4 ms·

I live in a very interesting area, across the street from me is a different city with housing costs roughly 10x the costs of mine. I am daily confronted with th

I live in a very interesting area, across the street from me is a different city with housing costs roughly 10x the costs of mine. I am daily confronted with the absurdity of pricing of housing. In addition as I've watched rents around me rise, and anticipated my own rent rising, I wonder at the expectation that we should continually get less for more. My house isn't getting any newer after all. If my employer decided to cut my pay by 10 or 20% every year there's no way I would stay, and yet I must admit that I have tolerated this behavior from my landlords. Unlike commodities or consumables, for which unrestrained markets influenced by collective expectations of supply and demand are not routinely shocking, the expectation that my house, in which I already live, and for which I have been paying consistently for years, suddenly being much more expensive ... well that feels like a hole in the social contract. A problem to be remedied by legislation if the governing societal expectations do not naturally lead to a different equilibrium. What if the expectation was that if you let someone live in your home you are granting them significant rights, significant stability, and are assuming significant risk of losing money? This set of expectations is well known elsewhere, but not so much where I live. So while I am willing to be convinced that a humane and equitable improvement to a cities housing situation can be achieved by building more housing, I would hate for legislative restrictions to be ignored as complimentary and beneficial efforts.

unfiltered 9y ago
How did you manage to find a housing price gradient that sharp? East Palo Alto vs. Palo Alto or something?
bhauer 9y ago
> my house ... for which I have been paying consistently for years If you are paying for it, not past-tense, then it's not technically your house. The apparently uneven market for real estate is shocking to buyers because of the variability of supply constraints, caused by geography but also in great measure by zoning regulation. The hackneyed refrain of "location, location, location" as the chief determinant of the value of a property illustrates this point. > I must admit that I have tolerated this behavior from my landlords. You have tolerated it precisely because you actually know that the value of property is not fixed. As demand increases while supply does not, the value/price goes up. Clearly you like the location, so you've not moved away. You are part of the demand that is moving prices upward. Your willingness to pay more is precisely what sets the price, along with supply. > A problem to be remedied by legislation if the governing societal expectations do not naturally lead to a different equilibrium. As the article points out, legislation focused on remedying the problem would relax constraints on supply caused by zoning, regulatory hurdles, etc. But so often the people complaining about the cost of housing are the same people voting to keep supply constrained.
- hackits 9y ago
  There does come a tipping point that most land lords don't like to talk about. When interest rates go so low that the cost of owning your own home is cheaper than renting. This is including all the cost of maintenance, water rates, garbage collection, insurance, taxes, and also property tax's that come with it. Do be careful when you decide to enter the market as choosing the wrong time can wipe out about 3-4 years savings within 2-3 months.
OrwellianChild 9y ago
> In addition as I've watched rents around me rise, and anticipated my own rent rising, I wonder at the expectation that we should continually get less for more. My house isn't getting any newer after all. I think your central confusion stems from the idea that the price of rent is in any way related to the original cost to buy the land and build the building you are renting. It is not. Rents move to stay competitive with the demand in the area. If more people want to live there, rents will rise. If vacancies increase, rents will fall until all the units are filled. Landlords have no leverage against renters in this regard - if you can find a similar rental for cheaper in your area, you are free to move or negotiate down your rents with your current landlord. Attempts to legislate this market dynamic away just risk guessing demand incorrectly and limiting prices inefficiently, which results in less housing stock and more expensive/scarce rentals in all cases.

unfiltered 9y ago

How did you manage to find a housing price gradient that sharp? East Palo Alto vs. Palo Alto or something?

bhauer 9y ago

> my house ... for which I have been paying consistently for years If you are paying for it, not past-tense, then it's not technically your house. The apparently uneven market for real estate is shocking to buyers because of the variability of supply constraints, caused by geography but also in great measure by zoning regulation. The hackneyed refrain of "location, location, location" as the chief determinant of the value of a property illustrates this point. > I must admit that I have tolerated this behavior from my landlords. You have tolerated it precisely because you actually know that the value of property is not fixed. As demand increases while supply does not, the value/price goes up. Clearly you like the location, so you've not moved away. You are part of the demand that is moving prices upward. Your willingness to pay more is precisely what sets the price, along with supply. > A problem to be remedied by legislation if the governing societal expectations do not naturally lead to a different equilibrium. As the article points out, legislation focused on remedying the problem would relax constraints on supply caused by zoning, regulatory hurdles, etc. But so often the people complaining about the cost of housing are the same people voting to keep supply constrained.

hackits 9y ago
There does come a tipping point that most land lords don't like to talk about. When interest rates go so low that the cost of owning your own home is cheaper than renting. This is including all the cost of maintenance, water rates, garbage collection, insurance, taxes, and also property tax's that come with it. Do be careful when you decide to enter the market as choosing the wrong time can wipe out about 3-4 years savings within 2-3 months.

OrwellianChild 9y ago

> In addition as I've watched rents around me rise, and anticipated my own rent rising, I wonder at the expectation that we should continually get less for more. My house isn't getting any newer after all. I think your central confusion stems from the idea that the price of rent is in any way related to the original cost to buy the land and build the building you are renting. It is not. Rents move to stay competitive with the demand in the area. If more people want to live there, rents will rise. If vacancies increase, rents will fall until all the units are filled. Landlords have no leverage against renters in this regard - if you can find a similar rental for cheaper in your area, you are free to move or negotiate down your rents with your current landlord. Attempts to legislate this market dynamic away just risk guessing demand incorrectly and limiting prices inefficiently, which results in less housing stock and more expensive/scarce rentals in all cases.