Austin’s surge of new housing construction drove down rents • Hacker News Board

Re: Austin’s surge of new housing construction drove down rents

#101

Post by CharlieDigital » Thu, Mar 19, 2026, 1:13 AM UTC

TulliusCicero wrote: post #33

amelius wrote: post #10

Earlier quoted context omitted.

What if the people in power don't want prices to go down?

It's typically local residents who fight this. There's a "fuck you, got mine" tendency to pull up the ladder once you've made it.

It is more complicated than that. A few years back when my youngest entered 1st grade, I attended some meetings where the superintendent talked about school expansions in the pipeline due to confirmed property development projects.

Namely, when new housing is added, there are infrastructure considerations and corresponding expenses that translate to higher taxes. Civil planners have formulas for how much the student population will grow based on the housing density/type.

Schools built on parcels based on 1970's population now have to expand to fit more students or the township has to find and acquire new land to build a new school.

That requires raising taxes for bonds. A new school is several million dollars and then hiring staff. NJ has a legal limit of 25:1 in elementary. Add 100 students and you add at least 4 teachers that have to be supported by taxpayers. Expand the lunchroom, build a new gym, purchase new computers, all the ways up the chain for the next 12 years.

If you ever look at your municipal tax bill, you will find that education is going to be the biggest expense by far.

On top of that, roads may need to be widened. New roads have to be built and maintained. Municipal staff may need to increase.

Some services may actually benefit from economies of scale (waste collection). Most will not.

Imagine you bought a house in 1970 (i.e. my development) and you were paying $1000 annual property taxes. Now your property taxes are $12000 because of the increased spend on infrastructure and increased assessed value. You're a retiree and you've paid taxes for 2 or 3 generations of students. You live on a fixed income and your property taxes are a higher and higher proportion of your income. What do you do? Mortgage the house to pay taxes to fund more growth?

The problem is exacerbated because obviously people want to go where the good schools are, where it's low crime, good infra, easy access to transportation. That drives demand and puts pressure on services while also raising taxes to pay to fund municipal bonds for growth.

End of the day, my personal belief is that housing is a right. But I can also see why middle class folks, retirees end up pushing back when they get the bill in the form of increased property taxes. I've lived in my house 10 years now and my taxes have gone up ~$3500 in that time. Every school in the township had to expand to meet population growth with the additional units. Sure, my home value went up as well, but I can't cash that out. I can't imagine how it feels for retirees that are living in a family home here.

Re: Austin’s surge of new housing construction drove down rents

#102

Post by paulnpace » Thu, Mar 19, 2026, 1:14 AM UTC

tkel wrote: post #89

riknos314 wrote: post #4

So glad we don't need to re-write the first chapter of almost every economics 101 textbook!

There's loads of other inefficiencies as well. Moving is a huge hurdle. It's difficult to find housing that meets dozens of conditions, and even then you don't respond to supply + demand imagined equilibrium, you pay more or pay less to live near friends or family. It's something you only do a handful of times in your whole life. Trying to use the same analysis as for buying a can of beans is absurd. You might need t…

I'm not clear: does Econ 201 inform us as to how demand and supply are not related to price?

Re: Austin’s surge of new housing construction drove down rents

#103

Post by lesuorac » Thu, Mar 19, 2026, 1:14 AM UTC

muyuu wrote: post #77

riknos314 wrote: post #4

So glad we don't need to re-write the first chapter of almost every economics 101 textbook!

it's crazy that people nowadays seriously question basic market pressure being a thing

Eh, people really need to be questioning econ 101 more often.

It's built upon untrue assumptions

- infinite buyers / sellers

- perfect information

- no switching / transaction costs

---

The article itself has 3 different year ranges provided so I'm not sure how you can use it as evidence. Plus overall the rent is still up by a lot since 93% - 4% is still at least 80%.

- Rents increase by 93% from 2010 to 2019

- Housing increase from 2015 to 2024 (this overlaps with when rents increased ...)

- Rents fell from 2021 to 2026 by 4%

Re: Austin’s surge of new housing construction drove down rents

#104

Post by onlyrealcuzzo » Thu, Mar 19, 2026, 1:15 AM UTC

alephnerd wrote: post #72

rconti wrote: post #11

Meanwhile, California is also trying to build housing near transit, but Menlo Park wants to preserve the character of downtown by preserving dirty, cracked, flat, surface-level parking lots like it's 1950.

Menlo Park isn't comparable to Austin though - Austin's equivalent of Menlo Park would be a country club CDP in the Austin Hills like Rob Roy. A better comparison would be ATX against San Jose. Just like how the "rich" residents of Santa Clara county know that you want to live in Campbell, Los Gatos, Menlo Park, Los Altos, Loyola, etc, similarly rich Texans and Austinites live in the Hills. The reality is the residen…

Menlo Park has a higher population density than Austin...

The majority of it is not Bel Air...

Re: Austin’s surge of new housing construction drove down rents

#105

Post by peder » Thu, Mar 19, 2026, 1:15 AM UTC

JumpCrisscross wrote: post #64

tkel wrote: post #58

Earlier quoted context omitted.

They also teach you about elasticity in econ 101. It's foolish and anti-intellectual to insist that the housing market has only two factors, while simultaneously condescending about your understanding of economics shows that you really don't understand economics, it's more about your ego.

> It's foolish and anti-intellectual to insist that the housing market has only two factors Elasticitiy moderates the effect. It doesn't reverse it. Increasing housing supply decreases housing costs. A lot of people are venally or ideologically motivated against accepting this. Our housing crisis is a political choice. (Note: I'm a homeowner.)

> A lot of people are venally or ideologically motivated against accepting this.

That’s the story of the last 10 years among certain types that keep regurgitating obviously wrong concepts.

Re: Austin’s surge of new housing construction drove down rents

#106

Post by bombcar » Thu, Mar 19, 2026, 1:16 AM UTC

james_marks wrote: post #46

legitster wrote: post #28

Another part of this - higher interest rates really put the brakes on home values. We own a rental property and the home value has more or less been locked in since 2022. In our otherwise hot metro area, nobody has raised their rental rates on similar properties in 4 years. It's a win-win for our tenants. Prices seem to be stable and there's no rush for them to lock down a house RIGHT NOW. It's sure not good for my b…

This balanced perspective on what’s good for someone personally vs what’s good for society at large is what’s missing from the world.

Any reasonable landlord/real estate investor will have planned for various results - if your rental empire depends on "rents go up" and can't handle a flat market, let alone a downturn, you're going to be in for a bad time.

A stable market is great; as you can find good deals with some sort of certainty, and focus on where you can actually build value (rehab, etc).

Re: Austin’s surge of new housing construction drove down rents

#107

Post by seanmcdirmid » Thu, Mar 19, 2026, 1:16 AM UTC

bombcar wrote: post #98

CBLT wrote: post #18

Earlier quoted context omitted.

People are quick to point out that induced demand exists - especially people that aren't fond of change. Very broadly speaking, people mis-estimate effect sizes in economics by orders of magnitude. Induced demand is just their foothold to claim an effect exists, before they go about claiming the effect size they want to see.

I love induced demand. I'm going to use it to get rich - buy up some abandoned town somewhere, and then pay to run a 100 lane superhighway to it; induced demand means the town will fill up instantly and be hugely valuable!

It doesn’t work unless there is currently repressed demand for living in that abandoned town because not enough housing or other factors.

No one is complaining about a housing shortage today in buffalo which used to have twice as much housing stock as it does today, because the demand simply isn’t there now.

Re: Austin’s surge of new housing construction drove down rents

#108

Post by thaumasiotes » Thu, Mar 19, 2026, 1:16 AM UTC

rconti wrote: post #52

strbean wrote: post #42

Earlier quoted context omitted.

To be fair, parking structures always look and feel pretty distopian. I like the approach of making downtowns walkable and having a bit of parking at the periphery of downtown, along with good public transit. Encourages people to use public transit to get to town in the first place. Downtown residents can use transit or a zipcar or equivalent when the need to get out of town, instead of devoting a ton of space downto…

Well, in Menlo Park they're just flat surface parking lots, not even multi-story structures. The planned development is multi-story housing with parking underneath. To be fair, I am boycotting the (similar) underground garage over at Springline because they're clearly made only for people in Range Rovers or whatever. They have those AWFUL ticket machines, set too far back (to avoid getting hit) and too high to access…

> They have those AWFUL ticket machines, set too far back (to avoid getting hit) and too high to access from a normal car.

Are you sure it's the ticket machines? Around here, the ticket machines have stayed the same, but it's now impossible to use them without stopping the car and getting out, because car manufacturers have decided I need eight inches of empty space between myself and the side of the car.

Re: Austin’s surge of new housing construction drove down rents

#109

Post by WarmWash » Thu, Mar 19, 2026, 1:16 AM UTC

gtowey wrote: post #63

maxerickson wrote: post #40

Earlier quoted context omitted.

As a homeowner, I want number to go up. These things push against that. Really, I'd prefer not having policies that tend to push up housing prices or discourage people from moving, but here we are, those types of policies are common.

> As a homeowner, I want number to go up. Which is myopic. As a homeowner, I want cities to be livable and affordable for those who want or have to live there. I don't care if the value of my home changes one cent. It's honestly kind of useless, because it's not like I can sell the house and buy a nicer one. All the houses are more expensive so it's always going to be a lateral trade. It only helps if you sell and mo…

You can arbitrage markets for retirement, which is largely why people want their home values to increase. Their home is another form of 401k, and those mortgage payments aren't going to the bank or a land loed, they're going to their future.

It's a minority of people who are ok never capitalizing on their home value.

Re: Austin’s surge of new housing construction drove down rents

#110

Post by bombcar » Thu, Mar 19, 2026, 1:17 AM UTC

seanmcdirmid wrote: post #107

bombcar wrote: post #98

Earlier quoted context omitted.

I love induced demand. I'm going to use it to get rich - buy up some abandoned town somewhere, and then pay to run a 100 lane superhighway to it; induced demand means the town will fill up instantly and be hugely valuable!

It doesn’t work unless there is currently repressed demand for living in that abandoned town because not enough housing or other factors. No one is complaining about a housing shortage today in buffalo which used to have twice as much housing stock as it does today, because the demand simply isn’t there now.

Exactly - induced demand is just a misnomer/misunderstanding. "Pent-up demand" would be a much better way to explain it - but that would reveal that at some point the demand ceases; even SF has some limit - once all 12 billion people live there, demand will level off.