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People keep telling this story but not providing any evidence. What evidence is there that landlords not wanting to rent their units is the cause of high rents

by kar5pt 4y ago

People keep telling this story but not providing any evidence. What evidence is there that landlords not wanting to rent their units is the cause of high rents in nyc? On its surface it makes no sense. Why wouldn't they want to collect rents if they can do it?

saurik 4y ago
So, you are partly asking about the causal link between the practice of keeping properties vacant and rising rent, as maybe you believe there are multiple explanations and that's not the dominant one, but you do also seem to not believe that the vacancies are a thing in the first place, which is a lot easier to address. FWIW, even without my having any prior knowledge of the correct terminology here--which is apparently "warehousing"--it took about 10 seconds to find a bunch of references to what is going on using the search query "new york landlords keeping properties empty renters". I have provided a spattering of results from different kinds of sources. https://jacobin.com/2022/10/new-york-city-landlords-affordable-housing-single-room-occupancy-crisis https://jacobin.com/2022/10/new-york-city-landlords-affordab... https://nypost.com/2022/10/20/nyc-landlords-holding-60k-rent-stabilized-units-for-ransom/ https://nypost.com/2022/10/20/nyc-landlords-holding-60k-rent... https://www.fox5ny.com/news/nyc-warehousing-empty-apartments.amp https://www.fox5ny.com/news/nyc-warehousing-empty-apartments... https://www.thecity.nyc/housing/2022/10/19/23411956/60000-rent-stabilized-apartments-vacant-warehousing-nyc-landlords-housing https://www.thecity.nyc/housing/2022/10/19/23411956/60000-re... https://www.businessinsider.com/why-cant-find-affordable-nyc-rent-controlled-regulated-vacant-apartments-2022-7 https://www.businessinsider.com/why-cant-find-affordable-nyc... https://www.reddit.com/r/nyc/comments/ygnh7o/new_york_landlords_would_rather_keep_homes_empty/ https://www.reddit.com/r/nyc/comments/ygnh7o/new_york_landlo... (discussion of the jacobin article) How have you previously tried to find evidence and come up short? Can you list some of your failed attempts to research this?
- kar5pt 4y ago
  I was hoping for peer-reviewed research, not articles written by journalists. I'm not denying the vacancies are real (not sure how you thought that?). I'm questioning whether the cause of the vacancies are landlords intentionally refusing to rent out units for which qualified renters exist (in the absence of market-distortions like rent-control). I'm open to evidence that this happening, I'm just pointing out that I've seen dozens of people online make this claim and no one ever provides evidence to back it up. I don't have time to thoroughly read through all 6 of those articles, but I've skimmed through them and don't see evidence for the claim there either. The Jacobin and City articles just assert that it's true without citing any evidence. The Business Insider doesn't even try to make that claim, it immediately blames rent-control in the 4-6 paragraphs. The Fox5 article just says units are empty without trying to provide an explanation. If there is a piece of the articles I missed, please point it out.
  - walterbell 4y ago
    What's a good example of peer-reviewed research on rental markets, in any city?
Rury 4y ago
If you're looking for a reason, collecting $4000 from 1 person is preferable to collecting $1000 from 4 people as there is more work/maintenance in dealing with 4 people. This alone incentivizes landlords for wanting high rents, and a scarce supply, over a large supply and low rents. In any case, this question applies to any market involving artificial scarcity. Surely you don't think businesses have never tried to make their product artificially scarce in order to make higher margins?
- kar5pt 4y ago
  I find it hard to believe that refusing to rent out 3 units would raise the fourth one from $1000 to $4000. I also don't think businesses normally refuse to sell large portions of already produced merchandise to maintain artificial scarcity. Maybe that happens in limited scenarios for short periods of time, but I don't think it's usually a cause of severe, chronic undersupply like what we're seeing in the NYC housing market. Of course, like I said to the other comment. I'm open to hearing contrary evidence (if it comes from actual economists and not journalists).

by kar5pt 4y ago

saurik 4y ago

So, you are partly asking about the causal link between the practice of keeping properties vacant and rising rent, as maybe you believe there are multiple explanations and that's not the dominant one, but you do also seem to not believe that the vacancies are a thing in the first place, which is a lot easier to address. FWIW, even without my having any prior knowledge of the correct terminology here--which is apparently "warehousing"--it took about 10 seconds to find a bunch of references to what is going on using the search query "new york landlords keeping properties empty renters". I have provided a spattering of results from different kinds of sources. https://jacobin.com/2022/10/new-york-city-landlords-affordable-housing-single-room-occupancy-crisis https://jacobin.com/2022/10/new-york-city-landlords-affordab... https://nypost.com/2022/10/20/nyc-landlords-holding-60k-rent-stabilized-units-for-ransom/ https://nypost.com/2022/10/20/nyc-landlords-holding-60k-rent... https://www.fox5ny.com/news/nyc-warehousing-empty-apartments.amp https://www.fox5ny.com/news/nyc-warehousing-empty-apartments... https://www.thecity.nyc/housing/2022/10/19/23411956/60000-rent-stabilized-apartments-vacant-warehousing-nyc-landlords-housing https://www.thecity.nyc/housing/2022/10/19/23411956/60000-re... https://www.businessinsider.com/why-cant-find-affordable-nyc-rent-controlled-regulated-vacant-apartments-2022-7 https://www.businessinsider.com/why-cant-find-affordable-nyc... https://www.reddit.com/r/nyc/comments/ygnh7o/new_york_landlords_would_rather_keep_homes_empty/ https://www.reddit.com/r/nyc/comments/ygnh7o/new_york_landlo... (discussion of the jacobin article) How have you previously tried to find evidence and come up short? Can you list some of your failed attempts to research this?

kar5pt 4y ago
I was hoping for peer-reviewed research, not articles written by journalists. I'm not denying the vacancies are real (not sure how you thought that?). I'm questioning whether the cause of the vacancies are landlords intentionally refusing to rent out units for which qualified renters exist (in the absence of market-distortions like rent-control). I'm open to evidence that this happening, I'm just pointing out that I've seen dozens of people online make this claim and no one ever provides evidence to back it up. I don't have time to thoroughly read through all 6 of those articles, but I've skimmed through them and don't see evidence for the claim there either. The Jacobin and City articles just assert that it's true without citing any evidence. The Business Insider doesn't even try to make that claim, it immediately blames rent-control in the 4-6 paragraphs. The Fox5 article just says units are empty without trying to provide an explanation. If there is a piece of the articles I missed, please point it out.
- walterbell 4y ago
  What's a good example of peer-reviewed research on rental markets, in any city?

Rury 4y ago

If you're looking for a reason, collecting $4000 from 1 person is preferable to collecting $1000 from 4 people as there is more work/maintenance in dealing with 4 people. This alone incentivizes landlords for wanting high rents, and a scarce supply, over a large supply and low rents. In any case, this question applies to any market involving artificial scarcity. Surely you don't think businesses have never tried to make their product artificially scarce in order to make higher margins?

kar5pt 4y ago
I find it hard to believe that refusing to rent out 3 units would raise the fourth one from $1000 to $4000. I also don't think businesses normally refuse to sell large portions of already produced merchandise to maintain artificial scarcity. Maybe that happens in limited scenarios for short periods of time, but I don't think it's usually a cause of severe, chronic undersupply like what we're seeing in the NYC housing market. Of course, like I said to the other comment. I'm open to hearing contrary evidence (if it comes from actual economists and not journalists).