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Property owners are also artificially inflating their own home values by blocking any and all attempts to build more houses.

by tqi 6y ago

zepto 6y ago
That’s not typically how the relationship between building and home values works over time. Places where density increases also see increases in prices for existing homeowners. But sure - Prop 13 and new building are separate issues.
- tqi 6y ago
  Home owners definitely believe that proximity to multitenant housing lowers property values, and vote accordingly (whether that is actually the case is up for debate, but also less relevant to voting behavior than perception). [1] page 4: https://www.jchs.harvard.edu/sites/default/files/rr07-14_obrinsky_stein.pdf https://www.jchs.harvard.edu/sites/default/files/rr07-14_obr...
  - zepto 6y ago
    Yes, the belief is prevalent, even though mostly wrong. My guess is that other downsides, real and imagined, make people overestimate the impact on prices.
majormajor 6y ago
That's not what single family zoning does. It keeps the value of the land a bit lower than it would be otherwise by preventing denser development. In most areas, a developer can get a lot more money out of a medium-density condo building or a tower than out of a house. If that wasn't the case, developers wouldn't want to build denser buildings. Consider how much would it cost to get a standalone house with a sizable yard on Manhattan?
- Nasrudith 6y ago
  I thought they meant homeowners by property owners rather than developers. While selling to a developer for density would benefit the initial sellers it would cannibalize the value of other houses by fulfilling demand.
  - zepto 6y ago
    Generally that isn’t how it works. More density usually doesn’t come close to satisfying actual demand, but it does make the existing real estate more valuable.
    - imtringued 6y ago
      It doesn't get close because of the size of the problem. If 85% of real estate is single family housing then how is a 1% increase in density supposed to solve the problem? > but it does make the existing real estate more valuable. No it doesn't. Existing real estate is valuable because there is a mismatch between commercial and residential real estate. By building more residential real estate you are reducing the mismatch.

Property owners are also artificially inflating their own home values by blocking any and all attempts to build more houses.

by tqi 6y ago

Property owners are also artificially inflating their own home values by blocking any and all attempts to build more houses.

zepto 6y ago

That’s not typically how the relationship between building and home values works over time. Places where density increases also see increases in prices for existing homeowners. But sure - Prop 13 and new building are separate issues.

tqi 6y ago
Home owners definitely believe that proximity to multitenant housing lowers property values, and vote accordingly (whether that is actually the case is up for debate, but also less relevant to voting behavior than perception). [1] page 4: https://www.jchs.harvard.edu/sites/default/files/rr07-14_obrinsky_stein.pdf https://www.jchs.harvard.edu/sites/default/files/rr07-14_obr...
- zepto 6y ago
  Yes, the belief is prevalent, even though mostly wrong. My guess is that other downsides, real and imagined, make people overestimate the impact on prices.

majormajor 6y ago

That's not what single family zoning does. It keeps the value of the land a bit lower than it would be otherwise by preventing denser development. In most areas, a developer can get a lot more money out of a medium-density condo building or a tower than out of a house. If that wasn't the case, developers wouldn't want to build denser buildings. Consider how much would it cost to get a standalone house with a sizable yard on Manhattan?

Nasrudith 6y ago
I thought they meant homeowners by property owners rather than developers. While selling to a developer for density would benefit the initial sellers it would cannibalize the value of other houses by fulfilling demand.
- zepto 6y ago
  Generally that isn’t how it works. More density usually doesn’t come close to satisfying actual demand, but it does make the existing real estate more valuable.
  - imtringued 6y ago
    It doesn't get close because of the size of the problem. If 85% of real estate is single family housing then how is a 1% increase in density supposed to solve the problem? > but it does make the existing real estate more valuable. No it doesn't. Existing real estate is valuable because there is a mismatch between commercial and residential real estate. By building more residential real estate you are reducing the mismatch.