Housing sales are down 14% year-on-year in Finland.
While the population is only around 5.6 million in total, there are thousands upon thousands of unsold new apartments, older housing isn't selling, and outer-regional housing lays empty. This is because even though many are moving into the cities, population growth is well below replacement level, and immigration (the only thing keeping the growth positive) is low. And of course, many will say good, immigration should be low, because immigrants cause problems, but so too does falling value of housing for those whose largest investment and asset, is their house.
In Australia where there is a problem with not enough housing due to immigration, there has been calls for years to curb the influx. Housing crisis is only part of that reasoning and narrative of course, but let's put that aside for the time being at least. I wonder though, for all of those who have bought in the last decade or so and especially since Covid restrictions exploded housing prices for numerous reasons, would they want immigration to fall so those who want to get into the housing market can, even if it means that the house they bought at an inflated price can no longer come close to selling for enough to cover their inflated mortgage?
The problem with the economy currently, is that it isn't designed to spread wealth even close to evenly. Instead, it is designed to concentrate wealth in a smaller and smaller circle of hands. And those few hands are helping hands, helping each other to help themselves to the value of other to concentrate the wealth further. This means that at wealth can be high at country level, but the mean population is losing wealth, and in some cases, hand over fist.
For many decades home ownership was recommended and still is, but if it depends on immigration alone to keep prices stable and above or at par with inflation rates, it is always going to fail. Because immigration at the level required for most western countries is going to fail, because there just aren't enough adequate jobs for immigrants to do that would allow them to enter into the housing market anyway. Most of the foreigners I know in Finland do not own their home and are instead renting, mostly due to the jobs available or the uncertainty of the job market. This is good for the investors, but not for the owners in Finland, because the owners can only really sell to Finns then, and that is a reducing pool of people.
Of course, if there was true parity between Finn and foreigner, jobs were available and the job market wasn't skewed, then the pool of potential buyers increases significantly, and the spread of where buyers buy would also shift. Foreigners tend to end up in "foreign suburbs" because that is where it is cheapest to live. But in my experience, even as a renter I was being pushed toward those suburbs by rental agents, as they wouldn't even consider me for a rental apartment in the city. I ended up getting one only because I got to talk to the owner of an apartment directly, and she liked me. And of course, some groups of foreigners might feel more comfortable in a foreign suburb, if they feel themselves discriminated against and can't accept it. For me, I don't give a crap, other than at the practical level of my life. Discrimination has been a constant.
Economically though, I wonder how many homeowners consider the value of their homes when making decisions on immigration. For example, 70-75% of trump voters are homeowners (higher than the national average), which makes sense since nearly 80% of Trump supporters in the last election (the lowest share so far [88% was the highest]) were non-Hispanic white. They were also more likely to be situated in suburban or rural areas, where home ownership is higher. Perhaps though, because of this they aren't as affected by immigration, since a lot of immigrants are going to look for jobs in urban areas.
In Finland, the foreign-born percentage crossed the 10% threshold this year, with almost 12% foreign-born or born to foreigners. However, while anti-immigration sentiment has reared its head in the last two decades, it really has been about the look of people, not their foreign status. Because the largest immigrant groups in Finland are people from former USSR, Sweden and Estonia. They blend right in, and have been here for decades. Those that don't blend in visually are the problem and, they are also the ones who are more likely to face employment discrimination, as well as location discrimination.
I am not pro immigration.
Despite being an immigrant, I am not pro immigration at all. Rather, I am more pragmatic and look at the needs of a country at an economic and social level, because ultimately that is what is going to make or break a population. And, I don't care much about what languages people speak for work, as long as there is a common tongue for communication. This means that someone needn't learn Finnish first in order to work, if people in the workplace they need to communicate with can speak together. However, I quite strongly believe that foreigners who come into a country have to add value to the economy and community as best they can, and should hold themselves to a very high standard. Earn your place in a community through behaviour. Bring and build skill, and prove worth. Value isn't innate, it has to be demonstrated.
More than the value of housing is affected by population, because there is a demand and supply ecosystem and when demand falls, supply is going to struggle to make ends meet. This means that there is economic contraction, but it will inevitably lead to social contraction and degradation also, as opportunities for everyone decrease, even while those few hands keep extracting an increasing amount. And because of this last fact, the indication of how bad things truly are will lag, because the initial numbers will give the impression that everything is okay on average, as that average is skewed by the few with a lot. For instance, the average salary in the US is around 85K a year, but the median salary is closer to 50K a year. That is a significant difference, isn't it? That means that half the population earns about 40% less than the average.
What do you imagine that lower-half demographic looks like?
I get that there are lot of concerns that people have with immigration and the changing culture that they identify with, but I think the focus and energy should be put on the larger issue of wealth distribution, and the fact it is becoming narrower. Because those who make the decisions on resources and immigration, don't care about anything other than their wealth potential increasing, as they are able to buy a better life in a gated suburb of similars anyway. While they might use these public narratives to garner support, what they are actually trying to support is their own wealth maximisation. They don't care about colour, culture or wellbeing - everything is in service to profit and power. Driving these emotional narratives is the most efficient way to service their desires.
You'd think that by now we would have got over arbitrary judgements, but they persist because our own prejudices keep on driving structural and systemic bias that ends up shaping the outcomes in a self-fulfilling prophecy. In order to overcome the hurdles, people have to work twice as hard and even then, are unlikely to be able to overcome the bias of people, because human bias is incredibly persistent, especially when it has been attached to identity. Identity is also incredibly easy to leverage for influence.
Unfortunately, there is no easy solution to all the problems we face, and while it would be far, far easier if we could strip away the identity bias and look at it all with some practical discernment, it is very unlikely that will happen. Instead, people seem destined to become more emotional and use their feelings to inform their behaviours, even if they are invalid, misaligned, and ultimately in service to creating wealth for the few.
People want better, but doing better currently seems beyond us.
Taraz
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