Except higher-density buildings still equally price people out. There's no such thing as new urban apartments/condos that are cheaper than the houses they replaced. A 500k house never gets torn down to become 3 400k condos. It becomes 3 600-800+k condos. We should build more, because we need it. But "build more" can't be the only tool to lower prices, because simple observation shows us that it doesn't work.
You can't judge pricing in a market that's very restrictive. Sprinkling a few higher density buildings in area with rapidly growing demand isn't going to be enough to lower prices.
What about markets with no restrictions. Because this same behavior is seen there too, even in small cities in the south or Midwest. Even in cities that let developers do anything they want, anytime they want to.
"They’ve increased 38 percent in Seattle, 12 percent in Austin and 6 percent in Phoenix." The article names the usual suspects for engineer emigrants (Austin, Portland, strangely no mention of NYC or Raleigh RTP), but why are people moving to Phoenix? Isn't living in the less sexy areas of South Bay (Sunnyvale, Milpitas, South San Jose) pretty much on par with urban life in Phoenix?
It's interesting that Seattle's rent has raised 38 percent, but I am left wondering if some of that is related to their ~37% minimum wage increase in the last year.
King County property taxes have been steadily going up, that's a bigger factor than minimum wage. Even in the sprawl around Seattle, prices have gone up, but I hope they'll see a regression since the commuting situation is if anything worse than it was even just a few years ago especially on the Eastside with the 405 toll lanes.
Portland resident here. What this article doesn't cover, is now locals are victim of gentrification. Rent prices are almost 2x, out of state buyers are throwing all cash offers on houses, and overall housing supply is low... I'm sure the commercial market is just as bad. Interesting times.
It's 2016, and people still think that if someone moves into your neighborhood, someone else has to move out. Rising demand is great. It means people want to enjoy your neighborhood. You can either meet that demand by increasing supply, or you can restrict the demand, and let certain people be outpriced by the market. Locals aren't victims of gentrification. They're victims of zoning laws and nimbyism.
It seems like a lot of folks believe that things - people, places, stuff - are naturally meant to remain in one state forever? I get the anger at not being able to afford the place you live in any longer, but all these arguments seem to be built on an assumption that things shouldn't change. "Just ride the wave, bruh."
It's 2016, and people still think that if someone moves into your neighborhood, someone else has to move out. Rising demand is great. It means people want to enjoy your neighborhood. You can either meet that demand by increasing supply, or you can restrict the demand, and let certain people be outpriced by the market. Locals aren't victims of gentrification. They're victims of zoning laws and nimbyism.
So consider a nice, quaint neighborhood. Person A lives there. Person B wants to live there too, because it is so nice. Ok, let's say we double supply. All the houses are now either twice as high, or half as big, or maybe the trees were cut down and the bushes ripped out to make room. There's twice as many people & everything therein. Is it still the same nice neighborhood?
Very dense neighborhoods can still be quaint with trees and bushes. This census tract is around twice as dense as San Francisco:
https://goo.gl/maps/d2rQ7wc6Tc12
This is the answer. Deregulate housing/small businesse spaces/offices and let the market do its work. It's crazy the amount of regulation there is that pretty much dictates single family detached homes for large swaths of the country. Here in Bend, for instance, you must have a driveway with not one, but two parking spots. Land of the free indeed... http://marketurbanism.com/ Also, this book, although it's pretty hig…
"Here in Bend, for instance, you must have a driveway with not one, but two parking spots. Land of the free indeed..." Where I live people don't leave any room for parking on their own property and all of the streets are completely jammed with cars, every inch. You don't hardly dare move your car if you've been able to find a spot. Is that freer?
I'm sorry someone is forcing you to own a car, and forcing you not to pay a garage owner for somewhere to park it.
if anyone is interested in solving the problem, im putting together a campaign for major housing reform through the ballot measure. email me greg@gregferenstein dot com
I have to say I was impressed to see that Manhattan is +29.6% to San Francisco. SF was certainly the most expensive place I've ever lived.
Possibly skewed because there's so much luxury housing in Manhattan? Anecdotally NYC has always been much cheaper for me than SF. You can still get one bedrooms for under 2k in the East Village and LES
Yeah, as someone running like hell from the Bay Area (to Manhattan), I think this is the key.
It's actually possible to get cheap, bad, but livable housing in NYC. It would be difficult to get a plot of floor with a roof over it of any quality at $2k in SF.
What possible connection could there be? Does minimum wage now change property values? Are all housing units in Seattle occupied by minimum wage workers? The average rent in Seattle for a one bedroom apartment is around $1600, which is around 100% of what a minimum wage worker made there two years ago - coincidence or no? It's all just so interesting, I think?
No need for the snark, friend. Is it really that much of a stretch to think that minimum wage increases (more money in the hands of lower-income earners) semi-proportionately increases localized prices? Do you truly think it's necessary that all houses in Seattle must be occupied by minimum wage workers in order for it to affect the cost of living?
It's a lot easier for people to see this argument with basic income than with minimum wage, but the signaling on property owners ends up being the same whether you know for certain all your tenants now have an extra $x in funds or just some of them might now be getting a raise to the new minimum wage. From the property manager perspective, suddenly they're getting more demand on units than they were previously, so they balance that by increasing rents. An increased minimum wage can play a part in that rise in demand even if no single person can afford an apartment on their own at minimum wage. For instance perhaps there's a group of 4 people cramped in one apartment, but now with all of them getting more money, they can afford to split off into two groups of 2. Until the landlord raises rents, anyway, because they aren't enough units for everyone to do that and building new units takes time.
So are there any tech hubs right now that aren't dealing with issues of rent increases, gentrifications, and growing pains?
None. But 'gentrification' in, say, Pittsburgh means houses in newly-hip neighborhoods that used to cost $50,000 are being renovated and sold for $250,000, instead of houses that use to cost $500,000 being renovated and sold for $2,000,000.