The New Crisis Hitting Europe

[PeterRS]

Today's Observer newspaper has a series of articles about the acute housing shortage in Europe, with the Mayor of Barcelona recently saying -  

"The housing crisis is now as big a threat to the EU as Russia"

He is right to include almost the entire continent of western Europe. Renters now find that virtually half their incomes are routinely swallowed up by rent. Year on year increases are now routinely 10% or more resulting in many having to live in ever more cramped conditions and increasing the number of homeless. It is also having an increasingly vocal move towards political disenfranchisement in the continent and away from established political parties towards those fuelling the far-right.

Not everyone is suffering, of course. The housing crisis is lining the pockets of a small number of individuals and institutions who moved in a big way from more traditional investments to housing. Major financial institutions such as banks, insurance companies, pension funds and other mega financial groups have been pouring more and more of their investment cash into property since the 2008 financial crisis. Whereas these investments accounted for US$385 billion in 2008, by 2023 that had risen to $1.7 trillion. So all those who almost brought the world to its knees in the 2008 financial crisis and not one of whom has gone to jail are now on another financial rampage, this time controlling the homes many of us live in. In Vienna 42% of all new private rental homes are in the hands of institutional investors.

One of the Observer articles ends -

"In the coming years, housing will occupy centre stage in European politics. As investors have come to dominate, so the power of residents has been systematically undermined. We are left with a crisis of inconceivable proportions . . . Now is the time for fundamental structural changes that reclaim homes from the jaws of finance, re-empower residents and reinstate housing as a core priority for public provision."

https://www.theguardian.com/commentisfree/2025/jul/07/europe-financial-sector-house-prices-politics

[sydneyboy1]

This is an international issue. Australia has an identical problem. Young people cannot afford to buy and rents are increasing astronomically making saving for the deposit on a home impossible. 

[TheBossBabyback]

26 minutes ago, sydneyboy1 said:

This is an international issue. Australia has an identical problem. Young people cannot afford to buy and rents are increasing astronomically making saving for the deposit on a home impossible. 

What's wild is that. Australia is effectively empty development wise. There is an abundance of space so it really shows the faults of capitalism that artificial supply shortages are causing increased demand. Same for most of the US as well, specifically California which could build up into the sky by zoning regulations, protected by NIMBY owners, is causing chaos. 

[msclelovr]

2 hours ago, TheBossBabyback said:

Australia is effectively empty development wise.

This made me laugh. Perhaps you haven’t visited and spent much time in Australia?
 

I like the country very much and visit every year. When others ask me about it, I always describe it as the most heavily urbanised nation on earth with almost all the population confined to a few coastal cities and towns. 

2 hours ago, TheBossBabyback said:

Same for most of the US….specifically California which could build up into the sky

You may not have noticed the wild fires in recent years but are you aware of the earthquakes? In the years I lived in San Francisco, I experienced two significant ‘quakes….I was glad I lived in a house and not a high-rise. 

[PeterRS]

I love Sydney and visited regularly on business and to stay with friends around 15 times, usually around the Christmas/New Year period. Thankfully I was never involved in the bush fires.

But I was at a meeting in Pacific Grove CA on the afternoon of 1 October 1989 when the magnitude 6.9 quake occurred in the Santa Cruz mountains only around 30 miles away. It awas the largest to strike the San Franscisco area since that of 1906. The quake was quite frightening, but as much for the aftershocks as the event itself.

[TheBossBabyback]

On 7/27/2025 at 12:46 AM, msclelovr said:

This made me laugh. Perhaps you haven’t visited and spent much time in Australia?
 

I like the country very much and visit every year. When others ask me about it, I always describe it as the most heavily urbanised nation on earth with almost all the population confined to a few coastal cities and towns. 

You may not have noticed the wild fires in recent years but are you aware of the earthquakes? In the years I lived in San Francisco, I experienced two significant ‘quakes….I was glad I lived in a house and not a high-rise. 

One, visited Australia. The nation is primarily empty. There is plenty of room for growth. Suburban sprawl can and should be replaced with more mixed used housing to meet their housing demands. But their issue isn't space. 

 

 

LA has tall buildings and the means to build upon the sediment at the base of the city. As they've been doing for over 200 years. Pretending that LA can't build up is foolishness. There is no reason for a city of this size and with much demand for affordable housing to retain zoning laws that restrict so many areas from turning single family homes into multi-unit dwellings. Even if 3 or 4 flat buildings became more of the norm, it would be a marked improvement. But pretending LA can't build up because of earthquakes, as a person that claims to have lived in LA, is an interesting statement. 

Here are the buildings currently standing, despite earthquakes. Please tell us how each is just one more shake away from toppling over. 

Most of the city isn't like Downtown LA and may never reach this point. But allowing the zoning laws to grant more variety in building options is the answer. Tear down more of the single family plots for 2-3 story apartments would help alleviate their housing issue. Building more 20-60 story apartment buildings would also help. LA has a long history of managing their earthquake problem. It's the NIMBY folks that are creating unnecessary housing shortages. 

[PeterRS]

8 hours ago, TheBossBabyback said:

One, visited Australia. The nation is primarily empty. There is plenty of room for growth. Suburban sprawl can and should be replaced with more mixed used housing to meet their housing demands. But their issue isn't space. 

LA has tall buildings and the means to build upon the sediment at the base of the city. As they've been doing for over 200 years. Pretending that LA can't build up is foolishness. There is no reason for a city of this size and with much demand for affordable housing to retain zoning laws that restrict so many areas from turning single family homes into multi-unit dwellings. Even if 3 or 4 flat buildings became more of the norm, it would be a marked improvement. But pretending LA can't build up because of earthquakes, as a person that claims to have lived in LA, is an interesting statement. 

Here are the buildings currently standing, despite earthquakes. Please tell us how each is just one more shake away from toppling over. 

Several times I visited friends who lived in Pasadena for 20 years in the 1980s and 1990s. I know the LA area has had quite a number of earthquakes - but no major one has hit down town. Since those skyscrapers were built, construction in earthquake zones has advanced considerably. You only have to look at Tokyo where there are earthquakes under the city virtually every 6 weeks or so (yes, I did live there and I did experience them). Or in Taipei where Taipei 101 was until quite recently the tallest buiding in the world. And Taiwan lies on a major earthquake zone. I have experienced at least six quakes there - some jerking, some plain rumbling. 

As this LA Times article points out, the worst quake was the one at Sylmar (better known as the San Fernando quake) on February 9, 1971. Although this caused death and destruction - 2 hospitals flattened, elevated highways destroyed and many low rise homes suffering damage - their construction had been mostly rigid concrete. Apart from City Hall, the city regulations had forbidden any building over 13 stories until they were repealed in 1966. Up popped the group we now regard as the centre of the city.

The problem for LA, though, was less the effect on the skyscrapers than that on the surrounding countryside. "The top of the earthen Lower Van Norman Dam melted into the reservoir. No one knows exactly what kept the dam near Granada Hills from collapsing," said the article in the Times. Had it done so, that 1971 quake could have resulted in vastly more damage and become "many times over" the most deadly in US history. Scientists still wonder if the quake had lasted just a few seconds longer, could the dam have withstood the shaking? The state geologist reckons over 100,000 would have been killed.

Following that quake, some high rises were retrofitted to make them more earthquake proof. But far from all. In 2013 the Mayor gave a 30 year deadline for retrofitting to be completed. 30 years? So some buildings could still be in their original state 54 years after the Sylmar quake! What devastation might occur before 2043? And let's never forget. That 1971 quake was only a 6.6 magnitude quake. The Tohoku earthquke off Japan in 2011 was between 9.00 and 9.1 magnitude. Would present day Los Angeles survive anything anywhere close to that. I very sincerely doubt it.

My point is that LA is not a good example for earthquake-proof construction of high rise buildings. Tokyo and Taipei are far better examples. Yet as @TheBossBabyback points out, integrated medium-high rises could be an answer to the housing problem, but for one thing - cost. Who is going to pay their construction and maintenance for what would be much more expensive housing? 

https://www.latimes.com/california/story/2021-02-09/50-years-ago-1971-sylmar-earthquake-shook-la

[floridarob]

8 hours ago, TheBossBabyback said:

LA has a long history of managing their earthquake problem.

Have you never seen this movie  😳

 

 

[PeterRS]

So far it seems that the faults under the Pacific are more serious than those under the west coast of the USA. In the last 21 years we've had the giant 9.2-9.3 eathquake off Indonesia which resulted in the horrific Indian Ocean tsunami in 2004, the devastating 9-9.1 Tohoku earthquake and tsunami in 2011, and now the 8.8 quake off eastern Russia. The biggest California quake in the last 40 years was just 7.4. I wonder how the state, and LA in particular, would cope with one closer to 9. The devastation would I suspect be utterly disastrous.