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Oregon passed sweeping housing crisis laws

latimes.com

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Re: Oregon passed sweeping housing crisis laws

#221

Post by PunksATawnyFill »

TulliusCicero wrote: post #3

Good. Mandatory single family home zoning should not exist, anywhere. It is exclusionary by nature; economic segregation is often the intent, and in most cases the impact. It's one thing to accept the free market causing this sort of segregation as the collective result of individual choices, quite another to suggest that the government ought to be using regulatory power to help enforce the creation of invisibly gate…

Bogus rationale. So, because minorities couldn’t afford houses, let’s take them away from everyone?

And then the minorities wind up living in, yep, other apartments. That’s a lateral move at best.

Fix the social or economic factors that preclude house ownership for minorities, instead of bringing everyone down.

Re: Oregon passed sweeping housing crisis laws

#222

Post by shkkmo »

AnthonyMouse wrote: post #104
wpietri wrote: post #31

Earlier 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…

> 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 con…

That is not just wrong, but the opposite of what this law does. Since new properties have no rent control for 15 years, during any periods where market rates might reasonably be predicted to rise that much faster than the PCI, new property would be a more valuable investment than existing property (and churn in the rental market would increase as more evictions become profitable.)

Re: Oregon passed sweeping housing crisis laws

#223

Post by coredog64 »

toomuchtodo wrote: post #196
sdenton4 wrote: post #123

Earlier quoted context omitted.

Great! If you can't fill the spot to your liking, you should get out of the game. Sell to someone who needs a place to live, or is comfortable lowering rents and dealing with the work load.

The other option is to simply default and walk away from the property if you can't find a tenant, and you can't afford to eat the loss of selling it.

Not every US state is a non-recourse state.

Re: Oregon passed sweeping housing crisis laws

#224

Post by AnthonyMouse »

shkkmo wrote: post #222
AnthonyMouse wrote: post #104

Earlier quoted context omitted.

> 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 con…

That is not just wrong, but the opposite of what this law does. Since new properties have no rent control for 15 years, during any periods where market rates might reasonably be predicted to rise that much faster than the PCI, new property would be a more valuable investment than existing property (and churn in the rental market would increase as more evictions become profitable.)

Rent control for existing properties raises market rents by encouraging existing tenants to stay even if their apartment is bigger than they need anymore and they might otherwise move to a smaller one or e.g. retire to Florida or Arizona, thereby keeping those units off the market and requiring the remaining demand to be satisfied by fewer units.

Moreover, the relative value of investing in old vs. new apartments is not particularly relevant, because what really matters is the value of investing in building new housing as compared with all other alternative investments, including real estate in other cities or stocks or anything else. And the prospect of rent control at any point in the future lowers the net present value of those investments by the corresponding amount, causing reduced investment in building new housing.

Worse, if the old buildings have rent control and the new ones don't, the tenants will prefer a rent controlled apartment, driving rents up in the old buildings and down in the new buildings (because, unlike investors, tenants do specifically need housing in that city so the relative difference matters), which both increases rents on existing buildings and reducing the incentive to build new buildings.

Re: Oregon passed sweeping housing crisis laws

#225

Post by vl »

BeetleB wrote: post #151
Retric wrote: post #150

Earlier quoted context omitted.

This greatly depends on the number of units. If you’re managing 1,000 units renting them all is a sign you have left money on the table. The safest approach to maximize profit is to increase prices as your vacancy rates drop. The ideal situation is to effectively always have 1 vacancy of each size not 0.

>If you’re managing 1,000 units renting them all is a sign you have left money on the table. That is the very definition of an outlier. Most landlords (easily over 90%) don't even have a 100 units. In fact, most landlords have a target number of units they need to "retire", and that number is usually less than 100.

Managing 1000 units is way beyond full-time job, for this you need staff, which is additional expense.

Re: Oregon passed sweeping housing crisis laws

#226

Post by clairity »

BeetleB wrote: post #155
pmoriarty wrote: post #144

Earlier quoted context omitted.

"It's almost never the case that they can make more money by keeping the rent high and units vacant." Unless they can hold out until property values rise and they can sell for a profit.

>Unless they can hold out until property values rise and they can sell for a profit. Sure, if they've got piles of cash sitting around to pay for the loan, insurance and real estate taxes. Here's another tidbit people don't understand. If the property has more than 4 units, the value of the property is determined almost entirely by the revenue it generates.[1][2] The bank who will provide the loan to the buyer will l…

> "Here's another tidbit people don't understand. If the property has more than 4 units, the value of the property is determined almost entirely by the revenue it generates."

actually, that's pretty straightforwardly "income-based valuation", and it's logical because having more than 4 units means the property is primarily a business and not primarily a residence. businesses are valued by the income (i.e., profits) they generate. the sales comparison method (employing "comps") is primarily used with residences because the more accurate income-based valuation isn't available to residences, as non-income-generating assets. (the third valuation method is cost approach, which is used as a primary method of valuation in markets with low turnover/few comps, and in many tax assessment jurisdictions).

Re: Oregon passed sweeping housing crisis laws

#228

Post by shrimpx »

thrav wrote: post #21
scribu wrote: post #13

Earlier quoted context omitted.

> We've observed that [leaving children unattended] becomes unsafe in places with high density populations. Is that factually accurate, or just a false impression that people get? Let's assume it is objectively more unsafe. Is the problem the high density or is it some other aspect that causes issues? Most kids in East European countries, the vast majority of which grow up in high density neighborhoods, are left unat…

I think the problem is imagined. The “problem” of safety has made its way out to the burbs now too. The public world is mostly safe, and kids are mostly capable of navigating it on their own and in small groups — the adults in America have chosen not to believe that, and written laws forbidding parents from allowing their children to even attempt it. These choices may have resulted in a few less kidnappings, but they…

My take is it's not about gross safety statistics. It's about feeling safe. A lot of unsightly activity in your hood may make it feel totally unsafe even though statistically it's pretty safe.

Re: Oregon passed sweeping housing crisis laws

#230

Post by shrimpx »

nickserv wrote: post #35
Misdicorl wrote: post #5

Earlier quoted context omitted.

> It is exclusionary by nature; economic segregation is often the intent, and in most cases the impact. This seems awfully reductionist. I think often the intent is more along the lines of- "We want to live in a place where kids can walk to their friends house without an adult escort and/or play kickball in the street. We've observed that this becomes unsafe in places with high density populations, so lets prevent hi…

It's not the density that makes urban areas unsafe, it's all the cars. A downtown pedestrian street is perfectly safe for kids to hang out and play. Neighbors, older kids and shopkeepers keep an eye out without being in helicopter mode. In the few cities I've been to that have banned vehicular traffic in downtown areas, you do see bunches of kids running around, as done for millennia.

I think it has nearly zero to do with cars and 100% to do with growing homelessness and grewing drug activity in homeless camps. Nobody who has become weary in Portland claims car traffic. They're all terrified by the growing homelessness and unsafe drug activity in their hood. Needles in your front yard type of thing.
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