California Approves Statewide Rent Control • Hacker News Board

Re: California Approves Statewide Rent Control

#361

Post by [deleted] » Thu, Sep 12, 2019, 2:51 AM UTC

jacobolus wrote: post #339

dgzl wrote: post #259

I'm a renter in Oregon and I've been outspoken about this long before the laws were passed. From my experience, people who support heavy laws, regulations and taxes don't spend enough time considering potential side effects. They feel like with enough support, they can just force anything they want to happen, while completely disregarding the market. I feel like an amount of the general public just wants Big Daddy go…

YMMV, but in my experience people who use phrases like “Big Daddy government” and accuse everyone else of “pure ignorance” are typically not arguing in good faith.

[deleted]

Re: California Approves Statewide Rent Control

#362

Post by rolltiide » Thu, Sep 12, 2019, 2:52 AM UTC

mabbo wrote: post #43

It seems more and more clear that California, or at least those in power in California, don't want to fix the housing problem. Because if you're a land owner, the only problem is people trying to spoil the good times. All this VC money pouring into the pockets of tech employees, and a larger and larger fraction going straight into landlords' pockets. What's not to love? If actually you want lower home prices, build m…

yes, the incentives are misaligned for any other outcome

Re: California Approves Statewide Rent Control

#363

Post by ralusek » Thu, Sep 12, 2019, 2:52 AM UTC

human20190310 wrote: post #322

There is no functioning market to begin with. Housing prices and rent are through the roof in California, yet supply is not rising to meet demand, largely because existing owners oppose new construction. Turnabout is fair play. If owners organize politically to control supply, tenants can organize politically to control prices.

Let's just not even talk about the fact that regulation is the reason why housing is scarce, let's just assume California is 100% at capacity. How the hell does rent control increase turnabout? It just let's people who got in at the right time have their status as a resident enforced indefinitely, when there are plenty of people who are willing and able to pay far more in order to live there.

Re: California Approves Statewide Rent Control

#364

Post by aswanson » Thu, Sep 12, 2019, 2:52 AM UTC

zamfi wrote: post #355

pvelagal wrote: post #347

Earlier quoted context omitted.

Well, i disagree with your opinion. Silicon Valley has been attracting a lot of people from lot of states, who all need housing. Remember , size of California is fixed. Housing in Silicon valley doesn't grow at the same rate as number of people coming here. Added to that, foreigners living in foreign countries ( who have never visited USA, who have no intention of living in USA) are able to own land/houses in silicon…

> Housing in Silicon valley doesn't grow at the same rate as number of people coming here Bingo. And why not?

Existing homeowners don't want their living space turned into downtown Manhattan because there's a temporary exorbitant demand for ad click optimization and pic sharing networks.

Re: California Approves Statewide Rent Control

#365

Post by aianus » Thu, Sep 12, 2019, 2:53 AM UTC

cryptoz wrote: post #75

pitaj wrote: post #71

Earlier quoted context omitted.

Rent doesn't get changed daily, only when a lease is up for renewal. Rent control deters the creation of new housing. This reduce in supply raises the price, which is bad for the poor - exactly the people it is meant to help.

I was under the impression that some rents can be increased during the lease. I do not think it is only a renewal event, by law. > Rent control deters the creation of new housing. I keep seeing this repeated but I don't understand. Why does rent control deter creation of new housing? > This reduce in supply raises the price But you've glossed over why supply is reduced. I don't see any reason that supply would be red…

> Why does rent control deter creation of new housing?

If you have a lot of money and you want to build/buy a rental property, would you do it in a) a growing city with no rent control where your discounted future cash flows are unbounded or b) a city where there is a law placing a ceiling on your returns.

All else being equal, you are going to choose the city without rent control to build your new housing units in (or invest in something other than real estate altogether), thus illustrating how rent control disincentives new investment in housing, and specifically low-income rental housing.

Re: California Approves Statewide Rent Control

#366

Post by dehrmann » Thu, Sep 12, 2019, 2:53 AM UTC

pvelagal wrote: post #347

dgzl wrote: post #259

I'm a renter in Oregon and I've been outspoken about this long before the laws were passed. From my experience, people who support heavy laws, regulations and taxes don't spend enough time considering potential side effects. They feel like with enough support, they can just force anything they want to happen, while completely disregarding the market. I feel like an amount of the general public just wants Big Daddy go…

Well, i disagree with your opinion. Silicon Valley has been attracting a lot of people from lot of states, who all need housing. Remember , size of California is fixed. Housing in Silicon valley doesn't grow at the same rate as number of people coming here. Added to that, foreigners living in foreign countries ( who have never visited USA, who have no intention of living in USA) are able to own land/houses in silicon…

> Housing in Silicon valley doesn't grow at the same rate as number of people coming here

To be clear, the population is growing faster than the housing stock.

> Rent control or low income housing are essential tools to make ordinary Americans’ lives better.

How exactly does this address the problem that there are more people than housing? It addresses it for some (the select few low-income residents who were lucky enough to get a below-market rate unit and people already renting), but squeezes everyone else into even fewer units. It doesn't even help "ordinary" people; it helps two specific groups.

Re: California Approves Statewide Rent Control

#367

Post by cabaalis » Thu, Sep 12, 2019, 2:53 AM UTC

baby wrote: post #149

bgorman wrote: post #27

One thing I have noticed as I have become more aware is that many of our laws are aimed at trying to freeze a moment of time, often by piling on contradictory policies on top of each other. Subsidize home loans Ban new construction Ban rent increases It is no wonder why housing prices/rents continue to rise in these markets. In software engineering sometimes conclude that a rewrite is necessary. How can we completely…

Stop making housing an investment?

I've seen this argument before. Why shouldn't it be an investment?

1. Land is a limited resource. 2. Property improvements last for a very long time, and are incrementally improved. 3. The buy-in price is relatively high, so only very interested parties get involved. 4. It's a home for goodness sake, why would you not call it an investment?

Re: California Approves Statewide Rent Control

#368

Post by cybersnowflake » Thu, Sep 12, 2019, 2:54 AM UTC

raldi wrote: post #351

cybersnowflake wrote: post #331

Earlier quoted context omitted.

So you blame republicans and want even more Democratic control of the Legislature than they already have.

When did I blame Republicans?

You having problems reading your past posts? You just basically said evil Republicans are blocking common sense housing solutions and indicated the solution is an even greater proportion of Democrats but then said that a Democrat blocked it and their numbers don't matter.

Re: California Approves Statewide Rent Control

#369

Post by raldi » Thu, Sep 12, 2019, 2:54 AM UTC

dantheman wrote: post #333

raldi wrote: post #136

Earlier quoted context omitted.

This bill specifically exempts new housing from its controls.

It can be expected to stay exempted?

They'd have to start over from scratch with a new piece of legislation to do that.

Many of the legislators who supported it specifically cited this aspect of the bill, so I don't think such a change would make it through.

Re: California Approves Statewide Rent Control

#370

Post by someguydave » Thu, Sep 12, 2019, 2:55 AM UTC

jacobolus wrote: post #345

closeparen wrote: post #256

Earlier quoted context omitted.

Many landlords are not paperclip maximizers. REITs are, but small time families often charge below-market rents to the long term tenants they personally like or can’t be bothered to replace. They feel comfortable doing this because they can always revert to market rate later. With that long-term optionality going away, some will revert to market rate or as close as legally possible right now.

So in other words, landlords love to reserve the right to kick a tenant they stop liking out at the drop of a hat for no specific reason, by jacking the rent up as high as they want. As compensation for this power, they are willing to charge well below market rates to help indigent tenants. If they lose this “right”, they insist on becoming pure profit maximizing machines?

A better way to think about it is that a social norm that constrains landlords will be completely upended by the new legal norm. This legal norm will likely encourage behavior that otherwise wouldn't be exhibited, due to unintended consequences - in particular the landlord's estimation of what other landlords are going to do under the new law.