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Rent controls have split housing in Berlin into two distinct markets

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Re: Rent controls have split housing in Berlin into two distinct markets

#161

Post by sokoloff »

codeflo wrote: post #144
sokoloff wrote: post #118

Earlier quoted context omitted.

If the shortage of consumer form-factor toilet paper wasn't in the supply chain, where was it?

I don't like "gotcha" style discussions, but I admit I could have worded that more precisely. What I meant is: There was no reduction in overall toilet paper production, and people didn't suddenly start to shit more. The shortage was mostly a distribution/packaging issue in the form of "not available in packaging X at location Y". Markets tend to solve that kind of problem incredibly quickly.

I wasn't trying to "getcha", but I do think this genuinely is a supply chain issue.

Consumer form factor toilet paper is still being rationed for me right now (in Cambridge, MA-max 1). That's a year after the start of this.

Re: Rent controls have split housing in Berlin into two distinct markets

#163

Post by csunbird »

sudosysgen wrote: post #35
steviedotboston wrote: post #20

Earlier quoted context omitted.

You also need to look at how many formerly rent controlled apartments have been sold and taken off the market. The charts don't really show that, but the articles suggests that is happening

If they are finding homeowners which are not renting them, is that not a good thing?

But, people are not buying it, companies are. Most known offenders are Akelius and Deutsche Wohnen, who just buy those apartments for cheap, wait until the renters leave (or make them leave), then renovate the apartment and rent for 4 times the price. The rich is getting richer, while people are being screwed.

Re: Rent controls have split housing in Berlin into two distinct markets

#164

Post by alacombe »

febeling wrote: post #72

The situation in Berlin before the policy change was that the city government had made it very hard to build apartments at all. Each time a project it developed, the developer is blackmailed into supporting various unrelated policies, being it parking space related, maximum stories, etc., and sometimes capriciously denied permission to build. This is how my green-leaning, government-trusting architect friends describ…

> The situation in Berlin before the policy change was that the city government had made it very hard to build apartments at all.

Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.

Re: Rent controls have split housing in Berlin into two distinct markets

#165

Post by davidw »

Kalium wrote: post #128
davidw wrote: post #119

Earlier quoted context omitted.

I think this is part of the nuance: we've gotten ourselves into such a bind with housing in so many places that it feels like we need the short term, crisis relief that rent control provides. For some people, it absolutely means not being kicked out into the streets. Go tell that mom and her kids about 'the market'. Yet at the same time, markets, supply and demand are real, and we need to bring them back into balance…

The political complication is that it's very easy for people to be convinced that the short-term answer is the only one that will ever be needed. Addressing long-term problems often involves painful choices that people would rather not face.

That's part of it. The "losers" with rent control are newcomers who may have a harder time finding housing, and some landlords. They're kind of anonymous. But turn up to a public hearing on building some new housing, and the people there to yell about it are your neighbors, ordinary people who "got theirs".

Re: Rent controls have split housing in Berlin into two distinct markets

#166

Post by Kalium »

davidw wrote: post #165
Kalium wrote: post #128

Earlier quoted context omitted.

The political complication is that it's very easy for people to be convinced that the short-term answer is the only one that will ever be needed. Addressing long-term problems often involves painful choices that people would rather not face.

That's part of it. The "losers" with rent control are newcomers who may have a harder time finding housing, and some landlords. They're kind of anonymous. But turn up to a public hearing on building some new housing, and the people there to yell about it are your neighbors, ordinary people who "got theirs".

Yup, that's the core of it. The future has no constituency. The past has.

Re: Rent controls have split housing in Berlin into two distinct markets

#167

Post by huitzitziltzin »

davidw wrote: post #119
codeflo wrote: post #110

Earlier quoted context omitted.

I agree, although the toilet paper situation was a bit different IMO because the shortage wasn't in the supply chain -- it was absolutely clear that inventories would restock sooner or later. In that situation, higher prices wouldn't have incentivized more production. Still, supermarkets could have temporarily raised prices 10x and still sold their inventory. Why didn't more of them do it? Presumably, they made the r…

I think this is part of the nuance: we've gotten ourselves into such a bind with housing in so many places that it feels like we need the short term, crisis relief that rent control provides. For some people, it absolutely means not being kicked out into the streets. Go tell that mom and her kids about 'the market'. Yet at the same time, markets, supply and demand are real, and we need to bring them back into balance…

> it feels like we need the short term, crisis relief that rent control provides.

These programs have a remarkable way of being sticky over time. For example, New York's current rent stabilization program has its origins in a World War 2 era program which never died (first a federal program, then taken over by the state).

Solution: Build more and build it higher. If you are looking for a different kind of short-time-horizon solution for the mom and her kids who are in a precarious situation due to housing costs, give them cash assistance! But in the long run give them more options and lower prices. There is no reason we cannot do both.

Re: Rent controls have split housing in Berlin into two distinct markets

#168

Post by alacombe »

crote wrote: post #45
robertlagrant wrote: post #13

> In a food shortage, for example, regulating the price of bread only trades one expression of scarcity (high prices) for another (empty shelves). This is the key statement to refute if you want to argue for rent control.

If the bread price explodes, poor people will starve and the rest of the population ends up paying a boatload of money to the lucky few bakers. If the bread price remains stationary, people will starve randomly. People are going to starve either way, why not skip the whole "make the bakers filthy rich" part?

That's petty resentment right here found in both communist ethics and catholicism... "if I can't get filthy rich, nobody shall be".

If the bakers gets filthy rich, kudos on them !

Re: Rent controls have split housing in Berlin into two distinct markets

#169

Post by lornemalvo »

rsj_hn wrote: post #139
aphextron wrote: post #88

>In a food shortage, for example, regulating the price of bread only trades one expression of scarcity (high prices) for another (empty shelves). Well sure. But the total amount of people who have some bread is now greater, versus a select few wealthy people getting all the bread they want, as the wretched masses stare longingly. You can either increase total happiness, or concentrate it to the powerful. It's pretty…

Yes, this cogent analysis describes why communist nations are known for food security whereas those capitalist nations are known for starvation.

When I look at the list of famines in the last centuries, it does not look like capitalism provides any kind of food security.

Re: Rent controls have split housing in Berlin into two distinct markets

#170

Post by ericd »

sokoloff wrote: post #147
nonsince wrote: post #113

Earlier quoted context omitted.

Rental properties are inherently rationed by the fact that there is no reason to rent more than one flat in the same city.

That part is true, but the decision to take roommates vs not affects the demand on rental properties. The decision to rent a 2 or 3 BR instead of a 1 BR as a single person working from home affects the demand as well. In a rent-control environment, people have incentive to hoard their rent-controlled apartment as well, especially if rents reset on turnover. If I have a rent-controlled apartment that's well below its…

Yep, I know at least one family that’s pretty well off that held onto their rent controlled place for years after no longer living in it, and then essentially passed it down to their kids. They basically own that apartment for less than it’d cost to maintain if they actually owned it, in terms of HOA/property tax, since the rent is stuck where it was like 30 years ago.

And when I was looking for a place, I came across a couple people playing landlord and trying to sublet out their rent controlled place for more than they were paying the landlord.

It’s pretty broken, at least in NYC.

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