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Austin’s surge of new housing construction drove down rents

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

#111

Post by orangecat »

mountainriver wrote: post #96
nemomarx wrote: post #3

Good news - experimental verification of the law of supply and demand! I'm sure the analysis is welcome though and I hope policy makers try to learn from this. We could densify most american cities quite a lot more.

We could but it’s not always just “good” to make things dense. My hometown has had a huge push to add more housing to make things more affordable. What happened? Rents went down for a couple years then right back up. Except now the city has a bunch of more soulless condos and is horribly congested. Sometimes preserving things and keeping them nice and simple even if it’s costs a bit of a premium is better.

Rents went down for a couple years then right back up. Except now the city has a bunch of more soulless condos and is horribly congested.

So there were a bunch of people who wanted to live there and now can.

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

#112

Post by ajross »

mountainriver wrote: post #96
nemomarx wrote: post #3

Good news - experimental verification of the law of supply and demand! I'm sure the analysis is welcome though and I hope policy makers try to learn from this. We could densify most american cities quite a lot more.

We could but it’s not always just “good” to make things dense. My hometown has had a huge push to add more housing to make things more affordable. What happened? Rents went down for a couple years then right back up. Except now the city has a bunch of more soulless condos and is horribly congested. Sometimes preserving things and keeping them nice and simple even if it’s costs a bit of a premium is better.

> now the city has a bunch of more soulless condos and is horribly congested

The first bit is a taste thing; obviously lots of people view modern sprawl as "soulless" too.

But the latter point is just plain wrong. Dense housing IMPROVES traffic congestion and shortens commutes, always, everywhere, markedly. And it's for a bleedingly obvious reason: pack people in closer together and they don't have to travel as far to get where they're going. QED.

What you're imagining is some kind of fantasy hometown, which never increased in population and whose economy never developed. I mean, it's true. Forgotten ghost towns have very little traffic and quirky soulful architecture, c.f. Detroit. Everyone agrees that's a bad thing, though.

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

#113

Post by shimman »

matheweis wrote: post #59
atomicnumber3 wrote: post #21

Earlier quoted context omitted.

So, do we just need to nationalize housing construction? If the free market apparently just can't handle it?

It’s not a free market construction issue at all, it’s a regulatory zoning and permitting issue. Read the article and the peer comments here; Austin’s boom came about from reducing regulatory constraints. Nationally remove the artificial restrictions and the supply side will fix itself.

Seems like a free market issue, any profit resulting from development is a free market issue. Your profit margins mean worse quality housing for people, and we can see what actual public housing programs look like with Singapore and Vienna where rents can typically cost less than 20% of median salaries:

https://www.youtube.com/watch?v=LVuCZMLeWko

As renown corporate welfare recipient Bezos would say: "your margin is [our] opportunity."

If the only thing stopping development is that rich developers want to make more money, then maybe we should get rid of the rich developers and let the public decide what to build. It couldn't be worse and it'd be 20-60% cheaper too.

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

#114

Post by bombcar »

servo_sausage wrote: post #82
Gigachad wrote: post #8

Same has been happening in Melbourne, Australia. The state government has basically steamrolled the boomers and allowed highrise construction next to existing train stations. Despite having huge population growth, rents are some of the most affordable in the country.

One of the things I like about the reporting in this Austin article, is they break down by building class. In Melbourne I've never found a good source for this, only general averages; and my suspicions are that we just build shitboxes and claim the rent is lower on average, capturing something like shrinkflation rather than affordability.

You should be able to identify properties and track them over time; and then even if you argue that "brand new condo" vs "same condo 10/20/30 years later" aren't directly comparable; well you can start to compare other metrics.

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

#115

Post by alephnerd »

onlyrealcuzzo wrote: post #104
alephnerd wrote: post #72

Earlier quoted context omitted.

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...

> The majority of it is not Bel Air...

Menlo Park was never a "middle class" town. The 101 was always the (literal) redline.

The median household income is $210K [0] and it's the same demographic, unlike historically lower middle class but now upper middle class San Mateo [1].

A Menlo Park home address that is on the correct side of the 101 opens the same doors in the Bay that a Bel Air address does in Los Angeles or an Austin Hills address does in Austin.

Rich doesn't equal conspicuous, especially in the Bay Area - "Wealth is quiet, rich is loud, poor is flashy"

[0] - https://www.census.gov/quickfacts/fact/table/menloparkcityca...

[1] - https://www.census.gov/quickfacts/fact/table/sanmateocitycal...

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

#116

Post by seanmcdirmid »

bombcar wrote: post #106
james_marks wrote: post #46

Earlier quoted context omitted.

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).

If you are smart, you throttle up investments just before a boom starts and throttle them back just before a boom ends. At least you try to up your margins during good times so you can survive bad times. The trick is keeping your talent employed during the bad times so they are trained up and still in the industry for good times. Stability is obviously preferable.

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

#118

Post by nomilk »

Dumb question, many cities suffer from extremely high property (i.e. land) prices. I understand the NIMBY barrier. But I don't understand why it isn't more common to simply.. start a new city. Especially in countries like Australia where property prices are sky high and alternative places for setting up a new city are abundant. Maybe internet connectivity was previously a barrier, but now.. starlink.

I put this question to grok; its response:

> Unfortunately, Australia's legal, regulatory, financial, and practical systems make this extremely difficult (bordering on impossible at any meaningful scale).

Crazy that the reason we can't have an order-of-magnitude reduction in the cost of the most important thing people need (shelter) is not due to resource constraints, but man-made ones.

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

#119

Post by mh2266 »

odyssey7 wrote: post #68
rconti wrote: post #52

Earlier quoted context omitted.

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…

Is the Bay Area really dealing with ticket machines? The global capital of technology? Just bill by plate or something.

I got billed by plate at gravel parking lots in places in Iceland where there were probably more sheep nearby than human residents. Embarrassing.

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

#120

Post by hombre_fatal »

narrator wrote: post #67
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.

[flagged]

I think this is a bunch of retrospective justification when the truth is that home-owners vote against supply expansion measures that may decreases their home value (their main investment).

Just like how people pretend "I'm actually super concerned about emergency vehicles" when it comes to replacing a car lane with a bus/bike lane. It sounds better than admitting they don't want to be inconvenienced, they'd rather have an extra car lane than someone else get a bus/bike lane, etc. So the hand waving begins.

Austin is unique even in Texas for its aggressive construction boom + decreased rent, so it's not even a Texas thing.

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