Rents in Megacities Can't Go Up Forever • Hacker News Board

Re: Rents in Megacities Can't Go Up Forever

#111

Post by dpark » Thu, Mar 23, 2017, 3:28 PM UTC

robterrin wrote: post #60

reverend_gonzo wrote: post #33

Earlier quoted context omitted.

I live in Chicago. I love it here because of everything else it has to offer. I have everything almost everything I need available to me within walking distance from home. That includes grocery store, dive bars, cheap restaurants, high end restaurants, clubs. For anything else I may want to do (concerts, sports games, plays, comedy), there are dozens of world class options within a ten minute cab drive / 30 minutes o…

I've heard this pitch for Chicago many times, and it seems reasonable if you are in the one of the industries, Tyler mentions, that are more diffuse. The main problem with Chicago is it lacks an anchor industry. Is it the best place to be for finance? No, that's NYC. Is it healthcare? Boston, Baltimore, Cleveland or Rochester. Energy? Houston. Technology? SF. Entertainment? LA or NYC. Politics? DC. What exactly is Ch…

> The main problem with Chicago is it lacks an anchor industry. Is it the best place to be for finance? ...

This is a weird expectation. Why does a city have to be "the best" at something? Seattle isn't the best place for software but I'd still choose it over SF any day. Chicago has plenty of industry.

Re: Rents in Megacities Can't Go Up Forever

#112

Post by Arizhel » Thu, Mar 23, 2017, 3:28 PM UTC

trapperkeeper79 wrote: post #98

This article crystalizes a point that was vague in my mind: "megacities have a problem making it affordable to raise large or even medium-size families. How many of us could live in San Francisco, London or New York City and bring up three children in a decent neighborhood with good schools? Only the already well-to-do can manage such a feat.". As a mid-30s person with a new baby, I don't see how the numbers work for…

>How many of us could live in San Francisco, London or New York City and bring up three children in a decent neighborhood with good schools?

The simple solution is to not have any children. Leave that to extremely rich people and very poor people. Society obviously does not support child-rearing, given the cost of housing and the lack of support from employers, so why fight it?

Re: Rents in Megacities Can't Go Up Forever

#113

Post by Declanomous » Thu, Mar 23, 2017, 3:28 PM UTC

robterrin wrote: post #60

reverend_gonzo wrote: post #33

Earlier quoted context omitted.

I live in Chicago. I love it here because of everything else it has to offer. I have everything almost everything I need available to me within walking distance from home. That includes grocery store, dive bars, cheap restaurants, high end restaurants, clubs. For anything else I may want to do (concerts, sports games, plays, comedy), there are dozens of world class options within a ten minute cab drive / 30 minutes o…

I've heard this pitch for Chicago many times, and it seems reasonable if you are in the one of the industries, Tyler mentions, that are more diffuse. The main problem with Chicago is it lacks an anchor industry. Is it the best place to be for finance? No, that's NYC. Is it healthcare? Boston, Baltimore, Cleveland or Rochester. Energy? Houston. Technology? SF. Entertainment? LA or NYC. Politics? DC. What exactly is Ch…

Chicago has finance, it just doesn't have Wall Street. If you want to trade options or commodities Chicago is arguably a better place to be. New York is undoubtedly the better place to be for stock trading.

As far as entertainment goes, it's no accident that a huge number of comedians get their start in Chicago.

Chicago has tons of anchor industries, the real problem is that they don't translate well to the unicorn strategy of most start-ups.

Re: Rents in Megacities Can't Go Up Forever

#114

Post by scurvy » Thu, Mar 23, 2017, 3:28 PM UTC

acchow wrote: post #74

ntdef wrote: post #71

Earlier quoted context omitted.

I think you're a bit misinformed. Chicago has two large keystone industries that serve the global economy: (1) Industrial large scale manufacturing (Boeing, John Deere, Caterpillar), (2) Insurance (all of them); not to mention a ton of Food and Agriculture HQs are based there as well.

Isn't Boeing in Washington? Also, not too many people aspire to be in insurance. I don't think you can put it on the same level as finance, arts, software, fashion, film, etc.

They left Washington a while ago; I think over taxes?

Re: Rents in Megacities Can't Go Up Forever

#115

Post by scurvy » Thu, Mar 23, 2017, 3:29 PM UTC

elindbe2 wrote: post #101

robterrin wrote: post #60

Earlier quoted context omitted.

I've heard this pitch for Chicago many times, and it seems reasonable if you are in the one of the industries, Tyler mentions, that are more diffuse. The main problem with Chicago is it lacks an anchor industry. Is it the best place to be for finance? No, that's NYC. Is it healthcare? Boston, Baltimore, Cleveland or Rochester. Energy? Houston. Technology? SF. Entertainment? LA or NYC. Politics? DC. What exactly is Ch…

NYC is more the equity side of finance, Wall St. and all that. Chicago is home to the largest futures exchange in the world, the CME and the largest options exchange, the CBOE.

What about debt?

Re: Rents in Megacities Can't Go Up Forever

#116

Post by kesselvon » Thu, Mar 23, 2017, 3:29 PM UTC

robterrin wrote: post #60

reverend_gonzo wrote: post #33

Earlier quoted context omitted.

I live in Chicago. I love it here because of everything else it has to offer. I have everything almost everything I need available to me within walking distance from home. That includes grocery store, dive bars, cheap restaurants, high end restaurants, clubs. For anything else I may want to do (concerts, sports games, plays, comedy), there are dozens of world class options within a ten minute cab drive / 30 minutes o…

I've heard this pitch for Chicago many times, and it seems reasonable if you are in the one of the industries, Tyler mentions, that are more diffuse. The main problem with Chicago is it lacks an anchor industry. Is it the best place to be for finance? No, that's NYC. Is it healthcare? Boston, Baltimore, Cleveland or Rochester. Energy? Houston. Technology? SF. Entertainment? LA or NYC. Politics? DC. What exactly is Ch…

That's also the main benefit of Chicago. The city isn't incredibly screwed when one industry goes belly up (i.e. Detroit and automotive).

Re: Rents in Megacities Can't Go Up Forever

#117

Post by Arizhel » Thu, Mar 23, 2017, 3:29 PM UTC

davidf18 wrote: post #77

The author of the article is a professor of economics but doesn't state the true cause of rising housing costs: Market inefficiencies (or market failures) caused by politically induced market scarcity restrictions called "rent-seeking" which benefits landowners such as President Trump over people who rent or are purchasing housing. Rent-seeking was first illustrated by David Ricardo in the mid-19th century (IIRC) and…

>Remember, rising prices come from scarcity. Eliminate the scarcity and your eliminate the high prices. Reverse the zoning density restrictions and you get lower prices.

Yes, but why would you want to do this? Or more accurately, why would the powers-that-be in a given area want to do this? They already have their real estate, and they're profiting by the rising prices. Why would they want to bring prices down?

Re: Rents in Megacities Can't Go Up Forever

#118

Post by wan23 » Thu, Mar 23, 2017, 3:30 PM UTC

mehaveaccount wrote: post #103

lordCarbonFiber wrote: post #83

Earlier quoted context omitted.

While there's certainly some true to that statement, I think you're being overly cynical. People congregate in cities to be near _people_ . For sure with a good internet connection I could do all my work from small town america living in a mcmansion at a quarter of my rent; instead I live in nyc. Access to artistic communities, robust public transit, diverse food and culture, and a fluid job market makes the value ad…

I have to disagree strongly. I live in NYC for work. I actually hate living here and I don't like the people I'm around. I am desperately looking for a way out of this city but my family lives on Long Island, so it's hard to justify going to another city.

Why don't you move to Long Island and commute? If you don't like the city there are plenty of smaller towns nearby and it's cheaper too.

Re: Rents in Megacities Can't Go Up Forever

#119

Post by startupdiscuss » Thu, Mar 23, 2017, 3:31 PM UTC

glibgil wrote: post #94

startupdiscuss wrote: post #62

Earlier quoted context omitted.

That's not snarky, and you have a point. But even if things seem "really obvious" and we can tell "just by looking at the facts", I feel better if someone has looked at the data and shown that to be the case. We aren't living in the feudal era, and a lot of people like to think that the reason people move to the cities is because of (for instance) bars and restaurants, museums and the opera, high-paying jobs and so o…

> bars and restaurants, museums and the opera, high-paying jobs And these would actually be rent seeking activities? Is that the idea?

That wasn't what I was thinking of.

I was just contrasting two different types of reasons for why people cluster in those cities.

Type I, the optimistic theory

Information is more efficient and trust is better when people meet in person. Industries need to co-ordinate trust and information flow through lots of people, so they have to be in the same place. They produce a lot of value, which produces wealth and increases productivity. That wealth pays for all these great things.

This causes a happy cycle of smart and educated people being attracted to the "good" things in life coming to the cities, and providing labor for the companies and so on.

Type II, the pessimistic theory

In order to get industries going (tech startups, new Oil and gas company etc) you need capital, and the capital exists in these enormous clusters. So the people who want to fund the industry has to go to these clusters of existing capital and convince them to invest them. The returns from the success of the industry go back to the same place and so on.

The existence of the bars, restaurants and museums are compatible with both, but only have causal power in the first type of theory.

Re: Rents in Megacities Can't Go Up Forever

#120

Post by fluxic » Thu, Mar 23, 2017, 3:31 PM UTC

trapperkeeper79 wrote: post #98

This article crystalizes a point that was vague in my mind: "megacities have a problem making it affordable to raise large or even medium-size families. How many of us could live in San Francisco, London or New York City and bring up three children in a decent neighborhood with good schools? Only the already well-to-do can manage such a feat.". As a mid-30s person with a new baby, I don't see how the numbers work for…

Montreal?