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Has LA cracked the code for building affordable housing?

benjaminschneider.substack.com

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Re: Has LA cracked the code for building affordable housing?

#121

Post by Sabinus »

cyberax wrote: post #93
tomtheelder wrote: post #47

Earlier quoted context omitted.

Neither the article nor the comment you are referring to were talking about government housing. And you’re entitled to not want to live in a dense urban environment, but you might need to open your mind to the idea that not everyone feels the way you do.

> And you’re entitled to not want to live in a dense urban environment, but you might need to open your mind to the idea that not everyone feels the way you do. You're entitled to move away from a toxic river that catches fire. But you might need to open your mind to the idea that not everyone feels the way you do. Perhaps some people like to work at the factory that produces the toxic slime. Urban density is polluti…

Do you think there are economic efficiencies in gathering a large workforce in one location?

Do you think suburbia is an efficient and effective use of land?

Re: Has LA cracked the code for building affordable housing?

#122

Post by robomartin »

apsurd wrote: post #37
robomartin wrote: post #28

Making things affordable in LA will be easy. Almost everyone I know is either in the process of leaving CA or planning on leaving. This includes everything from middle-class individuals to high-net-worth families, soon-to-retire and retired. Everyone is sick of the financially abusive environment in CA, at every level. And, of course, other issues. My wife and I are so sick of it that it has become an almost weekly c…

I hear you. There's definitely a stur up going on these days. > When we go, we will take three businesses and as many of the people working for us as possible out of CA. Logistically, it is far more likely that the move will happen within the US, of course. I'm replying because this is just the tiny vocal minority. California is fucking BEAUTIFUL. People will want to live here until CA breaks off and sinks into the o…

> there is no place like CA.

The US is a beautiful place. I would not be so bolt as to make such a categorical statement.

Economically, in terms of business climate, affordability and more, CA is a dumpster fire. To the point that people at the new $15 to $20 per hour minimum wage that was supposed to solve so many problems actually have lower spending power than when they were earning at a lower rate. That should not be surprising when we pay 3x to 5x for auto licenses, 3x to 10x for auto insurance, 3x to 10x for homeowners insurance, 2x or more for gasoline, more in taxes across the board, from sales to income taxes and a bunch of little taxes on everything that just kills your money. Etc.

The only way CA improves is if there's a major ideological shift that permeates the state. I cannot see that happening for decades. I think it has to sink to a very painful bottom before people actually understand. CA needs to get the "Argentina experience" before voters will understand just how dumb it is to continue to support the charlatans and crooks who have been running this state.

The CA high speed rail was supposed to cost us $10 billion. We are well --way-- past $100 billion and nowhere completion. It will probably take this project another 25 years (if we are lucky), it might cost $500 billion and, if it ever really comes online, the cost per rider will be such that we could have sent everyone to the moon for less. Stupid voters. Ideologically broken crooks for politicians. Not a good combination. Time will tell.

As for affordable housing. Good luck. The very idea in CA violates the laws of physics. Unless there's a serious regime change this particular issue will not improve at all. Not at scale.

Re: Has LA cracked the code for building affordable housing?

#123

Post by xnx »

cyberax wrote: post #93
tomtheelder wrote: post #47

Earlier quoted context omitted.

Neither the article nor the comment you are referring to were talking about government housing. And you’re entitled to not want to live in a dense urban environment, but you might need to open your mind to the idea that not everyone feels the way you do.

> And you’re entitled to not want to live in a dense urban environment, but you might need to open your mind to the idea that not everyone feels the way you do. You're entitled to move away from a toxic river that catches fire. But you might need to open your mind to the idea that not everyone feels the way you do. Perhaps some people like to work at the factory that produces the toxic slime. Urban density is polluti…

Small cities are a relic from 100 years ago when 40% of the US population worked on farms. Their diminished present day stature is a indication that they are not a productive use of resources (e.g. roads and other infrastructure). We don't need government intervention to save them.

Re: Has LA cracked the code for building affordable housing?

#124

Post by seanmcdirmid »

twelvechairs wrote: post #16

Good to see this happening. That said I strongly dislike when there's a conflation of "affordable housing" (lower-case, the general concept of providing for people on lower incomes) with specific schemes you have to qualify for (often "Afffordable Housing" upper-case) - in this case it seems to be deed restrictions on income that are required in exchange for floorspace bonuses and building code relaxations? There's a…

Ya, I don’t see any of these schemes being sustainable until they are somehow universal (eg an option even for the rich, but not one they can somehow monopolize). Like Singapore’s public housing, which isn’t gated by income, but rationed in other ways (marriage, have a family, must be a resident).

Re: Has LA cracked the code for building affordable housing?

#125

Post by seanmcdirmid »

Aloisius wrote: post #116
cyberax wrote: post #92

Earlier quoted context omitted.

> The solution to that is... ... ... denser housing. No large city in the US managed to decrease prices by building more housing (dense or not) within the last 25 years. There are several fundamental reasons why density increases won't work.

What large US city has actually built enough housing to even match natural population growth in the last 25 years? More housing can only lower prices, in absolute terms, if it actually exceeds demand, but it still lowers prices compared to what they would have been had nothing been built, all else being equal. There is broad consensus among economists that it is stringent regulatory controls constraining supply that…

Given that natural population growth has basically flatlined, I’m not sure what to take from that challenge.

https://www.brookings.edu/articles/u-s-population-growth-has...

If we look at the growth from 2000-2020, it basically went from 1% to .12%, so I guess we could use a step method to integrate (or just take population delta from 2024 to 1999 and subtract immigrants?). I don’t think we’ve grown that much, and growth is incredibly uneven.

> There is broad consensus among economists that it is stringent regulatory controls constraining supply that lead to higher housing prices - not building more housing.

People say things like this without backing it up. We get:

> https://truthout.org/articles/big-real-estate-says-regulatio...

“Big Real Estate Says Regulations Caused Housing Crisis, But They Wrote the Rules”

But if you try to key in on specifically economists, they don’t say that. The fact that we have a global housing crisis, not just in America, seems to hint that something else is going on. Of course, we can build baby build Chinese style and wind up with 1.5 houses for every household, but that is probably a worse problem.

Re: Has LA cracked the code for building affordable housing?

#126

Post by seanmcdirmid »

cyberax wrote: post #90
apsurd wrote: post #29

Earlier quoted context omitted.

I'm the person that wants more dense and walkable cities, so I'm really curious to learn more about why that will ALWAYS lead to more misery down the road. Honest question, do you have any stuff I can read or terms I can search on?

"Supply skepticism" is a good overview: https://furmancenter.org/research/publication/supply-skeptic... And it's written from the viewpoint of pro-density. Read the linked papers there, the best results of density increases are either extremely indirect ("migration chains") or insignificant (no sale price decreases, and single-digit percentage one-time decreases in rent). I'm writing an analysis of all densifications…

Density increases actually make cities more popular, so the supply constraints remain or even worsen. They also generate wealth, meaning people earn more, and can bid up housing prices. I think people just like dense cities with good transit, so we should definitely do it, but let’s not pretend that SF would be affordable if only it had HK’s density (it would be as affordable as HK, which means not very).

Re: Has LA cracked the code for building affordable housing?

#127

Post by xnx »

closeparen wrote: post #74
cyberax wrote: post #17

I'll save you a click: no. Here's the thing: housing in dense cities will NEVER be affordable. Never. What happened recently (and is happening in other cities like Seattle) is companies pivoting from building "luxury" crappy condos to sweet state-subsdizied housing. These kinds of projects are great for them, they don't need to care about the market demand.

You can, right this moment, purchase a 2-3 bedroom condo in a glass-and-steel high rise in a central business district from a profit-seeking entity, for less than $400,000. It’s called Chicago. Something SF, LA, Seattle, etc. would be immensely improved by imitating.

Chicago is great, and $400K can be a good deal compared to the coasts, but watch out for those assessments.

Re: Has LA cracked the code for building affordable housing?

#128

Post by Aloisius »

cyberax wrote: post #90
apsurd wrote: post #29

Earlier quoted context omitted.

I'm the person that wants more dense and walkable cities, so I'm really curious to learn more about why that will ALWAYS lead to more misery down the road. Honest question, do you have any stuff I can read or terms I can search on?

"Supply skepticism" is a good overview: https://furmancenter.org/research/publication/supply-skeptic... And it's written from the viewpoint of pro-density. Read the linked papers there, the best results of density increases are either extremely indirect ("migration chains") or insignificant (no sale price decreases, and single-digit percentage one-time decreases in rent). I'm writing an analysis of all densifications…

Greenaway-McGrevy (2023) showed an increased supply of housing in Auckland reduced rents in 3-bedroom homes by 26-33% below a control.

Mense (2023) showed a 1% yearly increase in housing supply in Germany results in an average local municipality rent to fall by 0.2%.

Asquith et al. (2023) found in NYC, the average new building lowers nearby rents within 250 meters of the new building by 5% to 7% relative to the trend rent growth otherwise would have followed.

Li (2022), looked at new market rate buildings of 7+ stories and found that for every 10% increase to the housing stock that new high rises add within a 500-ft ring, residential rents for the buildings within that ring decrease by 1 percent.

Pennington (2021) found rents within 500 meters of a new project fell by 1.2 to 2.3% in San Francisco.

Re: Has LA cracked the code for building affordable housing?

#129

Post by Aloisius »

seanmcdirmid wrote: post #125
Aloisius wrote: post #116

Earlier quoted context omitted.

What large US city has actually built enough housing to even match natural population growth in the last 25 years? More housing can only lower prices, in absolute terms, if it actually exceeds demand, but it still lowers prices compared to what they would have been had nothing been built, all else being equal. There is broad consensus among economists that it is stringent regulatory controls constraining supply that…

Given that natural population growth has basically flatlined, I’m not sure what to take from that challenge. https://www.brookings.edu/articles/u-s-population-growth-has... If we look at the growth from 2000-2020, it basically went from 1% to .12%, so I guess we could use a step method to integrate (or just take population delta from 2024 to 1999 and subtract immigrants?). I don’t think we’ve grown that much, and gro…

Population growth since 2000 doesn't really affect the housing market today. Most of those people aren't old enough to be in the housing market.

We're facing shortages caused by 40 years of building below the level of population growth.

Re: Has LA cracked the code for building affordable housing?

#130

Post by seanmcdirmid »

Aloisius wrote: post #129
seanmcdirmid wrote: post #125

Earlier quoted context omitted.

Given that natural population growth has basically flatlined, I’m not sure what to take from that challenge. https://www.brookings.edu/articles/u-s-population-growth-has... If we look at the growth from 2000-2020, it basically went from 1% to .12%, so I guess we could use a step method to integrate (or just take population delta from 2024 to 1999 and subtract immigrants?). I don’t think we’ve grown that much, and gro…

Population growth since 2000 doesn't really affect the housing market today. Most of those people aren't old enough to be in the housing market. We're facing shortages caused by 40 years of building below the level of population growth.

So you mean growth in population from 1975 to 2000 as the 25 year window we should be looking at?

We went through a property bust in the late 80s/early 90s due to Japan’s larger property bust and the S/L crisis, among having wicked recessions at the time.

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