Oregon passed sweeping housing crisis laws • Hacker News Board

Re: Oregon passed sweeping housing crisis laws

#241

Post by roenxi » Sun, Jul 21, 2019, 2:49 AM UTC

anderskaseorg wrote: post #184

roenxi wrote: post #142

Earlier quoted context omitted.

> Make no mistake about it: landlords have a massive advantage in any negotiation with a tenant. This isn't a very strong argument because it applies to, eg, purchasing food at a supermarket. Worst case for a supermarket; wasted produce. Worst case for consumers; literal death. Yet the supermarkets are generally famous for being very low margin and cut-throat competitive. A tenant is only forced to move neighborhoods…

I’m pretty sure you lost track of your own analogy there. If there are better deals at a different supermarket, people will just go there. They might even go to multiple supermarkets in pursuit of deals. Literal death is not a realistic consequence of switching supermarkets (thanks in part to food safety regulations!). There’s a very efficient market here. On the other hand, if there’s a better deal on a different ap…

If a house is being rented out to a tenant for $1,000 a month when it could plainly be rented out to a different tenant for $1,200 a month then there is charity afoot. It might be rent control (ie, compulsory charity) but someone is getting something that they didn't work for.

Now I'm not against charity as a concept, but we have a century or so of economic experience on this matter. If charity becomes compulsory, first people make stupid decisions and then the vulnerable have to live with the consequences of those decisions.

Being born gives everyone a right to dignity but it certainly does not give anyone a right to choose that someone else sets them up in a house and area of their preference. If somebody wants control of their own life, they are going to need to earn enough to either buy their own house, learn to build their own house or pay market rates for rent. It would be nice if there was a better way; but all the alternatives that are tried turn out worse than being honest about the economics of the situation up front.

> I’m pretty sure you lost track of your own analogy there. If there are better deals at a different supermarket, people will just go there...

If there are better deals in a rental market, people absolutely will go there. There are substantial costs of the order of a few hundred dollars to hire removalists, that isn't cheap but people aren't going to be so overwhelmed with emotion that they can't move a few blocks over for a $3,000 a year improvement in rents.

> It’s not “charity” when you’re paying through the nose for something that you don’t have a realistic choice about.

I've lived in 4 different communities in my life. I don't accept that moving somewhere with a lower cost of living is so terrible that people need to be protected from it - I can do it, it isn't bad. Somebody who can't afford to live in a neighborhood should be encouraged to move somewhere cheaper, and the idea that landlords should be protecting them from that outcome is a great way to set up a housing shortage. If they want to be part of a community then they should find a job that lets them rent in that community at the market rate.

> thanks in part to food safety regulations

You misunderstand; starvation from not being able to afford food. The point is that a vendor of a product can't unilaterally deny anyone access to market rates for that product because the competition will step in and undercut that vendor.

Re: Oregon passed sweeping housing crisis laws

#242

Post by jessaustin » Sun, Jul 21, 2019, 2:54 AM UTC

sampo wrote: post #107

jessaustin wrote: post #32

Earlier quoted context omitted.

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.

Poor tenants are not renting new apartments. In general, you could say that new apartments are added to the overall stock so that's good for all renters. ITT however we're specifically talking about the kind of apartments that are rented by the poor being replaced on the same site by the kind of apartments that are rented by wealthier tenants. That is actually good for one group and bad for another group.

Widely anticipated wonderful new laws are usually chock-full of this kind of crap. Lobbyists don't try to step in front of oncoming political trains. They do successfully redirect those trains to their own purposes.

Re: Oregon passed sweeping housing crisis laws

#243

Post by TuringNYC » Sun, Jul 21, 2019, 4:04 AM UTC

nothrabannosir wrote: post #128

bko wrote: post #52

Earlier quoted context omitted.

> 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. Not necessarily true. Sure , the landlord knows more about the apartment but you know more about yourself as a tenant. Landlord takes a huge risk in terms of allowing someone rent, especially given protections afforded to th…

> He can't just sell it tomorrow but I could easily choose another rental. At worst, the landlord loses money. At worst, the tenant is on the streets. Emotionally, finding a new tenant is business (maslow level.. 4?). Emotionally, finding a new home touches on your core safety and wellbeing (maslow level 2). Switching tenants means a new contract and new risk to lose money. Switching neighbourhoods means losing your…

No, at worst the landlord loses enough rent to miss mortgage payments and lose the entire house, years of savings and all their equity and credit worthiness.

Re: Oregon passed sweeping housing crisis laws

#244

Post by TuringNYC » Sun, Jul 21, 2019, 4:17 AM UTC

BeetleB wrote: post #149

lotsofpulp wrote: post #83

Earlier quoted context omitted.

It’s not theoretical at all, and Walmart does dick you around, albeit indirectly. They dick around the supplier and force them to make cuts in quality to meet the price. And if Target/Amazon/Dollar General weren’t around, there’s no reason they wouldn’t increase prices and pad their margins. In a landlord situation, their cost of goods is so small that they can afford to sit on an empty apartment while prospective re…

>In a landlord situation, their cost of goods is so small that they can afford to sit on an empty apartment while prospective renters need to put a roof over their family or business. I'm not a landlord, but I did consider getting into it once, and studied how the system works. And a number of my friends are landlords (including one who quit his job because the passive income is enough). No - probably over 95% of lan…

There is another point missed — freezing rents seems fair only if all the other costs are also frozen — property taxes would need to be frozen, and utility costs, and repair costs. Otherwise you just have a situation where one party is squeezed from both sides.

Re: Oregon passed sweeping housing crisis laws

#245

Post by TuringNYC » Sun, Jul 21, 2019, 4:17 AM UTC

devxvda wrote: post #188

schalab wrote: post #94

Earlier quoted context omitted.

Yep. The idea that you have one unit while the landlord has multiple units is not true. You have the choice of a hundred units. And its their responsibility to fight with each other to make you choose one of them. Thats what keeps them honest and gives you bargaining power.

Until they collude with each other.

Tenants can also collide.

Re: Oregon passed sweeping housing crisis laws

#246

Post by TuringNYC » Sun, Jul 21, 2019, 4:23 AM UTC

asdff wrote: post #209

Karishma12347 wrote: post #101

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.

You can come back to market price between tenants. Rent control doesn't discourage new construction: https://dornsife.usc.edu/assets/sites/242/docs/Rent_Matters_...

I realize the reasonable 7% cap prevents this in Oregon’s case, but in NYC you will find rent controlled apartments kept thru two generations, now used as storage only because the cost is so low. Sometimes a rent controlled apartment can cost less then a storage unit after 30yrs.

Re: Oregon passed sweeping housing crisis laws

#247

Post by wpietri » Sun, Jul 21, 2019, 4:35 AM UTC

schalab wrote: post #94

BurningFrog wrote: post #61

Earlier quoted context omitted.

> One is asymmetry in scale: you have one unit; landlords have many more. This gives them stronger negotiating power. This is one of those theoretical arguments that sounds good but have no empirical foundation at all. If it was true the gigantic Walmart could completely dick me around when buying socks and toilet paper. In reality prices are very competitive. It also completely ignores that fact that most landlords…

Yep. The idea that you have one unit while the landlord has multiple units is not true. You have the choice of a hundred units. And its their responsibility to fight with each other to make you choose one of them. Thats what keeps them honest and gives you bargaining power.

For renewing your lease, you have a choice of exactly one unit. Since the switching cost is high, the landlord has the ability to extract money beyond what a new renter would pay for the unit.

Re: Oregon passed sweeping housing crisis laws

#248

Post by wpietri » Sun, Jul 21, 2019, 4:40 AM UTC

bassman9000 wrote: post #158

jbay808 wrote: post #130

Earlier quoted context omitted.

I assume the GP is referring to something like this: https://equilibriabook.com/an-equilibrium-of-no-free-energy/ > What about houses? Millions of residential houses change hands every year, and they cost more than stock shares. If we expect the stock market to be well-priced, shouldn’t we expect the same of houses? > The answer is “no,” because you can’t short-sell a house. Sure, there are some ways to bet against a…

* the only members of the market are you and the landlord* But that's not true. The landlord can increase the price of the rent, knowing that, as some point, you'll leave, because you, the buyer, consider it too high. The market around you, other possible renters, may not, and so the price the landlord sets will still be the market price. Now, the landlord knows you're a good customer: no pets, no parties, always cle…

It is definitely true. The market for renewing your lease has exactly one seller.

Last time I moved I spent maybe 60 hours looking and another couple hundred hours packing, cleaning, moving, and unpacking. Call it 250 hours, plus all sorts of stress and hassle. There were also a variety of expenses involved, plus having to have two deposits in play at once.

I am definitely willing to pay more than $0 to avoid that hassle. Landlords can take advantage of that in lease renewal negotiations.

As to having this discussion here, yes, HN has plenty of free-market fundamentalists. But it also has plenty of people who see markets as a tool for optimization. Like any tool they have necessary preconditions and failure modes. You can't design the market for housing like you do the market for candy bars and expect it to work just as well. You need the right tool for the job.

Re: Oregon passed sweeping housing crisis laws

#249

Post by BurningFrog » Sun, Jul 21, 2019, 4:41 AM UTC

quickthrower2 wrote: post #231

BurningFrog wrote: post #71

Earlier quoted context omitted.

Your observation also highlights how rent control is institutionalized privilege. Those who already have a home are given an ownership right to that status, while those without a home are being permanently excluded.

In a fair system we’d all need to take turns in being homeless and share our homes around.

In my fair system, building housing on your own land would be legal.

That's how great cities are made!

Re: Oregon passed sweeping housing crisis laws

#250

Post by humantiy » Sun, Jul 21, 2019, 4:46 AM UTC

g8oz wrote: post #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.

I hope it stays in Minneapolis and doesn't spread outside of the city for a number of reasons. I enjoy living in a neighborhood of houses and families where we have some space and nature visible vs tar and housing complexes. Its one of the reasons why I don't live in or closer to Minneapolis.