Rant about housing policies + bonus rant
I’ve explained it to you twice in two different threads now. Many investors do not want renters as it devalues the properties in the eyes of their prospective buyers as well as themselves due to their culture. Simple as that.
It’s not people with their lights off.
It’s not illegal to build affordable homes. Developers simply haven’t been interested in building regular homes working people can afford when they can build luxury homes for people with deep pockets and with almost no restrictions on foreign money pouring in, local incomes cannot compete.
They’re entirely conflicting concepts. Maximizing profits and maximizing affordability. That’s why government should get back into housing again as they’ve been out of building social housing here for 30 years. People who work jobs for a living need homes to live in.
Rent control, which you mentioned earlier, is an awful idea.
I think you place too high of a competence level on government. When someone says the market isn't doing something right, the government should step in, that means putting people like activists in charge of the decision making. The result is they often end up making things worse.
The best solution is to push for policies that keep land prices low, but also subsidize rent for poorer people. I don't trust government not to hand out contracts to favorites, and otherwise do things that are sub optimal.
However I believe in a perfect world there would be a universal basic income and much less other market specific government interventions. Politicians don't have a good tracker record of doing things better than the market. On some things it makes sense, but on most things it does not.
When you put politicians in charge of things, there are incentive structures in place that don't have much to do with the market. If you put AOC in charge of housing, she will do a lot of showy things to get attention for herself to increase her instagram followers. She will probably see any concession as a complete outrage, worthy of a social media scolding rant.
Its not a better way to do things.
goldfish21
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I’ve explained it to you twice in two different threads now. Many investors do not want renters as it devalues the properties in the eyes of their prospective buyers as well as themselves due to their culture. Simple as that.
It’s not people with their lights off.
It’s not illegal to build affordable homes. Developers simply haven’t been interested in building regular homes working people can afford when they can build luxury homes for people with deep pockets and with almost no restrictions on foreign money pouring in, local incomes cannot compete.
They’re entirely conflicting concepts. Maximizing profits and maximizing affordability. That’s why government should get back into housing again as they’ve been out of building social housing here for 30 years. People who work jobs for a living need homes to live in.
Rent control, which you mentioned earlier, is an awful idea.
I think you place too high of a competence level on government. When someone says the market isn't doing something right, the government should step in, that means putting people like activists in charge of the decision making. The result is they often end up making things worse.
The best solution is to push for policies that keep land prices low, but also subsidize rent for poorer people. I don't trust government not to hand out contracts to favorites, and otherwise do things that are sub optimal.
However I believe in a perfect world there would be a universal basic income and much less other market specific government interventions. Politicians don't have a good tracker record of doing things better than the market. On some things it makes sense, but on most things it does not.
When you put politicians in charge of things, there are incentive structures in place that don't have much to do with the market. If you put AOC in charge of housing, she will do a lot of showy things to get attention for herself to increase her instagram followers. She will probably see any concession as a complete outrage, worthy of a social media scolding rant.
Its not a better way to do things.
Rent out of control seems to be an awful reality. Not really seeing how putting a cap on things can make things worse than prices spiralling straight upwards every time someone is forced to move. Jobs don't pay the kind of money it takes to pay those prices here.. and with MANY people scrambling to make rent each month, they don't have the $ to simply relocate somewhere and train into a new job. Rents going straight up are creating all sorts of problems.
Umm, okay. Who's the only entity that can set policies to affect land prices?
Government. And now that they've done what they've done, or not done, and literally everyone is poor compared to land prices.. what's the solution? Everyone gets a massive rent subsidy ? Seems we're heading ever closer to Hong Kong style living. Work a couple jobs in order to afford rent in a sleeping cage and a bowl of rice kind of BS.
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goldfish21
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This could start to change things:
https://www.cbc.ca/news/canada/edmonton ... -1.6866226
Maybe not in BC, though. We have rules that say if a renovation is extensive they can bounce you and then you can re-rent at the new price if you want.
Article makes a good point about social housing being needed.
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WHAT??? How on Earth does anyone think "density buildup" causes more trees to be cut down???
More density means FEWER trees get cut down, not more! More density means less suburban sprawl and fewer lawns, hence less de-forestation!
"Density buildup" does mean there will be fewer trees per person in the immediate neighborhood, but certainly not fewer trees overall!! !
Her: "Yes"
Me: "You know if you start restricting density buildup in a high demand area, it causes rents and home prices to go up, right?"
Her: "N--- I am sad you never mention things that help others."
Me: "I was just pointing out that you are advocating for contradictory policies. You said on one hand you want more affordable housing for low income people but on the other hand you want less density."
Her: "Why can't we have both?"
I certainly agree with you that residential zoning restrictions need to be loosened. It will probably be politically impossible to get rid of them entirely, but certainly we need them to be greatly loosened, especially in cities where jobs are abundant.
For example, a recurring policy that progressives advocate for is price controls. Now here's the thing - price controls can actually be called for in specific markets. The classic example of price controls being optimal is in a "natural monopoly" where it makes sense to have one producer and that one producer is treated like a public utility. Sewer systems are an example. It doesn't make sense to have three competitors trying to build sewer systems in an area.
Rent control in housing markets is a horrible idea - it shifts land use away from housing.
I see your point, but, unfortunately, a lot of people, including myself, really do depend on rent control or rent stabilization to avoid losing our apartments.
Perhaps the above-mentioned effect of "it shifts land use away from housing" could be mitigated via property tax policy? For example, lower property tax per-property-value, for the landlord, on rent-controlled or rent-stabilized apartments?
Of course I do agree with you that the main problem is the supply of housing, which needs to be dealt with primarily by loosening residential zoning restrictions.
Fully agreed. Hopefully more and more progressive-minded people will see this.
Maybe you might be shocked at the idea of 4 people living in a 2 br apartment, but when you set a minimum rent price (which is what you do with restrictions), you end up with homeless tent cities that I find more abhorrent.
I'd focus more on getting rid of single-family zoning than on increasing "tenants per bedroom." Putting unrelated people in the same bedroom has substantial undesirable consequences, such as making them super-vulnerable to theft (from each other). On the other hand, allowing more two-family and three-family homes would benefit the vast majority of people, including new homeowners, by making it easier for them to pay their mortgages.
(IMO, the only people who benefit from single-family zoning are greedy longterm homeowners who believe they have a God-given right to eternally skyrocketing property values.)
In addition to allowing two-family homes everywhere, we also need more apartment buildings to be constructed in areas where jobs are plentiful.
Obviously, the supply of housing needs to be increased also.
By the way, I favor both - policies to increase the amount of land and density of housing in high demand areas and federal dollars for housing allowance. You get the best of both worlds - when supply is more fluid the subsidy has less impact on housing prices.
Agreed.
So when I taught I was pretty good at leaving an impression. I used to give this example - I did not come up with the example but its meant to illustrate unintended consequences. This example made a 50 yo woman cry once, I will explain later.
In the 1980s there were politicians calling for the death penalty for drug trafficking. There was one guy calling for the death penalty even for the possession of a joint. During that time period, penalties for drug trafficking did go up, and most notoriously the penalties for possession of crack cocaine got significantly more serious than the penalty for cocaine, even though they are the same drug.
Let's use the death penalty for possession as an extreme example and work backwards from there. Now, imagine you are a heroin smuggler and you are pulled over with 1 kilo of heroin in your trunk. What is now your optimal strategy?
In almost every class I taught this example in, there was always one person who would say it.
"Kill the cop." Yup, now your optimal strategy is to kill the cop. If you do the payoff matrix, you get pulled over and you are dead, and the worst that can happen if you start shooting the cop is you get killed. Best case you get away completely.
Even if the penalty is many decades in prison, many people might see that as worse than death or close enough to it where the optimal strategy remains "kill the cop."
And we saw this, in the 1980s violence against cops skyrocketed. Drug violence in particular was very violent because the prison penalties for possession was on par with many violent crimes. So why not be violent to avoid the drug charge?
Very good point!
Agreed.
Still shouldn't be death penalty IMO.
I was molested when I was a kid by an adult. When I tried to tell adults years later, everyone covered for him and protected him until he died.
I'm very sorry to hear that this happened to you.
Yes, that's what's important here.
Excellent point here.
I agree. Ditto for mandatory reporting laws, which discourage pedophiles from seeking therapy.
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Last edited by Mona Pereth on 12 Jun 2023, 4:35 am, edited 3 times in total.
goldfish21
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There's an ~80 storey building proposed in Burnaby with 14 floors of underground parking w/ more than 2500 parking spaces. City councillors think that's way too much parking and the city needs to change the minimum requirements builders have to have per unit or sf or whatever the metric is. Maybe it's too much, maybe not, but it's interesting because it's peculiar I suppose.
https://www.vancouverisawesome.com/high ... ed-7125340
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Max capacity would be towering apartment buildings as far as the eye can see! Only a few locations on the planet are at that point and they fit far more people than the UK does in tiny spaces.
Whether this is feasible/safe depends on local geology, e.g. the presence or absence of bedrock.
But, yes, I am sure there are plenty of places where towering apartment buildings could be safely built but are forbidden.
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The only thing there that is true is "prices still skyrocketed".
There is very little vacancy in Vancouver. And it makes no sense whatsoever to imagine investors are leaving large amounts of property empty. The way investors make money is by getting someone to pay them to live there.
However much it "doesn't make sense" to you, it does indeed happen, and not just in Vancouver. Expensive empty condos are a big issue here in NYC too. For details, see, for example:
- Shocker: Half of Midtown's Super Luxury Condos Sit Vacant by Hana R. Alberts, Curbed, Oct 24, 2014
- Why Luxury Units in Manhattan Are Vacant by Derek Thompson, January 2020
A lot of luxury condos remain empty for two reasons: (1) They haven't sold yet, and the developers are willing to wait a long time to sell them at a higher price rather than sell them immediately for a lower price, and (2) many of them are bought by foreigners as a second, third, or even tenth home, to be occupied only for a small fraction of the year and empty the rest of the time.
Both of these situations could be discouraged via higher taxes.
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The latter issue -- residential zoning restrictions -- is a much more significant cause of the housing crisis than rent control/stabilization is.
Given that, in too many cities, the supply of rental housing would not be allowed to increase very much, if at all, even without rent control, it's not fair to blame rent control.
I agree that rent control/stabilization is not a solution. But it's a necessary band-aid.
What's desperately needed is, first, a great loosening of zoning restrictions, then also to have real estate tax policies (such as the land value tax you mentioned) to encourage maximal use of land.
Rent control does. not. work. It makes the problem worse. In Vancouver, in New York, in San Francisco, in Portland, in Washington DC, in Toronto, in Los Angeles, there is rent control. Guess which places have the worst housing crises in North America? Why, that would be Vancouver, New York, San Francisco, Portland, Washington DC, Toronto, and Los Angeles... large cities without rent control, like Chicago, Houston, Atlanta, Philadelphia, are not necessarily doing well (although some of them are!) but are not having the same issues. Weird, huh?
This is the single issue where there is most consensus among economists, a famously disagreeable bunch. Everyone from leftists like Paul Krugman to libertarians like Thomas Sowell agrees that they have the opposite of their intended effect.
As well as reducing the supply of housing, rent control creates a disincentive for landlords to properly maintain the property - after all, they cannot get a fair market price for a maintained home, so they may as well get a fair market price for one that's still habitable but in need of some serious TLC.
Whether and to what extent this is the case depends on the type of rent control/stabilization. If rents are not allowed to be raised at all, then, yes, houses and apartment buildings will fall into serious disrepair. On the other hand, if rents are allowed to be raised but only in small, predictable legislated increments, then landlords still have some incentive to maintain the building.
In any case, I would much rather live in a less-than-perfectly-maintained building than in a building where renters have no rights. I would not want to live in a place where the landlord can throw me out on a moment's whim, without due cause.
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The People build the housing, then ALL the People move into the housing, then the People MAINTAIN the housing. Forget "rent", especially when most "rent" today is merely used to enrich a tiny class of ghouls who are decidedly NOT the ones actually physically building the housing (or everything else, for that matter).
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The linked poll question was phrased as: "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."
I suspect that the question would get a lot more positive responses if it were phrased as: "Has rent control helped to prevent homelessness for many people, given the gentrification trend and given the limits on the supply of housing due to residential zoning laws?"
In other words, as I said earlier, rent control/stabilization is not a solution, but it is an absolutely necessary band-aid.
What do you mean by "underoccupied"?
"Young people or immigrants" -- other than the very wealthiest -- would gain nothing if rent control/stabilization were repealed without first getting rid of (or at least substantially loosening) restrictive residential zoning laws. Doing the former without first doing the latter would just result in a LOT more people being homeless.
There's also another aspect of the situation you might not be considering. Poor people who cannot afford to own a car, and who cannot afford twice-daily taxi/Uber/Lyft rides either, need to live in a neighborhood with decent public transportation. Therefore, repealing rent control/stabilization in a city with very restrictive residential zoning laws would result in the neighborhoods with good public transportation being occupied solely by people who don't actually need it, while the people who actually do need it would be totally up s**t's creek.
Perhaps this is not as much of an issue in the U.K. as it is here in the U.S.A. (It is my understanding that you have much more and better public transportation in the U.K.)
That remark is extremely offensive to those of us who would be homeless without rent stabilization.
NIMBY homeowners would not be homeless without restrictive zoning laws; they would just have property values that rise less quickly. But NIMBY homeowners are, themselves, a MUCH, MUCH more significant cause of the housing crisis than rent control/stabilization.
What we desperately need is to get rid of, or at least greatly lessen, restrictive zoning laws. Until then, repealing rent control/stabilization would only result in many more homeless people and would not help anyone who is currently homeless.
Unfortunately, getting rid of restrictive residential zoning laws will be extremely difficult politically.
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Last edited by Mona Pereth on 12 Jun 2023, 8:20 pm, edited 5 times in total.
Housing was built flat out for many years as fast as we had the capacity to build yet prices still skyrocketed because housing didn’t turn into homes - many units are empty; held by investors from overseas who might come visit for a couple weeks/year if at all.
The only rent controls we have here are the max % per year rents can rise (usually around 2% or something) + restrictions on reasons for eviction, which get abused so people can drastically raise rents with new tenants. Not so convinced that rent controls are a bad thing. Rents have been absolutely skyrocketing way beyond what local incomes can afford. If there were some sort of controls in place, maybe people wouldn’t have bid properties up into the multi millions ?
Long term having enough supply of homes to keep prices & rents affordable makes sense, but in the short term it sure would be nice to have some sort of rent controls vs this s**t show that’s putting ever more people into the street/tents/cars etc. What an absolute clusterf**k.
Probably not true, in Vancouver, that "Housing was built flat out for many years as fast as we had the capacity to build." Looks to me like Vancouver does have highly restrictive zoning laws.
See Vancouver Zoning Codes Explained and Vancouver Zoning Map and barf at the many, many details. See also Introduction to zoning on the website of the City of Vancouver.
Here in NYC, and probably in Vancouver too, it is possible for big developers to apply for zoning "variances." Said "variances" are commonly granted primarily to developers who want to build luxury condos in run-down neighborhoods.
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goldfish21
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Housing was built flat out for many years as fast as we had the capacity to build yet prices still skyrocketed because housing didn’t turn into homes - many units are empty; held by investors from overseas who might come visit for a couple weeks/year if at all.
The only rent controls we have here are the max % per year rents can rise (usually around 2% or something) + restrictions on reasons for eviction, which get abused so people can drastically raise rents with new tenants. Not so convinced that rent controls are a bad thing. Rents have been absolutely skyrocketing way beyond what local incomes can afford. If there were some sort of controls in place, maybe people wouldn’t have bid properties up into the multi millions ?
Long term having enough supply of homes to keep prices & rents affordable makes sense, but in the short term it sure would be nice to have some sort of rent controls vs this s**t show that’s putting ever more people into the street/tents/cars etc. What an absolute clusterf**k.
Probably not true, in Vancouver, that "Housing was built flat out for many years as fast as we had the capacity to build." Looks to me like Vancouver does have highly restrictive zoning laws.
See Vancouver Zoning Codes Explained and Vancouver Zoning Map and barf at the many, many details. See also Introduction to zoning on the website of the City of Vancouver.
Here in NYC, and probably in Vancouver too, it is possible for big developers to apply for zoning "variances." Said "variances" are commonly granted primarily to developers who want to build luxury condos in run-down neighborhoods.
I meant that every available tradesman was working and pretty much every single construction company was hiring and many still are. I've seen Fb posts from various tradesmen getting burnt out because if you work in the condo construction side of residential building, guys are having to sign work contracts that they will work a minimum of 50-60 hours/week vs. expect to work 40h & go home. It's either work 10-12h/day or 5-6 10h shifts or no job for you. People are getting burnt out. There aren't tons of extra skilled hands being sat on at home doing diddly squat and there hasn't been for a decade or two. Plenty of unskilled hands being put to work doing shoddy work, too. For people that build housing, they've been building flat out as much as they can as fast as they can.. but it's never enough when so many units are intentionally left empty as investments they don't want tarnished by tenants, or as vacation homes they only visit once a year or whatever.
I was looking for a different article and stat, but here's a good one:
https://macleans.ca/economy/realestatee ... -disaster/
Here's another where he points out that 25% of new construction condos in Richmond (Metro Vancouver) are owned by non-resident owners: https://viewpointvancouver.ca/2019/03/2 ... ownership/
I can't find the article I was looking for, though. I recall reading that by Andy Yan's calculations we constructed 26% MORE units of housing than we needed to house the growing population here BUT we're still in a housing crisis because of all the empty homes owned by people who don't live here and don't have anyone living in their properties. So, it hasn't seemed to matter that those who build housing constructed them flat out as fast as they could as housing has not turned into homes.
Yes, many neighbourhoods could be rezoned to denser housing.. but try telling some elitist prick who paid tens of Millions of dollars for a house that there's going to be a 6 storey apartment building next door or across the street.. good luck with that.
Here's one of them equating high density housing to slave ships:
https://www.rew.ca/news/shaughnessy-man ... 1.19233817
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Here's one of them equating high density housing to slave ships:
https://www.rew.ca/news/shaughnessy-man ... 1.19233817
What's needed is incremental re-zoning. It's not necessary to suddenly allow 20-storey apartment buildings in a place that was nothing but mansions on 2-acre lots. However, places now zoned for single families could be re-zoned for two-family. Places now zoned for two-family could become three-family, and so on. Places that currently disallow basement apartments could allow them, subject to appropriate fire safety regulations. These changes would make it easier for new home buyers to pay their mortgages.
Also there could be a tax on "pied-à-terres," i.e. expensive coop and condo apartments that are not used as a primary residence. This would hopefully discourage purchase by real estate speculators.
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goldfish21
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Slow incremental changes aren’t enough to meet housing demand asap.
The rental market is so tight that the average rent for a 1 bedroom apartment in Vancouver has hit $2945/mo in a city where the average salary is $62k. We need 6 storey apartment buildings, not duplexes.
There is an empty homes tax for completely empty properties no one lives in. This got some of them rented, but even as the empty home tax increased rich people just pay it as a cost of their investment/vacation home. The tax would be unaffordable to us, but it’s nothing to some of them.
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I think it's interesting that in the USA and Canada, self-identified leftist progressives want affordable housing, but they also want all of the housing to be open and spacious and have luxury quality. I recently had a conversation with someone who used the fact that you couldn't rent a two bedroom apartment with 30% of a minimum wage income to support one of his arguments (I don't remember what the argument was). Back when there were actually leftist countries, they gave people affordable housing, sure, but affordable housing meant a small room for your whole family on the fifth floor of a concrete building with no elevator.
I would actually support these types of commie blocks, because they would really put a dent in rent, and I personally don't need a lot of space. Unfortunately, people think they're an "eyesore" and would rather pay 60% of their paycheck on rent than have to look at rectangular buildings.
goldfish21
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^Buyers won’t accept that. For $1M for a condo or $2M+ for a house they expect luxury design/finishes/appliances etc. I get that.
But renters will live in cheaper boxes 100% for sure. Tons of people living in their cars or pitching a tent on a traffic circle or in a forest. Tons of rental homes and rooms that are unfit for habitation due to mold/pests/undesirable people. Tons of renters that would happily walk upstairs to a simple box they can afford.
But buyers tend to want the latest and greatest of everything for their Million dollars.
Meanwhile, if a lucrative work opportunity materializes I’m going to sleep in one of my vehicles or on the floor of the job site. If that’s not kosher, I’ll buy a 50 year old trailer for $13k and sleep in it for as long as the money flows then either rent it out or sell it. (Lucrative job in an area with Zero available housing so tradesmen sleep in their trucks in order to make that $$$)
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