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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

#251

Post by triceratops »

ms_menardi wrote: post #242
bryanlarsen wrote: post #228

Earlier quoted context omitted.

35% of Americans rent their homes. And they almost invariably rent from investors. Therefore if more than 35% of homes are owned by investors this drives down rent. If less than 35% are owned by investors rent goes up.

This logic assumes that 35% of Americans WANT to rent their home. Which seems odd to me, if only for financial reasons - why would you pay 1400$ for a 1 bedroom apartment when you could pay 700$ in a mortgage for that same apartment if you could have bought it?

If you invent a scenario where the mortgage is half the rent then buying is a no-brainer. Does that reflect reality?

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

#252

Post by slg »

jychang wrote: post #233
slg wrote: post #217

Earlier quoted context omitted.

This comment is phrased as if the article is confirming these points when it either doesn't mention them or even directly refutes them. First there is no mention of either crime or rent control in the article. But more importantly, it states that "A key piece of Austin’s strategy has been to encourage the construction of affordable housing." So why are you concluding that affordable housing isn't needed?

The comment is phrased in the greater context of the public discussion about housing, in general. Not the specific information of the article. You know, like how a discussion about war might reference the various recent wars that everyone knows about; it's not limited to just the content of the article.

But it didn't reference anything, it stated political opinions like they were confirmed facts, provided zero evidence to support those assertions, and completely ignored the ways in which the article provides counterevidence.

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

#253

Post by terminalshort »

School-Cotton wrote: post #174
odyssey7 wrote: post #68

Earlier quoted context omitted.

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

The reasons why the Bay Area is the global capital of technology are absolutely totally unrelated to the quality of infrastructure or the policies of local government there. It’s mainly due to the state of US technological advancement decades ago when the whole thing got started, the general US-level business-friendly environment, and the presence of an extremely prestigious (especially in science and tech fields) un…

The specific reason is that William Shockley's mother lived in Palo Alto. Stanford gets the credit but in reality it had nothing to do with the decision.

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

#254

Post by bsder »

bryanlarsen wrote: post #228
tharmas wrote: post #218

Earlier quoted context omitted.

You have to restrict investors buying up that newly built housing too. Homes for people. Not investors.

35% of Americans rent their homes. And they almost invariably rent from investors. Therefore if more than 35% of homes are owned by investors this drives down rent. If less than 35% are owned by investors rent goes up.

> 35% of Americans rent their homes. And they almost invariably rent from investors. Therefore if more than 35% of homes are owned by investors this drives down rent. If less than 35% are owned by investors rent goes up.

This only holds until the percentage owned by the investors becomes a monopolistic chunk. At that point the investors would rather leave some apartments empty rather than see rents go down.

See: all the current RealPage lawsuits

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

#255

Post by terminalshort »

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

Housing and immigration are two areas where people just can't accept basic economics. You can see some olympic level mental gymnastics routines all over this comments section.

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

#256

Post by spongebobstoes »

estearum wrote: post #221
pclowes wrote: post #176

Its wild how the solution to housing costs is really just: Build more housing. Keep law and order. No it doesn’t need to be “affordable”. Yes rent control is a terrible idea. Just build more housing. Note: that the US already has plenty of housing and housing costs basically go up in areas of low crime relative to economic opportunity. If you build housing, but allow crime to rise, you have wasted everybody’s time.

New construction has already decelerated in Austin due to falling prices, which compresses already-near-zero margin on real estate development. So yes, it really is "just build more housing." The problem is: why would you build more housing as prices fall?

it doesn't matter if prices are falling or rising, it only matters how the ROI of building compares to other investment opportunities

we can also make it cheaper to build. easing taxes on imported materials, bringing in more skilled labor, expediting permits, and even direct subsidies like tax breaks

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

#258

Post by estearum »

spongebobstoes wrote: post #256
estearum wrote: post #221

Earlier quoted context omitted.

New construction has already decelerated in Austin due to falling prices, which compresses already-near-zero margin on real estate development. So yes, it really is "just build more housing." The problem is: why would you build more housing as prices fall?

it doesn't matter if prices are falling or rising, it only matters how the ROI of building compares to other investment opportunities we can also make it cheaper to build. easing taxes on imported materials, bringing in more skilled labor, expediting permits, and even direct subsidies like tax breaks

> it doesn't matter if prices are falling or rising, it only matters how the ROI of building compares to other investment opportunities

Correct, which it basically doesn't in Austin, which is why construction is decelerating.

> we can also make it cheaper to build

Yep, this is the only structural solution. The "just add supply" runs into the problem of price equilibriums. The reality is the input costs of building housing basically guarantees that housing is hard-to-attain for any local market. We need to address the cost of inputs. Temporary reductions in price are temporary and the market will self-correct back to restrict supply (as we're seeing in Austin) until prices go back up to being hard-to-attain.

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

#259

Post by maest »

estearum wrote: post #240
FireBeyond wrote: post #232

Earlier quoted context omitted.

In my state, or in my capital city, you say this, but the real estate developers are generally the top 1% in town. If they're running on razor-thin margins, I'm not seeing it - I am seeing them on my Facebook (being friends with the wife of the mayor) doing things like taking their kids on vacation to the French Riviera, Switzerland, Tokyo, the Maldives... well, alongside the City's Planning Committee commisioners an…

Well you see, we clearly need to armor the parts of the planes that have bullet holes in them upon return!

I get what you mean, but I doubt corruption is good for building good housing
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