The Prof G Pod with Scott Galloway
00:14:07 · Scott Galloway
[00:14:07] S1: Kyla, anything to add to that?
00:14:09 · Kyla Scanlon
[00:14:09] S2: Yeah. I mean, I think that there was a piece called Negative Yield New York a couple of years ago that talked about... So this is sort of tangential to the question, but it it talks about how there are these, like, epicenters where people want to move to because it's where a lot of jobs are. It's where a lot of opportunities are. Like, for example, I left Kentucky to go to LA because that's where the... My finance job was when I graduated school. And so, like, how seeing in these cities that people, as Aziz pointed out, wanted to move to are more expensive because there's more demand. Like, everybody kinda wants to be in these big cities, see if it works out, and then maybe they go back home. Right? And there's a lot of opportunities in the smaller cities too, but the big cities are where most of the big businesses are. And so this piece in Negative Yield New York was talking about how because housing has gotten so expensive in these big cities, it's harder and harder for people to move there. It's harder and harder for the culture to be established. And so I think that it is pretty painful in big cities, and it sort of creates this reverberation across the economy where people aren't able to take on as much risk. They're not able to take these big swings because the housing is so expensive. And so I think that's definitely one of the the complications. Like, I remember when I moved to LA in 2019 on my on my starter salary, it was very, very, very, very painful. I could barely afford rent. And I was paying, like, $2,000 a month, and this was 2019, for a 300 square foot studio. It was so tiny. And so if we think about that and if we think about the opportunities that people want in these bigger cities just to, like, take a big swing, be around these bigger businesses, bigger corporations, you know, it I think, it creates these downstream effects that we don't totally understand quite yet. So, again, a little bit of a tangent, but I think it's important that there is affordable housing in the places where people want to move to take these bigger risks.
00:16:05 · Scott Galloway
[00:16:05] S1: We'll be right back after a quick break.
00:16:11 · Scott Galloway
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00:17:55 · Scott Galloway
[00:17:55] S1: I wanna try and get to the core of the problem and get your thoughts on where I have it wrong and and whatever nuance you wanna add. But every market has a demand side and a supply side. Let's talk about the supply side. The US completed about 2,100,000 homes, privately owned homes in '73, 1973 when the population was roughly two eleven, so millions, approximately 1% ratio of houses built to population. In 2024, The US completed about 1,600,000 with a population of more than three forty million. If I'm doing my math right, that's about 0.5%. So the ratio of new homes being built to population has been cut in half. Duplexes, triplexes, fourplexes accounted for 7% of new homes in 1979 versus 1.1 in 2025. And then to make things worse, it feels like the programs are all on the demand side, low and trying to keep interest rates artificially low or lower than they should be. First time home buyers tax credit, low income housing tax credit, which puts more money in the home in the pockets of buyers. But without an increase in supply, all that does is take prices up. It feels as if there's just a basic understanding of the economics. And then we cosplay concern with programs that ultimately just take prices up. Your thoughts. I'll start with you, Kala.
00:19:18 · Kyla Scanlon, Scott Galloway
[00:19:18] S2: Yeah. I mean, I think that's... I I interviewed Wally Ediemo a few years ago now, who is the deputy secretary of the treasury in the Biden administration under Janet Yellen. And that was one thing that he really talked about is that it's very hard to do much about supply, so all you really can do is the demand side. So the financing side, that's what a lot of... It's a little simpler to pass policy on mortgage rates and support for first time homebuyers than it is to fix zoning laws, for example. And so I think for a lot of big governments in these cities, you know, they're just looking towards the demand side subsidies. But it... Of course, if there's not enough supply and then everybody has a little bit more money to spend, home prices are gonna go up. [00:20:00] S1: Susan, any thoughts?