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California's housing bill SB 50 has died in the state Senate

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Re: California's housing bill SB 50 has died in the state Senate

#431

Post by omgwtfbyobbq »

kec wrote: post #70
omgwtfbyobbq wrote: post #39

Earlier quoted context omitted.

Repealing prop 13 might help a little, but it's a weaker driver than recessions and interest rates. https://fred.stlouisfed.org/series/CASTHPI https://fred.stlouisfed.org/series/JHDUSRGDPBR https://fred.stlouisfed.org/series/MORTGAGE30US

How do those graphs support this claim?

It supports them because the inflation adjusted difference in monthly payments correlates very well with the 30 year mortgage rate. As interest rates fall, home values appreciate based on how much of a monthly payment someone can afford, less the effect of recessions and including other things like prop 13.

Take Q1 of 1995 for instance. The inflation adjusted home value at that time was ~340, and the interest rate was 9%. In that case, a $340k home would have a $2.7k monthly payment. A $680k home today with interest rates at 3.75% today would have a $3.1k monthly payment, and I believe that most of it's appreciation is because of low interest rates.

If housing prices were driven by prop 13, then when interest rates go up, housing prices should stay the same. If housing prices depend on mortgage rates, then they should decrease over time as interest rates increase.

Re: California's housing bill SB 50 has died in the state Senate

#432

Post by likpok »

scarface74 wrote: post #401
harryh wrote: post #392

Earlier quoted context omitted.

You could say the same thing for almost all goods and services which are subject to consumption taxes.

The cost of police, fire fighters, schools, roads, etc. don’t go up with the value of the home. There is no reason that you couldn’t charge a flat rate to every property owner - including businesses.

The cost of all of these things do increase with the value of the home, because the labor required to do it gets more expensive. The individual house price doesn't contribute to this but overall housing costs do.

SF has had an explosion in property values and thus struggles to find teachers, firefighters and police officers at the salaries it's willing to pay.

Re: California's housing bill SB 50 has died in the state Senate

#433

Post by veeralpatel979 »

kilotaras wrote: post #331
veeralpatel979 wrote: post #28

To combat many problems, the government would certainly be helpful, but isn't necessary. Take climate change. If every corporation took a carbon negative stance like Stripe and Microsoft, that would make a big dent in carbon emissions. Unfortunately, a lack of housing is a problem that the government created. And it's a problem that only the government, in my view, can really fix. As long as housing supply is artific…

> Take climate change. If every corporation took a carbon negative stance like Stripe and Microsoft, that would make a big dent in carbon emissions. But then some corporation would move away from that, get extra money and eat competition who is more green/moral/etc. Competitive economy maximizes profits in the space allowed by regulations. That's a feature, not a bug. But it also means that expecting some sectors/inp…

In theory, yes.

But I don't see Microsoft or Stripe going anywhere soon. They've built many great products and delivered a lot of value to users and displacing them will not be easy.

Spending money on lowering climate emissions may help improve their public image, which is a good tradeoff.

Re: California's housing bill SB 50 has died in the state Senate

#434

Post by scarface74 »

likpok wrote: post #432
scarface74 wrote: post #401

Earlier quoted context omitted.

The cost of police, fire fighters, schools, roads, etc. don’t go up with the value of the home. There is no reason that you couldn’t charge a flat rate to every property owner - including businesses.

The cost of all of these things do increase with the value of the home, because the labor required to do it gets more expensive. The individual house price doesn't contribute to this but overall housing costs do. SF has had an explosion in property values and thus struggles to find teachers, firefighters and police officers at the salaries it's willing to pay.

Again why should those taxes be based solely on housing instead of or in addition to other types of wealth?

Re: California's housing bill SB 50 has died in the state Senate

#435

Post by justinzollars »

Twixes wrote: post #283
justinzollars wrote: post #168

Earlier quoted context omitted.

Dean is a nice guy but I believe the way he looks at the problem is naive. He believes land lords are to blame for high costs - but I see this as a function of what the market is willing to support. He could guide the invisible hand of the market if he would allow more housing. But he favors character of the neighborhood over housing.

Landlords are to blame for squeezing people like lemons (which extracts a lot money from software engineers and the like while leaving lower classes without decent housing), but the underlying problem is indeed insufficient supply. But what's really being done about either of these things?

No they are not. You could become a landlord and find out for yourself. Or you could simply do the math. Mortgage plus Insurance plus Earthquake insurance plus upkeep plus taxes. Costs are incredible.

The only way to bring down rents is to increase supply.

Everyone else is lying to you.

Re: California's housing bill SB 50 has died in the state Senate

#436

Post by rcpt »

jnordwick wrote: post #363
refurb wrote: post #236

Earlier quoted context omitted.

Jesus Christ. I didn’t know CA already had that law. As you said Prop 13 is absolutely not required. That law basically says if you can’t afford the increases, we’ll bank it. If you can, pay up.

That isn't nearly enough. It only applies to 65+ or with disability who make $35k or less. This is part of the problem is that people are unwilling to compromise. On one side you have those who view even the risk of a single person being displaced by gentrification and rising housing prices as unacceptable. On the other side you have those will accept nothing less than displacing everything. I make enough that I don'…

Is $35k not good income for retirement? They already own a house which has gone up in value and have had years to accumulate savings.

I lived in Los Angeles for the better part of a decade making less than $35k and it was fine (and I didn't own a house).

Re: California's housing bill SB 50 has died in the state Senate

#437

Post by ratfaced-guy »

cf wrote: post #213

Alright, please see this as an olive branch to YIMBYs. The results are pretty clear. The YIMBYs do not have the votes on their own to get this done. Unless you are some suburban retiree you probably recognize that the solution is building more housing. I think based on the voting records YIMBYs should join forces with PHIMBYs and make the next iteration of SB50 really take public and affordable housing seriously. The…

This has been obvious to me for years. Also because the most affordable dynamic places always have a combination of PHIMBY and YIMBY. YIMBY was started by libertarian market urbanists. I agree govt intervention limiting land use rights is the main problem, but you’ll never get support for deliberalizing land use without guaranteeing protections to the lower and working classes. There’s plenty of ways to make this stuff work (see abroad) without having it turn into another Cabrini Green

Re: California's housing bill SB 50 has died in the state Senate

#438

Post by Tiktaalik »

thedance wrote: post #159
0xB31B1B wrote: post #143

Earlier quoted context omitted.

They can’t be passed at a local level without CEQA review and a torrent of unending lawsuits. That’s why it needs to happen at a state level.

That’s not true. Any city in California has total authority to adjust their zoning code. Cities change zoning as a matter of routine business. The reason cities have not done anything constructive is each individual small government is held hostage by its own incumbent land owners.

There are so so many more renters than land owners. It should be possible if not easy.

YIMBYs need to focus more on winning local elections instead of hoping for sweeping changes at the state level.

Re: California's housing bill SB 50 has died in the state Senate

#439

Post by scarface74 »

tptacek wrote: post #421
scarface74 wrote: post #412

Earlier quoted context omitted.

No, I’m not saying that “taxation” is theft, but the undercurrent of raising property taxes on people who have been living in their houses for years is that the land could be better use by “more productive” tech bro’s than old people and if you raise the taxes enough, they would be forced to move. Those same tech bro’s would hate it if they were taxed on unrealized, illiquid wealth. But, yes there are plenty of juris…

This is how property taxes work pretty much everywhere else, dense and sparse, tight housing market and loose. It doesn't seem to be causing a crisis anywhere, unlike California's policy, which is implicated in an actual housing shortage.

And since we do have 49 other states, if prices get to high - companies and people will move.

Problem solved.

Re: California's housing bill SB 50 has died in the state Senate

#440

Post by hundt »

harryh wrote: post #430
hundt wrote: post #403

Earlier quoted context omitted.

Sure! Here are some things that could cause the rent/value ratio to be significantly different for a single property: - There is no usable building on your property. - There are plans to build a highway through your neighborhood in five years. - Amazon has announced plans to build an office in your neighborhood two years from now. - There are harvestable (with further development) natural resources on your property.…

I don't have data as to precisely how strong the correlation is I'm actually pretty curious now, and might be go looking for data. It's surely not precisely 1, but I bet it's not all that far off. Especially if you limit the sample to residences. Your list of outliers is a good one (I particularly like the natural resources one), but I think they're probably mostly exceptions to the rule. In the end though sure, prop…

Thanks, I enjoyed the exchange as well. I am also curious about the correlation coefficient but could not find any details in the amount of time I had to put into it. I did get the feeling that there is substantial research in the area of what drives housing prices, though.
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