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The big loss with rent control is the disincentive for developers to create new apartments which has happened in San Francisco dramatically. We should have far

The big loss with rent control is the disincentive for developers to create new apartments which has happened in San Francisco dramatically. We should have far more apartments here given the demand with normal market incentives. The incredibly high cost of regulation in SF is also a large negative force, but if the normal market incentives (without rent control) were able to operate, developers would work through the regulation as they do in other cities without rent control.

irq11 7y ago
The article I cited found a minimal impact of rent control on new construction in SF. The costs of this were accounted for in the numbers cited. You should read the article before you assert that your opinions rebut its contents.
epistasis 7y ago
I don't think rent control has discouraged new construction, since it can't apply to new construction in SF.
- jfnixon 7y ago
  All housing was new construction at some point.
  - epistasis 7y ago
    Rent control only applies to buildings built before a particular date. So unless the developer is using a time machine, rent control can't affect the potential profit from building.
speedplane 7y ago
> The big loss with rent control is the disincentive for developers to create new apartments Rent control does not prevent developers from building new construction, in fact it may promote new developments. Rent control reduces the cost of housing for a select few people who haven't moved in a while, which artificially raises the prices for newer tenants that just moved into a neighborhood. Higher prices for new tenants make developing new housing more attractive, not less.
- imtringued 7y ago
  >Higher prices for new tenants make developing new housing more attractive, not less. I think you have switched cause and effect. Developers have to charge higher prices because they have to subsidize rent controlled units. Without rent control you may get away with charging $1000 per month to cover your costs and then slowly increasing prices as inflation picks up over the years. If you expect 3% inflation but rent control only allows a 1% increase then only charging $1000 will result in a net loss over time so you will have to adjust the rent upward. Assuming a tenant in a rent controlled unit stays for 20 years then the land lord has to charge the tenant $1400 from day one.
  - speedplane 7y ago
    >> Higher prices for new tenants make developing new housing more attractive, not less. > Developers have to charge higher prices because they have to subsidize rent controlled units. I don't think these two points are contradictory. Yes, rent control increases housing prices on newer units. However, higher prices on newer units provides incentive for developers to build new construction rather than squeezing everything they can from existing ones.

irq11 7y ago

The article I cited found a minimal impact of rent control on new construction in SF. The costs of this were accounted for in the numbers cited. You should read the article before you assert that your opinions rebut its contents.

epistasis 7y ago

I don't think rent control has discouraged new construction, since it can't apply to new construction in SF.

jfnixon 7y ago
All housing was new construction at some point.
- epistasis 7y ago
  Rent control only applies to buildings built before a particular date. So unless the developer is using a time machine, rent control can't affect the potential profit from building.

speedplane 7y ago

> The big loss with rent control is the disincentive for developers to create new apartments Rent control does not prevent developers from building new construction, in fact it may promote new developments. Rent control reduces the cost of housing for a select few people who haven't moved in a while, which artificially raises the prices for newer tenants that just moved into a neighborhood. Higher prices for new tenants make developing new housing more attractive, not less.

imtringued 7y ago
>Higher prices for new tenants make developing new housing more attractive, not less. I think you have switched cause and effect. Developers have to charge higher prices because they have to subsidize rent controlled units. Without rent control you may get away with charging $1000 per month to cover your costs and then slowly increasing prices as inflation picks up over the years. If you expect 3% inflation but rent control only allows a 1% increase then only charging $1000 will result in a net loss over time so you will have to adjust the rent upward. Assuming a tenant in a rent controlled unit stays for 20 years then the land lord has to charge the tenant $1400 from day one.
- speedplane 7y ago
  >> Higher prices for new tenants make developing new housing more attractive, not less. > Developers have to charge higher prices because they have to subsidize rent controlled units. I don't think these two points are contradictory. Yes, rent control increases housing prices on newer units. However, higher prices on newer units provides incentive for developers to build new construction rather than squeezing everything they can from existing ones.