10 ms·

In most of Palo Alto, it's against the law to build anything but the most expensive kind of housing—single family homes with big yards. People who already bough

by natrius 10y ago

In most of Palo Alto, it's against the law to build anything but the most expensive kind of housing—single family homes with big yards. People who already bought in get to enjoy their walled-off neighborhoods at the expense of families with less money. It's nice that they feel bad enough about it to do something, but instead of legalizing cheaper housing on less land, they're trying to fund a lottery as a totem to make themselves feel better about the artificial affordability crisis they've created.

xiphias 10y ago
Actually it doesn't legalize cheaper housing, as it won't change the supply/demand. The house prices will increase by the subsidy amount. All this subsidy does is that it funnels more public (tax-payer) money to house owners.
- natrius 10y ago
  These programs typically have a formula to set prices based on income. It's a lottery, not a direct subsidy like school loans.
- pgreenwood 10y ago
  I agree that monetary subsidies tend to simply get capitalized into higher prices, but if you read the article the proposal is to actually build 2,000 units.
- runholm 10y ago
  What? No. They are building housing and will rent it out below market price. No one is given a monthly check to spend on housing or anything like that.
dimino 10y ago
Why is it "at the expense of" others, to own a home now? I've been trying for years to understand the concept of "everyone should be able to live everywhere" but I just cannot wrap my head around it, or it's cousin, "I shouldn't ever have to move, regardless of geopolitical changes". Why are people so attached to any particular place that they'll suffer immensely to keep that particular place theirs?
- nshelly 10y ago
  Well, on a purely economic basis, many of those homeowners, including investment funds, are paying < 0.1% in property tax and sitting on properties that are worth millions in value. As an example, the homeowner of one property with a market value of $7M was paying 0.04% in tax.[1] Property taxes help pay for streets, police, ambulatory services, schools and maintaining parks. These essential services are paid for "at the expense of" renters and new homeowners. Of course, this deeply vested interest group also manifests itself in roadblocks for new developments that would mitigate the drastic increases in housing costs. [1] http://www.zillow.com/homedetails/1536-Bryant-St-Palo-Alto-CA-94301/19497046_zpid/ http://www.zillow.com/homedetails/1536-Bryant-St-Palo-Alto-C...
  - JustSomeNobody 10y ago
    Oh. So it is somehow the homeowner's fault that the property values have increased around them?
    - nshelly 10y ago
      Not their fault, but it is their gain. One of the other posts here mentions a few solutions that wouldn't force retirees or those on fixed incomes out of their newly valuable properties. The coastal areas of California are unique in the US in that vast discrepancies exist between market value and what long-time property owners pay. - Apply market-rate taxation only for values over a certain threshold, say $1m+ and non-owner occupied - Defer tax payments until the property changes hands (aka they sell the property or pass it on) - Reverse mortgages
      - JustSomeNobody 10y ago
        Ahhh... so basically make it financially impossible for that property to be handed down to their kids? Wow. We really have become a horrible society.
      - burfog 10y ago
        It's completely messed up that a change in regional average property value could cause a change in total tax revenue. This causes a city's tax income to vary wildly. Cities take on obligations (bonds, salary increases, pensions) in good times and then hit disaster in bad times. We fight this in a stupid way. We limit tax increases for a property, with a reset upon sale. This discourages people from moving closer to work, causing our roads to be clogged with commuters. The right way is to say that assessed home value relates to the total portion of the city budget that your taxes must support. Your tax bill then wouldn't change unless the city budget changes or the relative value of your property changes. Subjecting the total city budget to voter approval is OK. Basically the problem is millage rate. The dollar value of your property should not directly (by simple multiplication or division) translate into a tax amount. It should instead translate into a portion of the total. That is, it should represent your share.
slowmotiony 10y ago
It's not a basic human right to own a house in Palo Alto.
- Houshalter 10y ago
  What about the right to build a house on land you own? As long as its not hurting anyone and is safe, why should my neighbors be able to tell me what I can't do with my own property?
  - criddell 10y ago
    Probably because they are afraid your building will make theirs less valuable and so you would be, in effect, hurting them.
    - eli_gottlieb 10y ago
      Well then, we'd better walk into every major stock exchange and explain that we're holding the guns to their heads because they're not trading everything at the highest price humanly possible, draining the rest of the economy in the process, and that therefore, as stockholders, we are being hurt and have the right to hold them at gunpoint for higher asset prices.
      - et2o 10y ago
        They are trading at the highest price possible when they are selling
        eli_gottlieb 10y ago
        Nah, they can go higher if we hold guns to their heads. Surely. Personally, I'm being harmed by not sticking them up /s.
    - Houshalter 10y ago
      You don't have a right to "value". The exact same argument works against you. Preventing me from building housing hurts the poor! It makes their cost of living increase. And surely they suffer far more than rich property owners. All economic transactions hurt someone's value, but they create more value than they destroy. It's a net good.
saalweachter 10y ago
I wonder if there'd be political support for a delayed change to the zoning laws -- multi-family dwellings become legal once 80% of the housing stock in a neighborhood turns over, or something like that.
KKKKkkkk1 10y ago
It's not the city of Palo Alto that created the crisis, it's all the companies and people who are moving into a city that clearly doesn't want them there.
- wmil 10y ago
  It always amazes me how techies swing from an extreme open borders position to an extreme xenophobia position the second the debate is about the city they live in.

by natrius 10y ago

xiphias 10y ago

Actually it doesn't legalize cheaper housing, as it won't change the supply/demand. The house prices will increase by the subsidy amount. All this subsidy does is that it funnels more public (tax-payer) money to house owners.

natrius 10y ago
These programs typically have a formula to set prices based on income. It's a lottery, not a direct subsidy like school loans.
pgreenwood 10y ago
I agree that monetary subsidies tend to simply get capitalized into higher prices, but if you read the article the proposal is to actually build 2,000 units.
runholm 10y ago
What? No. They are building housing and will rent it out below market price. No one is given a monthly check to spend on housing or anything like that.

dimino 10y ago

Why is it "at the expense of" others, to own a home now? I've been trying for years to understand the concept of "everyone should be able to live everywhere" but I just cannot wrap my head around it, or it's cousin, "I shouldn't ever have to move, regardless of geopolitical changes". Why are people so attached to any particular place that they'll suffer immensely to keep that particular place theirs?

nshelly 10y ago
Well, on a purely economic basis, many of those homeowners, including investment funds, are paying < 0.1% in property tax and sitting on properties that are worth millions in value. As an example, the homeowner of one property with a market value of $7M was paying 0.04% in tax.[1] Property taxes help pay for streets, police, ambulatory services, schools and maintaining parks. These essential services are paid for "at the expense of" renters and new homeowners. Of course, this deeply vested interest group also manifests itself in roadblocks for new developments that would mitigate the drastic increases in housing costs. [1] http://www.zillow.com/homedetails/1536-Bryant-St-Palo-Alto-CA-94301/19497046_zpid/ http://www.zillow.com/homedetails/1536-Bryant-St-Palo-Alto-C...
- JustSomeNobody 10y ago
  Oh. So it is somehow the homeowner's fault that the property values have increased around them?
  - nshelly 10y ago
    Not their fault, but it is their gain. One of the other posts here mentions a few solutions that wouldn't force retirees or those on fixed incomes out of their newly valuable properties. The coastal areas of California are unique in the US in that vast discrepancies exist between market value and what long-time property owners pay. - Apply market-rate taxation only for values over a certain threshold, say $1m+ and non-owner occupied - Defer tax payments until the property changes hands (aka they sell the property or pass it on) - Reverse mortgages
    - JustSomeNobody 10y ago
      Ahhh... so basically make it financially impossible for that property to be handed down to their kids? Wow. We really have become a horrible society.
    - burfog 10y ago
      It's completely messed up that a change in regional average property value could cause a change in total tax revenue. This causes a city's tax income to vary wildly. Cities take on obligations (bonds, salary increases, pensions) in good times and then hit disaster in bad times. We fight this in a stupid way. We limit tax increases for a property, with a reset upon sale. This discourages people from moving closer to work, causing our roads to be clogged with commuters. The right way is to say that assessed home value relates to the total portion of the city budget that your taxes must support. Your tax bill then wouldn't change unless the city budget changes or the relative value of your property changes. Subjecting the total city budget to voter approval is OK. Basically the problem is millage rate. The dollar value of your property should not directly (by simple multiplication or division) translate into a tax amount. It should instead translate into a portion of the total. That is, it should represent your share.

slowmotiony 10y ago

It's not a basic human right to own a house in Palo Alto.

Houshalter 10y ago
What about the right to build a house on land you own? As long as its not hurting anyone and is safe, why should my neighbors be able to tell me what I can't do with my own property?
- criddell 10y ago
  Probably because they are afraid your building will make theirs less valuable and so you would be, in effect, hurting them.
  - eli_gottlieb 10y ago
    Well then, we'd better walk into every major stock exchange and explain that we're holding the guns to their heads because they're not trading everything at the highest price humanly possible, draining the rest of the economy in the process, and that therefore, as stockholders, we are being hurt and have the right to hold them at gunpoint for higher asset prices.
    - et2o 10y ago
      They are trading at the highest price possible when they are selling
      - eli_gottlieb 10y ago
        Nah, they can go higher if we hold guns to their heads. Surely. Personally, I'm being harmed by not sticking them up /s.
  - Houshalter 10y ago
    You don't have a right to "value". The exact same argument works against you. Preventing me from building housing hurts the poor! It makes their cost of living increase. And surely they suffer far more than rich property owners. All economic transactions hurt someone's value, but they create more value than they destroy. It's a net good.

saalweachter 10y ago

I wonder if there'd be political support for a delayed change to the zoning laws -- multi-family dwellings become legal once 80% of the housing stock in a neighborhood turns over, or something like that.

KKKKkkkk1 10y ago

It's not the city of Palo Alto that created the crisis, it's all the companies and people who are moving into a city that clearly doesn't want them there.

wmil 10y ago
It always amazes me how techies swing from an extreme open borders position to an extreme xenophobia position the second the debate is about the city they live in.