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Rent goes up because of supply and demand. If a rich person moves into an area with a housing shortage, they will displace poor renters and rent will go up. But

by pitaj 5y ago

Rent goes up because of supply and demand. If a rich person moves into an area with a housing shortage, they will displace poor renters and rent will go up. But the problem is the housing shortage, a consequence of many years of terrible housing policy.

erhk 5y ago
If you follow housing policy you might find wealthy benefactors
pydry 5y ago
If you assume that minimum waged employees would spend 100% of their raise on rent then landlords would swallow the surplus but more likely the workers would spread it around. They do have other costs. I havent seen a study that connects the two. A quick google suggests a fair number of business-centric publications spreading FUD about it though. This article suggests it was connected to lower business rents: https://anderson-review.ucla.edu/a-15-minimum-wage-may-have-partially-arrived-but-who-pays/ https://anderson-review.ucla.edu/a-15-minimum-wage-may-have-... (The mechanism being that restaurants pass on the cost of their higher wages to their landlords)
- ethanbond 5y ago
  > the researchers present evidence that minimum wage changes led area restaurants to raise prices, change menu items, obtain lower rents in the high wage areas and, in some cases, caused eateries to shut down. I wonder if the units made empty by closures may have reduced price pressure on the ones that survived.
  - pydry 5y ago
    Yes, maybe. There's a definite tension between: * Restaurants being unwilling to raise prices (diners are notoriously intolerant, it can kill restaurants). * Landlords being unwilling to lower rents. * Restaurants being unwilling to tolerate < 6% profit margins. * Landlords being unwilling to lose a good, paying tenant if there isnt another around the corner. The pain has to be distributed somehow though.
Aerroon 5y ago
>Rent goes up because of supply and demand. And if people now earn more money they can pay more money to rent a house they want. This would force the people that are already renting there to also pay more, which they can afford because they now earn more money too. It seems feasible to me that landlords could eat up most of that wage increase.
- ethanbond 5y ago
  Exactly. Actually fairly self-evident when you think about it. Rent doesn’t go up because costs go up, it goes up because people’s ability to pay does.
  - BirdPlusPlus 5y ago
    Consider how widely available high-speed broadband through Starlink might change some of these things once that makes living in the interior of the country more desirable. I think we may end up seeing a sort of reverse of the industrial revolution's migration pattern over the coming decades.
    - ethanbond 5y ago
      Totally possible! I hope we actually see small walkable enclaves throughout the country. Like the little mountain resort towns, but kept afloat by residents rather than tourism. Jobs are a big part of the equation with living in a city, but definitely not the only one. Food, arts, other cultural artifacts that people who live in cities care about are harder to move across the web for sure.

by pitaj 5y ago

erhk 5y ago

If you follow housing policy you might find wealthy benefactors

pydry 5y ago

If you assume that minimum waged employees would spend 100% of their raise on rent then landlords would swallow the surplus but more likely the workers would spread it around. They do have other costs. I havent seen a study that connects the two. A quick google suggests a fair number of business-centric publications spreading FUD about it though. This article suggests it was connected to lower business rents: https://anderson-review.ucla.edu/a-15-minimum-wage-may-have-partially-arrived-but-who-pays/ https://anderson-review.ucla.edu/a-15-minimum-wage-may-have-... (The mechanism being that restaurants pass on the cost of their higher wages to their landlords)

ethanbond 5y ago
> the researchers present evidence that minimum wage changes led area restaurants to raise prices, change menu items, obtain lower rents in the high wage areas and, in some cases, caused eateries to shut down. I wonder if the units made empty by closures may have reduced price pressure on the ones that survived.
- pydry 5y ago
  Yes, maybe. There's a definite tension between: * Restaurants being unwilling to raise prices (diners are notoriously intolerant, it can kill restaurants). * Landlords being unwilling to lower rents. * Restaurants being unwilling to tolerate < 6% profit margins. * Landlords being unwilling to lose a good, paying tenant if there isnt another around the corner. The pain has to be distributed somehow though.

Aerroon 5y ago

>Rent goes up because of supply and demand. And if people now earn more money they can pay more money to rent a house they want. This would force the people that are already renting there to also pay more, which they can afford because they now earn more money too. It seems feasible to me that landlords could eat up most of that wage increase.

ethanbond 5y ago
Exactly. Actually fairly self-evident when you think about it. Rent doesn’t go up because costs go up, it goes up because people’s ability to pay does.
- BirdPlusPlus 5y ago
  Consider how widely available high-speed broadband through Starlink might change some of these things once that makes living in the interior of the country more desirable. I think we may end up seeing a sort of reverse of the industrial revolution's migration pattern over the coming decades.
  - ethanbond 5y ago
    Totally possible! I hope we actually see small walkable enclaves throughout the country. Like the little mountain resort towns, but kept afloat by residents rather than tourism. Jobs are a big part of the equation with living in a city, but definitely not the only one. Food, arts, other cultural artifacts that people who live in cities care about are harder to move across the web for sure.