Any rent control is a distortion that should not be done. Open up property rights and get more high-density housing built. Done.
California Approves Statewide Rent Control
761–770 of 1001 posts
Re: California Approves Statewide Rent Control
#762There 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.
This is the best argument I've seen to support these price controls. They're a bad idea on their own, but as a response to another bad idea (landlord opposition to construction) they make political sense.
Sometimes the system has to break down before progress happens.
Re: California Approves Statewide Rent Control
#763Earlier 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?
Dude, they own the property. This is OK.
Re: California Approves Statewide Rent Control
#764I'm shocked at the ideological fervor here and the fact that virtually no one seems to have looked at the details of the actual bill. This is nothing like the rent control ordinance in SF that has caused $3000 units to get stuck at $500 rents. That will never happen under this law. The allowable increases are so much higher than "normal" rent control laws that any given unit will catch up to market rates in a matter…
The lack of affordable housing always has been and always will be a supply problem. When demand for homes outpaces the number of homes being built, prices go up. Plain and simple.
Homes that are built for renting (mainly apartments and condos, but some houses, too) are built for profit. If you make it less profitable to build, fewer will be built. If fewer homes are built, the problem is compounded, not rectified.
If you want to make housing more affordable, make it as cheap and profitable as possible to build new homes. Get rid of the fees that can push over $100,000 for a single family home in some counties, before the builder even buys a nail or 2x4. In most states you can build a home for less than the price of permission to build a home in some California counties.
Re: California Approves Statewide Rent Control
#765Earlier quoted context omitted.
are these vanishing landlord eating their properties or just throwing them into the sea
No, just leaving them vacant while the value increases.
Cool- next up, a tax on vacant properties. Maybe they will have to sell.
Perhaps the people can again seize the means of production (part of that being stable housing).
I’d far rather know another 100,000 units are owned by the people that live in them than 100 landlords owning and profiteering from those units.
If this “disrupts” the entire rental industry, that’s fine with me. Didn’t bring much value anyway
Re: California Approves Statewide Rent Control
#766Earlier quoted context omitted.
Because landlords start being unable to afford repairs, and you get a bunch of decrepit buildings falling apart all over the city (with all the dangers that implies, not just to occupants, but to nearby buildings as well). It happened in my home town, and it wasn't pretty. Landlords are not social security. It's probably better for the city to forcefully buy them out and create a new management model of the buildings…
Rents are growing insanely fast in SF compare to anything else. The idea that landlords can't afford to make repairs because they aren't extracting maximum rent from the property is completely ludicrous on the face of it. Do you actually believe these arguments?
I know a few landlords and that’s exactly what’s happening. I’m not sure why you find it hard to believe.
When you have a 3 unit building and everyone is paying less than 1/3 the market rate, it’s not worthwhile in the least for a landlord to fix up the building beyond the absolute minimum. Contractor rates have skyrocketed in SF, so even just repainting the building might cost $15k, which might represent several years of profit.
Re: California Approves Statewide Rent Control
#767Earlier quoted context omitted.
Well said. It is weird to see so many people jumping out to lay the accusations of 'uninformed!', 'never works', etc... In fact, the CA, especially in bay area, the rent is already top among this country. 7% on top of that is still a quite sizable increase. And it is hilarious to see those (aspiring) landlords playing the blame-the-game-not-the-player rhetoric here to blame the government not allowing more houses to…
Saying "7% on top of that is still a quite sizable increase" is not a fact, it's an opinion. Furthermore it's like my employer telling me "you should take this 7% raise and be happy even if the market dictates a 20% raise. It's still a quite sizable increase". Then you make an ad-hominem argument about landlords being hypocrites which isn't relevant. Landlords act in the best interest of landlords. I don't yet know w…
It’s fair to say that 7% is faster than wages increase for many people on average. Why should my rent outpace my income?
Re: California Approves Statewide Rent Control
#768Earlier quoted context omitted.
SF calls them ADUs(auxiliary dwelling units) and incentivized people to build them. A lot of people don’t want to because once you’ve rented it out, the tenant can never be kicked out unless they break the law. Do you want to sign up for someone living in your backyard for the next 20 years?
Well then they didn’t really incentivize people to build them! An ADU should be like renting a room in your house. Exempt from fair housing laws, and at worst a non-guaranteed lease renewal, if not a simple 30 day notice.
I agree! I get the sense that many more people would build ADUs and rent out units if they knew they had more control over them. I’m not saying we should get rid of all tenant protections, but could make them a little more fair for the owners.
Re: California Approves Statewide Rent Control
#769Earlier quoted context omitted.
Rent control in SF really is that bad. Rent increase limits are 60% of CPI, so it can’t even match inflation. If your costs go up (utilities) or you want to do capital improvements, good luck getting the rent board to approve a pass through. Want to prevent other people than the tenant from moving into a 1 bedroom? Tough, can’t say no to that, it just has to be under 3 people. Want to move into your own house? Sure,…
Why should I care about the woes of landlords as opposed to renters?
Wow, I literally belly laughed.
If a renter can't find a landlord to rent from, then what?
"Why should I care about the woes of water treatment plants as opposed to water drinkers?" Do you want drinkable water, or not?
Re: California Approves Statewide Rent Control
#770Earlier quoted context omitted.
It is uninformed. Note that in a survey of economists ~80% of economists disagreed with the statement below and only 2% agreed: > Local ordinances that limit rent increases for some rental housing units, such as in New York and San Francisco, have had a positive impact over the past three decades on the amount and quality of broadly affordable rental housing in cities that have used them. [0] The negative effects of…
Your quote is completely irrelevant to this discussion, because increasing "amount and quality of broadly affordable rental housing" is not the goal of this law as described by your GP. The law is supposed to give families enough time to adjust or move away and find affordable housing elsewhere, without becoming bankrupt in the meantime. A completely different goal. Quoting opinions on something that is at best tange…
How is "economists broadly agree that rent control is bad" irrelevant to a discussion of rent control?
The intention of the law is what's irrelevant. What matters is what the law will actually do. Economists broadly agree that rent control will drive down supply. Are they right? Is this law different? Time will tell. But there's every reason to be skeptical.