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I don’t quite understand the point about building more “yuppie fish tanks” as a way to bring down rent. Having lived in Portland, I did not see a correlation be

I don’t quite understand the point about building more “yuppie fish tanks” as a way to bring down rent. Having lived in Portland, I did not see a correlation between the construction of market rate housing or luxury housing and the reduction in rent in other neighborhoods. I also don’t understand that “if the government says something is designated as being affordable housing then it will be affordable” is suggested to be a possibly unreliable assumption. I’ve lived in affordable housing and market rate housing. Affordable Housing was uh, much more affordable. Maybe I’m completely misunderstanding this post but the general tone comes off as “anything associated with ‘the left’ is actually diametrically opposed to truth”

theptip 6y ago
If there are 1000 yuppies looking for houses in Portland this year, if they don’t find their fish tank, then they start bidding on the rest of the housing stock, and increase everyone’s rent. If you build fish bowls for them they don’t have a first-order effect on rent prices. This is an attempt to prove the principle of supply and demand (that NIMBYs often reject) from first principles. Of course, the counter-argument from induced demand is “after those 1000 yuppies move in, then 2000 more hear about how good the fish tanks are in Portland and come along and bid up the rest of the housing stock even further”. The degree of induced demand is an empirical question that the author provides some citations around. “Affordable housing” can be a relative term, for example see https://www.housingwire.com/articles/43818-san-franciscos-definition-of-low-income-is-shocking/ https://www.housingwire.com/articles/43818-san-franciscos-de.... It might not be affordable by the current residents. At the end of the article the author points out that YIMBYs are mostly leftists so I don’t think they are making an anti-leftist point.
- newbie789 6y ago
  Thank you, I suppose the counter argument you cited is anecdotally experienced in Portland. Over the course of a decade I went from a $700/mo 2bd/2ba condo to a $1400 studio. Pretty much every person in my friends group experienced something similar in all four quadrants of the city (proper), Beaverton, Garden Home, Multnomah Village, Tigard, etc. If the Portland fishtanks are driving down the price of rent, I haven’t heard about it myself. I am not, however, an expert on this.
  - theptip 6y ago
    I think it's an open question; economics papers are being written in 2021 on the subject (see https://www.dropbox.com/s/oplls6utgf7z6ih/Pennington_JMP.pdf?dl=0 https://www.dropbox.com/s/oplls6utgf7z6ih/Pennington_JMP.pdf... for example from the article). One confounding factor here is that it's quite hard to draw anecdotal conclusions, because it is impossible to test the counterfactual; the YIMBY would make the case that rents would have gone up even more in Portland if the fishtanks were not built. And the effect is quite hard to measure; that paper I linked says "I find that monthly rents fall by $22.77 - $43.18 relative to trend, or roughly 1.2 - 2.3%, for people living within 500m of a new project" -- this is probably not noticeable by you or me with anecdotal observations, but if the study is correct, and we committed to lots of new buildings, then it could make a noticeable difference in aggregate after lots of new projects were completed.
    - newbie789 6y ago
      That’s a very interesting paper about San Francisco. In my experience in Portland over a decade, I’ve not experienced this tiny nearly unnoticeable decline that the paper suggests. I’ve in reality seen a significant increase in rent year over year for myself and pretty much my entire friend group that spans from “couch surfing” to “can comfortably rent a multiple bedroom house”
      - theptip 6y ago
        Note that the paper is just saying it fell vs trend - if the trend is +10% vs. last year, a local development could reduce that to say +8%. So both observations could be correct.
jboog 6y ago
I mean the author posted several peer reviewed empirical studies to back up his claims but you've got an anecdote from your personal experience which I guess we should all trust to be the real truth?
- newbie789 6y ago
  I stated that I have not experienced the phenomenon that the author suggests is emergent from the construction of market-rate housing. I didn’t say that it can’t happen or that I’m an authority on the topic. Aside from the empirical studies, have you personally experienced (or know someone that has experienced) a reduction in rent as a direct result of adding non-“affordable” (eg. luxury or market rate) housing to their neighborhood? I’d love to hear another perspective. I’m sorry if I gave you the impression that I was trying to position myself as an expert. I try to make my language clear about my experience but sometimes I might not mail it in such a way as to not be misinterpreted.

theptip 6y ago

If there are 1000 yuppies looking for houses in Portland this year, if they don’t find their fish tank, then they start bidding on the rest of the housing stock, and increase everyone’s rent. If you build fish bowls for them they don’t have a first-order effect on rent prices. This is an attempt to prove the principle of supply and demand (that NIMBYs often reject) from first principles. Of course, the counter-argument from induced demand is “after those 1000 yuppies move in, then 2000 more hear about how good the fish tanks are in Portland and come along and bid up the rest of the housing stock even further”. The degree of induced demand is an empirical question that the author provides some citations around. “Affordable housing” can be a relative term, for example see https://www.housingwire.com/articles/43818-san-franciscos-definition-of-low-income-is-shocking/ https://www.housingwire.com/articles/43818-san-franciscos-de.... It might not be affordable by the current residents. At the end of the article the author points out that YIMBYs are mostly leftists so I don’t think they are making an anti-leftist point.

newbie789 6y ago
Thank you, I suppose the counter argument you cited is anecdotally experienced in Portland. Over the course of a decade I went from a $700/mo 2bd/2ba condo to a $1400 studio. Pretty much every person in my friends group experienced something similar in all four quadrants of the city (proper), Beaverton, Garden Home, Multnomah Village, Tigard, etc. If the Portland fishtanks are driving down the price of rent, I haven’t heard about it myself. I am not, however, an expert on this.
- theptip 6y ago
  I think it's an open question; economics papers are being written in 2021 on the subject (see https://www.dropbox.com/s/oplls6utgf7z6ih/Pennington_JMP.pdf?dl=0 https://www.dropbox.com/s/oplls6utgf7z6ih/Pennington_JMP.pdf... for example from the article). One confounding factor here is that it's quite hard to draw anecdotal conclusions, because it is impossible to test the counterfactual; the YIMBY would make the case that rents would have gone up even more in Portland if the fishtanks were not built. And the effect is quite hard to measure; that paper I linked says "I find that monthly rents fall by $22.77 - $43.18 relative to trend, or roughly 1.2 - 2.3%, for people living within 500m of a new project" -- this is probably not noticeable by you or me with anecdotal observations, but if the study is correct, and we committed to lots of new buildings, then it could make a noticeable difference in aggregate after lots of new projects were completed.
  - newbie789 6y ago
    That’s a very interesting paper about San Francisco. In my experience in Portland over a decade, I’ve not experienced this tiny nearly unnoticeable decline that the paper suggests. I’ve in reality seen a significant increase in rent year over year for myself and pretty much my entire friend group that spans from “couch surfing” to “can comfortably rent a multiple bedroom house”
    - theptip 6y ago
      Note that the paper is just saying it fell vs trend - if the trend is +10% vs. last year, a local development could reduce that to say +8%. So both observations could be correct.

jboog 6y ago

I mean the author posted several peer reviewed empirical studies to back up his claims but you've got an anecdote from your personal experience which I guess we should all trust to be the real truth?

newbie789 6y ago
I stated that I have not experienced the phenomenon that the author suggests is emergent from the construction of market-rate housing. I didn’t say that it can’t happen or that I’m an authority on the topic. Aside from the empirical studies, have you personally experienced (or know someone that has experienced) a reduction in rent as a direct result of adding non-“affordable” (eg. luxury or market rate) housing to their neighborhood? I’d love to hear another perspective. I’m sorry if I gave you the impression that I was trying to position myself as an expert. I try to make my language clear about my experience but sometimes I might not mail it in such a way as to not be misinterpreted.