Impacts of AI on the housing markets

post by PottedRosePetal · 2023-10-05T21:24:03.045Z · LW · GW · 0 comments

Contents

  Introduction
  The Destination
  Where We Are
  How do we get there
  Conclusion
None
No comments

Introduction

First of all, some disclaimers. 

This is all my opinion. I did not research this topic a lot, especially since I feel like it would always be inadequate and I simply do not have the time to do it properly. It is a very complex topic. It is no financial advice, it is no advice to do anything at all. 

The reason I talk about this is that I feel like this is not talked about at all, and it seems like a very obscure field. Initially I wanted to ask about the general opinion on this matter, but the more I thought about it, the less I saw many alternatives the the scenario below for housing. But this is my world view, which almost certainly is lacking, and in the spirit of the forum name I want to correct it. 

Unrelated to the post topic, this is my first post here and while I did read HPMOR and started with the sequences and lurked for some time, I still might not get it all right. I would love some feedback if you notice some parts where I argue badly. 

I am no expert in well... anything. I have some insights into AI development, I have little insights into the housing market. My personal view based on some sources such as this or other leaks, which results in very aggressive timelines compared to some stuff I have read here before (for example this [LW · GW]).   [LW · GW]

I think we will get public AGI (OpenAIs definition of it) in under 5 years with a very high probability, with a high probability in under 2 years. Similarly I think we will get embodiment AGI in 5 to 10 years. 

While this might be up to debate, its not the point of this scenario, which should also be independent of how long those timelines are - albeit with longer timelines introducing more potential disruptions. I will also assume that all AIs in this scenario are successfully aligned and work to do good in general. 

About the housing market I think it is artificially inflated to keep prices high due to many people profiting from it. The reasons are complex, I do not claim to know all them. I am unsure about how this will develop, which is the biggest uncertainty in this whole scenario. The market could completely collapse "2008 style" in a few months for all I know. I will try to keep my scenario independent of this, but I dont think I will manage to do so completely.

 

The Destination

So, first of all, what will the housing market look like in the far future. This is probably the easiest yet hardest part to predict. I think there will be massively cheap houses, given some robotic advancements. Robots will be able to build basically anything out of anything and make it livable. Humans will have no place in the whole process except moving into the house.

In this case there are a few options to how to fiannce that new house. 

1. Similar to what it is like today, the humans will simply pay a fee to pay for construction materials, the land and the runtime of the robot - whatever that might look like, it should be fairly cheap as locality in that new world would also not be as important due to advancements in AR, VR and transportation improvements. 
2. Some sort of UBI will be introduced, that allows for a free new house either every x years (depending on the average lifespan of humans at that time as well as build quality) or a free new house per person. I think thats a sensible UBI implementation, but it remains to be seen.
3. Housing markets will forever stay dystopian, the technology does not take off or just increases margins for companies. In this case not much would change. I think this is unlikely, but it has to be mentioned for completeness sake. It is not impossible, but I do think it is very improbable if we assume an AI takeoff.

In this world, many features such as solar panel roofs and battery walls could be added quite easily to the house. There could also be tech that absorbs CO2 somehow, either through "living houses" or by simply binding it in wood or something with higher density of CO2. 

 

Where We Are

Next it might make sense to look at where we are right now. We already do have certain robots capable of building houses which already shows how the future might look like. It is uncertain though, as the future of concrete, 3D printing and robotics are quite uncertain. I do not know which of those is the most promising and will be the final winner so to speak. 

Housing market seems to be inflated in the whole western world as far as I can see. I do not know about South Korea, China or Japan, to name some bigger Asian countries, but I feel like that is true for Europe, Australia and America. Germany for example is slowly declining in population in those parts of the world due to the deaths of the baby boomer generation, but that does not quite get reflected in terms of housing prices. Other countries have other complex reasons, but in general we do not see a lack of space. People are also not getting any richer in general, at least not enough to justify the housing price increase.

This can have many reasons. While this could be analyzed in depth, I am not qualified to do so, and so far most data I have seen on this topic seems to suggest a certain disparity between any inflation, wage or urban movement factors and the price increases. I will assume this to be the case, but I do welcome anyone who can provide an analysis on why the prices truly increase. 

This suggests some sort of malicious influence on the market, which I will just assume to slow down any development towards our destination. As most of the population is suffering from these prices and governments at least overtly try to fight this issue, I do not see this influence completely stopping any movement towards a better future in that direction though. 

 

How do we get there

This is heavily influenced by local arrangements. In my area there are lots and lots of very small companies (i.e. <50 people) that do work related to building houses, such as electricians, carpenters or roofers. 

This has some effects on firstly the long term vision of the company bosses, as they often lack the kind of business perspective seen in CEOs of big companies, which might lead to slower adoption speed of expensive new equipment or methodologies. This can already be seen in terms of labor conditions, as this sector severely lacks workers, yet that area often fails to improve bad labor conditions (such as forcing worktimes starting at 6 am for no reason) that are easily fixable. 

This kind of company also struggles more with expensive machines in the range of 100k bucks (whatever the local currency is, lets assume something similar to the Euro or Dollar). While that is affordable, it has to be a well thought out decision and will not be tried on a whim. 

Both of those factors make it unlikely for this field to adapt fast enough to prevent a takeover in my opinion. At this point it almost does not matter if some AI formed company somehow manages to start a business that builds whole houses efficiently or if a person does it, but it will probably result in some big companies taking over the whole process. Short term the jobs mentioned above seem to be pretty safe, but long term they will be lost like all others in the wake of AGI. 

There might be ways to survive some time for those smaller companies, such as buying those machines themselves and busying the workers by letting them drive and oversee the machines while they do the jobs the workers would normally do - just faster and better. But that would be economically pointless, as oversight would probably not be required for long and simply driving the machine somewhere and getting it back at the end of the day would make more sense - until self-driving is a thing.

 

Conclusion

There are a few factors I struggle to estimate which might change the speed of this scenario. Firstly there is the malicious force that seems to influence the housing market right now, then there is the compentence of smaller business owners which might slow adoption in the wake of extremely fast technological advances. Another two reasons could be legislature and logistics. Those two could even bring the whole scenario to a halt, as a global supply chain collapse would obviously also halt robot development as well as building new houses. Legislature could also somehow outlaw those robots in order to protect jobs or due to some accidents early on in usage of those robots. But I do not think the destination is all that far away. 

Please let me know if you think I am wrong somewhere and how you think the housing market will develop in the face of AI. This area honestly feels like a blindspot to me, I can kind of predict what work might look like, what cars might look like, but houses? Very unsure. 

I look foward to your views on this!

0 comments

Comments sorted by top scores.