5 ms·

Somehow, no one in SF has realized this: that they can institute rent control... and increase housing supply... at the same time.

by tw_hn_3_14_2021 6y ago

epistasis 6y ago
These are not contradictory ideas. The pro forms that will finance any construction loan/mortgage is not going to let the builder assume big increases in rents beyond inflation. In fact, if the only way to increase rents is to build a larger building and collect from more units, rent control could actually incentivize building. Where rent control gets into trouble is where it encourages "got mine, forget allowing anybody new here" sort of NIMBYism that accompanies home ownership. But that's a cultural problem, not a rent control or home ownership problem. And it's only a problem when the ability to build is gated by letting a tiny number of people veto new buildings. This veto power of tiny minorities is the true problem with building more in SF and other supply constrained places. A more democratic process that took into account the broader views of the people would fix it.
- candiodari 6y ago
  Maybe not, but obviously the institution of rent control is an attempt to get out from under the house price problem without construction. That's why it's not working. The policy doesn't make half as much sense if you also increase construction.
worik 6y ago
If the state is willing to be activist and damage the (paper) wealth of very influential people, like senior bureaucrats and policy wonks - who decide the states policy... I do not know what it is really like in SF, but here in Aotearoa that is where we find ourselves. House prices and rents double what they ought to be and no state actor willing to take the hit of doing anything about it
- cheriot 6y ago
  It's more about neighborhood level obstruction in SF. People will elect pro-housing candidates as Mayor and State Senator/Rep, but the local Board of Supervisors (the city council) is controlled by people that will say, "you should build that anywhere, but here." People are _very_ anti-change and especially don't want people different from themselves moving in.
arcticbull 6y ago
It's certainly possible to do both, but I do not believe that rent control is necessary when organic market-based solutions should sort the problem out. I'm an interventionist when the market fails, but not when the market isn't even allowed to try due to different failed intervention.

Somehow, no one in SF has realized this: that they can institute rent control... and increase housing supply... at the same time.

epistasis 6y ago

These are not contradictory ideas. The pro forms that will finance any construction loan/mortgage is not going to let the builder assume big increases in rents beyond inflation. In fact, if the only way to increase rents is to build a larger building and collect from more units, rent control could actually incentivize building. Where rent control gets into trouble is where it encourages "got mine, forget allowing anybody new here" sort of NIMBYism that accompanies home ownership. But that's a cultural problem, not a rent control or home ownership problem. And it's only a problem when the ability to build is gated by letting a tiny number of people veto new buildings. This veto power of tiny minorities is the true problem with building more in SF and other supply constrained places. A more democratic process that took into account the broader views of the people would fix it.

candiodari 6y ago
Maybe not, but obviously the institution of rent control is an attempt to get out from under the house price problem without construction. That's why it's not working. The policy doesn't make half as much sense if you also increase construction.

worik 6y ago

If the state is willing to be activist and damage the (paper) wealth of very influential people, like senior bureaucrats and policy wonks - who decide the states policy... I do not know what it is really like in SF, but here in Aotearoa that is where we find ourselves. House prices and rents double what they ought to be and no state actor willing to take the hit of doing anything about it

cheriot 6y ago
It's more about neighborhood level obstruction in SF. People will elect pro-housing candidates as Mayor and State Senator/Rep, but the local Board of Supervisors (the city council) is controlled by people that will say, "you should build that anywhere, but here." People are _very_ anti-change and especially don't want people different from themselves moving in.

arcticbull 6y ago

It's certainly possible to do both, but I do not believe that rent control is necessary when organic market-based solutions should sort the problem out. I'm an interventionist when the market fails, but not when the market isn't even allowed to try due to different failed intervention.