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In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

nytimes.com

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Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#41

Post by abalone »

pmcollins wrote: post #36

I grew up in California, went to Berkeley, and worked in there for years, but I couldn't stand the backwardness of California's homeowner cabal anymore and moved out of state. In my new state, there's no rent control, no NIMBYism, and homes and neighborhoods are beautiful and affordable. Sure, there's more room to grow here, fewer people, and a smaller economy, so it's not a completely fair comparison, but take a mom…

> Sure, there's more room to grow here, fewer people, and a smaller economy, so it's not a completely fair comparison, but take a moment and look on a satellite map at how much land in the bay area is completely undeveloped, most of it on hillsides.

To say it's not a fair comparison is putting it rather lightly. Those are the three biggest factors that influence pricing.

Your entire premise is that Bay Area rents are high because of an excess of "completely undeveloped land". That defies credulity and is far from evident from satellite imagery.

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#42

Post by dexterdog »

MichaelBurge wrote: post #8
raldi wrote: post #4

Earlier quoted context omitted.

1979, and that rule comes from a state law called Costa-Hawkins which prohibits any California municipality from requiring rent control on any new unit constructed after then. The intention was to spur construction by offering a carrot to anyone who built a new (and presumably bigger) apartment building. The unforeseen consequence is that now city planning commissions in places like SF simply don't issue demolition p…

> The unforeseen consequence is that now city planning commissions in places like SF simply don't issue demolition permits anymore for pre-1979 apartment buildings. Is that even legal? It's one thing to use zoning for city planning as a general guideline, or to require permits to ensure work is done safely; but people ultimately have rights to their property. Has it been taken to court before? It's borderline a viola…

Of course it's legal. Just ask the guys that write the laws to protect the people who pay for their campaigns.

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#43

Post by pappyo »

tuna-piano wrote: post #25

Supply and demand explains all. When more people want something than there are available, prices increase - until the price increases enough to ration the available supply to the highest bidders. For those calling for rent control, they are advocating a different method of rationing the available apartments... leaving multiple interested people for one apartment. Why is the non-price way of rationing better than rati…

Because you've turned a "neighborhood" into an "investment property." Neighborhoods develop culture. Investment properties develop nothing other than capital that leaves the neighborhood.

What happens when the Silicon Valley boom is over? What happen to those neighborhoods? I guess that's not your problem.

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#45

Post by ZanyProgrammer »

johnwatson11218 wrote: post #32
CydeWeys wrote: post #24

Earlier quoted context omitted.

What's wrong with making San Francisco more like Tokyo? Do you know how much economic productivity is lost because zoning regulations prevent further densification that is otherwise desired?

I'm not against making it look like Tokyo, I agree that it would be more productive if it were more dense. I don't live there so it isn't my problem. I do think that it limits the amount of economic growth and could hurt the national economy. I think it could also make it easier for other countries to leap frog us in terms of software but that is very speculative.

There's a lot of room between SF now and Tokyo. Even moderate increases in density and building housing stock. It's not a binary choice of the status quo or a dystopian nightmare.

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#46

Post by cauterized »

johan_larson wrote: post #2

Has any place every imposed rent controls, but later removed them? Some of those quoted in the article speak of rent control as a temporary measure, to buy time while other more permanent solutions to be brought to bear. Does that ever happen?

NYC has been gradually deregulating rent controlled and rent stabilized apartments as previous tenants move out or pass away. (The original intention was partly to make sure people on fixed incomes - especially the elderly - wouldn't lose their long time homes). I won't say that deregulation has done anything to improve the housing market tho. Supply and demand for land, the cost of construction, and the city's enormous population growth have far bigger impacts on the availability of housing, affordable or otherwise.

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#47

Post by pash »

tuna-piano wrote: post #25

Supply and demand explains all. When more people want something than there are available, prices increase - until the price increases enough to ration the available supply to the highest bidders. For those calling for rent control, they are advocating a different method of rationing the available apartments... leaving multiple interested people for one apartment. Why is the non-price way of rationing better than rati…

> Why is the non-price way of rationing better than rationing based on who is willing to pay the most?

It's not. But rationing by price has little advantage if you're not going to allow anybody to build more housing: the basic benefit of the price mechanism is that higher prices recruit more resources to employ towards increasing supply. But if you're going to fix supply though a NIMBY-dominated political process, then every dollar of increased rent is going to end up in the pockets of property-owners, not budging the supply of housing, to the unallayed detriment of renters.

This is a both a partial explanation of why NIMBY-ism is so pernicious and of why capital (foreign or otherwise) is so strongly attracted to NIMBY-dominated, supply-constrained markets like the Bay Area.

The quality of commentary on these issues in the press and in the political process is abhorrent. If anyone with a basic understanding of economics is interested in learning more about the economics of rationing, I recommend starting with Economic Analysis of Property Rights, by Yoram Barzel [0,1].

0. Publisher's site: http://www.cambridge.org/us/academic/subjects/economics/indu...

1. Amazon: https://www.amazon.com/Economic-Analysis-Political-Instituti...

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#48

Post by alasdair_ »

hueving wrote: post #40
arbuge wrote: post #35

Earlier quoted context omitted.

>> The solution is to build more good US cities that aren't car centric. I'm not aware of any. NYC is definitely not car-centric or even car-friendly. Indeed, the non-car-centric zone there is considerably larger than SF's. Other cities like Washington DC and Boston are not too different so long as you don't venture too far from downtown.

The weather and people there are crap if you're used to the west coast. Winters suck and the rudeness of NYC people is insufferable in the long run for me.

Portland and Seattle are both excellent cities to live in if you want a car free existence on the west coast.

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#49

Post by alasdair_ »

hueving wrote: post #40
arbuge wrote: post #35

Earlier quoted context omitted.

>> The solution is to build more good US cities that aren't car centric. I'm not aware of any. NYC is definitely not car-centric or even car-friendly. Indeed, the non-car-centric zone there is considerably larger than SF's. Other cities like Washington DC and Boston are not too different so long as you don't venture too far from downtown.

The weather and people there are crap if you're used to the west coast. Winters suck and the rudeness of NYC people is insufferable in the long run for me.

Portland and Seattle are both excellent cities to live in if you want a car free existence on the west coast.

Re: In Silicon Valley Suburbs, Calls to Limit the Soaring Rents

#50

Post by throwaway76543 »

pappyo wrote: post #43
tuna-piano wrote: post #25

Supply and demand explains all. When more people want something than there are available, prices increase - until the price increases enough to ration the available supply to the highest bidders. For those calling for rent control, they are advocating a different method of rationing the available apartments... leaving multiple interested people for one apartment. Why is the non-price way of rationing better than rati…

Because you've turned a "neighborhood" into an "investment property." Neighborhoods develop culture. Investment properties develop nothing other than capital that leaves the neighborhood. What happens when the Silicon Valley boom is over? What happen to those neighborhoods? I guess that's not your problem.

This is utter nonsense. There's no evidence that neighborhoods made up of renters are any more or less "cultural" than neighborhoods made up of, well, you haven't really articulated an alternative have you? Do you expect everyone to purchase a home, and not have renting at all?

Generally areas regarded as having a vibrant culture also correlate with high percentages of renters -- because they're in cities. Areas with high percentages of homeowners and low percentages of renters tend to be suburbs.

In any event we can answer your question of what happens when the boom is over because we've already lived through two tech booms in this area. The answer is: Prices fall and folks with investment properties will lose some money but not much else changes. Homeowners get hurt a lot more than renters when bubbles pop.

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