As much as the title "doesn't work" is true, it's also just a choice between two things: either you have market rents in a city and you accept that only rich people live there.
Or you have rents controlled and a black market, long queues etc - but you have some chance of not gentrifying the city entirely. Neither of these is attractive. Neither really "works".
While there could be an effect on construction, the area where there is a lack of supply is central Stockholm, which is also of course an area where you can't possible build any significant number of new houses because there simply isn't any land.
Market rents could be a very good idea in some smaller cities where there is a shortage of supply because rents are controlled at a too low level, but at the same time there is land available to build on. In central Stockholm, one could remove the queue over night if rents tripled - but it wouldn't create any supply and therefore not address the underlying problem.
There is a third option in which we have market rate prices and don't dramatically restrict the ability to add new housing.
And I don't believe that is impossible to build more housing in Stockholm. It has a population density of 400 people/km^2. To put that in perspective, Chicago (in the US) has a population density of 4000 people/km^2. And Chicago (outside of a central business district which is very dense) is not some dystopian megalopolis. It is mostly neighborhoods of single-family homes and small apartment buildings. Seoul, SK has a population density four times higher than that at ~16000 people/km^2. Paris is even denser at 20000 people/km^2.
The 400 figure (or even 350) is for the “metro area”, but while metro might sound like city, it’s not. That’s a huge area with large swaths of rural land. There are large municipalities with under 30ppl/sq km which lie inside the metro area. This scenery is pretty typical: (try to streetview-walk to city hall…)
The confusion is probably because the “greater Stockholm” and “Stockholm metro area” were defined to be synonymous.
So greater stockholm isn’t even a city + suburbia, it’s downright rural for the most part (which is of course evident by the 400 number). Next to me is a 20sq km national park forest, for example.
The density in Stockholm city proper is 4-5000 per square km which is pretty typical. It’s simply surrounded by a massive area of very low density which is still called the metro area.
Also what areas are included in such density measures? Buildable land or also including e.g. water? if you consider the amount of area consisting of water in central Stockholm, the density per land square km must be quite high if it’s the overall density that is 4-5000/sq.km
Dramatically increasing the density in the city itself would require building tall buildings in what is currently (most likely) green space in the city. That’s not possible for the foreseeable future. There are a few highrises popping up on former industrial land in central locations, but it’s not going to make a big difference.
There is no problem building housing in the largely rural Stockholm metro area, but far from the city there isn’t much demand either.
I’m not saying there isn’t a lack of construction - but the areas where there is both demand and space aren’t as large as one might think just because the density overall is low.
My mistake, the 400 number is not correct as you point out. Still, even at 5km per km^2 it is one quarter the density of Seoul and one fifth the density of Paris. I've never personally been to Seoul but Paris still seems to have plenty of green spaces.
I don't doubt for a second that building a lot more housing is not possible for the foreseeable future but like in most places that is a political problem and not some fundamental constraint. And rent controls don't "solve" the basic imbalance between people wanting to live in a place and there not being enough housing for all of them in any meaningful sense. You are still rationing one way or another. When there are fixed supply constraints then maybe that is a more just way to do it, but when the supply constraints are artificial then it just entrenches a bad equilibrium.
I guess I don't understand why having only rich people live in the most desirable areas "doesn't work." Nobody seems to think that it's an injustice that poor people don't get to have houses on the beach, so why is it a big deal that they have to live in the suburbs and rich people get downtown?
To set the scene, "poor" means middle class and below, but not quite rich enough, to be able to get a mortgage. Or facing any other obstables to a mortgage such as career stability or being self-employed.
I think typically "poor" people move in when the prices are just about affordable in the area. There they settle, have families, have their friends, support network, schools, jobs, community, etc. It all seems very reasonable.
And then the rents go up, and up, and up, and up... faster than income.
So they are forced to move away to a new place where they don't know anybody and have no connections.
They settle down in the new place. Children go to a new school. Community programs are scrapped in the old place and re-founded in the new place. Keep in touch with old friends by phone, but in-person friends have to be made anew. Do it all over again. Get really settled in. And then the rents in the new place go up, and up, and up, and up... faster than income again.
So they are forced to move again.
I think there's a fair moral argument for it being an injustice that "poor" people are not able to settle in any area except the most deprived areas where it's possible to project will stay deprived for decades to come.
There's always a substantial chance that wherever they land, if it's a reasonable place that they can afford, conditions will change, and they will be gradually squeezed until they are priced out and forced to reset their lives again somewhere else.
Being able to settle long-term in some reasonable place is arguably a significant moral imperative in the design of society. This is one of many possible metrics for evaluating what "works" or "doesn't work".
And almost everyone's income drops a lot when they become elderly. Stability of place is really important for the elderly. It's sad when they have to leave to a place where they have nobody.
I don’t necessarily think it’s a “right” to live in attractive areas, but I do see the point of having all kinds of people in a city.
My point was merely this: housing politics isn’t simply solving an economics/allocation/optimization problem. It’s also the sociological problem of creating a city.
While there could be an effect on construction, the area where there is a lack of supply is central Stockholm, which is also of course an area where you can't possible build any significant number of new houses because there simply isn't any land.
Market rents could be a very good idea in some smaller cities where there is a shortage of supply because rents are controlled at a too low level, but at the same time there is land available to build on. In central Stockholm, one could remove the queue over night if rents tripled - but it wouldn't create any supply and therefore not address the underlying problem.