It all comes down the regulatory hurdles. Even land prices are the result of rent-seeking behavior among land-holders due to regulatory impediment.
If California would pass legislation radically limiting regulatory burdens that municipalities and other legislative bodies could pass, this problem would disappear within a year or two.
Well, a bit more than a year or two, pluis its impossible to take out all reg's immediately. Just eliminating rent-control could have devastating political effects.
But even california official economist reports say the situation is harming the state tremendously. There is no debate about what needs to be done. Its just about politics now.
Simply removing regulation is not enough to fix everything. Downtown Los Angeles is a prime example of that. It has been seeing a construction boom in recent year and loosened regulation is probably responsible for part of that boom. However since there is little regulation on the type of housing that is being built, the new construction is all coming in at the top of the market. This is because buying land and building a mid-market apartment building is not much cheaper than buying the land and building a luxury apartment building. The end result is that Downtown Los Angeles is full of luxury apartments with some of the areas highest vacancy rates as landlords are making more money charging high rents at 80-90% occupancy than they would with lower rents at 100% occupancy. Meanwhile these new buildings are replacing much more affordable housing which is pushing lower income renters out of their homes. Eventually those luxury apartments will trickle down to cheaper rent at the bottom of the market, but often times that means forcing a low income family out of their home in a gentrifying neighborhood into a less desirable area that is often farther from amenities the city offers like public transit which objectively make their lives worse.
knowing how bad downtown LA is/was in terms of poverty and crime it's hard for me not to be happy at the gentrification and cleaning up of DTLA. It still has a ways to go but I'd love a safe and clean DTLA. I don't know what the implications are for the poor that get displaced but old DTLA was (and still is) a blight on the city. Of course a solution that some how helps the poor down there would be great but keeping the place a cheap ghetto doesn't seem like the right thing either
You are taking the perspective of someone who is at least middle class. If you were a lower income family and you are pushed from DTLA to Whittier because of gentrification it could have a huge negative impact on your life. A "safe and clean DTLA" would do you no good in that instance.
Also it has now been a few years since DTLA was a "blight" or a "cheap ghetto". Is there a bigger sign of gentrification than Whole Foods[1]?
Most of the construction in DTLA was previously parking lots... I find it hard to believe that mostly vacant parking lots adjacent to a mostly vacant sports stadium is somehow a superior proposition to a sustainable urban fabric than much needed housing.
When was the last time you were in DTLA? There are many new buildings that weren't built in former parking lots and the gentrified area isn't purely centered around LA Live. You can walk 10 minutes south or west of the Staples Center and be in non-gentrified areas but if you walked 30 minutes north it is heavily gentrified.
About 10% vacancy seems to be a healthy amount. If that were over the entire city, and not only in new developments, then people would have much more freedom to move. And then prices would go down.
100% occupancy is bad, because it means the city is not flexible to changing demands. Fill up that new development 100%, and then the next person who needs to come in would need to double up, or bid higher and displace somebody.
That is my big problem with the Planning process, trying to manage growth. It’s slow and brittle to unanticipated changes.
It isn't over the entire city, it is over a small neighborhood within the city. The vacancy rate in that neighborhood was at 12% while the entire city rate was at 4%. That plus the rate being at a 17 year high would seem to indicate a problem. [1]
The whole point of a market is that capital is most incentivized to come alleviate a shortage when prices are highest.
There might be a cogent argument for fully centrally planned housing, but instituting price controls on new market supply when a shortage is at its worst is a staggeringly clueless demand.
And let’s be clear, affordable vs luxury housing is about price controls, not the units themselves. There is nothing physically embedded in the average “luxury” 700sqft unit that makes it worth more than a McMansion in Iowa. Only the supply and demand situation where it’s located. Countertops and dishwashers don’t add +$2000/mo.
Saving for retirement is hard due to the government's inflationary policy. The returns on savings accounts, bonds, or other traditional savings vehicles are untenably low. Thus, every Mom and Pop is thrusted into speculative investments such as the stock market or real state. Small wonder then they seek to protect their home equity. It's largely their only retirement plan.
It's the other way around. A deflationary economy forces the feds to lower interest rates to encourage lending. We've had record breaking low inflation rates for a decade now. A 'healthy' inflation rate would be in the 3.5-4.0% range. Yes, money is supposed to lose value. If it did not no one would spend.
That's nonsense. There's no objectively healthy inflationary rate.
Low interest rates are the key factor in driving demand for borrowing. Low interest rates signal a healthy supply of savings from which to borrow. So, low interest rates naturally match a large supply to a healthy demand. Such a scenario would create a market for investment-led expansion.
High interest rates signal the opposite. Either the supply of available savings is insufficient, or relative demand is high enough to drive out uncompetitive demands for savings.
> It requires cities and counties to develop plans every eight years for new home building in their communities. After more than a year of work and spending nearly $50,000, Foster City had an 87-page housing plan that proposed hundreds of new homes, mapped where they would go and detailed the many ways the city could help make the construction happen. But a crucial element was missing: Foster City was never going to approve all the building called for in the voluminous proposal, Perez said.
Why would a municipality spend $50,000 on a do-nothing report? Instead keep the $50,000 and spend $2.00 on a report that says, "It would be best to do something about housing. Someone should build more houses."
Sure, the law is a failure, but the municipalities that spent that kind of money willy-nilly are just as limited in their success.
To me the most mystifying part is why the city is involved in any of this planning? I find it utterly appalling that the city is planning housing units. What bizarre planned economy, communist system is this? Americans tend to be very pro-market, but as soon as it's about housing we get this bizarre stuff.
Our economy is already highly planned. Particular behaviours are tax advantaged, particular investment in particular industries is centrally planned through government procurement, healthcare prices are controlled through Medicaid/Medicare, almost every corporation heavily practices centralized planning...
The strange part is not that planning happens, its how we are so bad at it when it comes to land ownership.
Any time there's perceived market failure (or suboptimal outcome) in a democracy, voters will try to legislate alternative outcomes. There's nothing bizarre about it, it's been going on for a while now.
And not even cities, but towns of 10,000 have these kinds of issues where there's only so much physical room for them to grow and everyone there asserts the right to a view, so there are height restrictions for buildings. And then they also realize they need people who aren't millionaires to be teachers, waiters, plumbers, lawn care, and so on. And they can't all live in town, so now they live in the next town and commute, leading to traffic problems and a need for regional public transit, and all kinds of really obvious classist side effects.
You either want to live in an aristocratic homogeneous society or you want something quite a bit more diverse and less walled garden than that. And for sure not everyone is in agreement. Hence there's a problem and there's arguing about it.
Producing the report is tied to funding. If they don’t produce the report, then the city is ineligible for certain housing and infrastructure funds from the state or federal governments, or it gets fewer points in its applications for funds.
> Producing the report is tied to funding. If they don’t produce the report, then the city is ineligible for certain housing and infrastructure funds from the state or federal governments, or it gets fewer points in its applications for funds.
That is why I wrote that a report costing $2.00 should have been created. Spending $50,000 on such a report is foolish and an utter waste that occurs when people don't value taxpayer money and don't consider why their public employment position exists.
Judging by the endless thread on Nextdoor with people in my East Bay neighborhood complaining about the “Manhattanization” of their small town, due to 7 units being built on an empty lot, the housing crisis is going to get a lot worse before it gets better.
The “FU, I got mine” attitude is going to choke California. How we got here is a fascinating story, and recommend reading literature on it.
I don’t feel like I’m saying FU at all. My perspective is that I spent over 15 years in a house that I initially took a risk on. I helped build the neighborhood and community and schools that made it a nice place to live. And, now people who didn’t have to do all that work want to live here cheaply. And, they’re trying to use government and political power to force me to give up what I’ve helped build. Why is that fair?
As I’ve said in the past, No one is addressing the demand side of this issue. Make places less attractive, demand goes down, and prices go down. There are huge swaths of the US other than San Francisco that are in dire need of industry and people. Why not encourage companies and people to move to those places?
I believe that the bulk of the problem starts with the companies in CA. Wages clearly aren’t high enough to give workers salaries that allow them to buy properties. Raise wages, and some companies will naturally move elsewhere. Jobs will go with them, and demand will go down.
Also, the elephant in the room is foreign buyers. I looked through SF tax records the other day. I picked a random street, and most of the homes were owned by foreign trusts. Why not try to stop that first?
I’m not sure how one can disagree with my points. So, I’m probably clueless on this issue. Please educate me.
(Clearly, I’ve angered the mob. Please don’t bring torches and pitchforks to my door tonight. I just wanted to get an alternative and unrepresented viewpoint into the discussion.)
This is the exact FU attitude that GP is describing. There is nothing about "building the community" that entitles you to prevent other people from living near you.
They aren't trying to use political power to force you to give up what you've helped build, they are trying to buy land and build homes. It simply isn't ok for people to prevent other from living near the so they can turn their "communities" into elitist social clubs.
Foreign buyers are irrelevant. They wouldn't be getting involved at all if homes in CA weren't so absurdly overpriced.
Wait, did public opinion and political thought change somewhere within the last two decades such that owning property now doesn’t give one rights over that property and rights to shared governance of the incorporated area? Sorry if that comes across as flippant, but it’s a really serious question. I kind of bought this property so that I could enjoy it for at least 30 years. It’s not my fault that it’s appreciated so much. What do you want me to do?
Buying a property gives you the right to your property. It shouldn't give you the right to tell other people who live nearby what to do with theirs (i.e. to tell them not to redevelop it at a higher density if they so choose).
Unfortunately not the case. Ownership of your property gives you an effective fractional ownership interest in your local radius through zoning and community governance. No amount of state law is going to change that. You can keep fighting the issue (and you might have some traction in a decade or two) or move somewhere more accommodating.
You will never have as much power as those property owners without a time machine to 30-40 years ago, and in the unlikely event you become a property owner, it’s against your interests to do anything that devalues your investment (ie increasing supply).
You’re asking rational actors to make irrational decisions. The results are what you’d expect.
Increasing supply doesn't necessarily devalue your investment. When the large single family mansions on 5th Ave in Manhattan were slowly replaced by skyscrapers, the value of their land went up.
state law overrides local law. These battles are not going to be won by exclusionary wealthy communities willingly opening the gates, its going to be done by the state blowing the gates open. See the past year, bills like SB167 (Ability to sue for units denied at planning commision that are zoning/code compliant)sb 166 (making sure cities are up to date with their RHNA targets)and SB35 (bypassing local planning for zoning compliant projects).
It will take years, if not longer, for any challenges to work their way through the courts. By then, the next economic event will occur, driving out non-owners in the Bay Area.
As I mention in a sibling comment, you might see changes in a decade or two, but no sooner.
I am not opposed to efforts related to increasing the housing supply (although I do think it’s a fool’s errand in the Bay Area as demand is insatiable due to the tech industry and foreign money seeking a safe asset store), I’m just describing the uphill climb these endeavors face. It’s hard to fiddle with a core component of the economy (property law).
Yeah, but you don't own that other property. Other people do, and they should be able to do as they please with it, so long as it meets zoning regulations.
I don't think a concept of a fractional ownership exists because, well, it's not yours.
If you really want some guarantee that your immediate radius will meet some sort of standards, it sounds like you'd want to be part of an HOA. I personally would never want to be part of one (who likes being told what to do?) but they could help protect property values from that one neighbor who could be a problem.
Neighborhoods and communities are real things. Noise, dogs, trees, etc. don't respect property lines or zoning regulations. That's the sense in which fractional ownership exists: when you are my neighbor, you necessarily invade my space. But good neighbors look out for each other.
"Everyone should maximize the income from their property up to the limit of law" is a recipe for for having no neighborhoods or communities. It's the usual fallacy of treating people as fungible commodities.
HOAs are terrible, they are inevitably staffed with busybodies. We can agree on that!
I think that’s pretense. Homeowners use zoning primarily to protect property values, not build up communities. The suburb where I live now is incredibly neighborly. There’s also a bar within walking distance and a little corner store. Part of the reason is that lots are tiny (about 1/12 of an acre) and there are few cul de sacs so you actually see people walking their dogs, etc. Today, parking, lot size, traffic management, and other regulations would make it illegal to build something like our neighborhood. The minimum lot size is like 1/4 of an acre in our county! You’re basically obligated to build suburban hellscapes where you can’t even go to a neighbor’s house without getting in a car.
Zoning is not a property right in California Law, and community governance is not purchased through home ownership. Tenants and "live in owners" have the same amounts of votes in the system, 1. What you are describing, the enfranchisement of voters in a political system through land ownership is actually feudalism.
> Zoning is not a property right in California Law
It certainly is in San Francisco at least. Well, probably not literally zoning, but regulations around it make the home owners in an area de facto owners of it in many ways.
I see the current housing crisis as a direct result of this.
If someone is entering your property and enjoying it at the very same time that you are in the throes of enjoyment of your rightful property then you must dial 911 with great haste!
I don't think direct property rights are in question. It's the indirect, or imaginary, rights that have developed afterward, and put into law by established locals to make it difficult to build higher density housing that's up for debate.
I don't know a whole lot about it, but in NYC they have some concept of air rights, i.e. a particular 2D plot of land also has a height limit, and somehow those can be changed by buying up two plots and adding them together. And then most everywhere is the idea of "I have a right to this particular view in that direction, and maybe also this other direction over here, you can't build a building to block that view unless you compensate me - oh but wait no I don't want to be compensated actually, I want to just be able to prevent you from building anything."
So at one time people resolved such a dispute with bribes, or threats, or murder. And then later on it was resolved with bribes and elections, where only land owners had the right to vote so renters couldn't just come in and change all the rules. Today renters can vote, and basically if your town has more politically involved renters than owners, they can change the building codes, and get more high density housing built or whatever.
Anyway, it could be worse: no one wants to live there and it depreciates.
I don't see what the problem is. You think that if your neighbors are replaced by luxury condos that your house being one of the few single family homes on the block is going to go down in price?
Like, do you think if they bulldozed Manhattan to a big lawn that would make the price of the brownstones and single family homes actually worth more?
Your house would be millions more if your neighbors were allowed to develop to build market rate housing. People want the price per unit to go down by building more density. That means each lot will be worth more since you can replace it with more units. You own a home that's on a lot. You win financially if people are allowed to build. Think about how much a developer would offer you or your kids for your home after you don't need it if they're allowed to actually build. You'd be leaving your kids a fortune.
the problem is (1) all these old folks want to drive everywhere and fear the increase in traffic and change in their lifestyle and (2) fear the loss of exclusivity of their neighborhood when one can buy a condo for less than a SFH. IMO these concerns shouldn't inform policy.
> I kind of bought this property so that I could enjoy it for at least 30 years.
If what happens on the properties around you is critical to your enjoyment of your property, you should have bought them too.
You can't go to a fancy restaurant, order a salad, and expect to get a steak for free because it's necessary for you to properly enjoy the salad. If you really want a steak, you're going to have to pay for the steak.
I can go to a fancy restaurant and have the expectation that the person at the next table isn’t screaming at the top of their lungs and vomiting on the floor.
The restaurant example is actually perfect because a big part of what you pay for in a restaurant is not just the food. It is the service and ambience.
Edit:
My home price is based on access to the subways. I don’t own the subways. We happen to live in a system where the subways are run by the government, not privately owned. But regardless, I would do everything in my power to make sure the subways stay as good as possible, partly because I use them myself all the time, and partly because my home value is tied to them.
We aren’t talking about people screaming at the top of their lungs and vomiting on the floor, but simply existing in homes.
This is demanding that the restaurant leave perfectly good floor area clear and let a line form around the block, because more tables would ruin its quiet ambiance.
I’m really not an elitist person, so that’s a painful representation.
But, anyway, I’m willing to change my opinion. Just argue your case more persuasively. How is adding more supply going to fix this?
For example, if on any given day 20 people want to buy in my neighborhood (just guessing), how much supply would have to be built to even reduce prices? Seems like it would have to be massive. How do you prevent over-supply from being built? How do you ensure that the housing is of suitable quality?
By the way, I’m not the type of person that would oppose denser development. I just would prefer it be built slowly, in a controlled manner only because I’ve witnessed first hand developers destroying areas for quick profits.
For example, a friend recently visited and used airbnb to lodge at one of those newish buildings on 9th street. The building looks great on the outside. But, inside, the units looked and felt like what I imagine Soviet block style buildings would be like.
The reason prices are so high in the area you live is that so few people want to leave, so the available housing is a tiny percentage of the total housing that is being bid on, compounded by the fact that you can rent out your house for 4x you’re mortgage, so why sell? Adding more housing alleviates that pressure significantly.
It’s been years and next to nothing has been built in the vast majority of the Bay Area - housing has decreased in some parts. It’s not a rapid development concern, it’s a no development concern.
Adding supply helps because we now have a situation in California where there are many more jobs than homes for people to live. Conservatives keep saying people should work hard, right? Then they need to move where there are jobs. Liberals keep saying people should have access to dignity and a social safety net, right? Then they need to move where there is a friendly political climate and a robust economy to support that safety net. Being a “sanctuary state” is no good when refugees can’t afford to live here.
The big debate is over how to increase supply. The number of homes is increasing, but it is increasing much too slowly. That’s why even with visible construction, prices still increase. But even a slow increase of luxury homes helps, slightly, because every rich person buying a luxury home is a rich person not outbidding a middle-class family for a run-down hovel.
> 20 people want to buy in my neighborhood, how much supply would have to be built to even reduce prices?
It’s a region-wide market. But on a simple level, yes, you’d need 20 homes to stabilize prices. That seems more humane to me than forcing people to double-up or live in tents.
> How do you prevent over-supply from being built?
You don’t. You need like 10% vacancy, ± some amount, to have a healthy amount of wiggle room for people to move, in case they get a baby or need to fumigate the house or something.
In practice, developers have teams of economists working to make sure they don’t build too much. If the local government makes development excessively difficult and expensive, then they will develop only a limited supply of luxury apartments, unless they get some subsidy. If the local government makes development easy, then they will make profits building for the vast middle class. We should make developer profit margins align with what we need as a society.
> How do you ensure that the housing is of suitable quality?
Competition and building codes. That’s how we ensure suitable quality for everything else.
Note that building codes necessarily mean marginal housing is excluded, so they need to be balanced with our ability to subsidize. Otherwise, you end up with luxury housing in a sea of tents.
We should also be much more willing to destroy existing homes. This urge to preserve the exterior of every existing home is destroying the fabric of society. I call that, “The literal façade of neighborhood character destroying the neighborhood’s character.”
> I’ve witnessed first hand developers destroying areas for quick profits.
So we need to make competition easier. Experience has shown that trying to control the process in a central government manner just tilts the playing field in favor of huge well-connected firms that can absorb the overhead of dealing with endless processes, and disenfranchises small local developers.
I strongly disagree with restricting the process to build slowly. We have had 50 years of building slowly when we should have been building quickly. Some places should build slowly, but when the economy is changing, then building quickly should be possible.
First, thanks for the depth of your response. A little effort goes a long way. And, the links help, in particular.
I am still skeptical of some points (the NYC article, for example seems to make some large logical leaps), but at least I have paths for further research.
Minds can change. Often we just need more and better information (and some time to digest it all).
The only things I feel compelled to add (as Seattle is facing a similar condition to 'the bay area' now), are that at a mega-city, county, and state, maybe even federal level, there needs to be a 'resource recycling collector' that kicks in when the market fails; and that building codes should be much stricter about quality of life issues.
There are neighborhoods that simply need /vastly/ more density than currently exists, or which have predominantly older buildings and infrastructure. Those areas should be bought out en-mass by the people (government), and sale encouraged at some fixed ratio of existing market valuations consistent with values prior to market insanity.
The entire area can then be taken offline and upgraded from the base up with a full-refresh; ideally at a density target and with modern building codes and designs.
Those building codes should make apartment/condo living affordable, as well as requiring sufficient space, isolation, and quality of life for all involved. It should be less costly and higher quality of life to live in a city, not more costly and lower quality of life as it is now.
So you want the county/state/federal government to be able to use eminent domain to "buy" out entire neighborhoods?
And you expect them to uphold all of the quality standards from your last paragraph rather than taking the vastly easier and more profitable route of pocketing lobbying cash from the largest developers? This is a terrible idea.
> How do you prevent over-supply from being built? How do you ensure that the housing is of suitable quality?
How do we prevent the over-supply of anything? How do we ensure the quality of anything in the market? Housing is not a unique good. This is a solved problem.
> a friend recently visited and used airbnb to lodge at one of those newish buildings on 9th street. The building looks great on the outside. But, inside, the units looked and felt like what I imagine Soviet block style buildings would be like.
And what's the vacancy rate on that building? Just because you don't like it doesn't mean it's not serving a market niche.
Redeveloping a low density property for higher density is fine, except part of what makes that new property attractive is the neighborhood it was built in. Which in our hypothetical, is low density and maybe nice.
Then in the process of redeveloping, as more and more properties are redeveloped, the old character is lost to everybody- the people who lived there as well as the new people who moved there for that character!
It's not a new conundrum- what do you do about people moving to a community for it's desirable character, but killing that character in the process? It hurts everyone involved.
HN frequently likes to take the position that the parcel you bought is yours, but if your neighbor wants to bootstrap a red light district you just have to deal. But, all over the country we have HOA's and zoning and so forth. Turns out, people want to come together and live in a community. Nobody particularly likes living in a free-for-all, so mutual agreements were set up to ensure the neighborhood you bought into doesn't turn into something totally different overnight.
> what do you do about people moving to a community for its desirable character but killing that character in the process?
Here's what I think is the central (and flawed) assumption in this line of reasoning - people move to an area because of its "character". And that "character" is an intangible, immeasurable quality, but it is somehow diminished if more people move to the area.
I grew up in Seattle. Both of my grandparents, when I was a kid, lived in Seattle's Fremont neighborhood. I live in Fremont today. From one perspective, the Fremont of my childhood is completely changed. On the other hand, it's still Fremont, with the Center of the Universe sign and the statue of Lenin and many other things I remember from childhood. Does it have the same "character"? Does it have a newer, different, but just as good, "character"?
Those are impossible questions and it boils down to a Ship of Theseus style argument. Either way, I can't bring myself to assert that the housing supply of Fremont should be artificially constrained by zoning policies, in order to preserve my ideal of what Fremont "should be" or "used to be".
I admittedly come to this from a different angle. Many people move to my town for nature & recreation. Every new house & every new infill is less nature, less trails, less recreation. So paradoxically, by moving here, are we killing what we moved here for? Not a Ship of Theseus.
In our case redevelopment for density actually helps preserve that character. But I still feel like I can understand the Bay Area home owners.
We should collectively redefine what we are trying to preserve. You recognize that increasing density allows more people to live there without encroaching on the wilderness. As a bonus, increasing density also makes walkable neighborhoods more viable, so more people can live without cars.
But many voters believe what we should preserve is the single-family home, built environment that some developer created long ago. Then the number of people per unit of land is restricted: homes near economic activity become playthings of the rich, and any new home that is affordable is taking away wildlife habitat and farmland.
In short, their stance is understandable, but it is sociopathic.
But many voters believe what we should preserve is the single-family home, built environment
Do you believe this is an honest characterization of their core goal? Is the opposition's number one goal simply to oppose multifamily property? Like, "God ordained that no two families should live in a single structure"? Or is it about property valuation changes, or building height, or street parking, or land use, or decreasing number of (semi-permanent) owners and increasing number of (temporary) renters, or...?
> But many voters believe what we should preserve is the single-family home, built environment
> Do you believe this is an honest characterization of their core goal?
Yes. I can quote Rothstein about racist motivations[0] or Marohn about short-sighted financial recklessness,[1] but I believe more people have nostalgia than malice. Even if they deploy structural racism and racist rhetoric.
Most people become set in their ways very quickly, and have difficulty imagining what is good other than what they thought was good when they were young. By now, you cannot find a native-born American who grew up in a time before cars became supreme. Most Americans don’t even remember a time before the Suburban Experiment.[2]
So, yes, people will bring up building heights, and respecting the neighborhood, and traffic, and parking über alles, but I think the main motivation is that they can’t imagine someone else can have a good life that is a benefit to the community other than the life that they think is a good life.
Replacing low density with high density shouldn't have to touch outdoor/public spaces. I live in Denver and people from around my state complain about this all the time. Perfectly possible to keep (or even expand) recreation spaces if we allow more density. Might be better to argue about increased population use of same public recreation resources (crowded trails) but that's the same selfish complaints as this whole thread - it comes down to why some feel because they have it already that they should be able to exclude others from having it in the future.
Replacing low density with high density shouldn't have to touch outdoor/public spaces [...] Perfectly possible to keep (or even expand) recreation spaces if we allow more density.
Right, I'm pretty sure I specifically acknowledged this in my previous comment.
why some feel because they have it already that they should be able to exclude others from having it in the future
If some hypothetical resource has a determinate carrying capacity and any greater usage degrades the resource for everyone, it's not unreasonable to exclude people. See the fixed number of backcountry permits Yosemite issues. Some things simply cannot be had by everyone. Given this, how do you decide who gets, and who does not get?
We really only have three systems that I know of- 1) lottery, ala Yosemite permits 2) free market, ala Bay Area low density housing, also ski condos 3) precedent/i-was-there-first, ala people who already own a house there get to stay there as it becomes desirable, also prescriptive easements of public trails on private land
GP "helped build" a neighborhood presumably by buying when it was less desirable, and investing time and money and effort in to making the neighborhood better.
Yes, building a bunch of new units will change a neighborhood. Yes, changing zoning will alter a neighborhood.
What, precisely, gives everyone who wishes to live in an area the "right" to live there affordably, as defined by whatever arbitrary definition?
I am all for relaxing zoning and building new houses because the rent is too damn high, but I also see this attitude in NYC and it is insane.
No one has a right to move to NYC, and most particularly my block. If you don't like the prices, no one is forcing you to move in to my neighborhood. Actually, I'm beyond saturated with people moving in to the neighborhood I invested 20 years in to, and subsequently telling me and my neighbors who did similarly how to live, how to behave, and driving every existing business away and replacing it with the same exact thing but priced at triple.
And yes, I know gentrification and new developments are orthogonal and in many cases allowing more construction would lower rents and transitively lower prices which is why I am generally in favor of relaxing zoning.
But this general sense of entitlement, SHEESH! You don't have a right to move on to my block, at whatever price you feel like paying.
GP got his reward for that investment in the form of increased value of his own property. That’s all he’s entitled to.
> No one has a right to move to NYC, and most particularly my block.
People have a right to use their property as they see fit. If that means tearing down a brownstone in your neighborhood and building a high rise so a bunch of people from the Midwest can move in, so be it. The government can limit those rights when necessary, but the affirmative burden is on the party demanding such regulation to show why it is necessary to interfere with peoples’ property rights.
"GP got his reward for that investment in the form of increased value of his own property. That’s all he’s entitled to."
Says you. I don't see that. Although I live in a working-class area in a lesser city, I've worked to make my community better, and my interests don't stop at money.
"People have a right to use their property as they see fit. If that means tearing down a brownstone in your neighborhood and building a high rise so a bunch of people from the Midwest can move in, so be it. The government can limit those rights when necessary, but the affirmative burden is on the party demanding such regulation to show why it is necessary to interfere with peoples’ property rights."
But you are the one arguing for gov't intervention. The locals want things to stay the same. Its local landowners who don't want change. I don't understand this part of your argument.
Some of the local landowners do want to change. They want to tear down some buildings and build new taller ones. Local zoning laws are what prevents them from doing so.
But those laws are the current state of affairs. They were when the properties were purchased; they are now. Gov't intervention is required for change.
No, the law says that. The law lets you capture the increased value of your property. That’s the nature of a property right. Property rights don’t give you the right to dictate how other people use their property. Even zoning laws were intended to protect neighborhood health and safety, not the locals’ interests in preventing change.
> But you are the one arguing for gov't intervention. The locals want things to stay the same. Its local landowners who don't want change. I don't understand this part of your argument.
Owning property gives you complete dominion over that property, by default. If I own a brownstone, and want to tear it down and build a high rise, I can do that. That’s the nature of property rights. What prevents me from doing that is zoning boards, historical conservency laws, etc. Thats government intervention.
No, it's the locals who are intervening in government with their overly restrictive zoning laws. We want to undo that intervention an diet the market set the prices.
Oh please. Everyone should have the right to purchase housing at fair market value. People like you twist the power of local government to subvert the market for your own benefit. The price is high because of NIMBYism, not because of the market.
What are ways in which people are telling you to live?
I'm looking forward to the 3X price jumps of businesses in my neighborhood - it might improve the quality of the food and options. I say that entirely with a straight face - since almost all the food options are 'affordable', the food options are greasy, unhealthy and also lacking in diversity.
My take is, everyone has a right to try to 'make it.' People don't need to take note of how the community was 5, 10, or 50 years ago as the city is continually changing. Almost nowhere in NYC is a neighborhood static in terms of pricepoints, culture or just about anything else.
I think it's reasonable for people who have lived decades someplace to want this preserved, and it's equally reasonable for new people to come in with new ideas.
It's a zero-sum game and so the law has to view these things without biasing any group as much as possible.
Me too. I came in 15 years ago and bought a new house. I think that should have been the last home to be built in the bay area. I built this neighborhood every time I ate at sweet tomatoes and shat there. I just don't see why there should be more homes after mine.
It’s basically hell on earth if you’re there at the wrong time. Imagine an all-you-can-eat buffet restaurant that is pretty much nothing but a big salad bar plus a small selection of soups and sides. That sounds good to me, but the unfortunate reality is that it’s a magnet for very large families with lots of small children, and pathologically cheap people who can’t resist the all-you-can-eat aspects.
Imagine a cross between Sizzler, Hometown Buffet, and a middle school cafeteria, but focused on salad. Make it really crowded, but what empty tables exist seem to always be dirty and unbussed. Sprinkle with unsupervised children running around and randomly touching the food in the buffets. Mix in crowds of very slow people who enjoy standing in everyone’s way while they slowly investigate every single item in whichever buffet you’re interested in, and once they finally decide what to get you have to watch them slowly make a salad by painstakingly picking out one piece of lettuce at a time as if they were performing brain surgery.
It’s probably OK if you go there during whenever their downtime is, but I have no idea when that is or if such a time even exists in the Sweet Tomatoes dimension. But if you don’t mind crowds and germs and value optimizing your money:mass ratio for food above literally every other possible consideration, it’s great! But even then I wouldn’t dream of using the restrooms there- the person you responded to is clearly far braver than me.
As a kid, we ate at Ponderosa quite often. All you can eat soft serve.
Though I recall putting some chunked (presumably canned) pineapple on my plate once, taking it back to my table, and chomping into it before realizing it had (apparently) fermented.
> I don’t feel like I’m saying FU at all. My perspective is that I spent over 15 years in a house that I initially took a risk on. I helped build the neighborhood and community and schools that made it a nice place to live. And, now people who didn’t have to do all that work want to live here cheaply. And, they’re trying to use government and political power to force me to give up what I’ve helped build. Why is that fair?
I don't see how this differs substantially from "FU, I got mine." You're going into more detail on how you got yours and you're not cursing, but you're still saying people who have come later than you seeking the same sort of thing you have should be excluded.
Why do you think people will live cheaply if they join the community now? They pay the same taxes as you, and people engage in the community just as much as you for how ever long they choose to live there (perhaps 15 years to come and make it an even better neighborhood than it is now).
Because of prop 13, the ones who move in today will actually pay a lot more in taxes than the ones there today. Up to 2-3x - which means the newcomers will catch up to the older neighbor’ tax contributions within a few years.
2-3x? Try 10x. A lot of those living in million dollar homes purchased in the 70s at sub 100k prices, and are still paying based on that valuation. Or their children are, since Prop 13 lets your kids inherit the right to pay 1/10 the property taxes as newcomers.
I have a hunch that the people moving in will be paying a little bit more than you did. Probably 2x+? Not to mention they’ll pay much, much higher property taxes.
Do you really think your contribution to the community is worth the increase in the value of your home, or did you just buy in an area that was at the forefront of an economic renaissance, and you capture the value of that, while seeking to prohibit others from participating?
You should consider how the people that bought 15 years before you felt. Why does the buck stop with you? Why assume that people moving in won’t contribute to the community?
I used to have this opinion so I know where you’re coming from. I live in Mt View and I bought a condo about ten years ago. Since then traffic has been getting worse, and they put in some fairly ugly developments.
A few things changed my mind. First, many people I knew personally had to move out of the area because of the cost of housing. It sucks to have to uproot your life due to rising housing cost you can’t keep up with.
Second I came to realize that long term, the area either has to accommodate the inflow, or decline. The Bay Area is full of first and second generation immigrants and people who care from around the country to live her. They built SV and the companies we love/work at. If it’s too expensive for them they will stop coming, and in thirty years we’ll be in a retirement community (albeit a low density one...)
So now I say, build build build. It might bring traffic but that’s a small price to pay for the long term health of the area. My bigger concern now, and what I think cities should focus on, is how to build lots of housing while still maintaining high quality of life for everyone.
Edit: also remember that in California, you are really protected/subsidized if you are a home owner. Your property value will increase with no change in property tax due to Prop 13. Density and people moving in will generally drive up property values which will benefit you financially.
Prop 13 is an excellent point, and specific to California. I can’t imagine how different the housing situation would be without it. Maybe a little different, maybe a lot, but certainly better for almost everyone in the big picture.
Only if salaries are forced to scale with the increase in property taxes; rapid increases to the point of unaffordability were one of the reasons the law was enacted in the first place.
There were lots of states with similar problems in the 70s. Others solved it better (e.g., NY Star program that helps specific classes of people that need help). Prop 13 was a chainsaw solution to something that needed a scalpel.
I think I agree with your argument that we should discourage foreign speculators, but I would go further by adding that we should discourage domestic speculation as well, so I think I disagree with your apparent argument that you deserve your own house’s appreciation. The market should be designed to reward hard work and productive investments. Something is wrong if the rewards to speculation in scarce resources exceed the rewards to work. I believe this is a progressive-era concept from Henry George.
This means that hard-working people should be able to find opportunity when they come here, and the market shouldn’t reward speculators for sitting on land without making any improvements. Landlords should be rewarded for maintaining the building, and for constructing new housing, but not for appreciation on the land.
But the Bay Area housing market has seemingly been designed to do the opposite. Proposition 13 protects land speculation by limiting property taxes to a little over 1% of assessed value and rewards seniority through the the acquisition value pyramid scheme. It also encourages localities to raise funds through counterproductive development fees instead of broad-based taxes. And despite the strong economy, our rate of housing construction is far below past times and other cities. We have a housing market that rewards holding onto properties, allows landlords to capture wage growth, and discourages development. I would like to see this system change.
For your points about discouraging demand, I think I would agree at the national level but not at the local level. The federal government should encourage companies to locate in other cities. But localities have little power to do so. What local governments can do to discourage housing speculation is to increase land taxes and allow developers to flood the market with more housing.
Prop 13 is very regressive. The guy who gained 2 million dollars on his house's value, pays 2k in taxes, whilst the poor guy neighbor with the same exact house, who bought recently, has to take out 5 mortgages to buy that 2 million$ house and then, thanks to prop 13, is paying 10 times more taxes.
Millennials have been in a very poor position to start with, but Prop 13 really drives the last nail into the coffin.
You may have taken a risk in moving to a place that was less desirable 15 years ago, but part of that risk is that the neighborhood continually changes, maybe not always according to your ideal plan. Land (especially desirable land) is a scarce good. Allowing incumbent landowners absolute say in what happens to the surrounding area is not in the overall public's best interests.
I absolutely object to your view that people want to live here "cheaply". People want to live in SF _affordably_. As in, not having to put 75% of their income toward housing, which is an insane thing to have to do. I've been living in the bay area since 2004, the last 8 years of which have been in SF. I've been working hard to get to the point where I could buy my own place, but every year it becomes harder to justify buying over renting. At this point I do have the money, but it feels financially irresponsible to buy. But I love this city and want to put down long-term roots, and perpetually renting just doesn't seem to be the way to do that. Why don't I get a shot at helping to build the community?
It's not just me. I'm fairly well-off at this point, and many people, some who have lived in SF far longer than I have, are getting hurt by all this. Take service workers, who have been all but priced out of the city. More likely than not the cashier ringing up your groceries, the barista making your coffee, the person who comes to clean your house, the waiter at your favorite restaurant... they used to get to work by hopping on Muni or BART, but now they have to drive over an hour to get to work. How is that ok?
So yes, this is why I and others point fingers at you and say you embody the "FU, I got mine" attitude. You got in at a good time. I don't doubt that you put work into community building over the years, or that you took on some risk. But it absolutely floors me that people like you don't get how much of your current situation is completely down to pure dumb luck. And that's what this is all about: leveling the playing field for everyone, not just people who have money, or were lucky enough to be born at the right time or move in at the right time.
To be clear, I'm not raising up my pitchfork here or coming at you angrily. At this point I'm just extremely frustrated, disappointed, and sad. To echo your sentiments, I find it hard to believe that people on "your side" don't see the obviousness of what I'm saying. I mean, does SF seem like a healthy city to you? Do you really think that just ignoring these housing issues is going to make everyone leave and everything will go back to normal?
To address some of your points directly:
> Make places less attractive, demand goes down, and prices go down. There are huge swaths of the US other than San Francisco that are in dire need of industry and people. Why not encourage companies and people to move to those places?
Two reasons: 1) for a company, betting on an untried/untested job market to fill your needs is a ridiculously risky proposition. A company like Toyota (moved from Torrance, CA to Plano, TX) can take risks like that because they're a more mature business with a large margin for error and can absorb that pain. Most SF and bay area companies can't take that risk. 2) People such as myself just don't want to live in those places. I'm in my mid-30s right now, and I don't have the desire to spend 15 more years building a community as you claim to have done. I'm fine paying more than you did back then to enjoy the benefits of a more-established community, but the current situation is just ridiculous, untenable, and unsustainable.
> Wages clearly aren’t high enough to give workers salaries that allow them to buy properties. Raise wages, and some companies will naturally move elsewhere. Jobs will go with them, and demand will go down.
Unless in those 15 years you bought all the property around you, then your “investment” doesn’t give you the right to say what happens to that property. That’s the default: people (including developers) get to do what they want with the property they own. You’re the one trying to use the coercive power of the state to prevent them from doing that.
Guess what? You didn't build anything. You bought a house. The building of the neighborhood over the past fifteen years is totally attributable to Facebook and Google etc. They created the explosion of jobs. People wanting to live near work is what built your neighborhood.
While I agree with your overall idea, they've been doing a great job of making San Francisco less attractive these days. BART and the feces-plagued sidewalks to name a couple examples.
> And, now people who didn’t have to do all that work want to live here cheaply.
No, they want to pay market rates. And people want to use the power of government to stop them.
> And, they’re trying to use government and political power to force me to give up what I’ve helped build.
No one is trying to get you to give up what you own. What's being asked is that you stop trying to take from other people what they own. One of your neighbours who also helped build this community wants to build some apartments on their land. If you pass laws that stop him, then you are using political power to make someone give up what they've helped build. You are not the victim here, come what may; you are either the villain or a bystander.
> No one is addressing the demand side of this issue. [...] Why not encourage companies and people to move to those places?
Sure, great idea. But 1) it can happen in parallel with addressing the supply side and 2) if it's such a great idea, why don't you do it? The reasons why you don't want to apply to everyone else too. That "hey, I like it in SF, but you should move to Topeka" attitude is the exact "FU attitude" you claim not to have.
> Wages clearly aren’t high enough to give workers salaries that allow them to buy properties. Raise wages...
First off, that'll do nothing to actually fix anything; you'll just have more money chasing the same number of houses. That's a recipe for inflation. If I had a magic wand I could wave that would instantly double every salary and hourly wage in SF, all waving it would do is also double the rent. Second, that'll actually make the problem worse by drawing more workers into the area chasing the higher wages.
If you are trying to fix this by tinkering with wages (a bad idea!) it would make more sense to cut wages, or institute some extremely eye-watering tax rates at higher bands. The second an 80% tax rate on incomes over 80k is instituted, you're going to see a massive clear-out of tech workers from SF, followed by a collapse in rent and housing prices. Again, not a good idea, but at least it'd work...unlike your idea.
> some companies will naturally move elsewhere. Jobs will go with them, and demand will go down.
That's not how markets work, incidentally. Wages and jobs and house prices do not exist in a vacuum.
> I’m not sure how one can disagree with my points.
You are saying FU to people. You are exactly the type of person who is the problem, and who is causing countless low income people to suffer high rent. All because you want to live in an upper middle class bubble isolated from the real world.
> I don’t feel like I’m saying FU at all. My perspective is that I spent over 15 years in a house that I initially took a risk on. I helped build the neighborhood and community and schools that made it a nice place to live. And, now people who didn’t have to do all that work want to live here cheaply. And, they’re trying to use government and political power to force me to give up what I’ve helped build. Why is that fair?
You are not the owner of the community you help produce. In fact, every renter that lived in your area also contributed to that community and for their favor they were slapped with higher rents. Are you personally going to pay renters for their contributions to the community?
> As I’ve said in the past, No one is addressing the demand side of this issue. Make places less attractive, demand goes down, and prices go down. There are huge swaths of the US other than San Francisco that are in dire need of industry and people. Why not encourage companies and people to move to those places?
Why not encourage landlords to leave, by the same logic? Renters in the end are actually more people that landlords, so by simply trying to benefit the majority might as well punish landlords, right?
> Also, the elephant in the room is foreign buyers. I looked through SF tax records the other day. I picked a random street, and most of the homes were owned by foreign trusts. Why not try to stop that first?
You can stop all things together buy allowing to build more. Not only that, you could also use Land Value Tax to replace income tax, and eliminate income tax and sales tax. You could remove prop 13, rent control and mortage interest deductions from income, and it would make taxes simpler, easier and would stop speculation, would stop landlords wanting to keep 100 year old unsafe houses with mold, etc.
When perverse incentives divide constituents and create paralysis then the solution can only come from a higher level of Government, in this case either State referendum or Federal action.
Any recommended literature on the matter? 19 from bay area, lived here all my life and the "FU, i got mine" attitude is absolutely real, but i wasn't aware that this was a well known phenomenon, let alone that there were books on the matter.
Yes, I highly recommend the book The Color of Law by Richard Rothstein. It goes into depth behind the laws now used for NIMBYism, which have a shameful past that must not be forgotten, lest these mistakes be repeated.
The book begins by taking a look at the Bay Area in particular.
In NYC we have something of the opposite problem. California folks are always asking, why not upzone. Sometimes they say that in reference to the NYC much-publicized housing issues too.
The problem is that the infrastructure around it needs massive improvements to scale.
A suburban density increase is a good thing, because the denser housing leads to denser income flow to local governments, which go to things like water/sewer, road, and other improvements that need to be paid for. Economies of scale mean that suburbs are terribly inefficient.
An increase of density in NYC has had the opposite result. It's false to claim that there's no housing being built - there's plenty of it, and it's dense, and often times 20+% of it is legally affordable (rent stabilized due to developer tax breaks). Yet more people keep moving here. The issue is that one of the main infrastructure bottlenecks never kept up and it has become one of the topmost, if not the topmost quality of life issue in NYC: the public transport system.
It's all well and good to build density, but the municipalities need to move lockstep with housing increase. Unfortunately, I think that the decentralized nature of American political life makes this quite difficult. How can one of dozens or hundreds of city agencies keep tabs on one of dozens or hundreds of various other factors.
CA doesn't want more homes or people. The old generation and their heirs are firmly cemented in place (prop 13 + 58/193). No one is going to fix shit, and I certainly don't want any more market distorting policies like rent control. My area hasn't built a new home in 15 years.
California has 40 million people. We have renewable water resources for 20 million. At this rate we will utterly obliterate our water resources for good. No government can fix that...and no, you aren't going to desal that much water either.
We need to figure out how to get 10 million out of the State.
> It gives the public a false sense that a step has been taken toward having more housing when in fact it’s just an illusion.
This is the same anywhere there's direct democracy. 51% of the people vote in the government that perpetuates the ponzi scheme of rising house prices because borrowing from the bank to buy a house then selling it later for a profit is the quickest path to retirement. Restricting housing supply is one easy way to keep house prices rising. The government needs to feed a story to the other 49%, hence these illusions like in California.
Besides restricting supply, another way to keep the prices rising is to boost demand, so the 51% also vote for the governments that increase immigration, which has been especially successful recently in the western US, Canada, and Australia/NZ. Every now and then, a government comes along that attempts to boost housing supply or restrict demand from immigrants or foreigners, but they soon get voted out because early retirement is the top criteria of voting decisions for the 51%. That government's initiative then becomes another carcass used to fool the other 49%.
>This is the same anywhere there's direct democracy. 51% of the people vote in the government
Uh, not quite. 51% of the voters. I highlight this because it's incredibly important to understand that only voters have power, and if you refuse to vote then you will be screwed by politicians in favour of people who actually keep them in power.
There can nary be such a thing as a 'housing crises'.
California does not have one, in general.
If California municipalities 'don't want to enable building' because their residents don't want it ... well ... then they will have fewer people, probably higher housing costs and that's their choice.
If the 'average bay policeman' or whatever can't afford to buy a home for 100 miles - then the citizens of Cali are going to have to pay their cops more, or, those cops will go elsewhere.
It's a fairly fluid and competitive landscape - more so than most places on earth.
There's a high demand for living in some parts of Cali and it's going to be like that for a long time, even with some building it won't change.
It's a choice Californians seem to be making, it's their choice.
If town councils are arbitrarily messing things up against the will of the people - who want to see high rises everywhere ... well that's another story.
In this era of ridiculously low voter participation, I don’t see the elections as being a great source of legitimacy.
Housing is even worse. Many of the people I interact with are immigrants, so they are blamed for the high prices, but they are unable to vote to fix it.
It’s the old homeowners who organize and produce fractionally higher voter turnouts, that turn elections their way. Especially local elections, that have the most impact on land use policy. A minority harm the majority because they vote more.
The good news is that YIMBYs are now organizing, too.[0] You can even make tax-deductible donations to bring lawsuits against local governments that violate state law by refusing to allow housing.[1]
I don't think that part is true -- they'll still have more people, but those people will be doubling (or tripling) up in single family homes or (often illegal) in-law units, causing parking, traffic, infrastructure and other problems of increasing density in neighborhoods that were not designed for it.
I see that in a neighborhood I pass through on my way to work -- cars parked on sidewalks and front yards, and long lines of traffic at the only traffic light that leads out of the neighborhood.
Is it too much to ask to have an ideal place to live at a price strictly enforced to be well below its market value but only if you happen to live there already?
Not a problem, sure California residents have this right of self determination. But then stop using my tax dollar to enable your rent seeking behavior (prop 13) and paying next to nothing towards local development (again, prop 13) while shifting that burden to the renter (higher rents being partly used to fund libraries, fire stations, etc. when really, your local taxes should have been paying for those, not my continually rising rent).
The problem isn't housing. The problem is transportation and infrastructure. People need to work for a living. They also don't want to spend a significant amount of time commuting to said work. California's transportation, road, and highway infrastructure is completely and utterly inadequate for the population in the SF and LA areas. This forces people into living situations that are far from ideal and creates a fight over housing.
Create multiple ways for people to commute from 30 miles away in 30 minutes and housing will be much less of a problem with people having many more options.
Proof: If people could instantly teleport between work and home no matter how far apart they are, do you really think they would still cram into SF Bay Area or LA housing? Hell no. Housing is the symptom of poor transportation infrastructure.
This is true. But the easiest way to fix the inadequate transportation is to build more densely. Build more highrises. A 30 floor highrise with 8 apartments per floor can easily house 500 people but only takes up the land that 4 single family houses with less than 15 persons would occupy.
But the effect is multiplied if this highrise is in an city with many highrises. Now, instead of commuting 30 miles to pass another 1,500 single homes to reach work, the inhabitants of our highrise may only have to walk 1 mile to pass the homes of a similar amount of people and reach work.
it is very uncomfortable to stand near a 30-floor building looking up. Also, people in the building will have troubles with parking all of their cars. By the way this [1] is what those buldings look like.
It’s not optimizing for “comfort in looking up”. Also, cars are only a necessity when you can’t walk everywhere. San Francisco is already a city where the majority don’t own a car. Making it more dense won’t undo that.
Well how about, at least in IT and S/W development, we encourage remote working, rather than promoting childish "agile" work practices where people come in at 9 am for a "daily standup" and mess around by writing tasks on sheets of paper like in the last century?
And if that's not a strong enough argument, just think of the climate! All those hours stuck in traffic, each one a car running for 2 to 4 hours a day, that's got to be causing a lot of pollution.
The question is why are there more jobs than homes? Homeowners don't oppose commercial development because it raises their home value but they oppose residential development because it lowers their home value.
The only compromise for existing home owners could be to balance out job and home zoning so that there is no massive excess or deficit on either side.
“We’ve tried everything except building more housing and we’re all out of ideas!”
I’m baffled how local governments can’t seem to connect the supply side.
30k new jobs + 8k new housing units = higher housing prices
Or for a more hilarious ratio, look at Mountain View over the last 15 years. I think for a decade there were effectively zero new units created.
And what makes this even more tragic, is that this is happening in a highly educated cities. What's so hard to understand about supply and demand? I think, deep down, they're fundamentally misguided: democrats and liberals think that they're somehow fighting against capitalism, and by limiting developers, they're somehow helping humanity.
Red Cities and red states get it, they generally don't have these problems, even the extremely high growth ones: like Houston.
If they were serious about fighting capitalism, they might do more to resist the biggest and most profitable companies in the world expanding their own real estate portfolios and footprint. Instead they have decided to attack the employees. Relatively privileged employees, but workers nonetheless.
Height limits and zoning are a good idea. If you don't have limits then you will have only high ugly 25-floor apartment buildings. Like the ones they build in China [1][2] or in Russia.
Look at any old European city like Paris or Amsterdam or Saint-Petersburg. A historical part of the city with 3-5-7 floor buildings looks so much better than modern cities with skyscrapers.
And I am not sure that building new houses will solve the problem. New houses and lower living cost might attract even more people to move to California.
1. High-rise building can be build in different styles. I like most Manhattan buildings from 1920s - 1940s.
2. There are a log of ugly box building built in Russia (and China), because it is a race to the bottom. People can't afford apartments in good looking buildings and can only buy in cheapest ones.
Given how expensive land in California it is unlikely that developers will try to save every cent on buildings them-self.
You’re correctly pointing out some truly awful towers, and I’m happy to counter with some awful single family houses. Towers, like houses, can be good or bad.
The Bay Area is an international hotspot. You have people fighting to move in from the whole world. I would expect it to be one of the most expensive places on the planet. And given it is an American city, I expect the worst infrastructure on the planet.
149 comments
[ 2.7 ms ] story [ 49.7 ms ] threadIf California would pass legislation radically limiting regulatory burdens that municipalities and other legislative bodies could pass, this problem would disappear within a year or two.
But even california official economist reports say the situation is harming the state tremendously. There is no debate about what needs to be done. Its just about politics now.
Also it has now been a few years since DTLA was a "blight" or a "cheap ghetto". Is there a bigger sign of gentrification than Whole Foods[1]?
[1] - https://www.wholefoodsmarket.com/stores/downtownlosangeles
100% occupancy is bad, because it means the city is not flexible to changing demands. Fill up that new development 100%, and then the next person who needs to come in would need to double up, or bid higher and displace somebody.
That is my big problem with the Planning process, trying to manage growth. It’s slow and brittle to unanticipated changes.
[1] - https://la.curbed.com/2017/9/15/16316040/downtown-la-high-va...
There might be a cogent argument for fully centrally planned housing, but instituting price controls on new market supply when a shortage is at its worst is a staggeringly clueless demand.
And let’s be clear, affordable vs luxury housing is about price controls, not the units themselves. There is nothing physically embedded in the average “luxury” 700sqft unit that makes it worth more than a McMansion in Iowa. Only the supply and demand situation where it’s located. Countertops and dishwashers don’t add +$2000/mo.
Low interest rates are the key factor in driving demand for borrowing. Low interest rates signal a healthy supply of savings from which to borrow. So, low interest rates naturally match a large supply to a healthy demand. Such a scenario would create a market for investment-led expansion.
High interest rates signal the opposite. Either the supply of available savings is insufficient, or relative demand is high enough to drive out uncompetitive demands for savings.
Why would a municipality spend $50,000 on a do-nothing report? Instead keep the $50,000 and spend $2.00 on a report that says, "It would be best to do something about housing. Someone should build more houses."
Sure, the law is a failure, but the municipalities that spent that kind of money willy-nilly are just as limited in their success.
The strange part is not that planning happens, its how we are so bad at it when it comes to land ownership.
And not even cities, but towns of 10,000 have these kinds of issues where there's only so much physical room for them to grow and everyone there asserts the right to a view, so there are height restrictions for buildings. And then they also realize they need people who aren't millionaires to be teachers, waiters, plumbers, lawn care, and so on. And they can't all live in town, so now they live in the next town and commute, leading to traffic problems and a need for regional public transit, and all kinds of really obvious classist side effects.
You either want to live in an aristocratic homogeneous society or you want something quite a bit more diverse and less walled garden than that. And for sure not everyone is in agreement. Hence there's a problem and there's arguing about it.
http://www.hcd.ca.gov/community-development/housing-element/...
http://www.hcd.ca.gov/community-development/housing-element/...
That is why I wrote that a report costing $2.00 should have been created. Spending $50,000 on such a report is foolish and an utter waste that occurs when people don't value taxpayer money and don't consider why their public employment position exists.
http://www.latimes.com/politics/la-pol-ca-housing-legislatio...
The “FU, I got mine” attitude is going to choke California. How we got here is a fascinating story, and recommend reading literature on it.
As I’ve said in the past, No one is addressing the demand side of this issue. Make places less attractive, demand goes down, and prices go down. There are huge swaths of the US other than San Francisco that are in dire need of industry and people. Why not encourage companies and people to move to those places?
I believe that the bulk of the problem starts with the companies in CA. Wages clearly aren’t high enough to give workers salaries that allow them to buy properties. Raise wages, and some companies will naturally move elsewhere. Jobs will go with them, and demand will go down.
Also, the elephant in the room is foreign buyers. I looked through SF tax records the other day. I picked a random street, and most of the homes were owned by foreign trusts. Why not try to stop that first?
I’m not sure how one can disagree with my points. So, I’m probably clueless on this issue. Please educate me.
(Clearly, I’ve angered the mob. Please don’t bring torches and pitchforks to my door tonight. I just wanted to get an alternative and unrepresented viewpoint into the discussion.)
They aren't trying to use political power to force you to give up what you've helped build, they are trying to buy land and build homes. It simply isn't ok for people to prevent other from living near the so they can turn their "communities" into elitist social clubs.
Foreign buyers are irrelevant. They wouldn't be getting involved at all if homes in CA weren't so absurdly overpriced.
You’re asking rational actors to make irrational decisions. The results are what you’d expect.
That would be unthinkable today though.
As I mention in a sibling comment, you might see changes in a decade or two, but no sooner.
I am not opposed to efforts related to increasing the housing supply (although I do think it’s a fool’s errand in the Bay Area as demand is insatiable due to the tech industry and foreign money seeking a safe asset store), I’m just describing the uphill climb these endeavors face. It’s hard to fiddle with a core component of the economy (property law).
I don't think a concept of a fractional ownership exists because, well, it's not yours.
If you really want some guarantee that your immediate radius will meet some sort of standards, it sounds like you'd want to be part of an HOA. I personally would never want to be part of one (who likes being told what to do?) but they could help protect property values from that one neighbor who could be a problem.
"Everyone should maximize the income from their property up to the limit of law" is a recipe for for having no neighborhoods or communities. It's the usual fallacy of treating people as fungible commodities.
HOAs are terrible, they are inevitably staffed with busybodies. We can agree on that!
It certainly is in San Francisco at least. Well, probably not literally zoning, but regulations around it make the home owners in an area de facto owners of it in many ways.
I see the current housing crisis as a direct result of this.
I don't know a whole lot about it, but in NYC they have some concept of air rights, i.e. a particular 2D plot of land also has a height limit, and somehow those can be changed by buying up two plots and adding them together. And then most everywhere is the idea of "I have a right to this particular view in that direction, and maybe also this other direction over here, you can't build a building to block that view unless you compensate me - oh but wait no I don't want to be compensated actually, I want to just be able to prevent you from building anything."
So at one time people resolved such a dispute with bribes, or threats, or murder. And then later on it was resolved with bribes and elections, where only land owners had the right to vote so renters couldn't just come in and change all the rules. Today renters can vote, and basically if your town has more politically involved renters than owners, they can change the building codes, and get more high density housing built or whatever.
Anyway, it could be worse: no one wants to live there and it depreciates.
Like, do you think if they bulldozed Manhattan to a big lawn that would make the price of the brownstones and single family homes actually worth more?
Your house would be millions more if your neighbors were allowed to develop to build market rate housing. People want the price per unit to go down by building more density. That means each lot will be worth more since you can replace it with more units. You own a home that's on a lot. You win financially if people are allowed to build. Think about how much a developer would offer you or your kids for your home after you don't need it if they're allowed to actually build. You'd be leaving your kids a fortune.
If what happens on the properties around you is critical to your enjoyment of your property, you should have bought them too.
You can't go to a fancy restaurant, order a salad, and expect to get a steak for free because it's necessary for you to properly enjoy the salad. If you really want a steak, you're going to have to pay for the steak.
The restaurant example is actually perfect because a big part of what you pay for in a restaurant is not just the food. It is the service and ambience.
Edit: My home price is based on access to the subways. I don’t own the subways. We happen to live in a system where the subways are run by the government, not privately owned. But regardless, I would do everything in my power to make sure the subways stay as good as possible, partly because I use them myself all the time, and partly because my home value is tied to them.
This is demanding that the restaurant leave perfectly good floor area clear and let a line form around the block, because more tables would ruin its quiet ambiance.
But, anyway, I’m willing to change my opinion. Just argue your case more persuasively. How is adding more supply going to fix this?
For example, if on any given day 20 people want to buy in my neighborhood (just guessing), how much supply would have to be built to even reduce prices? Seems like it would have to be massive. How do you prevent over-supply from being built? How do you ensure that the housing is of suitable quality?
By the way, I’m not the type of person that would oppose denser development. I just would prefer it be built slowly, in a controlled manner only because I’ve witnessed first hand developers destroying areas for quick profits.
For example, a friend recently visited and used airbnb to lodge at one of those newish buildings on 9th street. The building looks great on the outside. But, inside, the units looked and felt like what I imagine Soviet block style buildings would be like.
It’s been years and next to nothing has been built in the vast majority of the Bay Area - housing has decreased in some parts. It’s not a rapid development concern, it’s a no development concern.
> How is adding more supply going to fix this?
Adding supply helps because we now have a situation in California where there are many more jobs than homes for people to live. Conservatives keep saying people should work hard, right? Then they need to move where there are jobs. Liberals keep saying people should have access to dignity and a social safety net, right? Then they need to move where there is a friendly political climate and a robust economy to support that safety net. Being a “sanctuary state” is no good when refugees can’t afford to live here.
The big debate is over how to increase supply. The number of homes is increasing, but it is increasing much too slowly. That’s why even with visible construction, prices still increase. But even a slow increase of luxury homes helps, slightly, because every rich person buying a luxury home is a rich person not outbidding a middle-class family for a run-down hovel.
https://www.youtube.com/watch?v=EQGQU0T6NBc
> 20 people want to buy in my neighborhood, how much supply would have to be built to even reduce prices?
It’s a region-wide market. But on a simple level, yes, you’d need 20 homes to stabilize prices. That seems more humane to me than forcing people to double-up or live in tents.
> How do you prevent over-supply from being built?
You don’t. You need like 10% vacancy, ± some amount, to have a healthy amount of wiggle room for people to move, in case they get a baby or need to fumigate the house or something.
In practice, developers have teams of economists working to make sure they don’t build too much. If the local government makes development excessively difficult and expensive, then they will develop only a limited supply of luxury apartments, unless they get some subsidy. If the local government makes development easy, then they will make profits building for the vast middle class. We should make developer profit margins align with what we need as a society.
> How do you ensure that the housing is of suitable quality?
Competition and building codes. That’s how we ensure suitable quality for everything else.
Note that building codes necessarily mean marginal housing is excluded, so they need to be balanced with our ability to subsidize. Otherwise, you end up with luxury housing in a sea of tents.
We should also be much more willing to destroy existing homes. This urge to preserve the exterior of every existing home is destroying the fabric of society. I call that, “The literal façade of neighborhood character destroying the neighborhood’s character.”
https://www.strongtowns.org/journal/2017/6/12/the-power-of-g...
> I’ve witnessed first hand developers destroying areas for quick profits.
So we need to make competition easier. Experience has shown that trying to control the process in a central government manner just tilts the playing field in favor of huge well-connected firms that can absorb the overhead of dealing with endless processes, and disenfranchises small local developers.
I strongly disagree with restricting the process to build slowly. We have had 50 years of building slowly when we should have been building quickly. Some places should build slowly, but when the economy is changing, then building quickly should be possible.
https://www.nytimes.com/2017/12/06/upshot/what-happened-to-t...
I am still skeptical of some points (the NYC article, for example seems to make some large logical leaps), but at least I have paths for further research.
Minds can change. Often we just need more and better information (and some time to digest it all).
There are neighborhoods that simply need /vastly/ more density than currently exists, or which have predominantly older buildings and infrastructure. Those areas should be bought out en-mass by the people (government), and sale encouraged at some fixed ratio of existing market valuations consistent with values prior to market insanity.
The entire area can then be taken offline and upgraded from the base up with a full-refresh; ideally at a density target and with modern building codes and designs.
Those building codes should make apartment/condo living affordable, as well as requiring sufficient space, isolation, and quality of life for all involved. It should be less costly and higher quality of life to live in a city, not more costly and lower quality of life as it is now.
And you expect them to uphold all of the quality standards from your last paragraph rather than taking the vastly easier and more profitable route of pocketing lobbying cash from the largest developers? This is a terrible idea.
The market ensures those things.
How could it not?
> How do you prevent over-supply from being built? How do you ensure that the housing is of suitable quality?
How do we prevent the over-supply of anything? How do we ensure the quality of anything in the market? Housing is not a unique good. This is a solved problem.
> a friend recently visited and used airbnb to lodge at one of those newish buildings on 9th street. The building looks great on the outside. But, inside, the units looked and felt like what I imagine Soviet block style buildings would be like.
And what's the vacancy rate on that building? Just because you don't like it doesn't mean it's not serving a market niche.
Then in the process of redeveloping, as more and more properties are redeveloped, the old character is lost to everybody- the people who lived there as well as the new people who moved there for that character!
It's not a new conundrum- what do you do about people moving to a community for it's desirable character, but killing that character in the process? It hurts everyone involved.
HN frequently likes to take the position that the parcel you bought is yours, but if your neighbor wants to bootstrap a red light district you just have to deal. But, all over the country we have HOA's and zoning and so forth. Turns out, people want to come together and live in a community. Nobody particularly likes living in a free-for-all, so mutual agreements were set up to ensure the neighborhood you bought into doesn't turn into something totally different overnight.
Here's what I think is the central (and flawed) assumption in this line of reasoning - people move to an area because of its "character". And that "character" is an intangible, immeasurable quality, but it is somehow diminished if more people move to the area.
I grew up in Seattle. Both of my grandparents, when I was a kid, lived in Seattle's Fremont neighborhood. I live in Fremont today. From one perspective, the Fremont of my childhood is completely changed. On the other hand, it's still Fremont, with the Center of the Universe sign and the statue of Lenin and many other things I remember from childhood. Does it have the same "character"? Does it have a newer, different, but just as good, "character"?
Those are impossible questions and it boils down to a Ship of Theseus style argument. Either way, I can't bring myself to assert that the housing supply of Fremont should be artificially constrained by zoning policies, in order to preserve my ideal of what Fremont "should be" or "used to be".
In our case redevelopment for density actually helps preserve that character. But I still feel like I can understand the Bay Area home owners.
But many voters believe what we should preserve is the single-family home, built environment that some developer created long ago. Then the number of people per unit of land is restricted: homes near economic activity become playthings of the rich, and any new home that is affordable is taking away wildlife habitat and farmland.
In short, their stance is understandable, but it is sociopathic.
https://www.sfhac.org
Do you believe this is an honest characterization of their core goal? Is the opposition's number one goal simply to oppose multifamily property? Like, "God ordained that no two families should live in a single structure"? Or is it about property valuation changes, or building height, or street parking, or land use, or decreasing number of (semi-permanent) owners and increasing number of (temporary) renters, or...?
> Do you believe this is an honest characterization of their core goal?
Yes. I can quote Rothstein about racist motivations[0] or Marohn about short-sighted financial recklessness,[1] but I believe more people have nostalgia than malice. Even if they deploy structural racism and racist rhetoric.
Most people become set in their ways very quickly, and have difficulty imagining what is good other than what they thought was good when they were young. By now, you cannot find a native-born American who grew up in a time before cars became supreme. Most Americans don’t even remember a time before the Suburban Experiment.[2]
So, yes, people will bring up building heights, and respecting the neighborhood, and traffic, and parking über alles, but I think the main motivation is that they can’t imagine someone else can have a good life that is a benefit to the community other than the life that they think is a good life.
[0] https://smile.amazon.com/Color-Law-Forgotten-Government-Segr...
[1] https://www.strongtowns.org
[2] https://www.strongtowns.org/curbside-chat-1/2015/12/14/ameri...
Right, I'm pretty sure I specifically acknowledged this in my previous comment.
why some feel because they have it already that they should be able to exclude others from having it in the future
If some hypothetical resource has a determinate carrying capacity and any greater usage degrades the resource for everyone, it's not unreasonable to exclude people. See the fixed number of backcountry permits Yosemite issues. Some things simply cannot be had by everyone. Given this, how do you decide who gets, and who does not get?
We really only have three systems that I know of- 1) lottery, ala Yosemite permits 2) free market, ala Bay Area low density housing, also ski condos 3) precedent/i-was-there-first, ala people who already own a house there get to stay there as it becomes desirable, also prescriptive easements of public trails on private land
Yes, building a bunch of new units will change a neighborhood. Yes, changing zoning will alter a neighborhood.
What, precisely, gives everyone who wishes to live in an area the "right" to live there affordably, as defined by whatever arbitrary definition?
I am all for relaxing zoning and building new houses because the rent is too damn high, but I also see this attitude in NYC and it is insane.
No one has a right to move to NYC, and most particularly my block. If you don't like the prices, no one is forcing you to move in to my neighborhood. Actually, I'm beyond saturated with people moving in to the neighborhood I invested 20 years in to, and subsequently telling me and my neighbors who did similarly how to live, how to behave, and driving every existing business away and replacing it with the same exact thing but priced at triple.
And yes, I know gentrification and new developments are orthogonal and in many cases allowing more construction would lower rents and transitively lower prices which is why I am generally in favor of relaxing zoning.
But this general sense of entitlement, SHEESH! You don't have a right to move on to my block, at whatever price you feel like paying.
> No one has a right to move to NYC, and most particularly my block.
People have a right to use their property as they see fit. If that means tearing down a brownstone in your neighborhood and building a high rise so a bunch of people from the Midwest can move in, so be it. The government can limit those rights when necessary, but the affirmative burden is on the party demanding such regulation to show why it is necessary to interfere with peoples’ property rights.
Says you. I don't see that. Although I live in a working-class area in a lesser city, I've worked to make my community better, and my interests don't stop at money.
"People have a right to use their property as they see fit. If that means tearing down a brownstone in your neighborhood and building a high rise so a bunch of people from the Midwest can move in, so be it. The government can limit those rights when necessary, but the affirmative burden is on the party demanding such regulation to show why it is necessary to interfere with peoples’ property rights."
But you are the one arguing for gov't intervention. The locals want things to stay the same. Its local landowners who don't want change. I don't understand this part of your argument.
No, the law says that. The law lets you capture the increased value of your property. That’s the nature of a property right. Property rights don’t give you the right to dictate how other people use their property. Even zoning laws were intended to protect neighborhood health and safety, not the locals’ interests in preventing change.
> But you are the one arguing for gov't intervention. The locals want things to stay the same. Its local landowners who don't want change. I don't understand this part of your argument.
Owning property gives you complete dominion over that property, by default. If I own a brownstone, and want to tear it down and build a high rise, I can do that. That’s the nature of property rights. What prevents me from doing that is zoning boards, historical conservency laws, etc. Thats government intervention.
What are ways in which people are telling you to live?
I'm looking forward to the 3X price jumps of businesses in my neighborhood - it might improve the quality of the food and options. I say that entirely with a straight face - since almost all the food options are 'affordable', the food options are greasy, unhealthy and also lacking in diversity.
My take is, everyone has a right to try to 'make it.' People don't need to take note of how the community was 5, 10, or 50 years ago as the city is continually changing. Almost nowhere in NYC is a neighborhood static in terms of pricepoints, culture or just about anything else.
I think it's reasonable for people who have lived decades someplace to want this preserved, and it's equally reasonable for new people to come in with new ideas.
It's a zero-sum game and so the law has to view these things without biasing any group as much as possible.
Is that a restaurant or did you mean that literally?
Imagine a cross between Sizzler, Hometown Buffet, and a middle school cafeteria, but focused on salad. Make it really crowded, but what empty tables exist seem to always be dirty and unbussed. Sprinkle with unsupervised children running around and randomly touching the food in the buffets. Mix in crowds of very slow people who enjoy standing in everyone’s way while they slowly investigate every single item in whichever buffet you’re interested in, and once they finally decide what to get you have to watch them slowly make a salad by painstakingly picking out one piece of lettuce at a time as if they were performing brain surgery.
It’s probably OK if you go there during whenever their downtime is, but I have no idea when that is or if such a time even exists in the Sweet Tomatoes dimension. But if you don’t mind crowds and germs and value optimizing your money:mass ratio for food above literally every other possible consideration, it’s great! But even then I wouldn’t dream of using the restrooms there- the person you responded to is clearly far braver than me.
Though I recall putting some chunked (presumably canned) pineapple on my plate once, taking it back to my table, and chomping into it before realizing it had (apparently) fermented.
We still went back months after month.
I don't see how this differs substantially from "FU, I got mine." You're going into more detail on how you got yours and you're not cursing, but you're still saying people who have come later than you seeking the same sort of thing you have should be excluded.
Do you really think your contribution to the community is worth the increase in the value of your home, or did you just buy in an area that was at the forefront of an economic renaissance, and you capture the value of that, while seeking to prohibit others from participating?
You should consider how the people that bought 15 years before you felt. Why does the buck stop with you? Why assume that people moving in won’t contribute to the community?
Perfect.
A few things changed my mind. First, many people I knew personally had to move out of the area because of the cost of housing. It sucks to have to uproot your life due to rising housing cost you can’t keep up with.
Second I came to realize that long term, the area either has to accommodate the inflow, or decline. The Bay Area is full of first and second generation immigrants and people who care from around the country to live her. They built SV and the companies we love/work at. If it’s too expensive for them they will stop coming, and in thirty years we’ll be in a retirement community (albeit a low density one...)
So now I say, build build build. It might bring traffic but that’s a small price to pay for the long term health of the area. My bigger concern now, and what I think cities should focus on, is how to build lots of housing while still maintaining high quality of life for everyone.
Edit: also remember that in California, you are really protected/subsidized if you are a home owner. Your property value will increase with no change in property tax due to Prop 13. Density and people moving in will generally drive up property values which will benefit you financially.
This means that hard-working people should be able to find opportunity when they come here, and the market shouldn’t reward speculators for sitting on land without making any improvements. Landlords should be rewarded for maintaining the building, and for constructing new housing, but not for appreciation on the land.
But the Bay Area housing market has seemingly been designed to do the opposite. Proposition 13 protects land speculation by limiting property taxes to a little over 1% of assessed value and rewards seniority through the the acquisition value pyramid scheme. It also encourages localities to raise funds through counterproductive development fees instead of broad-based taxes. And despite the strong economy, our rate of housing construction is far below past times and other cities. We have a housing market that rewards holding onto properties, allows landlords to capture wage growth, and discourages development. I would like to see this system change.
For your points about discouraging demand, I think I would agree at the national level but not at the local level. The federal government should encourage companies to locate in other cities. But localities have little power to do so. What local governments can do to discourage housing speculation is to increase land taxes and allow developers to flood the market with more housing.
Millennials have been in a very poor position to start with, but Prop 13 really drives the last nail into the coffin.
I absolutely object to your view that people want to live here "cheaply". People want to live in SF _affordably_. As in, not having to put 75% of their income toward housing, which is an insane thing to have to do. I've been living in the bay area since 2004, the last 8 years of which have been in SF. I've been working hard to get to the point where I could buy my own place, but every year it becomes harder to justify buying over renting. At this point I do have the money, but it feels financially irresponsible to buy. But I love this city and want to put down long-term roots, and perpetually renting just doesn't seem to be the way to do that. Why don't I get a shot at helping to build the community?
It's not just me. I'm fairly well-off at this point, and many people, some who have lived in SF far longer than I have, are getting hurt by all this. Take service workers, who have been all but priced out of the city. More likely than not the cashier ringing up your groceries, the barista making your coffee, the person who comes to clean your house, the waiter at your favorite restaurant... they used to get to work by hopping on Muni or BART, but now they have to drive over an hour to get to work. How is that ok?
So yes, this is why I and others point fingers at you and say you embody the "FU, I got mine" attitude. You got in at a good time. I don't doubt that you put work into community building over the years, or that you took on some risk. But it absolutely floors me that people like you don't get how much of your current situation is completely down to pure dumb luck. And that's what this is all about: leveling the playing field for everyone, not just people who have money, or were lucky enough to be born at the right time or move in at the right time.
To be clear, I'm not raising up my pitchfork here or coming at you angrily. At this point I'm just extremely frustrated, disappointed, and sad. To echo your sentiments, I find it hard to believe that people on "your side" don't see the obviousness of what I'm saying. I mean, does SF seem like a healthy city to you? Do you really think that just ignoring these housing issues is going to make everyone leave and everything will go back to normal?
To address some of your points directly:
> Make places less attractive, demand goes down, and prices go down. There are huge swaths of the US other than San Francisco that are in dire need of industry and people. Why not encourage companies and people to move to those places?
Two reasons: 1) for a company, betting on an untried/untested job market to fill your needs is a ridiculously risky proposition. A company like Toyota (moved from Torrance, CA to Plano, TX) can take risks like that because they're a more mature business with a large margin for error and can absorb that pain. Most SF and bay area companies can't take that risk. 2) People such as myself just don't want to live in those places. I'm in my mid-30s right now, and I don't have the desire to spend 15 more years building a community as you claim to have done. I'm fine paying more than you did back then to enjoy the benefits of a more-established community, but the current situation is just ridiculous, untenable, and unsustainable.
> Wages clearly aren’t high enough to give workers salaries that allow them to buy properties. Raise wages, and some companies will naturally move elsewhere. Jobs will go with them, and demand will go down.
That's easy to say, but, again,...
No, they want to pay market rates. And people want to use the power of government to stop them.
> And, they’re trying to use government and political power to force me to give up what I’ve helped build.
No one is trying to get you to give up what you own. What's being asked is that you stop trying to take from other people what they own. One of your neighbours who also helped build this community wants to build some apartments on their land. If you pass laws that stop him, then you are using political power to make someone give up what they've helped build. You are not the victim here, come what may; you are either the villain or a bystander.
> No one is addressing the demand side of this issue. [...] Why not encourage companies and people to move to those places?
Sure, great idea. But 1) it can happen in parallel with addressing the supply side and 2) if it's such a great idea, why don't you do it? The reasons why you don't want to apply to everyone else too. That "hey, I like it in SF, but you should move to Topeka" attitude is the exact "FU attitude" you claim not to have.
> Wages clearly aren’t high enough to give workers salaries that allow them to buy properties. Raise wages...
First off, that'll do nothing to actually fix anything; you'll just have more money chasing the same number of houses. That's a recipe for inflation. If I had a magic wand I could wave that would instantly double every salary and hourly wage in SF, all waving it would do is also double the rent. Second, that'll actually make the problem worse by drawing more workers into the area chasing the higher wages.
If you are trying to fix this by tinkering with wages (a bad idea!) it would make more sense to cut wages, or institute some extremely eye-watering tax rates at higher bands. The second an 80% tax rate on incomes over 80k is instituted, you're going to see a massive clear-out of tech workers from SF, followed by a collapse in rent and housing prices. Again, not a good idea, but at least it'd work...unlike your idea.
> some companies will naturally move elsewhere. Jobs will go with them, and demand will go down.
That's not how markets work, incidentally. Wages and jobs and house prices do not exist in a vacuum.
> I’m not sure how one can disagree with my points.
Easily. :)
You are not the owner of the community you help produce. In fact, every renter that lived in your area also contributed to that community and for their favor they were slapped with higher rents. Are you personally going to pay renters for their contributions to the community?
> As I’ve said in the past, No one is addressing the demand side of this issue. Make places less attractive, demand goes down, and prices go down. There are huge swaths of the US other than San Francisco that are in dire need of industry and people. Why not encourage companies and people to move to those places?
Why not encourage landlords to leave, by the same logic? Renters in the end are actually more people that landlords, so by simply trying to benefit the majority might as well punish landlords, right?
> Also, the elephant in the room is foreign buyers. I looked through SF tax records the other day. I picked a random street, and most of the homes were owned by foreign trusts. Why not try to stop that first?
You can stop all things together buy allowing to build more. Not only that, you could also use Land Value Tax to replace income tax, and eliminate income tax and sales tax. You could remove prop 13, rent control and mortage interest deductions from income, and it would make taxes simpler, easier and would stop speculation, would stop landlords wanting to keep 100 year old unsafe houses with mold, etc.
The book begins by taking a look at the Bay Area in particular.
The problem is that the infrastructure around it needs massive improvements to scale.
A suburban density increase is a good thing, because the denser housing leads to denser income flow to local governments, which go to things like water/sewer, road, and other improvements that need to be paid for. Economies of scale mean that suburbs are terribly inefficient.
An increase of density in NYC has had the opposite result. It's false to claim that there's no housing being built - there's plenty of it, and it's dense, and often times 20+% of it is legally affordable (rent stabilized due to developer tax breaks). Yet more people keep moving here. The issue is that one of the main infrastructure bottlenecks never kept up and it has become one of the topmost, if not the topmost quality of life issue in NYC: the public transport system.
It's all well and good to build density, but the municipalities need to move lockstep with housing increase. Unfortunately, I think that the decentralized nature of American political life makes this quite difficult. How can one of dozens or hundreds of city agencies keep tabs on one of dozens or hundreds of various other factors.
We need to figure out how to get 10 million out of the State.
This is the same anywhere there's direct democracy. 51% of the people vote in the government that perpetuates the ponzi scheme of rising house prices because borrowing from the bank to buy a house then selling it later for a profit is the quickest path to retirement. Restricting housing supply is one easy way to keep house prices rising. The government needs to feed a story to the other 49%, hence these illusions like in California.
Besides restricting supply, another way to keep the prices rising is to boost demand, so the 51% also vote for the governments that increase immigration, which has been especially successful recently in the western US, Canada, and Australia/NZ. Every now and then, a government comes along that attempts to boost housing supply or restrict demand from immigrants or foreigners, but they soon get voted out because early retirement is the top criteria of voting decisions for the 51%. That government's initiative then becomes another carcass used to fool the other 49%.
Most people would rather cheaper home prices, given the choice.
Uh, not quite. 51% of the voters. I highlight this because it's incredibly important to understand that only voters have power, and if you refuse to vote then you will be screwed by politicians in favour of people who actually keep them in power.
California does not have one, in general.
If California municipalities 'don't want to enable building' because their residents don't want it ... well ... then they will have fewer people, probably higher housing costs and that's their choice.
If the 'average bay policeman' or whatever can't afford to buy a home for 100 miles - then the citizens of Cali are going to have to pay their cops more, or, those cops will go elsewhere.
It's a fairly fluid and competitive landscape - more so than most places on earth.
There's a high demand for living in some parts of Cali and it's going to be like that for a long time, even with some building it won't change.
It's a choice Californians seem to be making, it's their choice.
If town councils are arbitrarily messing things up against the will of the people - who want to see high rises everywhere ... well that's another story.
Housing is even worse. Many of the people I interact with are immigrants, so they are blamed for the high prices, but they are unable to vote to fix it.
It’s the old homeowners who organize and produce fractionally higher voter turnouts, that turn elections their way. Especially local elections, that have the most impact on land use policy. A minority harm the majority because they vote more.
The good news is that YIMBYs are now organizing, too.[0] You can even make tax-deductible donations to bring lawsuits against local governments that violate state law by refusing to allow housing.[1]
[0] https://yimbyaction.org
[1] http://www.carlaef.org
I don't think that part is true -- they'll still have more people, but those people will be doubling (or tripling) up in single family homes or (often illegal) in-law units, causing parking, traffic, infrastructure and other problems of increasing density in neighborhoods that were not designed for it.
I see that in a neighborhood I pass through on my way to work -- cars parked on sidewalks and front yards, and long lines of traffic at the only traffic light that leads out of the neighborhood.
Create multiple ways for people to commute from 30 miles away in 30 minutes and housing will be much less of a problem with people having many more options.
Proof: If people could instantly teleport between work and home no matter how far apart they are, do you really think they would still cram into SF Bay Area or LA housing? Hell no. Housing is the symptom of poor transportation infrastructure.
But the effect is multiplied if this highrise is in an city with many highrises. Now, instead of commuting 30 miles to pass another 1,500 single homes to reach work, the inhabitants of our highrise may only have to walk 1 mile to pass the homes of a similar amount of people and reach work.
[1] https://varlamov.me/2016/china_ray/09.jpg
Take a look down any street in the Financial District. What we want is that, just more of it over a larger surface area.
If you legalize housing next to work, then you reduce the amount of stress on the transit systems we already have. It's just plain more efficient.
The only compromise for existing home owners could be to balance out job and home zoning so that there is no massive excess or deficit on either side.
30k new jobs + 8k new housing units = higher housing prices
Or for a more hilarious ratio, look at Mountain View over the last 15 years. I think for a decade there were effectively zero new units created.
Red Cities and red states get it, they generally don't have these problems, even the extremely high growth ones: like Houston.
Look at any old European city like Paris or Amsterdam or Saint-Petersburg. A historical part of the city with 3-5-7 floor buildings looks so much better than modern cities with skyscrapers.
And I am not sure that building new houses will solve the problem. New houses and lower living cost might attract even more people to move to California.
[1] https://varlamov.me/2016/china_ray/09.jpg
[2] https://varlamov.me/2016/china_ray/11.jpg
Given how expensive land in California it is unlikely that developers will try to save every cent on buildings them-self.
Why does the government have to be incompetent? Maybe just admit that prop 13 was a bad idea?
Fixed that for you.