Why the myth persists
The intuition behind the myth is understandable. New developments often arrive in areas that are already improving — better cafes, better transport links, rising demand. Prices go up around the same time as new buildings appear, so people assume one caused the other.
But this confuses correlation with causation. The neighbourhood was already attracting investment. The new homes didn't cause the price rise — the underlying demand did. And crucially, without those new homes, prices would have risen even faster.
A comprehensive synthesis of the latest rigorous evidence concluded that increases in housing supply lead to decreases in city-wide rents and slow rent growth in surrounding neighbourhoods. The review also found no evidence that new supply causes elevated displacement of lower-income households — one of the central fears behind opposition to new development.
Using weather-shock delays in housing completions as a natural experiment, researchers found that a 1% increase in new housing supply lowers average rents by 0.19%. Crucially, the effect was equally strong in high-demand markets, and lower-quality units saw equivalent rent reductions — disproving the idea that only luxury renters benefit from new supply.
Studying new market-rate apartment buildings across 11 major US cities, researchers found that new buildings decrease nearby rents by 5 to 7% relative to locations slightly farther away or developed later. Their conclusion: new buildings slow local rent increases rather than initiate or accelerate them.
An LSE study of eight Barratt residential developments in the UK found no evidence of longer-term negative impacts on surrounding house prices. Where prices fell during construction, they recovered after completion. In stable and rising markets, new development appeared to stabilise or even increase nearby values.
The amount by which Auckland's rents are lower today than they would have been without the city's 2016 upzoning reform. Auckland made it legal to build on 75% of its residential land, housing construction surged by 50%, and rents grew by just 22% over eight years — compared to 34% nationally. No rent controls. No subsidies. Just more homes.
What about gentrification?
The most serious version of this objection is about gentrification: that new development signals a neighbourhood is "up and coming," attracting wealthier residents who drive up rents and displace existing communities.
The research consistently finds that new supply does not cause elevated rates of displacement. The alternative — preventing new housing — simply concentrates displacement pressure elsewhere as wealthier renters compete for the limited housing stock. Blocking development does not protect existing residents. It just moves the problem next door.
Where we stand
The evidence is clear and consistent: building more homes moderates prices, at city-wide and neighbourhood level. The claim that new builds raise prices is a myth that, left unchallenged, prevents the homes Glasgow desperately needs from being built. YIMBY Glasgow endorses the planning reforms that would allow more homes to be built across the city — because the evidence shows this is the most effective way to bring down rents, widen choices, and end the housing emergency.
The Glasgow picture
Glasgow has declared a housing emergency. The city is missing tens of thousands of homes. In this context, the risk is not that we build too much — it is that opposition to new development, rooted in the myth that building raises prices, prevents us from building anything at all. The cities with the most affordable housing are the ones that have built consistently. The ones with the least affordable housing are the ones that stopped.