5 ms·
This sounds like an interesting project for YC research. Many of these questions are very open-ended and it will be exciting to see what comes out of it. Howeve
by scottrogowski 10y ago
This sounds like an interesting project for YC research. Many of these questions are very open-ended and it will be exciting to see what comes out of it. However, one question in particular upset me as a Bay Area resident:
How can we make and keep housing affordable?
This question is frustrating not only because the problem is particularly acute but also because it is completely self-inflicted and solvable using what we already know.
Take a look at the 7 American cities with the highest rent: SF, NYC, Jersey City, DC, Boston, San Jose, LA
https://www.apartmentlist.com/rentonomics/national-rent-data/ https://www.apartmentlist.com/rentonomics/national-rent-data...
Then look at the 7 largest American cities that still practice rent control: NYC, LA, San Diego, San Jose, SF, DC, Oakland, Jersey City
http://www.landlord.com/rent_control_laws_by_state.htm http://www.landlord.com/rent_control_laws_by_state.htm
Why? It's not a coincidence and it is causal. Rent control:
A. Disincentivizes new construction. Simply put, over time, long-term tenants might not be paying enough to make a keep a building profitable.
B. Causes owners to take recently-vacated, perfectly-habitable units off the market to avoid these same long-term un-evictable tenants (30,000 units are empty in SF alone. That’s 8.3% of the housing stock! http://blog.sfgate.com/ontheblock/2011/03/30/why-so-many-vacant-homes-in-san-francisco/ http://blog.sfgate.com/ontheblock/2011/03/30/why-so-many-vac...)
These both result in less housing in total. A smaller supply coupled with the same demand will cause prices to rise as the few apartments that are available go to the highest bidder.
In a 1992 study, 93% of surveyed economists agreed with the statement "a ceiling on rents reduces the quantity and quality of housing available." http://www.factcheck.org/2009/02/when-economists-agree/ http://www.factcheck.org/2009/02/when-economists-agree/
For comparison, the consensus that global warming is anthropogenic among climate scientists is 97% - just 4% higher.
We rightfully ridicule our elected officials for being skeptical of global warming. Why don’t we also ridicule elected officials who support rent control?
If the problem is keeping housing affordable, the solution is simple. We need to phase out rent control laws and remove regulations around the development of new housing. For now, in the Bay, rent control is not realistically going to be touched for a few years. For the latter, there is evidence that Sacramento is starting to understand that we actually need to build housing to bring down prices http://www.latimes.com/opinion/editorials/la-ed-brown-affordable-housing-20160527-snap-story.html http://www.latimes.com/opinion/editorials/la-ed-brown-afford.... If we are lucky, they might take this new insight and apply it to existing housing for a complete solution to this man-made problem.
A good article on the subject in general: http://www.econlib.org/library/Enc/RentControl.html http://www.econlib.org/library/Enc/RentControl.html