The Toilet Paper Shortage is Real but the Housing Shortage is Not
- Chris La Farge
- Apr 13, 2020
- 4 min read
For several years, the media has hyped a housing shortage that does not exist. This false narrative stands in contrast to the real shortage of toilet paper we're seeing.
Let's Review
Two years ago on May 29, 2018, this blog published its second post, "Don’t Believe the Hype: There’s No Housing Shortage." It argued that news stories fretting about Southern California's alleged housing "shortage" and housing "crisis" were false alarms and nothing more than devices used by developers to justify building denser residential projects. Not unexpectedly, many of these same profit-driven developers resist local inclusionary housing ordinances. Similarly, Sacramento politicians also use this hyped fiction to justify stripping zoning controls on density out of the hands of cities and counties.
As far as the rise in the prices of homes, the post Great Recession economic recovery was responsible for the rebound in the Southern California housing market. Home prices merely returned to their pre-Recession highs.
Specifically, the drop in LA County unemployment was associated with a rise in the median price of single family residences. That post ended with data showing that the real housing shortage is for affordable units. At the time, one estimate was that Southern California was about 800,000 affordable housing units short of what was needed. While more affordable units have come online in the last two years, we're still many thousands of units short.
The final analysis still holds true for housing in SoCal: If one has cash for a down payment and is high income, there is no shortage. Units are available for purchase by that fortunate individual. On the other hand, a low-income person who applies for Section 8 or affordable housing will be waiting a long time to get that rental assistance or affordable unit. That's because there is a shortage of affordable housing.
In that post, I noted that 256 homes were available to purchase and 25 units available to rent on Realtor.com in May 2018. Now, that same website lists 234 homes available to purchase and 62 for rent in Whittier. This is for just one small city in the largest metropolitan area in the nation. The inventory is there. So people with money can obtain housing at market rates.
What is a Shortage?
The previous analysis started with a definition and description of features:
According to Investopedia, a shortage is defined “as a situation in which demand for a good or service exceeds the available supply. Possible causes of a shortage include miscalculation of demand by a company producing a good or service, resulting in the inability to keep up with demand, or government policies such as price fixing or rationing. Natural disasters that devastate the physical landscape of a region can also cause shortages of such essential products as food and housing, also leading to higher prices of those goods.”
There have been shortages of goods in various countries throughout history, including our country. A recent example are the long lines of customers that form outside of major retailers each Black Friday. People line up in order to get their hands on a limited number of deeply discounted products.
The Great Toilet Paper Shortage
On Wednesday March 11th, the World Health Organization declared the novel coronavirus outbreak a pandemic. This virus causes the deadly COVID-19 respiratory disease which has officially killed over 100,000 people since January.
Also on March 11th, professional basketball player Rudy Gobert of the NBA's Utah Jazz tested positive for the novel coronavirus. Exercising an abundance of caution to stop the spread amongst its players, coaches, and fans, the NBA suspended its 2019 - 2020 season. This pivotal event marked a turning point from the old reality to our new reality of COVID-19. By that time, many people had begun panicking about this virus pandemic.
Many rushed to Target, Costco, Ralph's, Vons, Stater Brothers, and other stores across this country and purchased all the toilet paper they could. More people followed suit and bought up new stocks. This hoarding has continued for weeks. As a result, very few stores have toilet paper and most of the big stores have been without for at least a month and counting. Empty shelves are now a common sight.
Early in this shortage, we saw social media posts about it. One person thanked the caring anonymous friend who left two four-roll packs of toilet paper on their doorstep, like a Christmas gift left by Santa Claus. There was a guy who joyfully posted about the delivery of his case of janitorial branded rolls (that he ordered on ebay). These are desperate times and they call for desperate measures.
Even Amazon is out of the leading name brands like Charmin, Quilted Northern, and Angel Soft. Quilted Northern's website is out of stock. Although Walmart appears to have Angel Soft in stock.
While simply a commodity, toilet paper is a good we depend on. Unfortunately, we are witnessing how real the shortage is. But you don't need a blog to tell you about it. You are seeing it and living it.
The good news is there are signs the toilet paper shortage may be ending, as one recent post reported that the La Habra Costco has some in stock now. Relief is in sight. On the other hand, don't believe the hype about the "housing shortage" because that's another story.
For more information on the toilet paper shortage please read How a global pandemic led to a toilet paper shortage — and when it gets better.
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