Earlier quoted context omitted.
I think most people doubt supply and demand to some degree. How often have you seen someone argue we should secure the supply of food to disaster zones by repealing price gouging laws? Rent control is popular because many people believe, wrongly but wholeheartedly, that landlords are just price gougers and everyone could get cheap adequate housing if they weren’t manipulating it.
Rent control is popular with renters because the rent is too damn high. You can figure that one out without assigning motives to people you've never met.
Average Rent in San Francisco Has Dropped $1k This Year
431–440 of 562 posts
Re: Average Rent in San Francisco Has Dropped $1k This Year
#432Earlier quoted context omitted.
> It is hard to beat the economies of scale of a restaurant, as much as the "you only need to factor the cost of raw food" camp like to tell otherwise I'd be interested in seeing your math on the subject, and it probably depends on location and at what rate do you "bill" your time, but restaurants have a lot of overhead ( property, staff, taxes) that offsets economies of scale. Even without going all-in with cheap fo…
It seems the average Big Mac meal is $6 these days. It provides approximately 1,000 calories, and the average person needs approximately 2,000 per day, so we'll assume you'll need to order two. That puts the food costs at $12 per person. The average cost to install a kitchen is around $60,000. If we assume a rate of return of 5%, that is $3,000 per year right there that the money needs to provide to justify it being…
Could you expand on this? I have no idea what you mean. Aside from some niche restaurants like Benihana, I can't think of any sit down restaurant at any price point that provides any more entertainment than McDonalds.
Re: Average Rent in San Francisco Has Dropped $1k This Year
#433Earlier quoted context omitted.
This doesn't pass the sniff test to me, at least for most COL levels. The only way that our household was able to reduce our food budget by eating out was to massively reduce quality in order to meet caloric needs. For roughly the equivalent quality of ingredients it was much cheaper for us to cook at home. And that's before we got a bigger house in a lower COL area with a chest freezer, which allows us to bank high…
> This doesn't pass the sniff test to me Is that because, based on other comments here, you're already invested in a kitchen and, as a result, are forgetting to factor in that substantial cost? But that would be like if you owned your own silicon fab. You would no doubt also wonder how anyone could afford to buy their processors from Intel for hundreds of dollars when you can make your own for pennies. But you're not…
You're right that ignoring the cost of a kitchen discounts the cost of cooking at home, but I think you're drastically overestimating the cost of purchasing a kitchen. In another thread you mentioned $60,000 for a kitchen, a number which I think is way too high. I suspect that this is a case of the average being dragged up by the outliers. After all, high end kitchens can get very expensive, but we're not looking at high end income earners.
So, let's look at it from the perspective of someone buying a used home. Let's assume that they're buying basic, at median prices and reasonable sizes.
A basic kitchen remodel is somewhere in the neighborhood of $24,000[0][1], including all new cabinetry, countertops, flooring, plumbing, and appliances. Presumably installing a new kitchen in a new building is significantly cheaper since that is less labor intensive than remodeling. The median house costs in the neighborhood of $100/sq. ft[2], with a typical small kitchen being anywhere from 70-100 square feet. Even assuming that the cost/ft doesn't already include the kitchen itself, we have a bare minimum price of about $34,000 for a basic kitchen fully installed.
(This does not account for the fact that the $103/sq. ft. number includes the kitchen that comes with the house, and thus we are double counting some costs).
A 30 year mortgage on $34,000 is $441.76, which is $5.89 a person a day for a 2.5 person household, or $2.94 each for lunch and dinner. So in order for a basic kitchen to pay itself off, each meal must be at least $2.94 cheaper than what you would pay dining out. This is obviously quite hard to do if you're buying the cheapest calories available, but trivial if your typical meal is more expensive than say, Chipotle.
And of course, this is a pessimistic analysis. As you've mentioned, your typical American is purchasing a used house, which absent a growing market means that they're financing the depreciated value of that kitchen.
Now if the cost per square foot was closer to $850 per square foot, a not unreasonable estimate for San Francisco proper, one would quickly question whether the $59,500 was worth it for the space of a small kitchen alone.
> The luxury isn't cooking. The luxury is being able to have a large room full of machinery dedicated to preparing meals for, on average, 2.5 people. These days, average people can barely afford living spaces as-is.
I would argue that if having a kitchen is such an obvious luxury as you propose, we'd see more housing move to eliminate it. Instead our evidence is that you have to be extremely far up the COL curve before having a kitchen is no longer worth the space. Even in incredibly crowded markets like NYC it is more common to see apartments give up a separate bedroom before falling back to a half kitchen.
SF is certainly the outlier in terms of cost, so if any place in the US was going to have a local trend of abandoning full kitchens or even half kitchens, it would be there.
> Generally speaking, the poor have to buy used houses that already have kitchens for a lot of historical reasons. They have little opportunity to not become invested in the means of production, even when it is not ideal from a purely economic point of view.
Yes, the poor do have to buy kitchens. But they also buy cheap kitchens, which continues to tilt the equation towards cooking being cheaper. Instead it appears like time and energy are actually what drives people towards dining out, not cost.
0 - https://www.homedepot.com/c/cost_kitchen_remodel
1 - https://www.homeadvisor.com/cost/kitchens/remodel-a-kitchen/
2 - https://www.fool.com/the-ascent/research/average-house-price...
Re: Average Rent in San Francisco Has Dropped $1k This Year
#434Earlier quoted context omitted.
It seems the average Big Mac meal is $6 these days. It provides approximately 1,000 calories, and the average person needs approximately 2,000 per day, so we'll assume you'll need to order two. That puts the food costs at $12 per person. The average cost to install a kitchen is around $60,000. If we assume a rate of return of 5%, that is $3,000 per year right there that the money needs to provide to justify it being…
> It seems the average Big Mac meal is $6 these days. It provides approximately 1,000 calories, and the average person needs approximately 2,000 per day, so we'll assume you'll need to order two. That puts the food costs at $12 per person Yeah, i assumed so. Eating Big Macs is... let's say suboptimal. If you eat only that, you'll probably have all sorts of health issues. When counting actual food, fresh and with vege…
0 - https://www.homeadvisor.com/cost/kitchens/remodel-a-kitchen/
Re: Average Rent in San Francisco Has Dropped $1k This Year
#435Earlier quoted context omitted.
There so much land in the US. People don't have to live in San Fransisco. These people grew up there, they want to live in their home. You know, that emotional thing that money can't really explain. Sure they see the people arriving in, with huge paychecks that drive prices up, and them out as bad. Any human will, a rational agent won't.
Though this is not an uncommon view in SF at the moment, I find it horrifying. What has made SF such a great place from the 1970s to ~2010 has been its willingness to accept new people, including the strange and the weird. That's not to say that it's been a great city for everyone , the first-wave gentrifiers from the 1960s pushed out Black people from the neighborhoods they took over, like Haight Ashbury, and the do…
Please, for the sake of your good content, don’t go hyperbolic. It makes you sound less credible.
Things that are horrifying: genocide, torture, slavery, famine, child abuse, elder abuse.
Things that are not horrifying: almost everything else. Maybe bad, really bad, destructive...but not horrifying.
Certainly not a personal view about The Zeitgeist of SF.
Re: Average Rent in San Francisco Has Dropped $1k This Year
#436Earlier quoted context omitted.
How dare you say "I don't care." Who are you to speculate about what I think about?
People are forced out of their home all the time, without the gigantic windfall of money that a property sale entails. Evictions happen all the time, and these poor folks do not get the windfall of a $1M investment paying out. They get the trouble of trying to find a place to rent with an eviction on their record, which means they will be paying higher rents with less ability to pay. Nobody should be forced from thei…
When you say "large landholders", are you talking about REITs and commercial property holders? If so, wouldn't Prop 15 have addressed these issues?
https://en.wikipedia.org/wiki/2020_California_Proposition_15
Re: Average Rent in San Francisco Has Dropped $1k This Year
#437Earlier quoted context omitted.
Not necessarily. I’ve lived in three rentals in LA over the past five years and each one had a clause that allowed me to break my lease in exchange for two months rent. Not saying the OP had that clause, but I’ve never had to ask for it and it’s been baked into the lease. I know my current landlord is going to be excited about me leaving in a month, as rent had gone up about $1,300 a month in this area over the last…
I see. I am in NYC and read my lease break to see if I could brake it. Im from europe and this clause looks like illegal in my country but I guess USA is on a whole other level... If I move I could end up paying 1200$+ double rent for months... "In the event the lease is broken during the middle of the term, and the applicant did not pay a year up front due at lease signing, the lease break fee is $1,200.00 made paya…
Re: Average Rent in San Francisco Has Dropped $1k This Year
#438Re: Average Rent in San Francisco Has Dropped $1k This Year
#439Earlier quoted context omitted.
Raising taxes on the land owner will result in increased rents. Land owners are not in the business of giving money away.
False. https://en.wikipedia.org/wiki/Land_value_tax Land supply is inelastic
Say LVT twenty times, it changes nothing. There is no LVT. There will be no LVT. You have upvotes and nothing else.
Re: Average Rent in San Francisco Has Dropped $1k This Year
#440Earlier quoted context omitted.
People are forced out of their home all the time, without the gigantic windfall of money that a property sale entails. Evictions happen all the time, and these poor folks do not get the windfall of a $1M investment paying out. They get the trouble of trying to find a place to rent with an eviction on their record, which means they will be paying higher rents with less ability to pay. Nobody should be forced from thei…
> The idea that Prop 13 protects people from being taxed out of their hugely inflating financial asset is somewhat preposterous on its face. It mostly protects large landholders, and gives a tiny tiny benefit to the people that we are concerned about. When you say "large landholders", are you talking about REITs and commercial property holders? If so, wouldn't Prop 15 have addressed these issues? https://en.wikipedia…
If you look at land distribution in cities, you'll find lots of super wealthy families, hidden behind LLCs, and a few REITs, the smaller scale landlords, and then finally individual homeowners.
Those wealthy land hoarding families are often worse than REITs for cities, in that maintaining their own political power is more important than profits, and that can be worse for people on the lower end not the economic scale than even REITs' horrifying landlord behaviors.