by banning large-scale rental investment. A clear exposition of his closed-access and shortage-vs-bubble distinctions.
ResiDayCase-Shillerclosed access citiesbubble vs shortagebuilding boom
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Jan 7, 2026
Erdmann argues the 'superstar cities' thesis fails a natural experiment: Boston and San Francisco look like superstars mainly because supply constraints pushed poorer residents out (raising average incomes), and post-2008 Phoenix joined them as construction collapsed and low-tier rents inflated. He uses Phoenix retirement communities as a control group and Austin as the true superstar that stayed affordable by building. A substantive supply-vs-agglomeration argument with original framing of price compression across tiers.
superstar citiessupply constraintsPhoenixClosed Accessnatural experiment
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Feb 2, 2026
A back-of-envelope quantification of the US housing shortage built up from household-size and vacancy trends: roughly 10 million units as a baseline (5M vacancies plus 5M to restore pre-2008 adults-per-family), rising to a 12-15M estimate, plus a parallel residential-investment gap of ~13-26% below trend ($7T+). Valuable as a compact, fully-free statement of the magnitude of Erdmann's supply-shortage thesis with explicit assumptions.
housing shortage estimatehousehold formationvacanciesresidential investmentsupply thesis
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Apr 9, 2026
A landmark rebuttal of the 'producer discipline / builder cartel' thesis, arguing that 20th-century construction was volatile but cyclical and never metered to maintain rent inflation, while 21st-century building is a flat, scarred 'Sisyphus market' recovering from the one-time 2008 mortgage shock rather than a coordinated supply restraint. Uses Austin as the proof case: heavy permitting drove ~16% real rent declines that are sustainable because they reflect deflating inflated land values, not a reversible cycle. Core framework for distinguishing supply scars from collusion.
builder collusion mythAustinland value inflation2008 mortgage shocksupply thesis
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Apr 10, 2026
A follow-up refining the prior post: because low-tier rents outpace high-tier rents under shortage conditions, new high-tier supply lowers average rents on a gradient (level at the top, larger declines at the bottom), so builders mostly reduce rents on older homes they don't own and lower future land costs they'd have to buy. A simple two-household worked example illustrates how a missing home creates a uniform scarcity premium across a market. Makes the 'builders collude to maintain rent inflation' thesis even less plausible.
rent gradientbuilder behaviorland premiumsupply modelfiltering
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May 13, 2026
A comprehensive framework decomposing 'the housing crisis' into four distinct problems with different causes (homes could be larger/nicer, better-located, more abundant in amenity cities, or more affordable), arguing the affordability piece is dominated by an acute supply shortage rather than amenity demand. Erdmann uses Phoenix-vs-NYC price/income decompositions and his 'We are not as wealthy' Figure 14 to argue building more homes will NOT raise aggregate real estate value, skewering both supply-skeptic 'sophists' and amenity-focused YIMBYs for underestimating the 15-million-unit shortage premium. A landmark synthesis of his entire thesis.
housing crisis taxonomysupply shortageClosed Access citiesscarcity premiumCase-Shiller
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Jun 9, 2026
Opens the series by showing that the price gap between nice and poor neighborhoods has actually shrunk in percentage terms during the crisis (a $464 flat ZIP-code rent premium since 2015), a regressive pattern hidden because 'we are arithmetic creatures' who read arithmetic not log scales. Uses Compton vs. Manhattan Beach and Phoenix vs. LA to argue inelastic supply, not high demand, drives low-tier price inflation, and frames the misperception as an 'IQ test' the economics academy keeps failing. Strong explainer that sets up the framework.
regressive rent inflationlog vs arithmetic scalesupply inelasticityneighborhood price gradientsacademic critique
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Jun 10, 2026
Quantifies how agglomeration economies get conflated with scarcity, arguing economists carry forward 20th-century intuitions that work only in a shortage-free world and so misread the uniform per-unit scarcity premium (e.g. ~$330-380k in San Francisco/blue-dot cities) as agglomeration value. Demolishes a 'New York Families Are Doing Better Than You're Told' report on three grounds (wrong period, ignored out-migration, uniform inflation adjustment), showing metro-area averages describe 'wonderland' cities that don't exist. Foundational framework piece.
agglomeration vs scarcityscarcity premiumspatial equilibriummetro averages critiquesupply thesis
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Jun 11, 2026
Extends the dot framework to explain how the 2008 mortgage crackdown spread Closed-Access-style scarcity premiums nationwide, then attacks the academic literature's 'high migration elasticity' assumption, arguing migration elasticity is endogenous to supply and breaks the Rosen-Roback spatial-equilibrium models the San Francisco Fed relies on. Shows via Atlanta and LA price/income charts that expensive cities have high gross out-migration, not in-migration, which economists systematically misread. A core methodological critique central to his thesis.
supply thesismigration elasticityRosen-Roback critiqueSan Francisco FedClosed Access cities
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Jun 12, 2026
Back-of-envelope scale calculations contrasting the agglomeration effect (Glaeser-Resseger: doubling a city raises incomes ~9%) against the scarcity effect (a 10% housing shortfall raises prices ~50-63%), establishing an order-of-magnitude gap that grounds his estimate of a 15-million-unit national shortage and ~$350k uniform scarcity premiums in LA. Argues the claim that NYC/LA can't build to affordability has the sign wrong, because growth ends the compositional out-migration that inflates average incomes. Original quantitative model with lasting reference value.
scarcity premiumagglomeration economieshousing shortage estimateLos AngelesPhoenix
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Jun 15, 2026
Uses his gray/red/yellow/blue 'dot' framework to dissect a Yglesias-Sunderji-Murray Twitter debate over why Greenwich Village is unaffordable, arguing that 'superstar city' analysts misread supply-starved blue-dot cities as agglomeration-driven gray-dot cities and thus drastically overestimate New York's demand. Crystallizes the supply thesis with a usable quantification (10% stock growth lowers prices ~50%; each 1% adds/removes ~$15,000) and explains why upzoning's price effect has the sign reversed from conventional wisdom. High reference value as the capstone of the Facets series.
supply thesisagglomeration vs scarcitysuperstar citiesNew York Cityprice-sensitivity model
The 2008 Mortgage Crackdown & the Great Recession
13 tier-5 · 7 tier-4
Erdmann's signature revisionist macro thesis: 2008 was caused not by overbuilding or a bursting credit bubble but by a deliberate post-2007 retraction of agency mortgage lending to sub-760 credit scores that cratered consumption and construction. These forensic reconstructions use credit-score origination data, regional leverage charts, retirement-community control groups, and Midwest/Nevada 'no boom ever happened' evidence to argue the crisis was effectively a policy choice. The 'When we lost our minds' series, the Nevada/Cochrane rebuttals, and his reinterpretations of Bernanke's savings glut and The Big Short narrative anchor the cluster.
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Dec 3, 2024
Erdmann estimates mortgages outstanding by credit score (mapping Fannie Mae proportions onto Fed aggregates) to show the post-2008 crackdown cut sub-740 holdings from 41% to 16% of GDP, erasing the entire New-Deal-era gain in working-class mortgage access, while high-score lending rose. He argues causality runs from real estate values to mortgage levels (not vice versa), and that declining credit to low scores caused the recession which then caused defaults. An original, data-dense pillar of his case.
credit scoresmortgages outstandingFannie MaeGreat Recession causalityleverage
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Dec 4, 2024
A follow-up using Fannie Mae LTV and home-value data to show average down payments barely moved over decades (no secular loosening), while mark-to-market LTV kept worsening through 2011 (not 2008), meaning the equity destruction that triggered defaults peaked years after the events blamed for it. Documents the sharp 2007-2009 shift away from sub-740 borrowers and lower home values on new originations. Substantive supporting analysis of the mortgage-crackdown thesis.
Fannie Maeloan-to-valuecredit scoresforeclosuresmortgage crackdown
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Dec 5, 2024
Erdmann picks Missouri 'at random' to walk through the full toolkit on a non-bubble market: a modest 2002-2006 price/lending bump that fits a century of normal Case-Shiller variation, no real building boom, then a non-moderate post-2008 collapse where low-tier and credit-sensitive ZIP codes lost 40%+ years after 2008. Demonstrates the 'molehill of a lending boom, mountain of a moral panic' pattern that the supply thesis predicts everywhere. A useful self-contained case study of the method.
Missouricase studyCase-Shillercredit accessmoral panic
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Dec 9, 2024
The series opener reframes the 2008 narrative: 'The Big Short' bookends and Bernanke's 'global savings glut' both presume decades of housing overproduction that never happened, attributing a $5 trillion loss to the CDO boom when the real cause was the post-2007 tightening of prime mortgage credit. Erdmann uses Canada/Australia comparisons to show the US uniquely converted lost manufacturing jobs into lost construction jobs by policy choice. A sweeping, reference-grade statement of his revisionist thesis.
The Big ShortBernankesavings gluttrade deficitconstruction employment
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Dec 10, 2024
Erdmann walks through high-tier vs. low-tier Case-Shiller price trends in the four 'Contagion' cities (Phoenix, Las Vegas, Tampa, Miami) across four marked phases, showing the boom-bust was population-driven migration out of Closed Access cities plus a small late-cycle lending boom, then a separate post-2007 mortgage crackdown that crushed low-tier prices. Ranks the relative magnitude of each driver. A solid data-grounded explainer establishing the framework the rest of the series builds on.
Contagion citiesprice tiersThe Big Shortmigrationmortgage crackdown
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Dec 11, 2024
Erdmann uses Phoenix's age-restricted retirement communities as a natural control group (cash buyers, credit-insensitive) to separate the effects of credit access, local supply, and demand shocks across the 2002-2024 cycle. The period-by-period decomposition shows the post-2008 low-tier price collapse hit credit-insensitive retirement neighborhoods first, contradicting the credit-bubble narrative and isolating the mortgage crackdown as the cause. An original, methodologically clever piece of forensic price analysis.
Phoenixretirement communitiesmortgage crackdowncontrol groupprice tiers
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Dec 12, 2024
A thorough teardown of Leamer's 2007 Jackson Hole presentation, where he counseled the Fed against stimulus in mid-2007 on the theory that low rates had 'transferred building forward in time,' leaving no room for recovery. Erdmann argues this benchmarked policy to deprivation, that building a house in 2006 doesn't preclude building one in 2008, and that Leamer's choice of supply-starved Los Angeles as his volume-cycle exemplar was self-undermining. Connects local filtering and regressive rent inflation to the macro misdiagnosis.
Ed LeamerFederal Reserve2008 crisisfilteringLos Angeles
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Dec 13, 2024
Closing the series, Erdmann dissects Ed Leamer's 2015 retrospective on 'Housing IS the Business Cycle,' arguing Leamer correctly identified housing as a leading recession indicator but benchmarked the neutral construction rate far too low, mistaking a chronic supply shortage for overbuilding. He shows the 'volume cycle vs. price cycle' framing breaks down in supply-constrained LA and that Leamer's call for permanently displacing a million construction workers was exactly backwards. A landmark critique tying monetary policy error to the socialist-calculation problem.
Ed Leamermonetary policybusiness cyclesocialist calculationClosed Access cities
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Feb 6, 2025
Erdmann argues that rising existing-home inventory is an ambiguous signal that can reflect either strength or weakness, then uses 2000s data to dismantle the universal intuition that overbuilding caused the 2008 bust. He shows new-home oversupply peaked at just ~0.4% of the stock and that vacancies and inventory were coincident/lagging mirror images of a demand crash, not its cause, citing Stiglitz and Leamer leaning into the oversupply story against their own work. The free portion is a substantive supply-thesis argument even though the Texas/Florida payoff sits behind the paywall.
existing inventory2008 bustoversupply mythdemand shockTexas Florida
TIER 5
Feb 10, 2025
A data-rich landmark argument that the 2008 mortgage crackdown permanently pinned Midwest construction below maintenance rates (Canton stuck under 2 units/1,000 vs. a 3-unit norm) despite flat population, forcing the rent inflation now misread as economic vitality. Generalizes to the Northeast's self-imposed Closed Access 'Malthusian limit' and argues the industry is building at a structurally lowered capacity after ~40% of the construction workforce was permanently shed—so starts cannot be demand-constrained and there is 'no down button' on rents. Definitive statement of his supply/mortgage-suppression thesis with regional shortage estimates.
Midwestmortgage-crackdownClosed-Accesssupply-constraintbuild-to-rent
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Feb 11, 2025
Uses Canton/Massillon, OH as a case study showing single-family permits collapsed (1,009 to 361) post-2008 while rents outran inflation by 20%, driven jointly by restrictive R-1 zoning and the mortgage crackdown that made buying illegal even though mortgages would cost less than rent. Rejects the Atlantic 'cheap-but-no-jobs vs. expensive-but-opportunity' framing, arguing housing scarcity—not local economics—now makes cities expensive, so cheapness is an easy fix: just legalize building. A strong supply-thesis essay.
Canton-Ohiozoningmortgage-crackdownsupply-thesiscase-study
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Mar 27, 2025
Uses the Midwest as a 'control group' to demolish the boom-bust narrative of 2008, showing housing starts looked like 'normal, normal, crash' driven by deliberate Fed contraction (quoting Bernanke's March 2006 FOMC remarks) plus the later mortgage crackdown, not overbuilding. Demonstrates that Nevada had no building boom at all, that the Contagion states grew because they absorbed Closed-Access displacement, and that the only boom-era vacancies were Midwest rentals from an auto-sector slump. A definitive, data-rich revisionist account of the crisis with lasting reference value.
2008-crisismidwestfed-policyoverbuilding-mythhousing-starts
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May 2, 2025
A full free, original analysis of the Philadelphia Fed's housing-starts forecast survey, showing how the Great Moderation turned short forecast errors into a decade of serially-correlated pessimism that hardened into a self-confirming 'bubble' consensus by 2005-09. It ties this herding to a per-capita benchmarking error (skewering Ed Leamer's constant 1.5M-starts benchmark) and to the credit-vs-supply explanatory fork, making it a lasting reference on forecaster psychology and the 2008 narrative.
housing startsforecastingGreat ModerationEd Leamersupply thesis
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Jul 11, 2025
A core monetary-policy/forensics essay arguing the 2008 mortgage crackdown (median credit score jumping from ~720 to ~770) caused the Great Recession by blocking the residential-investment recovery that normally follows yield-curve un-inversion 'like clockwork.' He shows residential investment in 2025 is still no higher than Q1 2008 and reframes today's odd inversion as a capacity, not demand, problem. Original framework tying yield-curve mechanics, the credit shock, and Leamer's housing-leads-the-cycle thesis together.
mortgage crackdown2008 crisisyield curveresidential investmentmonetary policy
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Jul 30, 2025
A forensic walk-through of Phoenix prices, the Fed Funds rate, permits, and debt showing the conventional 'low rates to reckless borrowing to bubble to speculative building' sequence is backwards: prices spiked as the Fed raised rates and choked construction amid an LA-driven migration surge, with debt rising over a year after construction peaked. Erdmann argues the credit boom was a product of the price boom, not its cause, challenging readers to chuck the canonical credit-bubble narrative. Persuasive supply-side reinterpretation of the 2000s Phoenix cycle.
PhoenixFed Funds ratecredit bubble narrativemigration2008 forensics
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Aug 25, 2025
Erdmann applies a paper showing a 1pp rise in birth rate lifts home prices ~5% thirty years later to reinterpret US price history, arguing the mid-20th-century fertility drop depressed 1990s prices and made the 2000s 'bubble' look larger than measured. He links the paper's investor-friction mechanism to his own thesis that the post-2008 mortgage crackdown caused a 20-25% price drop. Useful original reframing of credit-effect and bubble debates through a demographic lens.
fertilitydemographicshome pricesmortgage crackdown2008 bust
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Nov 11, 2025
Prompted by Pulte's loosening of GSE credit standards (removing the 620 floor), Erdmann delivers a deep forensic rebuttal of a 2021 PMI 'moral hazard' paper and the broader 2008 literature, showing the 2007 mortgage-insurance expansion happened after the boom had ended and only slowed an already-fated collapse. He argues the literature's fatalism pre-blames everything on 2005-era froth while ignoring the post-2007 lending crackdown as the true driver of defaults and the homeownership collapse. A landmark reinterpretation of the 2008 crisis and the case for countercyclical agency lending.
Fannie & Freddie2008 crisismoral hazard critiquecredit accessmortgage forensics
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Apr 20, 2026
Erdmann dismantles John Cochrane's November 2008 'people who pound nails in Nevada need something else to do' recession call (echoing Stiglitz) by showing Nevada had no pre-2008 building boom and was already a year into a demand collapse, having gone from 4%+ growth to nil only because an engineered recession created it. He argues the universal blind spot, even among critics like Krugman and Delong, was failing to notice the 2008 retraction of one-third of the mortgage market, and that this shared error is far worse than any risk of his own overstatement. A sharp, evidence-rich rebuttal that anchors his 2008 thesis.
NevadaJohn Cochraneliquidationismmortgage crackdown2008 recessionKrugman
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Apr 21, 2026
A deep, fully-free forensic reconstruction arguing the 2008 mortgage crackdown (the loss of agency lending to sub-760 credit scores) caused the collapse in personal consumption and thus the Great Recession, distinguishing the pre-2007 subprime boom (a real correction that had buoyed spending) from the post-2007 agency retraction (an unnecessary over-reaction). Erdmann marshals mortgage-origination-by-credit-score data, regional leverage charts for Midwest vs Contagion states, and a Lucas-Critique argument that the crisis was effectively policy. A landmark macro-forensic piece with lasting reference value.
aggregate demand2008 crisismortgage crackdowncredit scoreLucas Critiqueregional leverage
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Apr 28, 2026
The fully free anchor of his series, contrasting the 20th-century market (cyclical, volatile CONSTRUCTION driven by 'impatience' cycles that always reverse) with the 21st-century market (volatile PRICES driven by permanent supply obstruction). Erdmann reinterprets the Closed Access cities, the 2008 mortgage crackdown, and Ed Leamer's 2007 Fed testimony to argue permabears keep misreading a structural shortage as a perpetually-about-to-reverse cycle. A landmark conceptual reframe central to his entire body of work.
20th vs 21st centuryimpatience cyclesClosed Access citiespermabearssupply thesisEd Leamer
Original Price & Valuation Models: Lot Premium, Case-Shiller & Upside-Down CAPM
12 tier-5 · 12 tier-4
Erdmann's home-grown analytical machinery sits here: the lot-premium / scarcity-premium decomposition that powers his Metro Area Analysis packages, the 'cantilever' price/income model, his rereading of the century-long Case-Shiller chart as a filtering chart rather than a bubble chart, and the idiosyncratic 'Upside Down CAPM' that treats fixed income as a service the borrower sells and recasts home prices, the trade deficit, and rates through one lens. These are the reference pieces for how the Tracker actually computes its numbers.
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Nov 18, 2024
Erdmann reframes the famous century-long real Case-Shiller chart: it was never a bubble chart but a housing-shortage chart, and properly deflating by rents (not general CPI) plus comparing the nominal index to incomes reveals it is really tracking the end of downward filtering. His original 'poor man's filtering rate' construction shows the late-20th-century ~1% annual downward filtering has reversed sign, so land values now rise as fast as real incomes and grandchildren are no better off than grandparents. A landmark synthesis tying together his supply thesis, the filtering mechanism, and the misread bubble narrative.
Case-Shillerfilteringsupply thesisland valuehousing bubble myth
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Jan 30, 2025
Prompted by an interview about a Nashville regulatory quirk easing infill starter-home construction, Erdmann applies his tracker to Nashville, Charlotte, and Austin as relative success stories on housing costs. He restates his core regressivity framework, that supply obstruction raises rents and prices most in the poorest neighborhoods, and decomposes ZIP-level valuation changes into cyclical versus supply-obstruction components. Useful applied case study, though the second chart sits behind the paywall.
NashvilleCharlotteAustinsupply constraintsregressive prices
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Apr 8, 2025
Lays out Erdmann's core 'Upside Down CAPM' framework — that expected equity returns mean-revert to ~6% regardless of bond yields, so price moves come from changing earnings or growth expectations rather than risk-premium swings — as setup for analyzing housing in a Trump-tariff-induced 'dumb recession.' Argues low interest rates reflect failure not stimulus, and that the new corporate giants are net creditors, rebutting Austrian/Minsky malinvestment narratives. Strong explainer of the underlying model, though largely scaffolding for later housing posts and heavy on tariff editorializing.
upside-down-capminterest-ratesequity-risk-premiumtrump-recessionmonetary-policy
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Apr 10, 2025
Applies Erdmann's 'Upside Down CAPM' framework to housing, arguing residential real estate behaves like a low-beta (~0.5) equity with stable expected returns, so a diversified basket of US homes almost never loses real value absent a policy shock. Uses the model to reclassify 2008 by city type — amply-supplied (Detroit, income collapse), cyclically bubbled (Phoenix), and secularly supply-constrained (New York) — and contends 2008 was a credit shock into disequilibrium, not a market correction. A landmark conceptual piece tying asset-pricing theory to the supply thesis with lasting reference value.
upside-down-capmhome-price-model2008-crisissupply-thesisasset-pricing
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Apr 14, 2025
A substantial free segment distinguishing two forms of excess housing inflation: cyclical (impatient households, inelastic short-run supply, prices rise while rents stay flat, self-reversing) versus secular supply obstruction (obstinate households paying landlord 'ransom', regressive rent-driven inflation that does not reverse without construction). He illustrates both with Phoenix price/rent and high-vs-low-tier data, framing the post-2008 'scarcity premium' as an unbounded per-lot tax; the tracker snapshots are paywalled.
Upside Down CAPMcyclical vs secular inflationPhoenixrentsscarcity premium
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Apr 16, 2025
A full free, framework-defining essay decomposing urban home value into four sources (agglomeration, cyclical inflation, density, and supply shortage) using a New York vs Phoenix price/income-by-density model, and arguing the supply shortage dwarfs the others and is pure income loss rather than real value. It distinguishes the affordability crisis (mortgage crackdown, fixable via filtering) from the quality-of-life city-building crisis (purpose-built dense affordable housing made illegal by zoning), a lasting reference for his price model.
urban home valuesagglomerationdensitysupply shortagezoning
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Apr 22, 2025
A full free, landmark theoretical post introducing Erdmann's 'Upside Down CAPM': start expected real equity returns at ~6% and treat fixed income (especially Treasuries) as a service the borrower sells to savers, recasting the federal deficit as the government profitably supplying deferred consumption rather than incurring pure cost. He uses it to explain the persistent US trade deficit as the byproduct of Americans out-earning foreigners on cross-border capital, a reusable framework spanning macro, rates, and his housing work.
Upside Down CAPMtrade deficitinterest ratesTreasuriesmonetary framework
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Aug 18, 2025
A deep model-driven essay forecasting future US housing consumption using Erdmann's two-yield framework (8% on structures, 3% on land) and tracing how the post-2008 mortgage crackdown raised low-tier rents and shifted renter consumption toward smaller units. He quantifies the long-run impact (roughly a 2.5% reduction in total real estate value, but trillions in new construction still demanded) and argues owner-occupiers hold a record-high 79.8% share of housing-stock value, debunking the 'large investors driving up prices' narrative. Original, reference-grade synthesis of his supply thesis.
housing consumption modelland vs structure yieldsmortgage crackdownbuild-to-rentinvestor share
TIER 4
Oct 2, 2025
Erdmann argues mortgage affordability is not mean-reverting and is a poor price-forecasting tool, because rising land rents raise price/rent ratios (land trades at ~36x rent vs ~10.5x for structures), which mechanically raise mortgage/rent ratios at any given rate. He shows cross-city differences in mortgage/rent ratios track the scale of each city's shortage, not a stable per-city mean, and that mortgage rates have a very weak pull on prices. Substantive explainer correcting a widely misused affordability metric, though the deeper payoff is paywalled.
mortgage affordabilityprice/rent ratioland rentmortgage ratescross-city comparison
TIER 5
Oct 14, 2025
The foundational post of the series lays out the core methodology: using ZIP-code price-vs-income scatterplots tethered at a marginal-lot value to isolate three drivers (cyclical deviation, credit access, and the scarcity lot premium), walking through Phoenix and a sample city from 2000 to today. Erdmann shows how the marginal lot value rose from ~$25K to ~$180K and estimates the sample city is short 150,000+ units. A landmark explainer of the entire lot-premium framework and how to read these scatterplots, with lasting reference value.
lot premiummethodologyPhoenixprice/income ratiosupply shortage
TIER 4
Oct 16, 2025
Erdmann decomposes recent price changes into general inflation, cyclical population flows, construction, and credit, showing the sample city's real non-premium home price reverted to pre-Covid levels while the lot premium endured. He emphasizes the regressive nature of the premium — high-tier mortgage affordability is near normal while low-tier affordability is destroyed entirely by the lot premium, not interest rates. Solid analytical explainer of the model's components and the credit-access angle.
price decompositionmortgage affordabilityregressive premiummigrationcredit access
TIER 5
Oct 17, 2025
Erdmann shows how a constant per-market lot premium hits low-tier homes proportionately hardest, then uses tiered price indices to debunk the academic GIGO consensus that the 2000s boom inflated poor neighborhoods most — that pattern only held in the Closed Access cities displacing families, not the building cities. He explains why institutional investors bought rental homes cheaply in 2010-2015 (negligible land value) and why rental investing now forces unavoidable land speculation. A reference-grade dismantling of conventional academic housing wisdom plus a sharp investor-strategy insight.
market tiersClosed Accessacademic critiqueinstitutional investorsland speculation
TIER 4
Oct 21, 2025
This installment uses the lot-premium model to forecast each market's construction potential, rents, prices, and premium trajectory, illustrating with a sample market that has seen 3%+ annual excess rent inflation for a decade and could plausibly double production to Austin-level rates. Erdmann notes the counterintuitive result that in this softened, high-premium market, aggressive land acquisition might still be profitable for several years before the premium peaks (~2031). Substantive forecasting framework with concrete numbers and a contrarian capital-allocation takeaway.
forecastingconstruction capacityexcess rent inflationland acquisitionsupply gap
TIER 4
Oct 22, 2025
Erdmann explains that excess rent is essentially land rent that trades at a higher multiple, so a 44%-of-value lot premium corresponds to only 20% of rent, and disaggregates a property investment into a traditional real-estate bundle plus speculation on land value. He shows how rising lot premiums compressed gross yields unevenly across ZIP codes and how investors can lower land-risk exposure by favoring high-amenity or structure-heavy investments. A meaty methodological treatment of yields, rent premiums, and land-speculation risk.
rent premiumland rentrental yieldprice/rent ratioinvestment risk
TIER 4
Oct 23, 2025
The final installment of the packages series decomposes home value into three components (structure, locational amenity, scarcity lot premium) using price/rent ratios, and shows how different ZIP codes carry very different sensitivities to supply recovery. Erdmann demonstrates how the lot premium proportionately devastates low-amenity homes and explores possible arbitrage where buyers downgrade away from locational amenities. Substantive analytical explainer of the valuation decomposition method.
lot premiumstructure vs locationprice/rent ratioZIP-code analysisvaluation
TIER 4
Oct 27, 2025
Erdmann positions his lot-premium model as an addendum to bottom-up real-estate underwriting, explaining that builders will keep finding projects above their hurdle rate while realized ROI comes in predictably low as lot premiums normalize. He traces the 25-year path of new-home production vs. lot premiums across the 30 largest metros, arguing every non-Closed-Access city will follow Austin's trajectory of rising-then-normalizing premiums. Useful framework for thinking about land-value risk in capital allocation, with a projected normalization path to 2034.
lot premiumunderwritingcapital allocationAustinhomebuilders
TIER 5
Oct 29, 2025
Erdmann reinterprets the famous century-flat-then-spiking Case-Shiller chart as evidence of a regime shift into 'upward filtering'—homes whose rental value rises faster than occupants' incomes, forcing families to pay ransom to stay put rather than for walls and roofs. He argues the chart was 'hijacked' to justify the 2008 mortgage crackdown, dissects the contemporaneous 2005 bubble reporting (showing The Economist's 6-country bubble list had a .333 hit rate), and reframes pre-2008 price gains as capitalized refugee-migration rents, not a credit bubble. A landmark restatement of his thesis with deep reference value.
Case-Shillerregime shiftupward filtering2008 bubble mythproperty taxes
TIER 4
Dec 1, 2025
Explainer for Erdmann's paid metro-area analysis packages, detailing how his model isolates each market's per-lot 'scarcity premium' and decomposes price/rent into cyclical, mortgage-access, and supply components, including new real-rent estimates. He walks through four anonymized markets showing how scarcity premiums have flattened recently due to credit tightening even as underlying scarcity keeps rising. A useful look inside his original price-sensitivity model and its investment read.
scarcity premiummetro area modelland valuerent estimatesmortgage access
TIER 5
Dec 8, 2025
Erdmann frames the housing shortage as a decomposition of rent into real 'structure rents' and inflated 'land rents,' arguing the post-2008 mortgage crackdown created a cumulative ~25%-of-GDP ($7T, ~15M homes) shortfall in residential investment that shows up as a regressive ~2.7%-of-economy transfer from renters/new buyers to existing owners. He presents the corrective building boom as a 'see-saw' zero-sum leveling rather than trickle-down, making this a clean statement of his core supply thesis and investment model. Lasting reference value for the whole framework.
land rentssupply thesisresidential investmenthomebuildersmortgage crackdown
TIER 4
Dec 17, 2025
The launch announcement of Erdmann's new Mercatus paper, arguing that of ~$58 trillion in US residential real estate value, only about half is true wealth (structures) and the rest is rent extraction from blocking construction. It reproduces the full paper abstract and section-by-section roadmap (national, metro, within-metro, policy), making it a useful index/overview of the series that follows. Primarily a framing/abstract post rather than new standalone analysis, since the substance is developed in the numbered parts.
Mercatus paperreal estate wealthrent extractionpaper abstractsupply thesis
TIER 5
Dec 19, 2025
Reframing Tyler Cowen's 2012 'not as wealthy as we thought' line, Erdmann argues a supply-constrained market deceptively looks like a perpetually cyclically-elevated one, decomposing 2005 prices into cyclical (~20%), supply/rent (~20%), and subprime (~8-9%) components. He contends post-2008 policy reversed a phantom cyclical boom via mortgage-access cuts while leaving the real supply problem intact, using low-tier Atlanta surpassing high-tier as evidence that 'half the price is for nothing.' A strong thesis-setting opener with lasting framing value.
cyclical vs structuralTyler Cowen2008 mortgage crackdownAtlantareal estate wealth
TIER 5
Dec 22, 2025
The national-data foundation of the paper: Erdmann shows the spike in aggregate real estate value coincided with declining (briefly negative) net residential investment, not a building boom, with real housing consumption lagging ~20% and rent inflation ~40% above general prices since 1980. He establishes the key relation that a 1% rent increase maps to a 1.68% price increase (land trades at a higher multiple than structures) and argues you cannot be a supply skeptic in 2025 — attributing prices to demand only forces an even worse implied supply constraint. Strong reference-grade aggregate evidence for the supply thesis.
residential investmentrent vs pricenational aggregatessupply thesishomeownership subsidies
TIER 5
Jan 8, 2026
The deep-weeds methodology post for Erdmann's Mercatus paper, laying out his full model that decomposes home value into structure, amenity, and scarcity ('Nothing') components using ZIP-level Zillow rent/price and IRS income data, and tracing five phases of the market since 2000 including how the 2008 mortgage crackdown inverted the scarcity premium. A landmark reference for his price-sensitivity framework, showing real home prices should settle at $300-350k with everything above that being a correctable scarcity premium.
scarcity premiumprice decomposition modelClosed Accessmortgage crackdownMercatus paper
TIER 4
Apr 16, 2026
Erdmann lays out the foundational price-sensitivity observation behind his models: a vertical supply curve inflates rents and prices asymmetrically by socio-economic distance from the most expensive homes, while constrained credit pushes low-tier prices down without affecting rents. He explains his three measurement frameworks (Mercatus rich-ZIP-proxy method, Metro Area lot-premium packages, and the three-component Erdmann Housing Tracker of Cyclical/Credit/Supply) and uses them to reality-check national price/income trends. A strong methodological explainer of his original models, though the data payoff cuts to paywall.
relative home pricesprice-sensitivity modelsupply vs creditErdmann Housing TrackerClosed Access cities
Filtering, Displacement & Regressive Rent Inflation
12 tier-5 · 5 tier-4
Why does the shortage make the poor poorest? This cluster develops Erdmann's filtering mechanism -- homes should drift down to lower-income tenants over time, but since 2008 the US has filtered up, so the cheapest neighborhoods inflate fastest while the rich stay flat. He shows with ZIP-level Zillow and IRS data that rent inflation is steeply regressive (poorest ZIPs up 40-80%, richest near zero), reframes this as a transfer to landowners and as the hidden driver of voter anger, and argues that building luxury units is the single most progressive force available.
TIER 5
Nov 8, 2024
Using Zillow rent data across cheapest/median/most-expensive ZIP codes, Erdmann lays out a four-phase model of post-2008 and post-Covid rent inflation, distinguishing supply-shortage regressive rent inflation (pre-2020), the Covid urban exodus, a general demand-driven cyclical rise, and a hopeful post-2023 moderation. The thesis: excess rent inflation of 20%+ (40%+ for poorer ZIPs) was a one-time jump to a new equilibrium where 20 million households are locked out of mortgages, and build-to-rent now stands to reverse it unless an institutional-buyer ban kills it. A rich, reference-quality articulation of his rent-inflation and Housing-Theory-of-Everything framework.
rent inflationCovid migrationsupply thesisbuild-to-rentZIP code analysis
TIER 5
Nov 21, 2024
Erdmann shows why renters are prime victims of the 2008 mortgage crackdown, using an Atlanta ZIP-code scatterplot to explain the filtering model: new homes get added at the top, the whole stock marches up-and-right over time, and when high-end building stalls the low-end dots (mostly rentals) are forced up instead. National BEA/HVS data confirm flat real housing consumption per household for 20 years while regressive rent inflation hit rental units 9%+ harder than owned homes. A rich, reference-grade exposition of filtering and regressive rent inflation.
rentersfilteringAtlantaregressive rent inflationbuild-to-rent
TIER 5
Mar 12, 2025
Uses newly published 2022 IRS ZIP-code income data to dissect rent vs mortgage affordability, showing rent inflation since 2015 was 45% for poor households vs 20% for rich — a disequilibrium signature of shortage — while price/rent ratios rise faster than rents and ownership is systematically cheaper than renting precisely in the ZIP codes denied mortgage access. Delivers the memorable 'homebuyers are suppliers, not just demanders' framing (homeowners as farmers producing shelter/bread). A model-rich, original affordability analysis with high reference value.
irs-income-datarent-vs-mortgage-affordabilityprice-rent-ratiomortgage-accessshortage-signature
TIER 4
Mar 24, 2025
Uses updated 2022 IRS ZIP-code income data to show that bottom-quintile households saw zero real income growth after rent from 2015-2022, because they spend more on rent and face ~20% higher neighborhood rent inflation than the rich — a 'double whammy' that standard CPI averages hide. Argues this lived 4%-vs-2% inflation gap explains voter anger and the turn to political extremes, and makes a passionate case for the Abundance/YIMBY agenda against both left and right 'parties of no.' Substantive distributional analysis, though heavily editorial in its second half.
income-after-rentregressive-inflationabundance-agendairs-datahousing-politics
TIER 5
Mar 31, 2025
Reviews two papers in the supply-skeptic debate, praising Gete & Reher ('Mortgage Supply and Housing Rents,' which finds the post-2008 credit contraction raised rents) and dismantling Howard & Liebersohn ('Why is the Rent So Darn High?') for using metro-average rents and standard elasticities that miss intra-metro regressive rent inflation. Crystallizes Erdmann's signature claim that nearly all price/rent growth comes from families' resistance to displacement, producing a downward-sloped price/income line (14x in poor ZIPs, 5x in rich) rather than aspirational newcomer demand. A core methodological statement of the displacement-resistance model.
supply-thesisdisplacementrent-inflationpaper-reviewprice-income-asymmetry
TIER 5
Aug 28, 2025
An extended original-model post arguing rentals are 'what's left over after buyers are sated' in a shortage market, tracing how new construction plus owner-occupier behavior determines rental supply and that ~1.1 million net new rental units a year levels out rent inflation. Proposes high short-term rates may have shifted market share from multi-family to single-family build-to-rent, treats the market as a disequilibrium flow toward ~15 million pent-up households rather than an equilibrium, and warns economists mistake displacement-driven inelastic demand for 'superstar' willingness-to-pay. Dense, model-driven, with lasting reference value despite the author's explicit 'thinking out loud' caveats.
rental supplybuild-to-rentrent inflationhousehold formationdisequilibrium model
TIER 4
Oct 8, 2025
A follow-up showing that total housing spending is stable but composed of excess rent inflation plus families compromising into smaller homes — at any income level, families now occupy smaller homes yet pay as much. Erdmann argues affordability is 100% a rent story, that 70% of excess rent inflation accumulated after 2014 (when mortgage affordability was historically good), and that restoring mortgage access is the most powerful force to push rents down. Sharp, data-backed reframing of the affordability debate around rent rather than interest rates.
rent inflationhome sizeaffordabilitymortgage accessdisposable income
TIER 5
Nov 12, 2025
Responding to Tabarrok/Horpedahl's 'everyone is getting richer' data, Erdmann argues uniform inflation adjustment biases real-income figures because rent inflation is steeply regressive: since 2016 rents in the cheapest ZIP codes rose ~50% more than in the most expensive, mechanically transferring families out of the middle class downward. He shows preferences can't explain why the least-favored neighborhoods inflate most, that adequate supply is powerfully progressive, and that the economy is effectively 'rigged' for households under ~$40k. An original, data-driven distributional framework with lasting reference value.
regressive rent inflationincome distributionreal incomesZIP-code rentsaffordability
TIER 4
Dec 12, 2025
Engaging Michael Green's '$100,000 is the new poverty' piece, Erdmann argues rising minimum living costs are a second-order effect of zoning and mortgage suppression — bans on mixed-use, multiplexes, and informal childcare eliminated cheaper lifestyles, so the added cost measures the imposition, not entitlement. He uses his own grandfathered-in Phoenix homeownership and a 828-ZIP Zillow regression (rents up ~37% plus an extra ~$450/month flat across tiers) to show the cost of merely existing has risen ~$5,000/year per family. A rich, original 'housing theory of everything' essay tying poverty measurement to the supply thesis.
poverty linehousing theory of everythingzoningMichael Greencost of existing
TIER 4
Dec 14, 2025
Erdmann contrasts micro thinking (accept costs as given) with macro thinking (ask why costs are high) to explain why builders blaming high input costs miss that those costs are symptoms of regulatory supply constraints. He argues the core mechanism is upward filtering — families hate trading down socioeconomically — and that the real estate value gap over income (~80% in 50 years) reflects the rising cost of being poor, not luxury demand. A worthwhile conceptual essay reframing the affordability debate around macro causation.
micro vs macroupward filteringaffordabilitybuilderszoning
TIER 4
Dec 16, 2025
Responding to Scott Winship's marriage-vs-affordability question, Erdmann eyeballs the data to argue the real problem isn't that renters can't afford to buy but that ~7 million 25-34-year-olds can't afford to rent and have become non-heads of households. He reframes affordability as a measure of the housing shortage rather than its cause, and applies his recurring logic that attributing low household formation to weak demand only implies an even worse supply crisis given rising rents. A substantive original take connecting family formation to the supply thesis.
household formationfamily formationrentersaffordabilityScott Winship
TIER 5
Dec 26, 2025
Erdmann explains 'filtering' — homes should filter down to lower-income tenants over time, but since 2008 the US has filtered up, with a tipping point where price/income ratios jump from a stable ~3x to double digits. He frames upward filtering as the shift from aspirational housing decisions to forced compromises ending in regional displacement ('paying a bribe to the land'), tying it to permitting data showing constrained metros built far less. A core conceptual piece establishing why the supply shortage produces regressive price patterns.
filteringtipping pointdisplacementpermitting ratessupply thesis
TIER 5
Dec 29, 2025
This installment lays out the core analytical engine of the Erdmann Housing Tracker: the 'cantilever' model where price/income ratios across a city's ZIP codes are flat under ample supply but tilt into a steep negative-slope line under upward filtering, decomposed into 'Base value' (richest decile) and 'Extra value' (scarcity premium). Using Atlanta/Phoenix/Los Angeles comparisons and low-vs-high-tier Case-Shiller divergence (low-tier Tampa beating high-tier by ~70%), he shows rising real estate wealth is a regressive transfer. A foundational explainer of the original model that drives his Metro Area packages.
filtering modelBase/Extra valuecantileverCase-Shiller tiersprice-to-income
TIER 5
Dec 30, 2025
Erdmann argues average/value-weighted price data systematically understate the housing shortage's regressive harm, making three points: supply-constrained cities show high average incomes partly because poor families are displaced out ('failure masquerading as success'); value-weighted aggregates hide doublings of poor families' price-to-income ratios; and rent trends are themselves regressive, cutting the bottom quintile's real income by 15% from 2015-2022. Backed by a worked numerical example and Diamond–Moretti consumption findings, this is a methodologically important reframing of how housing costs should be measured.
value-weighted vs equal-weightedregressive costsdisplacementincome measurementDiamond-Moretti
TIER 5
Jan 29, 2026
A dense multi-section essay tying together the four eras of housing-vs-other consumption, the regressive nature of rent inflation under shortage, why building Class A 'luxury' housing is the most progressive force for lowering Class C rents (filtering), and a fresh metro-level regression finding each 1% of housing stock added via multifamily yields a ~2% rent decline. Lands as a reference-grade synthesis of Erdmann's supply, filtering, and mortgage-access arguments with original empirical work.
filteringrent inflationsupply thesishousehold sizemetro regression
TIER 5
Feb 10, 2026
Erdmann dismantles a San Francisco Fed letter claiming income growth drives prices while supply constraints don't explain cross-metro differences, arguing its spatial-equilibrium framing misreads displacement as ho-hum preference-sorting. His counter: the 2008 mortgage crackdown and universally inelastic multi-family zoning erased cross-city supply differences, so the Fed's true empirical findings are misinterpreted, and Closed Access cities are expensive because of high low-income out-migration (ransom rents), not high in-migration. A landmark forensic critique showing how the academy's blind spot to the mortgage crackdown corrupts its housing interpretations.
SF Fedspatial equilibriumsupply elasticitymortgage crackdownClosed Access cities
TIER 5
Apr 14, 2026
A point-by-point rebuttal of a WSJ piece (and the think-tank claim that housing isn't really expensive), arguing that comparing 1980s starting mortgage payments to today's tells only 0.3% of the story because fixed-rate amortization front-loads payments under high inflation. Erdmann shows that measured net worth is biased upward by capitalized shortage rents (an accounting error of roughly $30 trillion), that rent inflation since 1990 has been steeply regressive, and that the crisis is distributional (renters and non-forming households) rather than an average-homeowner problem. Reference-grade synthesis of his core thesis with original analytical mechanisms.
mortgage amortizationnet worth accountingrent inflationsupply shortageaffordability
Engaging the Field: Academic Papers & Policy Critiques
10 tier-5 · 9 tier-4
Erdmann as forensic reader of the literature. This cluster collects his close engagements with the supply-skeptic papers (the NBER 'supply constraints don't explain prices' paper, Glaeser-Gyourko, the SF Fed and St. Louis Fed letters, Mian-Sufi, Howard-Liebersohn), the flagship reports (Harvard JCHS), and the Senate hearings -- almost always to make the same point: the work is empirically careful but corrupted by omitting the 2008 mortgage crackdown. 'The elephant in the room' is the thesis statement of the whole cluster.
TIER 5
Feb 26, 2025
A landmark methodological critique arguing that economists wrongly treat price/rent ratios as mean-reverting, when in fact almost all variation comes from changing rents (largely land rent), making standard housing analysis systematically wrong. Dismantles a Dallas Fed paper and the Financial Crisis Inquiry Commission for missing that high-rent-inflation cities drove the 2000s 'bubble,' and frames the error as a persistent, tradeable mispricing across the profession. Core reference for his whole supply-thesis worldview.
price-rent-ratiosland-rentDallas-Fed-critiqueeconomics-methodologymortgage-access
TIER 4
Mar 13, 2025
Reacts to a Senate Banking hearing, praising Ed Glaeser's zoning/upward-mobility points but arguing they describe only a minority of the problem — the pre-2008 Closed-Access displacement crisis — while missing the universal post-2008 cause. Contends a housing affordability problem that reaches rural Alabama cannot be a land-use regulation problem and must instead be the mortgage crackdown, which is the one solution within federal purview yet is under a self-imposed taboo. Substantive policy analysis sharpening the supply-vs-credit distinction.
senate-hearingzoningmortgage-crackdownglaeserhousing-policy
TIER 5
Apr 1, 2025
Detailed rebuttal of the NBER paper 'Supply Constraints do not Explain House Price and Quantity Growth Across U.S. Cities,' arguing its conclusion is an artifact of using post-2008 supply elasticities (which were uniformly inelastic everywhere because the mortgage crackdown killed sub-$250k construction) and total rather than per-capita income as a demand proxy. Shows that in cities like New York and Atlanta prices rose most when population growth was lowest, and that replacing a supply response with a migration response describes a refugee crisis, not a refutation of supply economics. A rigorous, citable takedown central to the supply thesis.
supply-thesisnber-paper-critiquesupply-elasticitymortgage-crackdownmigration
TIER 5
Jun 5, 2025
Erdmann's signature thesis statement: the 2008 mortgage crackdown is the unacknowledged 'elephant' distorting nearly all contemporary housing analysis, from Klein-Thompson's Abundance to Glaeser-Gyourko's supply paper to Dayen's progressive critique. He shows the ~15M missing units are overwhelmingly low-price single-family homes that sat below construction cost for a decade, and argues the academy's collective blindness to the crackdown is a systemic failure of an entire field of study.
mortgage crackdownAbundanceGlaeser Gyourkosingle-family supplyacademic critique
TIER 5
Jun 9, 2025
A deep data-driven engagement with the new Glaeser-Gyourko supply paper, where Erdmann re-bins their six-metro construction figures to show the 2000s-to-2010s drop in low-density building was a uniform ~50% national collapse driven by the mortgage crackdown, not localized suburban NIMBYism. He develops his sticky-downward demand model explaining why constrained-supply cities see the cheapest neighborhoods (not the priciest) appreciate most, and argues total US residential value is inflated ~50% by duress rather than cyclical demand.
Glaeser Gyourkosupply elasticitymortgage crackdownsticky demanddensity
TIER 4
Jun 30, 2025
A substantive critique of Harvard JCHS's 2025 report, dismantling the 'priced out' framing (true micro, unhelpful macro), exposing the impossible claim that high-rent units grew 5.5M when total completions were under 3.5M, and arguing the household-formation rebound is far from over because vacancies were the supply being harvested. Uses the farmland/bread analogy and his own household-formation forecast (room for 20M+ units this decade). A strong worked engagement with the field's flagship report.
JCHS reportpriced outhousehold formationrental supplycost burden
TIER 4
Aug 13, 2025
A pointed critique of Mian & Sufi's 2014 housing-net-worth-channel paper, arguing they correctly identified the wealth shock's role in 2007-09 employment losses but silently assumed the mortgage crackdown wasn't a causal factor, never testing tightened mortgage access as the source of the net-worth collapse. Erdmann reframes their county-level findings as indirectly measuring credit sensitivity in poor neighborhoods and presents his own ZIP-code price/income and credit-score evidence. A substantive academic-literature rebuttal advancing his mortgage-crackdown thesis.
Mian and Sufihousehold net worthmortgage crackdownacademic critique2008 causality
TIER 5
Oct 7, 2025
A detailed rebuttal of Carol Roth's Fox News op-ed, dismantling five conservative housing prescriptions (assumable loans, smaller-home incentives, lower property taxes, anti-corporate-buyer rules) by showing each ignores the 2008 mortgage crackdown — a multi-sigma collapse in lending to sub-760 credit scores. Erdmann marshals data on homeowner counts, shrinking new-home sizes since 2008, Dallas rent regression, and net institutional selling to argue self-described free-marketers have joined progressives in central-planning who gets to build. A landmark, evidence-dense critique that doubles as a clear statement of his whole thesis.
mortgage crackdownconservative critiquehome sizeinstitutional investorsproperty taxes
TIER 4
Nov 17, 2025
Erdmann praises John Cochrane's anti-rent-control post but argues that Cochrane, like most pro-market supply-side economists, is blind to the 2008 mortgage crackdown that turned regional shortages into a national 15M-unit shortfall. He dismantles the 'there's plenty of supply, just not where people want to live' truism and shows via vacancy rates and a Detroit-vs-NYC comparison that supply, not demand, drives the regional cost differences. A sharp supply-thesis argument aimed at converting fellow supply-siders.
rent controlJohn Cochranesupply-side economicsmortgage crackdownvacancy rates
TIER 4
Nov 24, 2025
A detailed critique of the Tyler-Cowen-praised 'Giving Up' paper on declining homeownership, which Erdmann faults (along with the entire academy) for framing the collapse purely as an affordability problem while ignoring the 2008 mortgage-access crackdown that removed ~13-15M households from the buyer pool. He shows homeownership fell sharply (2006-2016) precisely when homes were most affordable, and argues the coming investor-funded building boom will lower rents while statistically reducing homeownership. Strong restatement of the mortgage-access thesis against the affordability consensus.
homeownership declinemortgage accessacademic critiqueaffordabilityhousehold formation
TIER 5
Jan 2, 2026
The closing section of the Mercatus paper series argues that high price/rent ratios are caused by rent inflation, that land rents reflect scarcity not positional/agglomeration demand, and dismantles Joseph Stiglitz's positional-goods model with the empirical fact that low-tier neighborhoods (not Rivieras) appreciated most. Erdmann shows Stiglitz hallucinated a pre-2008 Nevada building boom and recommended further restricting credit exactly as record-high real prices coincided with the lowest residential leverage since 1960. A high-value forensic critique of the economics academy's misreading of the 2008 era and the supply/credit story.
Stiglitz critiqueland valuemortgage accessCase-ShillerNevada/Las Vegas
TIER 5
Jan 5, 2026
Erdmann distills his Mercatus paper to one durable core claim: rent inflation has been severe and deeply regressive (cheapest ZIP codes up ~80% in a decade vs ~30% general inflation), and because there are no easy substitutes for housing, standard CPI/BLS measures structurally miss it. He develops the memorable 'paying for nothing' framework — much of a home's price is a scarcity premium bundled with location families won't give up — arguing the fix is more housing of any kind, not 'affordable' or productivity gains. A landmark, self-contained statement of his thesis with lasting reference value.
regressive rent inflationhousing shortageCPI/BLS measurementsupply thesissubstitution
TIER 4
Jan 27, 2026
A detailed forensic critique of a Berkeley paper (Drukker) claiming lower mortgage rates reduce first-time-buyer share, arguing the declining share reflects recovering repeat-buyer activity, not falling first-time activity, and that the model's fixed-housing-stock and exogenous-rent assumptions break down out of sample. Erdmann generalizes this to the economics academy's blind spot about post-2008 credit-access shocks. Matters as a methodology-and-monetary-policy argument with specific empirical rebuttals (DTI cliffs, first-time-buyer counts).
mortgage ratesfirst-time homebuyersacademic critiquecredit accessmonetary policy
TIER 5
Feb 9, 2026
Erdmann reviews Vincent Rollet's parcel-level NYC study showing redevelopment concentrates in low-density, high-value parcels and that broad upzoning is highly progressive (lowering rents most where rents are lowest), while arguing Rollet's spatial-equilibrium model and constant migration elasticity likely understate the rent benefit by ignoring ransom rents and displacement. He uses the paper to reinforce his own scarcity-premium estimates and skewers its offhand claim that cities 'reached a mature stage,' pointing instead to the post-2008 mortgage crackdown that interrupted ~15 million suburban homes. A substantive paper review plus a sharp recurring critique of the academy's blind spot.
upzoningRollet paperNYC zoningredevelopmentscarcity premium
TIER 5
Mar 2, 2026
Erdmann reviews a strong Soltas-Gruber paper measuring LA permitting costs via a market for 'ready-to-issue' permits (finding preapproval explains a third of the price-cost gap, roughly matching his own scarcity premium) and then dismantles the SF Fed's Mondragon et al. 'supply constraints don't explain prices' paper plus McClure-Schwartz's no-shortage claim. His central critique: Rosen-Roback and pre-2008 metro supply estimates are 'true but inapplicable' because the 2008 mortgage crackdown made every city's entry-level single-family supply vertical, so economists discover real patterns and misinterpret them. A landmark forensic critique of the academic supply-skeptic literature.
academic critiqueSF FedRosen-Robackpermitting costsClosed Access cities
TIER 5
Mar 6, 2026
Erdmann lays out an original framework in which metro housing supply curves are vertical at both ends (existing stock and permitting capacity) and flat in the middle, and argues the post-2008 market is in 30-year national 'hysteresis' where capacity can only recover ~0.1 completions per 1,000 residents annually. He shows why the same supply curve can be simultaneously vertical (national capacity) and flat (greenfield), why upzoning helps in the Closed Access cities but not under hysteresis, and why this non-linearity makes most quantitative housing analysis 'garbage with a veneer of certitude.' A landmark conceptual reference that anchors his elasticity-is-binary view of housing markets.
supply elasticityhysteresisbinding constraintsClosed Access citieshousing model
TIER 4
Mar 9, 2026
A follow-up that uses South-vs-Midwest permit and price charts to explain his hysteresis model: builders in the fast-growing South bid up input prices until materials are directed away from the Midwest, pushing the flat part of the Midwest's supply curve higher so it looks inelastic even though prices justify building. He argues both the 'high costs' and 'inelastic supply' camps are reasoning from real facts within a confused framework, and flags a market opportunity in cheap edge-of-city land that will spike when input prices normalize. Useful for clarifying the national-capacity-constraint mechanism and its metro-level distortions.
hysteresissupply curvesMidwest housinginput costsupzoning
TIER 4
Mar 16, 2026
A detailed critique of a St. Louis Fed blog post and the authors' investor-effects paper, arguing they correctly note capacity constraints but miss the central event: the 2008 mortgage crackdown. Erdmann contends their 'small investors drove up low-tier prices since 2009' finding is a funhouse artifact because investor share is itself a proxy for the mortgage crackdown, and prices merely recovered the amount they had fallen. A sharp forensic read showing how omitting the key variable corrupts otherwise careful empirical work.
St. Louis Fedmortgage crackdownomitted variableinvestor effectspaper critique
TIER 4
Jun 4, 2026
Argues that supply-side economists, distracted by demand-side complaints about monetary policy and mortgage programs, became 'handmaidens' to the 2008 mortgage crackdown that cratered construction and cost ~15 million homes. Dismantles recent AIER and CATO pieces (Baumol-cost, constant-size price metrics, homeownership-rate, amenity claims), showing each misreads regressive land-rent inflation as income/quality-driven, and calls for non-confused supply-siders focused on mortgage access and land-use deregulation. Substantive polemic tying the supply thesis to the policy field.
supply-side economicsmortgage crackdown 2008CATO critiqueland rentpolicy
Quantifying the Housing Shortage: Households, Vacancies & Missing Homes
8 tier-5 · 11 tier-4
The empirical backbone of the project: how big is the shortage, and how do you measure it? Erdmann builds his headline 15-20 million-unit estimate from multiple independent angles -- vacancy benchmarks, the broken adults-per-home trend, suppressed household formation, demand-elasticity math, and metro-area tallies -- and stress-tests it against lower published figures. The metro-area shortage series, the 'What Homes Are Missing' decompositions, the neutral-completions models, and his labor-force/demographic asides give the framework its concrete numbers and lasting reference value.
TIER 4
Oct 24, 2024
Erdmann estimates the real-consumption cost of post-2008 mortgage suppression by charting real PCE per capita against a counterfactual without excess rent inflation, framing it as a regressive landlord-to-tenant transfer that grows as incomes fall. He argues residential real estate worth ~$60 trillion is undervalued by mortgage suppression, ties the distributional damage to his policy fix (return FHA/Fannie/Freddie to pre-2008 standards), and pessimistically forecasts a coming bipartisan build-to-rent ban. A substantive cost-of-shortage argument with an original consumption-counterfactual model, tempered by its admittedly rough back-of-envelope nature.
housing shortage costmortgage suppressionreal consumptiondistributionpolicy
TIER 5
Nov 11, 2024
Erdmann builds a detailed estimate of the housing shortage by disaggregating deviations from long-term household-size and tenure trends, arriving at roughly 10 million missing units (above nearly every other published estimate) once a one-time mortgage-shock of ~10 million households shifted from owning to renting is modeled. He walks through four phases of post-2000 building, reinterprets the 2000s 'overbuilding' (and John Taylor's 2007 Jackson Hole warning) as trivially small versus the post-2008 collapse, and lays out why pent-up demand for ~10 million rental/vacant units fuels the coming single-family build-to-rent surge. A landmark quantification of the shortage with original tenure-by-phase framework.
housing shortagetenurebuild-to-rentmortgage crackdownvacancies
TIER 4
Nov 27, 2024
Erdmann back-tests his shortage tracker at 2002, 2005, 2007, and 2012 to show the model isn't rigged to always find large shortages: in 2002 it flags only the regional Closed Access shortage, and the 2012 easing came from demand collapse (foreclosures, falling incomes), not construction. Argues forcefully that 'cities never overbuild to a surplus'—the Phoenix 2011 surplus came from crashed migration, not 2005 overbuilding—and that liquidationism is the disease. A persuasive calibration and methods piece.
housing shortagemodel calibrationPhoenix surplusliquidationismLos Angeles
TIER 4
Nov 29, 2024
Reframes the shortage hopefully by showing most metros have previously built at more than double their current rate, bifurcating cities into land-use-constrained (LA, NYC, Boston) versus mortgage-crackdown-harmed (Midwest) markets that could self-heal via build-to-rent. A second section on October new-home sales attributes the drop to Southern hurricanes, then makes the sharp argument that Midwest new-home sales sit at 60-year lows from the mortgage crackdown, not the China Shock, despite excessive rent inflation. Strong analysis plus a useful data note.
housing shortageMidwestbuild-to-rentnew home salesChina Shock
TIER 4
Dec 2, 2024
Erdmann defends his use of the word 'shortage' (homelessness, permit queues, price-cap politics, economically motivated migration as non-price rationing) and explains his estimate as inflated land value—the gap between construction cost and market price—and how many units would erase it. He extends the 'bribe to land' frame to rent control and to mortgage access (treating homebuyers as suppliers, not just demanders). A conceptual explainer anchoring the metro-area shortage tables.
housing shortageland valuerent controlmortgage accessmetro estimates
TIER 5
Jan 1, 2025
A landmark synthesis of Erdmann's shortage estimates: vacancy arithmetic, the Corinth-Dante elasticity model (~20M units), the adults-per-home trend break (~15M missing homes since 2008), and a real-expenditures-vs-rent-inflation comparison implying up to 40M units' worth of investment. The original LA-vs-Phoenix 'bribe to the land' disequilibrium framework distinguishes local pre-2008 shortages from the nationwide post-2008 shortage, making this a definitive reference for his whole thesis.
housing shortagedemand elasticityCorinth-Danteadults per homesupply thesis
TIER 5
Jan 8, 2025
Using Census household counts versus completions/manufactured-home shipments, Erdmann frames the ~140k/year post-2008 supply deficit and the harvesting of vacancies, then separates apartments/single-family against renters/owners to argue the mortgage crackdown excluded ~20 million would-be homeowners and forced the rise of the institutional single-family rental market. The framework ties supply obstruction, mortgage policy, and the build-to-rent boom into one coherent original model with lasting reference value.
housing shortagehousehold formationmortgage crackdownsingle-family rentalssupply thesis
TIER 5
Feb 3, 2025
Erdmann decomposes his ~15-million missing-homes estimate into its component causes: ~5M short on vacancies, ~3M from elevated adults-per-occupied-home, and ~8M from the broken pre-2008 trend in adults-per-home, plus an uncounted population-growth effect. He defends the floor of the estimate (arguing any serious adjustment still leaves >10M) and offers international household-size comparisons showing the US/UK flattening where shortages bind. This is the original quantitative framework behind his headline shortage number and has lasting reference value.
housing shortagemissing homesadults per homevacancieshousehold formation
TIER 4
Jul 29, 2025
Using long-run linear trends in owned, rented, and vacant homes, Erdmann estimates a 15-20 million unit pent-up shortage and rebuts vacancy-based shortage estimates and Leamer's 'housing is the business cycle' tightrope view, showing 2000s vacancies were never tied to a building boom. He explains the 2016-2023 rising homeownership rate as an artifact of suppressed renter household formation, and warns that blaming build-to-rent and private equity for the now-falling rate could shut down needed rental construction. Strong analytical synthesis of his demand-curve and supply thesis.
housing shortagevacancieshomeownership ratebuild-to-rentLeamer critique
TIER 5
Aug 11, 2025
A landmark quantitative essay estimating a 15-20 million unit national housing shortage (~10% of stock) and building an explicit demand-elasticity model where 1% more homes lowers rents ~2% and prices ~3%, tied to employment growth and rent-neutral construction needs. Erdmann argues conventional 'few million unit' shortage estimates can't reconcile their own elasticities with observed 20% rent and 70% price inflation, and insists 2007-2010 must be excised from supply-demand models because it was a credit shock, not a supply glut. Core reference statement of his quantified supply thesis.
housing shortagedemand elasticitysupply thesisrent inflationmodel
TIER 4
Sep 19, 2025
Reviews the ROAD to Housing Act and the Saving the American Dream Act, welcoming the supply-friendly direction but arguing they dance around the real binding constraints: restored access to entry-level mortgages and legal alternatives to single-family homes. Frames mortgage borrowers as 'suppliers of housing' whose 2008 elimination collapsed production capacity, and shows via Tulsa-vs-Phoenix ZIP comparisons how low prices became the cause of high rents. A substantive policy explainer of Erdmann's mortgage-access-as-supply thesis.
federal policymortgage accessROAD to Housing Actland valuessupply thesis
TIER 5
Nov 3, 2025
A full data-heavy model post estimating the 'neutral' construction pace that would flatten scarcity lot premiums, concluding it is ~2.6M completions annually (1.8% of the stock) versus 2024's 1.6M. Erdmann works through how Covid migration, population-growth volatility, and a near-recession have distorted the rent/premium signals, and assumes each 1% supply increase lowers rents ~2% and prices ~6% as ~15M delayed households form. Original, quantified, and core to his supply framework and investment outlook.
neutral completionsscarcity premium modelrent inflationhousing shortageconstruction capacity
TIER 4
Jan 6, 2026
Erdmann asks whether post-Covid completions of ~1.6 million homes annually have been enough to flatten the regressive excess rent inflation of the last decade, working through demand-elasticity math (an estimate of 0.5 would imply ~2.5 million units needed annually). He reasons that if only 600,000 extra units flattened rents, implied elasticity would be an implausibly inelastic 0.2, raising the question of the true neutral building rate. The substantive model setup matters for gauging whether the supply gap is closing, though the payoff analysis sits below the paywall.
rent inflationdemand elasticityhousing supplycompletionsneutral building rate
TIER 5
Feb 16, 2026
Responding to Aziz Sunderji's claim that rent burden is a function of income rank rather than supply, Erdmann concedes rent/income is income-driven but argues that since 2008 homes have stopped growing with incomes (new homes are now mid-1990s-sized despite 70% higher real incomes), which is the true signature of a shortage and crisis. He critiques both supply skeptics who benchmark to 1970 and supply-focused economists who over-attribute costs to prized locations, reframing the crisis as national rather than a few demand-driven prime cities. A foundational argument distinguishing genuine shortage from ordinary scarcity.
housing shortagerent burdensupply skepticshome sizedisplacement
TIER 5
Feb 17, 2026
Part 2 resolves the apparent paradox that rent/income ratios look stable since 2005 despite a shortage: Erdmann argues families absorb the shortage by downsizing, delaying household formation, and accepting displacement, so stable spending masks deep consumption compromises. He introduces a 'Maslow's hierarchy of housing' (single-family rentals, mortgage access, upzoning, socio-economic planning), a model of home value as structures at ~10x rent plus scarcity-inflated land at ~30x, and argues flat property taxes approximate Georgist land taxes. A landmark synthesis of his cost-and-consumption framework with policy implications.
housing shortagerent/incomeMaslow hierarchyland valueproperty taxes
TIER 4
Mar 4, 2026
Starting from his recurring point that homes-per-capita masks a sharp 2008 break in homes-per-adult (because families have fewer children), Erdmann extends the per-capita vs. per-adult lens to the labor force, showing workers-per-capita has been flat since 1990 and actually rose from 36% in 1964 to ~48% today. He argues the feared retirement boom is overstated because falling child counts, more than women entering the workforce, drove rising workers-per-capita. A thought-provoking analytical aside that reframes demographic and labor-force panic, with a housing-shortage-and-fertility throughline.
demographicslabor forcehousehold formationfertilityper-capita measures
TIER 4
Apr 1, 2026
Explains why the shortage's cost is hard to measure: shortage-driven rent inflation is a transfer from tenants to owners that inflates measured wealth (~$30T of inflated land value) without changing real GDP, and out-migration that lowers housing costs is recorded as a financial gain while the lost consumer surplus of staying near family/jobs goes unmeasured. Built around a California Policy Lab / LA Times report on Californians who left, framing departure as defeat under duress rather than free spatial choice. A clear conceptual explainer of measurement bias.
consumer surplusGDP vs wealthCalifornia out-migrationland valuemeasurement bias
TIER 4
May 5, 2026
Nominally a podcast announcement, but the free body is a substantial essay rebutting the 'square footage per person is at record highs, so no shortage' talking point. Erdmann shows family-household size has been flat 20 years while ~14 million extra adults live with parents (would-be 10 million households) and new-home size has fallen ~25% even as real incomes rose ~25%, arguing shrinking homes and suppressed household formation are themselves symptoms of the shortage. Strong demonstration of his household-formation quantification, with extended discussion of how rents settle if mortgage access isn't restored.
household formationhousehold sizehome sizeshortage evidencemortgage access
TIER 4
Jun 5, 2026
Argues that a functional housing market needs roughly a 13% total vacancy rate (and ~5 million more vacant units), debunking 'vacancy truthers' and showing that rent inflation has been elevated whenever measured vacancies fell near or below that benchmark for 30+ years. Explains methodological distortions (seasonal park models counted as vacant) and why low shortage estimates that count only missing vacant units ignore pent-up household formation. A useful data-driven defense of his ~15-20 million unit shortage figure.
vacancy ratehousing shortage estimaterent inflationhousehold formationdata methodology
Build-to-Rent, Investors & the Single-Family-Rental Bans
4 tier-5 · 13 tier-4
Erdmann's most policy-urgent cluster: a sustained argument that institutional investors and build-to-rent are the absence of family homebuyers, not an independent source of demand, and that banning them -- as the Merkley bill, Nevada SB391, and dozens of state bills propose -- would 'legislate homelessness' by closing the last legal margin for new supply. He repeatedly shows homeowners outbid investors, that institutional share is tiny and falling, and that ~15M new rentals are needed precisely because the mortgage crackdown locked families out of buying.
TIER 4
Jan 9, 2025
Erdmann visualizes the Biden CEA's own RealPage estimates to show the alleged rent-pricing cartel accounts for only ~2% of excess rent ($3.8B of $197B), while pre-2008 obstruction (38%) and post-2008 mortgage-suppression-plus-zoning (60%) dominate, and the algorithm has lowest penetration in the most expensive markets. The piece doubles as a broader argument that anti-corporate scapegoating distracts from the real supply causes and risks a catastrophic ban on institutional/build-to-rent housing.
RealPagerent collusionsupply thesismortgage crackdownscapegoating
TIER 4
Jan 25, 2025
An impassioned essay reacting to bills in nine states to ban corporate ownership of single-family homes, which Erdmann calls the latest and potentially most self-destructive form of housing obstruction. He frames scaled single-family-rental providers as the only remaining release valve given zoning bans on multifamily and the post-2008 mortgage crackdown that locked ~720-credit families out of buying, arguing the bans would close the last outlet and worsen homelessness. Persuasive policy argument resting on his supply thesis, though more polemic than data.
SFR bancorporate landlordsmortgage crackdownhousing policyhomelessness
TIER 4
Feb 21, 2025
Argues that proposed bans on large investors buying homes would 'legislate homelessness' because single-family build-to-rent is the last legally-growable form of housing once cities block apartments and federal regulators limit owner-occupier mortgages. Shows with ZIP-code price/income data that rising low-tier prices since 2014 coincided with MORE owner-occupancy (declining investor share), so investors aren't the cause; shrinking rental stock and homeowner outbidding are. A substantive supply-thesis policy argument.
investor-banbuild-to-rentsingle-family-rentalshousing-policysupply-thesis
TIER 4
Jun 4, 2025
Tied to an IndyStar op-ed, Erdmann analyzes Fishers and Carmel passing 10% single-family-rental caps as the 'Last No in Housing'—the final legal exclusion after apartments (nuisance) and default-risk mortgage borrowers were already blocked. Using Indianapolis ZIP-level rent and price data showing the steepest inflation in the poorest neighborhoods, he argues these caps push renters into Marion County and drive housing costs by scarcity rather than amenities, leaving only encampments as the last unbanned 'nuisance.'
single-family rental capsIndianapoliszoning exclusionbuild-to-renthomevoter hypothesis
TIER 5
Jun 12, 2025
A landmark polemic-plus-analysis on the Merkley 'Humans over Private Equity' bill, arguing its forced divestiture of large single-family landlords explicitly mandates evicting ~700,000 disproportionately vulnerable families. Erdmann ties the rise of institutional landlords directly to the 2008 mortgage crackdown that locked ~10M+ families out of ownership, uses Atlanta ZIP-level price and permit data to debunk the 'Wall Street inflated prices' narrative (benchmarking-to-2012 fallacy), and shows build-to-rent is now the only legal growth margin for needed supply.
investor banMerkley billbuild-to-rentAtlanta datamortgage crackdown
TIER 4
Jun 20, 2025
Following up on the Merkley anti-investor bill, Erdmann works through how forced divestiture of large single-family rentals would play out, estimating modest rent inflation and suppressed renter-household formation rather than a clean transfer to owners. The post's lasting value is its 7-phase framework of US housing from 1994 to present (homeownership rate vs. real prices), plus his 'sticky downward housing demand' model explaining how families slowly absorb shortages by degrading their living standards.
single-family rentalsMerkley bill7 phases frameworksticky demandrent inflation
TIER 4
Aug 16, 2025
Erdmann rebuts a viral 'marginal bidder' argument that Blackstone-style investors set comps and price out families, showing with owner-occupancy and Case-Shiller data that homeowners consistently outbid corporations and that the large-scale SFR investor market only exists because the mortgage crackdown raised rents. He argues builders selling in bulk to investors signals a safer, more resilient market rather than another 2008. A clear, data-backed supply-thesis takedown of anti-investor sentiment.
institutional investorsBlackstonemarginal bidderhomebuilderssupply thesis
TIER 4
Sep 30, 2025
Surveys 50+ state anti-investor housing bills (Georgia HB555, Virginia SB1424, RealPage algorithm bans) and dismantles the 'Wall Street is shutting out homebuyers' narrative with Atlanta data showing homeownership collapsed before institutions entered and that institutional buyers hold under 1% of metro homes. Argues the real constraint is suppressed single-family permitting and blocked apartment construction, and that healing will actually require more institutional build-to-rent capital, not less. A substantive policy-and-data takedown of a politically popular but misdiagnosed reform.
institutional investorsbuild-to-renthousing policyAtlantahomeownership rate
TIER 5
Oct 6, 2025
Using a tracked LGI Homes Florida neighborhood as a case study, Erdmann argues investors are a novel 'plan B' backstop that makes weak retail sales feel bearish while keeping construction strong, and that resale inventory is caused by flat prices rather than being a measure of supply. He quantifies the need for investor capital — 13M+ missing units, 500K+ single-family rentals annually for decades — and shows large institutions own under a million homes and were net sellers. A rich, original synthesis of rental-investor economics, inventory misreadings, and the supply outlook that rebuts the anti-corporate-housing narrative.
rental investorsresale inventoryhomebuilderssingle-family rentalssupply outlook
TIER 4
Nov 20, 2025
Erdmann critiques Nevada's SB391 (capping investor home purchases) and the anti-corporate-landlord rhetoric behind it, showing the 'corporate' share of Las Vegas single-family homes is tiny (largest owner ~3,190 homes) versus a 100,000+ unit shortage. He digs into why Las Vegas uniquely combines fast-growing-city price appreciation with Midwest-low supply response, arguing the city desperately needs more capital, not less, and that driving investors out risks dystopian homelessness. Substantive policy critique grounded in his supply model.
Nevada SB391investor banLas Vegascorporate landlordsmultifamily obstruction
TIER 4
Nov 20, 2025
Recap of ResiDay 2025 speakers filtered through Erdmann's supply lens: Amherst's Sean Dobson on underwriting being the real constraint, Parkland's build-to-rent stacked-townhome design as an answer to inflated land premiums, Roofstock on investor yields, and FHFA's Bill Pulte's announcements (50-year mortgage, GSE equity stakes in builders, continued conservatorship). He reframes investor activity as a derivative of supply-constrained homebuyer demand and rebuts Pulte's 'builders sitting on inventory' claim. Substantive industry-meets-thesis synthesis.
ResiDaybuild-to-rentmortgage accessBill Pulte / FHFAinvestors
TIER 4
Nov 27, 2025
Erdmann argues Canada's reforms levelling the field for purpose-built rental apartments (starts now ~2x the US per-capita rate) are working, contrasting Canada/Australia/NZ trajectories with the US's unique 15-20M-unit shortage from the 2007 mortgage collapse. He uses the comparison to dismantle the 'financialization'/anti-investor framing, showing that legalizing rental apartments mechanically produces large-scale investors who then get blamed for problems they didn't cause. A substantive cross-country supply-thesis argument plus a dissection of investor-bias errors.
Canadainternational comparisonapartment supplyfinancializationinvestor ban
TIER 4
Jan 9, 2026
Responding to Trump's pledge to ban large institutional investors from buying single-family homes, Erdmann argues the country desperately needs deep-pocketed investors to fund the missing rental homes and that the real culprit is post-2008 CFPB/FHFA mortgage-access clamps that stop families (e.g., in Baltimore's McElderry Park, where a mortgage would cost less than half the rent) from buying. A substantive policy essay using a vivid Heffalump/Annie-Lowrey framing to redirect blame from investors to lending standards.
investor banmortgage accessTrump housing policysingle-family rentalssupply thesis
TIER 5
Mar 11, 2026
Erdmann mounts a detailed rebuttal to Oren Cass and AEI's Tobias Peter over a Senate bill that would ban new build-to-rent single-family homes and large-scale investor ownership, arguing investors have never bid up home prices (homeowners always outbid them) and only filled the gap after the 2008 mortgage crackdown excluded a third of families from mortgage access. The core argument: roughly 15 million new rentals are needed to normalize costs and enable household formation, and since regulators bar those renters from mortgages, large-scale single-family rental investors are an essential source of new supply, not a price driver. It matters as a landmark policy-debate piece tying the supply thesis directly to live legislation and the institutional-investor controversy.
single-family rentalsinstitutional investorsmortgage accesshousing policysupply thesis
TIER 4
Mar 13, 2026
Argues the push to ban large single-family investors is moral/prejudicial reasoning dressed as empirical economics, dissecting how a Philadelphia Fed paper's '60% higher' rent figure actually means a trivial 3.7 percentage-point difference. Offers a three-tier buyer framework (homeowners drive prices; small investors are bottom-feeders; large investors entered post-2012 when small-investor capacity tapped out) and Census data showing investor share fell from 22% (2014) to 18% (2024). Concludes large investors will be necessary to reach the ~30% rental share needed to clear the 15M-home shortage. Substantive policy and market analysis.
investor bansingle-family rentalsprejudice vs empiricismbuyer tiershomebuilders
TIER 4
Apr 6, 2026
Traces how the suppression of apartment permitting and the 2008 mortgage crackdown reshaped owner-vs-renter household formation, with vacant units 'harvested' to keep renter households from declining. Erdmann sketches a forward scenario of ~600k natural household growth plus 15M+ pent-up demand, arguing there is near-limitless potential for build-to-rent and existing-home-to-rental conversion that the private market will resolve faster than expected, if anti-investor laws (e.g. Warren) don't block it. Substantive supply/household-formation forecasting.
rental supplyhousehold formationbuild-to-rentmortgage crackdownanti-investor policy
TIER 5
Jun 2, 2026
Responds to Brian Potter's Construction Physics post to argue that investors and build-to-rent are fundamentally the absence of family homebuyers, not an independent source of demand, since funded homeowners always outbid investors for single-family homes. Introduces memorable framings (the moon-vs-sun light analogy, the 5-year-old helping hold up a box) and shows with original charts that build-to-rent grew precisely when high mortgage rates suppressed homeowner formation, predicting more investor activity will eventually correlate with lower rents once building outpaces homeowner demand. Distinctive analytical framework with lasting value.
build-to-rentinstitutional investorssingle-family rentalsmortgage accessdemand framing
Monetary Policy, Rates & the Housing Business Cycle
3 tier-5 · 8 tier-4
Erdmann pushes his housing work up into macro: residential construction as Ed Leamer's leading recession indicator (and why that relationship broke once a chronic shortage set in), the 2008 'safe asset' destruction and safety trap, the shelter-CPI lag and his 'run everything but rent at 2%' rule, and the claim that a severe shortage makes a real recession nearly impossible to engineer. The 'New Business Cycle' series and the rates-are-effects-not-causes arguments live here.
TIER 4
Feb 17, 2025
A conceptual essay arguing that builders saying 'projects don't pencil' is a rhetorical artifact of their operating model, not a reliable macro signal of where starts or prices are headed. Uses a supply/demand-curve diagram (four scenarios from easy-supply to policy-capped Closed Access) to show the same complaint can coincide with rising OR falling construction, and concludes that high input costs today most likely precede rising starts as capacity loosens. A useful original framework for reading industry sentiment.
construction-economicssupply-demand-modelbuilder-sentimentmarket-monetarismanalytical-framework
TIER 5
Aug 6, 2025
A full essay tracing 65 years of housing's role in the business cycle, isolating 2008 as anomalous via a four-step decomposition (mild 2006 cyclical dip, 2007 SF-to-MF shift, 2008 agency mortgage crackdown, permanent SF decline) and showing multi-family starts behaved abnormally because the recession caused the MF downturn rather than leading it. He argues that under an endemic housing shortage residential investment is no longer a leading indicator, so 21st-century recessions should be rarer and shallower. Original framework for thinking about housing and the modern business cycle.
business cyclehousing startsmulti-family2008 decompositionleading indicator
TIER 4
Sep 8, 2025
Part 1 makes the series' core claim: residential investment was a leading cyclical/causal recession indicator in the 20th century, but by 2000 the dynamic flipped — marginal housing spending became inflationary land rents, so reducing housing expense now requires building more, not less. The free portion delivers this central reframing with the residential-investment-share history (5%+ of GDP in past cycles vs never recovering to 4% in the 1990s) before paywalling. The conceptual anchor of the whole series.
business cycleresidential investmentland rentscyclicalitysupply thesis
TIER 4
Sep 11, 2025
Part 3 introduces the three components of the Erdmann Housing Tracker model — Cyclical, Supply, and Credit — and frames an urban housing market via price/income deviations from the historical ~3x norm, noting top-tier homes still sell at that multiple (3.11x today vs 3.13x in 2002). The free portion presents the model's conceptual scaffolding before paywalling the worked decomposition. Useful as the methodological backbone of the tracker, though the full breakdown is gated.
Erdmann Housing Trackerprice/income ratiomodel componentssupply thesisframework
TIER 4
Sep 12, 2025
Part 4 of the framework series argues the post-2008 mortgage crackdown put every city into shortage, so Closed Access refugees (NYC, LA, Boston, SF, San Diego) can no longer be greeted by proportional new construction elsewhere, dispersing migration and slowing former boomtowns. The visible portion delivers the core migration-and-cycle thesis (including the recurring Nevada 'mass hallucination' point that the desert spec-home glut never happened) before paywalling the detail. Substantive conceptual content even with the back half gated.
business cycleClosed Access citiesmigrationTexasNevada
TIER 4
Sep 15, 2025
Closes the New Business Cycle series by using Moody's Mark Zandi's bearish 'red flare' housing call as a foil, showing how the obvious inventory-and-sales narrative misreads the market once you accept the shortage framework. The free portion lays out the conflicting inventory-vs-sales signals and argues the key skill is knowing which questions to ask; the detailed rebuttal is gated. A useful applied capstone, though the meat sits behind the paywall.
business cyclehomebuilder inventoryZandisupply thesismarket analysis
TIER 5
Oct 1, 2025
A point-by-point rebuttal of Fed Governor Bowman's housing remarks, arguing that mortgage rates and affordability are effects of supply conditions, not causes, and that under a shortage condition housing has become a defensive sector where weakness can't show up. Develops the framework that short and long rates move together only when the Fed is chasing a market rate, and that in a shortage nominal prices can only moderate (never crash) absent a 2008-style credit shock. High reference value as a compact statement of Erdmann's monetary-policy-vs-supply thesis.
mortgage ratesmonetary policysupply thesisFed critiqueaffordability
TIER 4
Oct 10, 2025
Erdmann highlights an unprecedented 2022 divergence where multi-family and single-family residential investment moved in opposition for the first time in 60 years, arguing it is a symptom of binding supply constraints — when multi-family briefly escaped NIMBY blocking, it drew resources from single-family. He uses this to argue that homes on scarcity-inflated land get built wherever capacity exists because landowners capture the premium, which in turn erodes the premium on all other lots. Substantive supply-thesis analysis connecting business-cycle dynamics to land economics.
residential investmentmulti-family vs single-familysupply constraintland premiumbusiness cycle
TIER 4
Feb 5, 2026
Erdmann argues the scary-looking 'months of supply' and homes-for-sale charts are an artifact of a low sales denominator, not genuine builder overhang, and that this same misreading led the Fed to withhold stimulus into October 2008 because it thought starts were still too high. He reconstructs that inventory-for-sale never broke from sales trends and that the 'stable' 300-400k for-sale range was actually a suppressed exponential trend. Useful as both an investment-thesis (builder stocks mispriced) and a forensic monetary-policy critique.
months of supplyhomebuilder inventory2008 Fed forensicsmonetary policysupply thesis
TIER 4
Feb 25, 2026
Building on Ed Leamer's thesis that residential construction employment leads the business cycle, Erdmann argues that a severe housing shortage makes it nearly impossible to engineer a real recession, so 2022-2025 was a would-be recession where unemployment rose to 4.5% but never collapsed. He predicts new single-family construction will finally rise once Southern migration normalizes, citing November-December new-home sales as possible green shoots. A substantive macro-cycle argument linking the supply shortage to monetary policy and the absence of recession.
business cycleconstruction employmentrecessionmonetary policyLeamer
TIER 5
May 4, 2026
Erdmann extends his mortgage-crackdown thesis into monetary economics, arguing the 2008 retraction of agency lending didn't just crater home prices but destroyed ~$10 trillion in safe assets, deepening the post-2008 'safety trap' that pinned interest rates at zero and forced QE. He connects the pre-2008 safe-asset shortage (Caballero-Farhi-Gourinchas), the CDO boom as a substitute for vanishing willing borrowers, and a counterfactual where stable lending would have left an extra $10 trillion in mortgage securities and a positive natural rate. An original cross-disciplinary synthesis with high reference value.
safe assetsmortgage crackdownsafety trapinterest ratesmonetary policy2008 crisis
Mortgage Access, Credit & Homeownership
2 tier-5 · 6 tier-4
The credit-side counterpart to the supply thesis: Erdmann documents how the post-2008 crackdown cut working-class mortgage access back to pre-New-Deal levels, why this -- not affordability or interest rates -- explains the homeownership collapse, and what reforms (countercyclical GSE lending, his Fixed-Payment/Adjustable-Principal mortgage) would restore it. Includes the Fannie/Freddie privatization analysis, the debt-to-income and credit-score data work, and his insistence that homebuyers are 'suppliers of housing,' not just demanders.
TIER 5
Jan 16, 2025
Erdmann argues the conventional wisdom that homeownership is dangerously risky is largely an artifact of the 2008-2012 mortgage crackdown that deliberately destroyed low-tier home values, not an inherent property of housing. Using ZIP-level Zillow data on 822 areas, he shows total real returns (rent plus capital gains) since 2015 are strongly negatively correlated with price, so lower-income owners of cheaper homes systematically earn the highest yields, meaning mortgage exclusion blocks exactly the buyers for whom ownership pays best. A rich, original empirical case with lasting reference value, capped by his 'we're the python' framing of self-inflicted exclusion.
homeownership riskmortgage crackdownrental yieldsZIP-level returnsCase-Shiller
TIER 4
Mar 4, 2025
Unpacks an NBER paper (Damen, Korevaar, Van Nieuwerburgh) finding that low-rent units earn the highest risk-adjusted returns and even hedge business-cycle risk, and ties it to Erdmann's thesis that the 2008 mortgage crackdown barred ~15-20M households from owning that lucrative asset. Argues blocking new housing or mortgage access to 'protect' affordability is self-defeating, and that the academic finding validates his supply-side framing of the crisis.
affordable-housingrental-yieldsmortgage-accessNBER-paperhomeownership
TIER 4
May 27, 2025
Erdmann argues the GSE-privatization debate's fixation on mortgage rates is misplaced—rates only ever mattered at the quarter-point margin, while the real value of Fannie and Freddie was standardized underwriting that safely extended ownership from the 40s to mid-60s. He marshals historical episodes where prices and production moved opposite to what rates would predict, reframing the post-2008 story as one of mortgage-access withdrawal, not interest rates, and warns coming rules blocking rentals could be the binding constraint.
Fannie Freddieinterest ratesunderwritingmonetary policymortgage access
TIER 4
May 28, 2025
Reacting to FHFA director Pulte clarifying that the GSEs would be taken public rather than fully privatized, Erdmann argues this amounts to selling future cash flows like a toll road with little real effect on housing markets. He revisits his contrarian read that Fannie and Freddie never needed taxpayer cash in 2008—the $200B 'injection' was an accounting round-trip into Treasuries—and contends keeping them under public control is a near-free public service worth preserving.
Fannie MaeFreddie MacGSE privatization2008 crisismonetary policy
TIER 4
Jun 10, 2025
Erdmann dismantles the credit-hawk reliance on high debt-to-income ratios on new mortgages, showing originations have collapsed to ~1% of real-estate value so that the absolute count of high-DTI loans has fallen even as the share rose. He explains DTIs are mechanically highest at origination and inflated by supply-driven price increases, arguing the obsession with tightening lending further feeds the supply-shortage doom loop that raises rents and prices.
debt-to-incomemortgage standardscredit hawkslending normsaffordability
TIER 4
Jun 24, 2025
Erdmann sizes the post-2008 contraction in mortgage access using NY Fed mortgage-account data, arguing that roughly 15 million mortgages disappeared as a one-time shock and never returned, even as accounts now grow in line with adult-population and household trends. He frames this 15M-missing-mortgages figure as the centerpiece any credible model of 20 years of US housing must explain, and deliberately rejects hyper-precise robustness demands in favor of order-of-magnitude clarity.
mortgage crackdownmissing mortgageshousehold formationsupply thesiscredit access
TIER 4
Feb 6, 2026
Erdmann walks through his original 'Fixed Payment/Adjustable Principal' (FA/AP) mortgage product, a floating-rate loan whose payment stays fixed while the principal absorbs the rate mismatch, arguing fixed-rate mortgages wastefully bundle payment stability with a costly one-sided inflation bet borrowers don't want. He shows a back-tested model (1954-1990) of payment-to-income paths versus fixed-rate and ARM loans. Matters as a concrete policy/financial-engineering proposal addressing payment predictability without the fixed-rate premium.
mortgage designFA/AP mortgageinterest rate riskback-test modelMercatus paper
TIER 5
May 18, 2026
Erdmann rebuts the NAR's splashy claim that the median first-time-homebuyer age jumped to 40, arguing the figure is a survey artifact and that a stable low-30s median is actually worse news because it means the 2008 mortgage crackdown permanently locked 10-15 million households out of ownership rather than merely delaying them. Using age-adjusted homeownership-per-capita data, he shows the headline homeownership rate is misleadingly inflated by suppressed renter household formation and forecasts ownership declining toward 60% over the next two decades. A landmark articulation of his ownership-vs-rent and mortgage-access thesis.
first-time buyershomeownership ratemortgage crackdownhousehold formationprice/rent ratio
Zoning, Density & the American City
2 tier-5 · 4 tier-4
The land-use half of the supply problem: how downzoning, apartment bans, and single-family-rental caps function as an escalating exclusion machine, why density is an 'inferior good' we made illegal, and what reforms like ADUs and upzoning can and cannot fix. Includes the homevoter-hypothesis reframe, the DC infill case study, the Northeast-without-zoning thought experiment, and the argument that cities are most valuable to the poor.
TIER 4
Apr 28, 2025
A full free, data-rich DC case study showing the District proper booming with multifamily infill at Austin-like rates and holding rent inflation 1.5% below the national average, a real YIMBY win. The deeper point: even this success only offset a fraction of the damage, since the 2008 mortgage crackdown halved suburban single-family permitting (three missing suburban homes for every new DC apartment), separating the city-building quality-of-life debate from the affordability crisis.
Washington DCmultifamily infillmortgage crackdownpermitssupply thesis
TIER 5
Apr 29, 2025
A full free landmark essay proposing an 'alternative homevoter hypothesis': NIMBY homeowners are driven by the rental/lived value of their neighborhoods (status protection) more than resale windfalls, which explains why they supported the price-crushing 2008 mortgage clampdown and now support investor-buyer bans. It reframes zoning, mortgage tightening, and anti-landlord policy as a single escalating exclusion machine that keeps rents high while suppressing prices, a genuinely original synthesis of his thesis.
homevoter hypothesisNIMBYzoningmortgage crackdowninvestor ban
TIER 4
May 22, 2025
Sparked by a conversation with Steve Randy Waldman, Erdmann develops his framing of urban density as an 'inferior good'—'downscale density' (the historic Lower East Side, SROs, walkable poor neighborhoods) that we made illegal, leaving cities serving only the affluent. He links zoning's structural-form bans to escalating explicit who-can-live-here exclusions (single-family-rental bans), and argues reforms like ADUs matter because they let neighborhoods 'filter' and evolve to serve the bottom half over decades.
urban densityfilteringADUszoninginferior good
TIER 4
Sep 4, 2025
A graphics-driven essay on how 20th-century downzoning killed American cities — New York's 1961 plan cut zoned capacity from 55 million to 11.8 million (Manhattan went from 7 Congressional districts to 2.5), and NYC's population has been roughly flat since 1960. Argues cities are most valuable to the poor (defensively and aspirationally), so banning density became, in effect, a policy of removing the places poor families value, which sits at the heart of stagnant low-end wages and mobility. A vivid, quotable framing of the zoning-as-anti-poor thesis, lighter on original modeling.
zoningdownzoningNew York Cityurban policyincome mobility
TIER 5
Sep 24, 2025
Uses ZIP-code IRS income distributions for New York City vs Dallas to argue the 50-year Sunbelt population shift is driven less by air conditioning or agglomeration than by Northeast zoning displacing low-income families, who left while high-income in-migration stayed roughly average. Quantifies that NYC would need ~20%+ more housing stock to eliminate excess costs and shows the shortage is highly regressive — poor neighborhoods carry double-digit price/income ratios while rich ones match Phoenix. An original data-driven reframing of internal migration as a supply phenomenon.
zoningmigrationregressive costsNew York Cityagglomeration
TIER 4
Apr 13, 2026
Using per-capita single- and multi-family completion data, Erdmann argues the Midwest's low building reflects binding zoning/apartment constraints and a measurable land scarcity premium, not mere economic stagnation, paralleling the Northeast. He candidly confesses to having fallen for the same essentialist 'the Midwest is just poor' framing he criticizes, and cites a new paper showing restrictive zoning binds even in stagnant or depopulating markets. A useful applied extension of his supply thesis to flyover country.
Midwest housingzoning constraintsapartment supplyland premiumessentialism
Tracker Updates, Trade & Year-in-Review Syntheses
0 tier-5 · 10 tier-4
The periodic and perimeter layer of the archive: monthly Erdmann Housing Tracker updates whose free front-matter carries a standalone argument (small-city/big-city price divergence, the construction-vs-rents disequilibrium, the residential-construction price decomposition, the shelter-CPI lag), the four 2025 Year-in-Review digests that index a quarter's worth of models in one place, and his trade-deficit-as-capital-surplus macro aside that applies the same 'costs reflect rents, not production' logic outward.
TIER 4
Nov 13, 2024
The monthly tracker update doubles as a substantive argument that density/agglomeration explanations for high prices became irrelevant after 2008: using Kalamazoo as a case and a 937-metro ordinal regression of price vs city size, Erdmann shows small cities got more expensive while big cities got cheaper from 2006-2024. The mechanism is the post-2008 mortgage crackdown spreading the shortage to small cities that only ever built single-family exurban housing. The metro-size regression and small-city/big-city divergence carry real analytical weight even though the tracker component numbers are paywalled.
tracker updatecity sizedensitymortgage crackdownsupply thesis
TIER 4
Nov 14, 2024
Erdmann argues inflation has been on a clean 2% non-shelter path for over two years and that shelter CPI's known lag is finally working out, using Zillow ZORI vs CPI shelter and ex-shelter comparisons. His monetary-policy thesis: ignore rent and run everything else at 2%, which he credits Powell with effectively doing, averting a recessionary construction contraction. A useful explainer of the shelter-CPI lag and his monetary framework, though lighter and more polemical than his deep model posts.
inflationCPI sheltermonetary policyrent inflationZillow ZORI
TIER 4
Nov 20, 2024
Erdmann decomposes new-home prices into square-footage, input-cost, and a residual (land/profit/quality) component, then contrasts new-home cost-per-square-foot against the real Case-Shiller index and his tracker's supply/credit-neutral ZIP benchmarks. The payoff is his core distinction: high-tier markets track rising construction costs while average homes track inflated land values from constrained supply, making inadequate supply a regressive price driver. The substantive model and original tracker-based decomposition give it reference value despite the bulk of the data dump sitting behind the paywall.
residential constructionhome pricesland valueCase-Shillersupply thesis
TIER 4
Apr 17, 2025
A substantial free analysis plotting Phoenix ZIP-code home prices against neighborhood income across 2000-2025, distinguishing a proportional 2005 cyclical bubble (regression line rotating from the origin) from the post-2008 mortgage crackdown that pushed low-tier prices sharply below neutral, then a uniform ~$200K-per-lot scarcity premium since 2011. He argues only mass construction (not a recession) could move prices back down, with the monthly tracker update paywalled.
Phoenixland pricesprice-income modelmortgage crackdownscarcity premium
TIER 4
May 6, 2025
A full free essay arguing the US trade deficit is the sustainable mirror of a capital surplus because Americans earn higher returns on foreign investments than foreigners earn on US assets, so it reflects no profligacy or offshoring. Its sharpest original point is that production moves to where wages are rising, not where they are low, and imports grow most from high- and rising-wage partners, paralleling his critique of attributing housing costs to construction costs.
trade deficitcapital flowsoffshoringwagesmacroeconomics
TIER 4
Oct 20, 2025
Despite being a monthly tracker update (truncated by the paywall), the free portion contains a substantive argument that the recent negative correlation between construction and rents is a disequilibrium correction from the 2008 mortgage crackdown, not proof that supply lowers rents in equilibrium. Erdmann dissects why the regression slope between construction and rent changes flipped sign across 2015-2025 periods, attributing it to demand fluctuations and the Covid migration reversal. The analytical front-matter outweighs the housekeeping nature of the post.
rent trendssupply-demand equilibriummortgage crackdowntracker updateconstruction
TIER 4
Mar 25, 2026
A digest of Q1 2025 posts covering adults-per-household shortage estimates, his contrarian investment philosophy, the argument that almost all change in price/rent ratios comes from changing rents (so economists treating the ratio as mean-reverting are wrong), agglomeration vs. scarcity, and critiques of several academic papers that miss the mortgage crackdown and rely on metro-area averages. A compact index of his methodological and price/rent-ratio arguments.
price/rent ratioagglomeration vs scarcityhousehold formationpaper critiquesyear in review
TIER 4
Mar 26, 2026
A digest of Q2 2025 posts centered on his 'Upside Down CAPM' series (reframing bond yields as a deferred-consumption premium and explaining the trade deficit, land prices, and home prices through it) plus the homevoter hypothesis, anti-investor ordinances in Indianapolis suburbs, and high-DTI / mortgage-crackdown estimates. Useful compilation of his more idiosyncratic financial-economics models and the anti-investor-policy series.
Upside Down CAPMhomevoter hypothesistrade deficitanti-investor ordinancesyear in review
TIER 4
Mar 27, 2026
A digest of Q3 2025 posts anchored by his 'mortgage radicalization' argument that the 2008 credit-score crackdown, not Fed policy alone, caused and prevented recovery from the recession (with yield-curve/residential-investment timing evidence). Also covers why coastal upzoning won't empty flyover country, the 7-sided supply debate, the filtering mechanism, and several 'funny charts' debunking conventional 2008 narratives. A rich index of his macro-housing and monetary-policy arguments.
mortgage crackdownmonetary policyresidential investmentfilteringyear in review
TIER 4
Mar 30, 2026
A curated digest of Q4 2025's most-read posts, covering the new Metro Area Analysis packages (attributing home value to structure, amenity, and temporary scarcity premium), critiques of papers that treat 2008 as inevitable, the regressive-distribution argument against 'average incomes are rising,' and rebuttals of Cochrane on rent control. Closes with the full abstract of his Mercatus paper 'We Are Not as Wealthy as We Thought We Were.' Dense reference index to his year's analytical output and signature models.
year in reviewmetro area analysisscarcity premiumMercatus paperregressive rent