61–70 of 326 posts
Of course it is. It artificially limits supply due to long term rent squatters taking advantage of the system
Did anyone read the excerpts in the article and not come to the conclusion that rent control caused this? It sounds to me to like greedy landlords being greedy. It feels like the title and the thesis of the news piece is either incorrect or at least misleading.
Rent control solves some problems. Creates other problems. Similar to almost any intervention in free markets. Sometimes the cost of intervention outweigh benefits, sometimes they don't. Rent control allows people (wealthy or poor) to remain where they are without purchasing their residence. Unfortunately, to do accomplish this objective, it increases the price for new arrivals (be they wealthy or poor). In Californi…
> Sometimes the cost of intervention outweigh benefits, sometimes they don't. + Sometimes it works for a short period, as the policy reflected the economy at the time of creation, then becomes irrelevant via technology/market reaction to policy/general progress... but yet stays a policy for decades. The important point is that we rarely ever measures whether it does work or not, and policy tends to have an extremely…
Rent control is a failed experiment. All it does is force land lords to massively increase rent amounts when someone moves out to account for multi-year market increases. Basically, if the real market price of an apartment is ~$3,000/mo, but in 5 years it realistically would be $5,000, they will simply list it for $5,000 now, to mitigate the loss. My mother-in-law is a land lord in Los Angeles (a very fair one at tha…
Landlords will rent at whatever they can a tenant to pay for, not some number in their mental ledger.
Earlier quoted context omitted.
My mother-in-law is a land lord in Los Angeles I'm a tenant in Los Angeles, and a staunch supporter of rent control. Knowing that my rent (which is already high) can only go up so much year-over-year provides some bit of stability as the tech industry devours eastward from Santa Monica.
I've been paying attention to what economists say fairly rigorously for the last ten years and they have some huge blind spots. One of them is they completely and utterly ignore the importance of income and social stability. Which is they see any expenditures needed to provide those as a unacceptable drag on society.
They don't ignore it, they're just not ignorant about the costs of income and social stability.
For example: I grew up in a relatively modest house (3BR, 1,100 square feet) about 40 minutes outside of D.C. Growing up, there were quite a few young families in our neighborhood. Average household income was probably about $70k/year in today's money--relatively well off but not even what you'd call "upper middle class." Today, you'd need about $130k/year to afford to live in the same house. You're talking about a completely different class of people at those two income levels. It's two people with average jobs (maybe even without a four-year degree), versus two people with mid-level white-collar jobs (GS-11, since this is D.C.). It's people who had kids in their 20s versus people who put off having kids for 5-10 years to focus on their careers.
Today, the people I know starting families in the area are professionals making multiples of what my parents and our neighbors made at a similar stage in their lives. Instead of playing the housing bubble game, my wife and I commute in 60+ minutes each way. Partly because it enables us to raise our kids in a neighborhood with young families. But also just out of spite.
All this "stability" is a huge drag on young people that proponents of things like rent control ignore. That grandma living in her rent-controlled apartment is displacing some family that now has to live out further and end up seeing the kids they put off having for fewer hours each day.
Another second-order effect of rent control is increased traffic. Suppose you have two residents with significantly below-market-rate housing at the same quality level, one in downtown SF and another in Mountain View. The former starts a new job at Google in Mountain View, the latter starts a new job at a trendy start-up in downtown SF. Since they're paying significantly below market rate, they're unable to trade apa…
Another second-order effect of rent control is increased traffic. Suppose you have two residents with significantly below-market-rate housing at the same quality level, one in downtown SF and another in Mountain View. The former starts a new job at Google in Mountain View, the latter starts a new job at a trendy start-up in downtown SF. Since they're paying significantly below market rate, they're unable to trade apa…
They're going in different directions though, so traffic is actually halved.
Earlier quoted context omitted.
>My mother-in-law is a land lord in Los Angeles ... She is a staunch opponent of rent control. Is this supposed to be surprising...? Regardless of whether it works for tenants, obviously rent control isn't there for the landlord's benefit.
Having read up on some of the building purchases in my own neighborhood (East Village of NYC), it seems that rent control is bad for honest landlords and good for the slimey ones who are willing to "encourage" people to leave. And thanks to Coase's theorem the building sales are usually in that direction.
Earlier quoted context omitted.
> Rent Control surely just prevents local families from being muscled out by the tech employees? Correct. And in the process of doing so, further contributes to the lack of inventory of market-rate rental units available to the influx of newcomers/tech employees. As mentioned elsewhere in the comments here, this causes huge disparities for rents of similar units within a given building as landlords attempt to compens…
So what's the solution for addressing this problem, AND not having local families from being muscled out by tech employees? Because whatever is proposed, if it means that local families have to leave because the rent was increased astronomically underneath them, then it's a non-starter.