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Your theories about cheap housing being a boon for everyone is hardly a thorough, long-term analysis. Plenty of history shows that constructors will cut corners

Your theories about cheap housing being a boon for everyone is hardly a thorough, long-term analysis. Plenty of history shows that constructors will cut corners for profit and build unsafe and/or unattractive housing that is ultimately a negative impact on an area. There are also other problems with lack of restrictions, like how it is easier to tear up and build over virgin land than pave over old developments. This is the reason the industry is regulated. There’s no need to prove that to ourselves here on once more - has that theory worked recently in other countries? Do you have any evidence or logic to demonstrate that people are inadequately houses currently due to over-regulation and not one of the other dozen factors? Such as (germane to the topic...) low wages relative to high prices, which can result from many economic causes such as interest rates, immigration and income disparity. For example, there’s plenty of housing being built in Denver right now, for people who can afford $2000 a month for a small apartment. The only factor stopping them from building apartments for $1000 a month is a profit motive, in that upscale developments have a higher margin. How would you propose to change that by deregulation?

jdavis703 8y ago
> The only factor stopping them from building apartments for $1000 a month is a profit motive At least in the Bay Area the high cost of housing is partially caused by construction labor costs, that are driven by the high cost of housing. There’s also a problem where an entire region generally has the same construction costs, but certain areas can command higher rents... Of course the developers are going to build where the most profits are. While I don’t believe deregulation is a panacea, reducing regulations to make lower cost areas more competitive with the higher profit areas could be beneficial. For example development impact fees could be reduced, smaller unit sizes could be legalized and the legal process could be streamlined to reduce legal costs and uncertainty. That could in theory make projects in cheaper areas more competive with “upscale” neighborhoods. Of course my analysis ignores the impacts that building in cheaper areas can have on the existing residents in terms of displacement, which is why deregulation is only part of the solution. Tenant rights and subsidized housing are equally important.
zeroname 8y ago
The main problem with regulation is zoning and NIMBY-driven development. Building codes drive up costs but zoning makes building impossible. I agree that interest rates have a huge impact on overpriced houses, but it's not such a direct correlation to rent prices. In SF there basically is no construction but there is huge demand for rent. In other areas there is demand for expensive construction for "investment", but nobody actually rents there. In China this has led to entire ghost cities full of empty highrises. Investors are speculating that rising prices will take care of the missing rent income - and they will, at least until the next bust comes. The situation where rent competition exists alongside building investment can only exist when both of these factors are eliminated. Interests rates need to rates. Zoning and NIMBY must go.

jdavis703 8y ago

> The only factor stopping them from building apartments for $1000 a month is a profit motive At least in the Bay Area the high cost of housing is partially caused by construction labor costs, that are driven by the high cost of housing. There’s also a problem where an entire region generally has the same construction costs, but certain areas can command higher rents... Of course the developers are going to build where the most profits are. While I don’t believe deregulation is a panacea, reducing regulations to make lower cost areas more competitive with the higher profit areas could be beneficial. For example development impact fees could be reduced, smaller unit sizes could be legalized and the legal process could be streamlined to reduce legal costs and uncertainty. That could in theory make projects in cheaper areas more competive with “upscale” neighborhoods. Of course my analysis ignores the impacts that building in cheaper areas can have on the existing residents in terms of displacement, which is why deregulation is only part of the solution. Tenant rights and subsidized housing are equally important.

zeroname 8y ago

The main problem with regulation is zoning and NIMBY-driven development. Building codes drive up costs but zoning makes building impossible. I agree that interest rates have a huge impact on overpriced houses, but it's not such a direct correlation to rent prices. In SF there basically is no construction but there is huge demand for rent. In other areas there is demand for expensive construction for "investment", but nobody actually rents there. In China this has led to entire ghost cities full of empty highrises. Investors are speculating that rising prices will take care of the missing rent income - and they will, at least until the next bust comes. The situation where rent competition exists alongside building investment can only exist when both of these factors are eliminated. Interests rates need to rates. Zoning and NIMBY must go.