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If we conclude that people should have affordable and predictable rent it is hard to make rent control the problem. While not adjusting rent for inflation and u

by njepa 8y ago

If we conclude that people should have affordable and predictable rent it is hard to make rent control the problem. While not adjusting rent for inflation and upkeep seems counterproductive, someone occupying an apartment at a low margin is only really a problem if we can't produce more apartments, or more opportunities, at the same price. The housing market cannot increase forever. You either end up with massive inflation or massive inequality. The few good ideas seem to essentially be to treat housing as infrastructure. Of course building infrastructure is a problem in itself for many countries.

AnimalMuppet 8y ago
Who should have affordable and predictable rent? Everybody? We're not getting that from rent control, because it only applies to a subset. Those who need it? We're not getting that from rent control, either, because many people suffer from high rent who don't have a rent-controlled apartment. Some of this may be due to those who don't need it getting it, but I suspect the numbers of such cases aren't enough to account for all those who need it who don't get it. > someone occupying an apartment at a low margin is only really a problem if we can't produce more apartments, or more opportunities, at the same price. That's exactly the problem with rent control. Let's say that there are a shortage of apartments for $100/month in NYC. Who is going to try to build more apartments in NYC for $100/month? Anybody who tries is going to lose their shirt. We can't produce them at that price. Rent control doesn't make that problem go away.
- njepa 8y ago
  > We can't produce them at that price. $100 per month isn't realistic, $500 might be. While construction costs do rise, you are mostly paying for the exclusivity. "High-rise apartment buildings cost an average $302 per square foot." https://therealdeal.com/2018/05/15/surprise-nyc-remains-most-expensive-place-to-build-in-the-world-report/ https://therealdeal.com/2018/05/15/surprise-nyc-remains-most...
  - AnimalMuppet 8y ago
    So, $151,000 per 600-square-foot apartment. If the loan for the building costs was at 5%, the interest cost is $7500 a year, or $629/month. That's not counting paying back principle, or maintenance. You might be able to do it for $800/month, though.

by njepa 8y ago

AnimalMuppet 8y ago

Who should have affordable and predictable rent? Everybody? We're not getting that from rent control, because it only applies to a subset. Those who need it? We're not getting that from rent control, either, because many people suffer from high rent who don't have a rent-controlled apartment. Some of this may be due to those who don't need it getting it, but I suspect the numbers of such cases aren't enough to account for all those who need it who don't get it. > someone occupying an apartment at a low margin is only really a problem if we can't produce more apartments, or more opportunities, at the same price. That's exactly the problem with rent control. Let's say that there are a shortage of apartments for $100/month in NYC. Who is going to try to build more apartments in NYC for $100/month? Anybody who tries is going to lose their shirt. We can't produce them at that price. Rent control doesn't make that problem go away.

njepa 8y ago
> We can't produce them at that price. $100 per month isn't realistic, $500 might be. While construction costs do rise, you are mostly paying for the exclusivity. "High-rise apartment buildings cost an average $302 per square foot." https://therealdeal.com/2018/05/15/surprise-nyc-remains-most-expensive-place-to-build-in-the-world-report/ https://therealdeal.com/2018/05/15/surprise-nyc-remains-most...
- AnimalMuppet 8y ago
  So, $151,000 per 600-square-foot apartment. If the loan for the building costs was at 5%, the interest cost is $7500 a year, or $629/month. That's not counting paying back principle, or maintenance. You might be able to do it for $800/month, though.