I'm willing to bet you more than a beer that a large share of people under rent-control are high earners.
Rent control is trumpeted as some sort of protection for low-income people, but it actually has no such provisions that make it available to, or targets such people. The only beneficiaries of rent-control are people who happen to be incumbent residents.
Also incumbent landlords who are sitting on paid off properties. A landlord with an old building has less vacancies if he doesn't have to compete with new construction.
If remote work becomes permanent for a lot of people and/or social distancing lasts a long time, I would expect a number of changes to happen: - Homes with more bedrooms will become significantly more attractive because people will want home offices (maybe one for each spouse!) - Homes with outdoor space will become more attractive - Quiet homes without noise from neighbors or the surrounding area will become more at…
I'm not sure remote work will drive much of that. Most families were already moving out of the cities into the suburbs. And young people want to be in the city for the social aspects and cultural aspects, and proximity to others. I think what we might see is an increase in demand for bigger units in the city as a young single person may want a two bedroom place, one for their home office and one for sleeping, but sti…
I don't think very many of the social and cultural amenities of big cities will come back anytime soon.
I think we are in for at least a year of social distancing and heavy restrictions on restaurants, bars, concert venues, sports arenas, etc. A lot of things that were previously considered amenities will now seem dangerous, such as public transit.
Just like everything else, it's a two way conversation. The discounts have to happen with the tenant's knowledge and agreement. If you don't like it don't rent from a landlord who plays those games. If every landlord is playing extreme games with discounts to game the rent control law, it only points to the deeper problems that we all know exist but refuse to fix.
I'll rent to you at $5000 a month with a $4k discount month to month. That discount is renewable solely at managements discretion after 12 months. Seems egregious.
Yeah, and if someone made me that offer on my current ($2k/month) apartment, I would turn it down despite it being a 50% discount because I don't want the uncertainty of having to move in a year. This is not a problem if both parties know up front. The only way it becomes a problem is if I think I'm renting an apartment for $1k/month and then a year later my landlord says "Oh, actually your rent was $5000/month but you had the $4000/month move-in discount for the first year, your rent is now $5250/month".
This article seems to be based on only a few transactions, as not a lot of people are actually moving right now. I manage a couple of properties in the Bay Area, so I keep a close eye on these things. What I'm seeing is not a drop in rents, but an increase in $0 deposits and many weeks of free rent upon move in (sometimes 6+ weeks). Landlords are very reluctant to lower rents, because with the statewide rent control…
The only reason rents are not dropping yet is human psychology.
Landlords don't want to accept that rents need to go down so they leave it up at the same price even if it means that places go vacant for multiple months. In a perfect market rents would be down 15/20% already.
Rent control has a lot of unintended consequences. It is supposed to be a short term band-aid for bad zoning policies, but the zoning policies actually have to be fixed if you want to remove the band-aid.
In defense of rent control, it provides a stabilizing force during a downturn. How many folks who live in an apartment that has been under rent control for 10+ years are packing up and moving into their parents basement right now? My guess is very few. It certainly has its issues, but there are much worse market distorting policies that I would like to see be fixed before rent control gets put on the chopping block.
I’m not sure this is a good argument. What landlords would try to raise rents or evict aggressively during a recession?
Rent control prevents rents from aggressively dropping because landlords know the rents can’t be increased later. This is during a time when rents really need to go down.
I'm not sure remote work will drive much of that. Most families were already moving out of the cities into the suburbs. And young people want to be in the city for the social aspects and cultural aspects, and proximity to others. I think what we might see is an increase in demand for bigger units in the city as a young single person may want a two bedroom place, one for their home office and one for sleeping, but sti…
I don't think very many of the social and cultural amenities of big cities will come back anytime soon. I think we are in for at least a year of social distancing and heavy restrictions on restaurants, bars, concert venues, sports arenas, etc. A lot of things that were previously considered amenities will now seem dangerous, such as public transit.
In the short term yes. In the long term I think more remote work will stick around as the amenities return.
This also might open many landlords eyes to how ugly their situations can get when they want to remove a tenant in Oakland/SF/Berkeley even if a tenant stops paying rent. I have two friends who are currently refusing to leave in-law units and it is quickly getting bad for their landlords ($30k deal to get one of them to leave). That said I totally welcome this, part of the reason why our communities suck in the bay a…
In Germany about half the population is renting. That in itself doesn't mean they're not fostering a community. The difference of course is, that in Germany there are very stringent renter protections, so tenants do usually plan to stay for long times (a good share for a lifetime).
Generally it isn’t a huge leap to assume that a resident will stay longer in a home they bought vs one they rent...
Rent control has a lot of unintended consequences. It is supposed to be a short term band-aid for bad zoning policies, but the zoning policies actually have to be fixed if you want to remove the band-aid.
In defense of rent control, it provides a stabilizing force during a downturn. How many folks who live in an apartment that has been under rent control for 10+ years are packing up and moving into their parents basement right now? My guess is very few. It certainly has its issues, but there are much worse market distorting policies that I would like to see be fixed before rent control gets put on the chopping block.
It helps the people in the apparent and hurts everybody else. Doesn't really change in a recession.
I'll rent to you at $5000 a month with a $4k discount month to month. That discount is renewable solely at managements discretion after 12 months. Seems egregious.
Yeah, and if someone made me that offer on my current ($2k/month) apartment, I would turn it down despite it being a 50% discount because I don't want the uncertainty of having to move in a year. This is not a problem if both parties know up front. The only way it becomes a problem is if I think I'm renting an apartment for $1k/month and then a year later my landlord says "Oh, actually your rent was $5000/month but y…
Right but when the market becomes red hot again why would they not? I think this will only impact units that fall under rent control more generally though.
Rent control is trumpeted as some sort of protection for low-income people, but it actually has no such provisions that make it available to, or targets such people. The only beneficiaries of rent-control are people who happen to be incumbent residents.
Much if its value is in protecting existing communities who would be displaced by rising rents, so yeah, it favours incumbents.
I think existing communities is interchangeable with incumbent residents. There are probably better ways to protect mass displacement of low-income residents since rent control only applies to certain really old buildings. Preserving the community in itself is not a bad thing to do but a lot of these policies have also been blocking the building of higher density housing, which could satisfy everyone (keep old residents AND let in new residents).