6 ms·

Welcome to the Future: Middle-Class Housing Projects

61 points by saeranv 11y ago

xfactor973 11y ago
The bay area is screwed. I moved to Portland and never looked back
- Ocerge 11y ago
  If you SV types keep moving to Portland, it's just going to be another SF housing debacle.
  - dkopi 11y ago
    Perhaps Portland can learn from SF's mistake, and actually allow massive building of new housing if there's a spike in demand.
    - dagw 11y ago
      But then it wouldn't be "Portland" any more, just some terrible city full of huge ugly housing projects (or so the argument goes).
    - teacup50 11y ago
      I've never seen a single example of this idea working. I've seen this idea lead to higher rents, with fewer people owning and more people renting. I've seen it lead to developer hand-outs in the name of tax incentives, zoning variances, and outright grants for subsidized (but still rental) housing. I've seen it overload local infrastructure, allowing developers to reap the profits while externalizing the costs. We need to address the root cause -- ever-growing income inequality -- not exacerbate the root cause by building an ever-higher wall between individuals and home ownership.
      - verg 11y ago
        Tokyo, Toronto, and Houston are all examples of large cities where it is relatively easy to build housing and housing is relatively cheap.
        dagw 11y ago
        Frist time I've heard anybody use Tokyo as an example of cities with cheap housing.
        beeboop 11y ago
        Desirable areas of housing in Houston are only cheap relative to SF area, downtown Portland, and downtown Seattle. Plenty of million dollar condos in Houston, and a nice but small one bedroom/studio in a good part of Houston start at about $1500 a month. It does appear to be easy to build here, though. Tons of new high density residential being built, but it's not making the prices come down at all.
        teacup50 11y ago
        You're using a very unusual definition of "relatively cheap".
      - cloakandswagger 11y ago
        Wealth redistribution would only slow down the problem, not fix it. At some point you have to concede that market forces exist and no amount of economic fiddling (aside from total abolition of currency and private markets) will address the issue.
  - santaclaus 11y ago
    I think the days of Portland being the affordable West coast city are on the way out. Portland real estate prices are forecast to overtake Seattle in the near future. Dilapidated bungalows in our hood across the street from houses with bi-monthly drive by shootings are selling for 650K for the land alone...
    - api 11y ago
      Come to San Angeles. Not cheap by any stretch but costs are kept in check by the simple fact that there's so much of it.
- Balgair 11y ago
  Whatever you do, don't move to Denver. It's just full of potsmokers and Tebow fans. Yuck
api 11y ago
Someone should tell Silicon Valley about this global telecommunications network that lets people connect in all kinds of ways to cooperate over vast distances.
- raverbashing 11y ago
  Oh yeah but that gets in the way of daily sit-ups or "bring your dog to work day"
- x0x0 11y ago
  Someone should convince companies to let workers work remotely. Hell, I live on the peninsula and just don't want to commute to sf 5 days a week and most startups (definitely including every YC startup I've spoken to) demand you be in the office 5 days / week. So even being in the same timezone and having the flexibility to shift planned remote days and come to the office with a day's notice isn't good enough. edit: and before I forget... Why doesn't everyone on the peninsula want to spend 10-15 hours / week commuting to sf? So strange. There's only one possible explanation: engineering shortage!
- return0 11y ago
  But it doesn't have elevators, so you can pitch some random rich guy and get off with $ 1e7 .
- Houstonymous 11y ago
  No this would require them to practice what they preach, big no no.
- erikpukinskis 11y ago
  It does seem like VR is the missing piece. When you can work in Google's VR campus and live with your family back in Knoxville* I suspect property prices in Silicon Valley will come down a bit. * where your kids can $0.80 autonomous cab ride to their grandparents 20 miles away, or $20 to put them on the same cab ride with a licensed babysitter. Things gon' change.
  - 11y ago
frozenport 11y ago
How about we build a ton of homes?
- maxsilver 11y ago
  Because building anything new drives the price up even higher than it already is. (High density generates more demand than it adds in units) We need the new homes. But we also need to rethink the system here, because building new homes makes all nearby homes less affordable.
  - seibelj 11y ago
    "We have a lack of supply, I agree. But building more supply makes it worse!!!" You are sorely mistaken
- techsupporter 11y ago
  Fantastic idea. Now you just have to convince the existing landed gentry--most of whom have the bulk of their personal wealth wrapped up in their primary residences--that building more won't actually cause their house to devalue to less than the cost of a Happy Meal. Or that building anything more dense than a single, regular-style house every 5,000sqft doesn't result in a Blade Runner dystopian future. At least in Seattle, this has been a tough slog.
  - teacup50 11y ago
    Building more doesn't devalue their land. It actually increases the value simply due to the fact that there's more revenue to be made on the same amount of land. It also doesn't solve the housing crunch, because there's no meeting the demand. It doesn't matter how dense you go; even Manhattan isn't dense enough. There are two things this does accomplish, though: - It exacerbates the wealth divide, as it increases the market entrance costs and moves ownership into the hands of fewer and fewer "landed gentry" who, invariably, build rental units. - It destroys quality of life for existing residents, as it foists all the scaling issues of upzoned density (traffic, crime, costs, required size of bureaucracy) right onto them.
natrius 11y ago
It's self-evident why the middle class can't outbid rich families for single family homes near employment centers: the rich have more money and they want to live there too. But for dilapidated homes that are ready to be torn down, the strategy for outbidding the rich is clear: rich families who want to build a big home with a big yard can be outbid by several middle class families who are willing to live in smaller homes with smaller yards. The problem is that we've made it illegal for the middle class to outbid the rich. Single family zoning laws have always been intended to segregate people by income, but the economics of urban growth have made the middle class the victims of the segregation laws they've always supported. The effects are most egregious in high employment areas with predominantly single family zoning, like Silicon Valley, Seattle, and Austin, where I live. In Austin, the vast majority of the city is blanketed with laws that make it harder for the middle class to outbid the rich than any city in Texas. Where Houston allows four families to build homes to outbid the rich, Austin only allows one. It's no surprise that we're the most economically segregated city in the country[1], and the only growing city that has a shrinking black population[2]. We must fight to desegregate our cities. The middle class is suffering not because they can't afford to outbid the rich, but because it's illegal to outbid the rich. [1] https://www.texastribune.org/2015/02/23/austin-most-economically-segregated-metro-area/ https://www.texastribune.org/2015/02/23/austin-most-economic... [2] http://kut.org/post/austins-population-booming-why-its-african-american-population-shrinking http://kut.org/post/austins-population-booming-why-its-afric...
- erikpukinskis 11y ago
  I wonder if anyone could have standing to sue a municipality to change the zoning laws on these grounds, under the civil rights act.
  - natrius 11y ago
    This has been done before with cities who were more egregiously discriminatory with their zoning, as I mention in the long form of this argument[1]. I don't know what hurdles are in the way of using the courts to end this subtle segregation, but we should definitely find out and make it happen. Economic segregation is the whole point of density-based zoning. It is widely supported by property owners. If we can't convince them that they are beneficiaries of unjust laws, then the courts are our best option. [1] https://medium.com/@niranbabalola/we-must-repeal-our-segregation-laws-32348d090520 https://medium.com/@niranbabalola/we-must-repeal-our-segrega...
jedberg 11y ago
Palo Alto is utterly stupid, and here's why: The last time a multi-unit building (ie. Apartments) were built in PA was in the 70s. They haven't approved one since, despite many hundreds of applications to build such things since then. The middle class don't need subsidies, they need affordable housing. The best way to get that is to let people build affordable housing. It's the same as with SF -- the city won't let people build to meet demand. You don't get to complain about the high price and then not let someone who wants to fix it actually fix it.
- Balgair 11y ago
  I've related this story before on HN, but it's good enough to share: When I went and saw the new Wrath of Khan with my brother (now in Portland, at the time he was the Inner Richmond in SF), he surprised me when he told me what was most fantastic to him about the movie. It was not the space aliens, the faster than light travel, the giant spaceships, Cumberbatch's acting, no. To him, the most fantastic part was that there were highrises in SF. Space monsters? Sure. A sensible housing board? Woah buddy, you just crashed my suspension of disbelief!
- randycupertino 11y ago
  Palo Alto is ridiculous. I saw firsthand how hard the residents went to the mattresses to protest a 17-unit senior housing development because they were worried about "increased urbanization." Jerks.
- maxsilver 11y ago
  >the best way to get that is to let people build affordable housing. Can you name an example of where this actually happens? I've never seen affordable housing built unless it was mandated by law or had some sort of government subsidy. Even out here in tiny flyover midwest cities, where developers have no restrictions of any kind , there's no affordable housing being built that isn't government mandated or subsidized. Lots of new developments, all 100% luxury apartments, or luxury homes. I wish it was as simple as "let them build it", but experience has taught me that if you let developers "just build", the only thing they ever build is impossibly expensive luxury units.
mchahn 11y ago
In the thirty years I lived in SV I made more money from home appreciation than I did from salary, and I made top dollar.

61 points by saeranv 11y ago

xfactor973 11y ago

The bay area is screwed. I moved to Portland and never looked back

Ocerge 11y ago
If you SV types keep moving to Portland, it's just going to be another SF housing debacle.
- dkopi 11y ago
  Perhaps Portland can learn from SF's mistake, and actually allow massive building of new housing if there's a spike in demand.
  - dagw 11y ago
    But then it wouldn't be "Portland" any more, just some terrible city full of huge ugly housing projects (or so the argument goes).
  - teacup50 11y ago
    I've never seen a single example of this idea working. I've seen this idea lead to higher rents, with fewer people owning and more people renting. I've seen it lead to developer hand-outs in the name of tax incentives, zoning variances, and outright grants for subsidized (but still rental) housing. I've seen it overload local infrastructure, allowing developers to reap the profits while externalizing the costs. We need to address the root cause -- ever-growing income inequality -- not exacerbate the root cause by building an ever-higher wall between individuals and home ownership.
    - verg 11y ago
      Tokyo, Toronto, and Houston are all examples of large cities where it is relatively easy to build housing and housing is relatively cheap.
      - dagw 11y ago
        Frist time I've heard anybody use Tokyo as an example of cities with cheap housing.
      - beeboop 11y ago
        Desirable areas of housing in Houston are only cheap relative to SF area, downtown Portland, and downtown Seattle. Plenty of million dollar condos in Houston, and a nice but small one bedroom/studio in a good part of Houston start at about $1500 a month. It does appear to be easy to build here, though. Tons of new high density residential being built, but it's not making the prices come down at all.
      - teacup50 11y ago
        You're using a very unusual definition of "relatively cheap".
    - cloakandswagger 11y ago
      Wealth redistribution would only slow down the problem, not fix it. At some point you have to concede that market forces exist and no amount of economic fiddling (aside from total abolition of currency and private markets) will address the issue.
- santaclaus 11y ago
  I think the days of Portland being the affordable West coast city are on the way out. Portland real estate prices are forecast to overtake Seattle in the near future. Dilapidated bungalows in our hood across the street from houses with bi-monthly drive by shootings are selling for 650K for the land alone...
  - api 11y ago
    Come to San Angeles. Not cheap by any stretch but costs are kept in check by the simple fact that there's so much of it.
Balgair 11y ago
Whatever you do, don't move to Denver. It's just full of potsmokers and Tebow fans. Yuck

api 11y ago

Someone should tell Silicon Valley about this global telecommunications network that lets people connect in all kinds of ways to cooperate over vast distances.

raverbashing 11y ago
Oh yeah but that gets in the way of daily sit-ups or "bring your dog to work day"
x0x0 11y ago
Someone should convince companies to let workers work remotely. Hell, I live on the peninsula and just don't want to commute to sf 5 days a week and most startups (definitely including every YC startup I've spoken to) demand you be in the office 5 days / week. So even being in the same timezone and having the flexibility to shift planned remote days and come to the office with a day's notice isn't good enough. edit: and before I forget... Why doesn't everyone on the peninsula want to spend 10-15 hours / week commuting to sf? So strange. There's only one possible explanation: engineering shortage!
return0 11y ago
But it doesn't have elevators, so you can pitch some random rich guy and get off with $ 1e7 .
Houstonymous 11y ago
No this would require them to practice what they preach, big no no.
erikpukinskis 11y ago
It does seem like VR is the missing piece. When you can work in Google's VR campus and live with your family back in Knoxville* I suspect property prices in Silicon Valley will come down a bit. * where your kids can $0.80 autonomous cab ride to their grandparents 20 miles away, or $20 to put them on the same cab ride with a licensed babysitter. Things gon' change.
- 11y ago

frozenport 11y ago

How about we build a ton of homes?

maxsilver 11y ago
Because building anything new drives the price up even higher than it already is. (High density generates more demand than it adds in units) We need the new homes. But we also need to rethink the system here, because building new homes makes all nearby homes less affordable.
- seibelj 11y ago
  "We have a lack of supply, I agree. But building more supply makes it worse!!!" You are sorely mistaken
techsupporter 11y ago
Fantastic idea. Now you just have to convince the existing landed gentry--most of whom have the bulk of their personal wealth wrapped up in their primary residences--that building more won't actually cause their house to devalue to less than the cost of a Happy Meal. Or that building anything more dense than a single, regular-style house every 5,000sqft doesn't result in a Blade Runner dystopian future. At least in Seattle, this has been a tough slog.
- teacup50 11y ago
  Building more doesn't devalue their land. It actually increases the value simply due to the fact that there's more revenue to be made on the same amount of land. It also doesn't solve the housing crunch, because there's no meeting the demand. It doesn't matter how dense you go; even Manhattan isn't dense enough. There are two things this does accomplish, though: - It exacerbates the wealth divide, as it increases the market entrance costs and moves ownership into the hands of fewer and fewer "landed gentry" who, invariably, build rental units. - It destroys quality of life for existing residents, as it foists all the scaling issues of upzoned density (traffic, crime, costs, required size of bureaucracy) right onto them.

natrius 11y ago

It's self-evident why the middle class can't outbid rich families for single family homes near employment centers: the rich have more money and they want to live there too. But for dilapidated homes that are ready to be torn down, the strategy for outbidding the rich is clear: rich families who want to build a big home with a big yard can be outbid by several middle class families who are willing to live in smaller homes with smaller yards. The problem is that we've made it illegal for the middle class to outbid the rich. Single family zoning laws have always been intended to segregate people by income, but the economics of urban growth have made the middle class the victims of the segregation laws they've always supported. The effects are most egregious in high employment areas with predominantly single family zoning, like Silicon Valley, Seattle, and Austin, where I live. In Austin, the vast majority of the city is blanketed with laws that make it harder for the middle class to outbid the rich than any city in Texas. Where Houston allows four families to build homes to outbid the rich, Austin only allows one. It's no surprise that we're the most economically segregated city in the country[1], and the only growing city that has a shrinking black population[2]. We must fight to desegregate our cities. The middle class is suffering not because they can't afford to outbid the rich, but because it's illegal to outbid the rich. [1] https://www.texastribune.org/2015/02/23/austin-most-economically-segregated-metro-area/ https://www.texastribune.org/2015/02/23/austin-most-economic... [2] http://kut.org/post/austins-population-booming-why-its-african-american-population-shrinking http://kut.org/post/austins-population-booming-why-its-afric...

erikpukinskis 11y ago
I wonder if anyone could have standing to sue a municipality to change the zoning laws on these grounds, under the civil rights act.
- natrius 11y ago
  This has been done before with cities who were more egregiously discriminatory with their zoning, as I mention in the long form of this argument[1]. I don't know what hurdles are in the way of using the courts to end this subtle segregation, but we should definitely find out and make it happen. Economic segregation is the whole point of density-based zoning. It is widely supported by property owners. If we can't convince them that they are beneficiaries of unjust laws, then the courts are our best option. [1] https://medium.com/@niranbabalola/we-must-repeal-our-segregation-laws-32348d090520 https://medium.com/@niranbabalola/we-must-repeal-our-segrega...

jedberg 11y ago

Palo Alto is utterly stupid, and here's why: The last time a multi-unit building (ie. Apartments) were built in PA was in the 70s. They haven't approved one since, despite many hundreds of applications to build such things since then. The middle class don't need subsidies, they need affordable housing. The best way to get that is to let people build affordable housing. It's the same as with SF -- the city won't let people build to meet demand. You don't get to complain about the high price and then not let someone who wants to fix it actually fix it.

Balgair 11y ago
I've related this story before on HN, but it's good enough to share: When I went and saw the new Wrath of Khan with my brother (now in Portland, at the time he was the Inner Richmond in SF), he surprised me when he told me what was most fantastic to him about the movie. It was not the space aliens, the faster than light travel, the giant spaceships, Cumberbatch's acting, no. To him, the most fantastic part was that there were highrises in SF. Space monsters? Sure. A sensible housing board? Woah buddy, you just crashed my suspension of disbelief!
randycupertino 11y ago
Palo Alto is ridiculous. I saw firsthand how hard the residents went to the mattresses to protest a 17-unit senior housing development because they were worried about "increased urbanization." Jerks.
maxsilver 11y ago
>the best way to get that is to let people build affordable housing. Can you name an example of where this actually happens? I've never seen affordable housing built unless it was mandated by law or had some sort of government subsidy. Even out here in tiny flyover midwest cities, where developers have no restrictions of any kind , there's no affordable housing being built that isn't government mandated or subsidized. Lots of new developments, all 100% luxury apartments, or luxury homes. I wish it was as simple as "let them build it", but experience has taught me that if you let developers "just build", the only thing they ever build is impossibly expensive luxury units.

mchahn 11y ago

In the thirty years I lived in SV I made more money from home appreciation than I did from salary, and I made top dollar.