Approaching Peak Housing Dysfunction in California • Hacker News Board

Re: Approaching Peak Housing Dysfunction in California

#221

Post by DrScump » Fri, Jul 26, 2019, 7:08 AM UTC

maxsilver wrote: post #188

nostrademons wrote: post #84

Earlier quoted context omitted.

There's a substitution effect. If zoning restrictions are relaxed and developer turns an acre into a 50 unit condo complex, that developer reaps a huge windfall. But everyone else who owns an Eichler on a 1/4 acre has fewer buyers competing for their property. It's sorta like when labor unions go away. The company that hires non-unionized labor at half the price and double the productivity reaps an enormous windfall.…

> If zoning restrictions are relaxed and developer turns an acre into a 50 unit condo complex, that developer reaps a huge windfall. But everyone else who owns an Eichler on a 1/4 acre has fewer buyers competing for their property. That's not completely accurate. Yes, demand might fall, but even so price and value will still rise regardless. If you build a 50 unit complex next door, as long as some of those 50 units…

  land value in the US has very little to do with buyers or demand, and is exclusively valued by whatever property transactions happen to occur nearby it

I don't understand the distinction you seek to make here. Those transaction values are specifically the result of buyers and demand.

Most residential properties here could have been snapped up in 2009 for about 60% of current costs... because demand was lower. (Probably several hundred percent in areas like Mission Bay.)

Re: Approaching Peak Housing Dysfunction in California

#222

Post by DrScump » Fri, Jul 26, 2019, 7:30 AM UTC

r00fus wrote: post #96

markbnj wrote: post #59

Earlier quoted context omitted.

> Cities do not want apartments because that doesn't generate revenue The property owners still pay tax on it don't they? I'm sure it is less lucrative per square foot than commercial development, but I assume it is still better than the revenue from the closed furniture store and parking lot, and after all you need people to patronize businesses.

Not in CA - Prop13 + corporate shell board of director transfers means the tax rate never increases, and after 40+ years, that means a lot of properties essentially pay a fraction of the taxes they should. Prop13 has had a LOT of unintended consequences.

  the tax rate never increases

But assessed values do. My property tax bill is 50% greater now than 17 years ago.

Re: Approaching Peak Housing Dysfunction in California

#223

Post by Animats » Fri, Jul 26, 2019, 7:44 AM UTC

cylinder wrote: post #214

Animats wrote: post #3

It's being overdone. A solid wall of railroad flats (cheezy "luxury" condos) is going up for miles along the Caltrain tracks. Those wooden multistory buildings are the slums of tomorrow. It's about time for the next Bay Area recession. Some of those buildings will never be fully occupied. Remember 2008? 2001?

Isn't that where you'd want flats? Nobody wants a SFH next to tracks. Certain types of people (I won't generalise) always seem to want to call apartment buildings "future slums." This almost never materialises. Is it a racial thing for you?

No, it's a wood thing. Miles of tightly packed five story wooden buildings are a worry.

Re: Approaching Peak Housing Dysfunction in California

#224

Post by DrScump » Fri, Jul 26, 2019, 7:51 AM UTC

mktmkr wrote: post #132

markdown wrote: post #131

Earlier quoted context omitted.

> Cities do not want apartments because that doesn't generate revenue Solved: https://www.investopedia.com/terms/l/land-value-tax.asp

I think everyone agrees that if it were practical to amend the California tax system then we would just do that.

Either the Legislature or an initiative petition drive could put whatever property tax changes you like onto the ballot.

Then, you just need a simple majority vote.

That's what Proposition 13 was in the first place.

For example, you could exclude commercial property from Prop 13 protections altogether.

Re: Approaching Peak Housing Dysfunction in California

#225

Post by DrScump » Fri, Jul 26, 2019, 7:55 AM UTC

mktmkr wrote: post #112

aeternus wrote: post #10

Earlier quoted context omitted.

Is housing "going wrong" simply because it is expensive? Maybe it is overall a good thing that tech companies are now expanding into cities outside the bay area due to high housing costs. At least housing prices are transparent to those thinking about moving in to the bay area, allowing them to make an informed decision. High traffic, insufficient public transit capacity, and over-capacity public services are less tr…

Here's an idea we can adopt from literally every other aspect of American society: let the market work. We venerate the free market in all matters except housing, where we've erected a complex system of legal protections for incumbent landlords. The solution to high housing prices is more supply but it is illegal to build housing almost anywhere in the state of California. In SF it is illegal to build a duplex on 90%…

  it is illegal to build housing almost anywhere in the state of California.

No, it is legal almost everywhere without adjacent neighbors. Most land is unincorporated anyway.

Re: Approaching Peak Housing Dysfunction in California

#226

Post by inferiorhuman » Fri, Jul 26, 2019, 8:15 AM UTC

beamatronic wrote: post #122

inferiorhuman wrote: post #108

Earlier quoted context omitted.

Prop13 has had a LOT of unintended consequences. No, those were intended consequences.

I don’t think anyone back then could have imagined property values going from say, 30,000 to 3,000,000. Can you imagine it now? Could we ever reach the $10 million mark for a single family Bay Area home? That’s the kind of leap you’d be asking them to make if you went back 40 years or so.

I don’t think anyone back then could have imagined property values going from say, 30,000 to 3,000,000.

Prop 13 was sold to the voters on a "granny is losing her home because of skyrocketing property taxes" argument. So, yes, I think that a 100x increase in value was predictable.

And, yes, I could see $10 million homes becoming the norm within my lifetime.

Re: Approaching Peak Housing Dysfunction in California

#227

Post by DrScump » Fri, Jul 26, 2019, 8:21 AM UTC

Spellman wrote: post #135

jacobolus wrote: post #48

Earlier quoted context omitted.

If people are going to live anything resembling a modern American lifestyle, then gathering people together in cities has much lower environmental impact and lower infrastructure costs than spreading them around South Dakota. People don’t expect just electricity and plumbing, they also expect modern construction techniques, roads, police, fire suppression, emergency response, schools, full-service hospitals, telecomm…

Strong Towns notes that the real cost of spreading out is all the infrastructure you need to maintain. Running water? Gotta run the pipes further. Road access? Gotta pave (and maintain) more road Power? Same thing Plus having decent response times for emergency services, quick commute to things like groceries as you mentioned. Not to mention having critical mass for a commercial district with any sort of variety with…

But they ignore the risks of infill where infrastructure approaches capacity. And much of the infrastructure dates back a century or more. As you infill, demand for water/sewer/gas/electricity increases.

Re: Approaching Peak Housing Dysfunction in California

#228

Post by DrScump » Fri, Jul 26, 2019, 8:30 AM UTC

opportune wrote: post #7

Animats wrote: post #3

It's being overdone. A solid wall of railroad flats (cheezy "luxury" condos) is going up for miles along the Caltrain tracks. Those wooden multistory buildings are the slums of tomorrow. It's about time for the next Bay Area recession. Some of those buildings will never be fully occupied. Remember 2008? 2001?

I am about to move into one of those and the demand seems very high... very crowded open houses and hopefully sometime before then there will be a sort of zoning/regulatory intervention and developers can finally start building highrise luxury condos If you want to see slums I can share some pins of places in the East Bay and the hinterlands of SF, and you can tell me if you think midrise condos on the caltrain/camin…

What about Caltrain grade separation, where you suddenly find trains running even with the second floor of your building at many major road crossings?

Re: Approaching Peak Housing Dysfunction in California

#229

Post by natecham » Fri, Jul 26, 2019, 8:34 AM UTC

entee wrote: post #147

CPLX wrote: post #27

Earlier quoted context omitted.

I mean, I don't know how to tell you guys, but from the perspective of an east coaster, the entire peninsula (including SF) looks like this. It feels like some kind of parallel universe where nothing makes sense. Like I hear about a housing crisis in SF but I go there and there are supermarkets surrounded by parking lots in the middle of the city. There are literal big-box stores like you'd see in the suburbs adjacen…

Speaking of the painted ladies, a clear example of how completely dysfunctional the market is, there's been a vacant lot ON Alamo Square, less than a block for the painted ladies for years. https://goo.gl/maps/7iW3oiqN3FcPhVXq6 Who owns it? Why is this still not housing or at least something? Who knows! There's a vacant boarded up mansion/victorian multiunit building on Grove as well that has been that way forever as…

Funny enough, it seems the vacant Victorian on Grove is making some progress, saw some scaffolding up around it this evening.

http://www.sfweekly.com/news/news-news/entropy-on-grove-stre... (2017) elaborates on why its been vacant, seems like the owner doesn't have the funds/desire to make it habitable. Also mentions how much red tape exists to develop in the neighborhood in the last couple paragraphs, maybe the owner doesn't feel like enduring that adventure.

Re: Approaching Peak Housing Dysfunction in California

#230

Post by Atheros » Fri, Jul 26, 2019, 9:05 AM UTC

6gvONxR4sf7o wrote: post #202

CydeWeys wrote: post #196

Earlier quoted context omitted.

You don't own the view. It's unrealistic to expect that owning a single parcel of land would grant you broad latitude to stop projects anywhere within sight. If you want a guaranteed good view, go buy a big plot of land way out in the middle of nowhere. You have no right to it in a city; other people's right to have housing is way more important.

Yes, of course in this situation Alice doesn't own the view. But she is made worse off by Bob's developments. I really hope we can agree that Alice's situation is being made worse in a real way here. Further, pre-Bob, the city is mostly full of Alices, so if you want them to not vote against Bob's development, like in OP's article, you might want to align Alice's and Bob's incentives. It's pragmatic. It also happens…

What about in the opposite direction? What if I build something that makes the neighborhood nicer (like buying a burned out building and replacing it with one that is beautiful and matches its neighbors). It seems like the neighbors should pay me their increased home value, right? If Nancy plants flowers, you have to pay her. It's only fair. It's also ludicrous. Your idea is unimplementable.

It would be simpler if everyone just stopped viewing their home as an investment. The meme that 'homes are investments' is a very recent invention. They not investments; they're depreciating assets.