5 ms·

Gentrification is a real thing and it's why a lot of people with low incomes oppose new construction where they live. NIMBYism isn't just a suburban or homeowne

Gentrification is a real thing and it's why a lot of people with low incomes oppose new construction where they live. NIMBYism isn't just a suburban or homeowner phenomenon, it also happens when people are afraid of getting priced out of their rental housing. At the same time, gentrification is inevitable when neighborhoods become more desirable. Better housing, amenities, schools etc. will inevitably attract people who would not have previously wanted to live there. In cities without a lot of demand pressure on housing, building new housing makes the older housing less attractive. That can at least give displaced renters a place to go. But in cities where demand outstrips supply, it takes a lot of new housing to make a noticeable dent in rents. (I suspect this is where the impression comes from that new housing doesn't help with prices -- in places where demand outstrips supply by a lot, prices can go up even while new housing is being built -- but without that new housing the prices would have gone up even more!) There are not easy solutions to this. Rent control might appear to be a good solution but in the long term it makes things worse. Building new housing often does change the character of neighborhoods economically, demographically, etc. But if we let that stop us, nothing new will get built except on unused land.

panick21_ 4y ago
Land value taxation is at least a way to hurt those more who have property that is not used well. Parking lots and other low value uses are hurt more.
- twblalock 4y ago
  Housing was affordable in the past without land value taxes. I don't see why those are needed now either. Supply and demand really does work for housing. We are just in a massive backlog on supply, which has built up over decades, and it will take decades to build our way out of it. During that time it will look like the new building isn't helping very much -- but that's because of how bad the backlog is. For example, in the San Jose area tons of new housing is being built, on unused shopping centers like Cambrian Plaza and former industrial areas like Santa Clara Square. It's dense housing for the area too -- 3-5 story apartment blocks with their own underground parking, sometimes shops and restaurants on the first floor. Thousands of units are coming online. But I still expect rents and housing prices to increase next year. They would have increased even more if we hadn't built that housing, but the backlog is decades deep and demand is also still increasing.
  - panick21_ 4y ago
    So no improvements should ever be made because they weren't made in the past? What kind of strange way of thinking is that. You can't time travel back to the 50s and recreate the situation then. I generally agree with your comment overall however. If you want to solve the housing crisis you need to reverse the bad policy and add good policy. Land value tax is one such policy. There are many other, changing in regulation for housing, changes in land use policy, like minimal parking requirements, changes in urban design, changes in transport priorities, the list goes on. Some of the most beautiful and most admired parts of old cities like Boston are all illegal to build now. Policy has mostly made it impossible to build the kind of places people travel to other arts of the world to experience.
    - alxmng 4y ago
      I don’t follow. A property tax is passed to renters. A land value tax would presumably increase the property tax, not lower it. Why would a tax increase on rentals lower rents?
      - twiceaday 4y ago
        The tax wouldn't affect all properties equally. It would punish undeveloped / under-developed land much more. Those owners could try to pass it on to the renter, if there is one, but the renter can move to better developed land that would be able to provide lower rents. The theory is that this would encourage the owner to develop the land into more units or sell it to someone else who will be under the same pressure.
        twblalock 4y ago
        The motivation to develop land and rent it out for more money is already firmly established simply by the laws of supply and demand. Anyone who is sitting on a vacant lot in a city knows they could make more money with it if they could build something more desirable on it. They don't do it because we make it really hard to do that. Consider San Francisco, where it takes years just to get permission to build housing: https://www.sfchronicle.com/opinion/openforum/article/sf-housing-development-red-tape-17815725.php https://www.sfchronicle.com/opinion/openforum/article/sf-hou... San Francisco is an extreme example, but many other cities are bad about this too. With a land value tax we are basically telling landowners that they aren't allowed to build and also they will be taxed for not building. Stop hitting yourself! Stop hitting yourself! A land-value tax would be a lot more reasonable if we allowed people to do what the tax incentivizes them to do.
Swizec 4y ago
> it takes a lot of new housing to make a noticeable dent in rents Eh. My landlord is already stuck unable to raise rent because there are ~4 brand new mid-rise complexes within a 3 block radius. Why would I agree to their rent increase, if for that same price I can just move to a brand new managed property? So every year we negotiate and rent stays about sameish. Actually lower now than when we moved in pre-pandemic. This is in SF.
- Laaas 4y ago
  Why does your landlord not collude with the owners of the new complexes to raise rents together?
  - Swizec 4y ago
    > Why does your landlord not collude with the owners of the new complexes to raise rents together? I imagine the various property owners in an area see each other more as competition than buddies. Or even targeting different demographics. Why would owners of a big building collude with some rando who happens to own a place or two?
  - zamfi 4y ago
    Probably: A) illegal, and B) would have to be extremely widespread to not just serve to keep those units unrentable.
  - deleted 4y ago
    [deleted]
  - nordsieck 4y ago
    > Why does your landlord not collude with the owners of the new complexes to raise rents together? The more vacancies across the city, the more difficult collusion is.
  - BurningFrog 4y ago
    Collusion can work with 2, maybe 3 suppliers. More than that, and somebody always breaks the pact fairly soon.
ajross 4y ago
> In cities without a lot of demand pressure on housing, building new housing makes the older housing less attractive. This bit is only situationally true. It's true for infill development: the 2018 condo next door to a 1918 brownstone is likely going to sell for more. But generally "next door" doesn't happen. In fact in most large urban areas, the more central and accessible areas (SF, say) with (by definition) older housing stock are the most expensive. The new construction in Livermore or Concord is where the cheap housing is.

panick21_ 4y ago

Land value taxation is at least a way to hurt those more who have property that is not used well. Parking lots and other low value uses are hurt more.

twblalock 4y ago
Housing was affordable in the past without land value taxes. I don't see why those are needed now either. Supply and demand really does work for housing. We are just in a massive backlog on supply, which has built up over decades, and it will take decades to build our way out of it. During that time it will look like the new building isn't helping very much -- but that's because of how bad the backlog is. For example, in the San Jose area tons of new housing is being built, on unused shopping centers like Cambrian Plaza and former industrial areas like Santa Clara Square. It's dense housing for the area too -- 3-5 story apartment blocks with their own underground parking, sometimes shops and restaurants on the first floor. Thousands of units are coming online. But I still expect rents and housing prices to increase next year. They would have increased even more if we hadn't built that housing, but the backlog is decades deep and demand is also still increasing.
- panick21_ 4y ago
  So no improvements should ever be made because they weren't made in the past? What kind of strange way of thinking is that. You can't time travel back to the 50s and recreate the situation then. I generally agree with your comment overall however. If you want to solve the housing crisis you need to reverse the bad policy and add good policy. Land value tax is one such policy. There are many other, changing in regulation for housing, changes in land use policy, like minimal parking requirements, changes in urban design, changes in transport priorities, the list goes on. Some of the most beautiful and most admired parts of old cities like Boston are all illegal to build now. Policy has mostly made it impossible to build the kind of places people travel to other arts of the world to experience.
  - alxmng 4y ago
    I don’t follow. A property tax is passed to renters. A land value tax would presumably increase the property tax, not lower it. Why would a tax increase on rentals lower rents?
    - twiceaday 4y ago
      The tax wouldn't affect all properties equally. It would punish undeveloped / under-developed land much more. Those owners could try to pass it on to the renter, if there is one, but the renter can move to better developed land that would be able to provide lower rents. The theory is that this would encourage the owner to develop the land into more units or sell it to someone else who will be under the same pressure.
      - twblalock 4y ago
        The motivation to develop land and rent it out for more money is already firmly established simply by the laws of supply and demand. Anyone who is sitting on a vacant lot in a city knows they could make more money with it if they could build something more desirable on it. They don't do it because we make it really hard to do that. Consider San Francisco, where it takes years just to get permission to build housing: https://www.sfchronicle.com/opinion/openforum/article/sf-housing-development-red-tape-17815725.php https://www.sfchronicle.com/opinion/openforum/article/sf-hou... San Francisco is an extreme example, but many other cities are bad about this too. With a land value tax we are basically telling landowners that they aren't allowed to build and also they will be taxed for not building. Stop hitting yourself! Stop hitting yourself! A land-value tax would be a lot more reasonable if we allowed people to do what the tax incentivizes them to do.

Swizec 4y ago

> it takes a lot of new housing to make a noticeable dent in rents Eh. My landlord is already stuck unable to raise rent because there are ~4 brand new mid-rise complexes within a 3 block radius. Why would I agree to their rent increase, if for that same price I can just move to a brand new managed property? So every year we negotiate and rent stays about sameish. Actually lower now than when we moved in pre-pandemic. This is in SF.

Laaas 4y ago
Why does your landlord not collude with the owners of the new complexes to raise rents together?
- Swizec 4y ago
  > Why does your landlord not collude with the owners of the new complexes to raise rents together? I imagine the various property owners in an area see each other more as competition than buddies. Or even targeting different demographics. Why would owners of a big building collude with some rando who happens to own a place or two?
- zamfi 4y ago
  Probably: A) illegal, and B) would have to be extremely widespread to not just serve to keep those units unrentable.
- deleted 4y ago
  [deleted]
- nordsieck 4y ago
  > Why does your landlord not collude with the owners of the new complexes to raise rents together? The more vacancies across the city, the more difficult collusion is.
- BurningFrog 4y ago
  Collusion can work with 2, maybe 3 suppliers. More than that, and somebody always breaks the pact fairly soon.

ajross 4y ago

> In cities without a lot of demand pressure on housing, building new housing makes the older housing less attractive. This bit is only situationally true. It's true for infill development: the 2018 condo next door to a 1918 brownstone is likely going to sell for more. But generally "next door" doesn't happen. In fact in most large urban areas, the more central and accessible areas (SF, say) with (by definition) older housing stock are the most expensive. The new construction in Livermore or Concord is where the cheap housing is.