Controlling rent is the surest way to discourage new housing capacity addition. If your profits are capped fewer people will be interested in entering the market.
Oregon passed sweeping housing crisis laws
101–110 of 278 posts
Re: Oregon passed sweeping housing crisis laws
#102Earlier quoted context omitted.
I accept that, but policy seems to enforce single family home neighbourhoods in many places. This exacerbates the problem of haves and have-nots in the housing market. I'm not in the "ban SFH neighbourhoods" camp, but I think we shouldn't have as much of a problem with them becoming denser. Particularly not when the people already living there tend to have the chance to be well-compensated by selling to developers if…
> Particularly not when the people already living there tend to have the chance to be well-compensated by selling to developers if they want. the developers have a significant amount of leverage in this situation. if they can build one large apartment building in a low-density sfh neighborhood, they can take a significant chunk of value off all the neighboring homes. if they can secure land to build several large bui…
I get that those opposed to density claim this is one of the reasons they oppose it, but is there any evidence of it?
Usually an increase in density in an area will increase land values rather then depress them.
Re: Oregon passed sweeping housing crisis laws
#103"the only state to eliminate single-family-only zoning in many of its residential neighborhoods." - this is the silver bullet. Minneapolis has done the same, I hope this becomes a nation-wide trend.
Re: Oregon passed sweeping housing crisis laws
#104> Lawmakers passed a first-in-the-nation cap on rent increases Unfortunately, rent control will have the opposite effect of what Oregon thinks, and only make housing scarcity worse. https://www.nytimes.com/2000/06/07/opinion/reckonings-a-rent... https://www.governing.com/gov-institute/voices/col-rent-cont... > in an effort to spur new homebuilding, became the only state to eliminate single-family-only zoning in many…
> Unfortunately, rent control will have the opposite effect of what Oregon thinks, and only make housing scarcity worse. It depends on the kind of rent control. Housing has important asymmetries it's reasonable to address through legislation. One is asymmetry in scale: you have one unit; landlords have many more. This gives them stronger negotiating power. Another is cost of change. It's much more expensive for me in…
> The first 15 years of a new building are free from rent control, and after that they can increase rent at 7% above CPI, meaning in real terms rents can still double circa every 10 years. And if a tenant moves out, landlords can raise rents as much as they like.
There are two possibilities here. One is that the maximum rent control rate is above the market rate of housing cost increases, in which case those rent control laws do nothing. This is better than most other rent control, but still no better than no rent control. The other option is that it isn't, and then the rent control laws do something bad, i.e. reduce the incentive to build more housing to fight the expanding market rate rents, and screw new renters a lot to benefit older renters a little. There is still no circumstance where they cause good.
Also, since which possibility happens isn't known ahead of time, they reduce the incentive to build housing today by landlords who expect rents to increase by a lot in the future, even if they turn out to be wrong.
Re: Oregon passed sweeping housing crisis laws
#105Earlier quoted context omitted.
> Unfortunately, rent control will have the opposite effect of what Oregon thinks, and only make housing scarcity worse. It depends on the kind of rent control. Housing has important asymmetries it's reasonable to address through legislation. One is asymmetry in scale: you have one unit; landlords have many more. This gives them stronger negotiating power. Another is cost of change. It's much more expensive for me in…
That means a landlord can extract money well above a true market rate. The market rate IS what the landlord extracts from it, which is what the market, you, is willing to pay.
Why is this being downvoted?
Re: Oregon passed sweeping housing crisis laws
#106> Lawmakers passed a first-in-the-nation cap on rent increases Unfortunately, rent control will have the opposite effect of what Oregon thinks, and only make housing scarcity worse. https://www.nytimes.com/2000/06/07/opinion/reckonings-a-rent... https://www.governing.com/gov-institute/voices/col-rent-cont... > in an effort to spur new homebuilding, became the only state to eliminate single-family-only zoning in many…
> Unfortunately, rent control will have the opposite effect of what Oregon thinks, and only make housing scarcity worse. It depends on the kind of rent control. Housing has important asymmetries it's reasonable to address through legislation. One is asymmetry in scale: you have one unit; landlords have many more. This gives them stronger negotiating power. Another is cost of change. It's much more expensive for me in…
All of this really depends on the scale of the landlord.
There are many retiree types that are renting out their in-law suite or have an extra rental property and definitely cannot afford bad tenant behavior.
They are probably in a worse negotiation position compared to a squatting bad tenant in those cases and very much care about their neighborhood, probably more than the renter.
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OTOH, rent control doesn't matter too much if the max percentage cap is high enough and tenants can't squat in eviction court for months as they destroy the old person's inlaw suite and their home.
Re: Oregon passed sweeping housing crisis laws
#107Earlier quoted context omitted.
Are you saying that because you think it's a good thing or a bad thing? Seems to me like either (or both) of these could be the case.
In most situations it would be good for rich renters and bad for poor renters, for an older building with apartment sizes and amenities that are typical of older buildings to be replaced by a new building with apartment sizes and amenities that are typical of new buildings.
It would be bad for those poor renters who already had apartment. But good for those poor renters who are just entering the market and looking for a home.
Re: Oregon passed sweeping housing crisis laws
#108Earlier quoted context omitted.
I agree with the first sentence. And the last one too. However, San Francisco in particular has worse spatial constraints than NYC. That city has “run out of land.”
75% of SF is single family homes that can be redeveloped, there are 800 acres of private golf courses in SF, how has SF “run out of land”
There are not 800 acres of "private" golf courses in SF. Most of those golf courses are on public land in public parks. Do you also propose SF tear down Golden Gate Park and replace that with housing?
Re: Oregon passed sweeping housing crisis laws
#109So, I probably drastically misunderstanding how rent control works, but I don’t see how it is going to help. I would argue it will push house prices even higher as you will have less people trying to rent places. Why? I was reading a bit about renting as a business (plus I have 1 house in Bay Area I rent) and there is so-called rule of 1%, which means for cash flow to be positive you should rent your house for at lea…
> Based on rule it should be 10k to make it interesting for the investors (buy and rent to make some profit). The only reason I didn’t sell it is the hope that prices will go up in x years, but right now I technically subsidizing people living there + waiting on possible rent increase in couple years.
Maybe the market is telling you that SF house prices are wildly overvalued. Maybe the best move is not to wait for ever higher prices, but sell now.
People seem to be programmed to buy high and sell low, making the old truism to do the opposite very difficult in practice. Your description isn't uncommon, but is very characteristic of the physiology of a top.
Re: Oregon passed sweeping housing crisis laws
#110In previous research, I haven’t been able to find an economist that supports rent control. Does anyone have examples?