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>The existing problem is that multi-family dwellings are illegal in many high demand areas This is technically correct but the areas mentioned are the size of

>The existing problem is that multi-family dwellings are illegal in many high demand areas This is technically correct but the areas mentioned are the size of a block or a subdivision so it's hardly the limiting factor. You can build high rise apartments in any big city and multi-family anywhere. The reason prices on housing go up is that it costs a lot to build housing and it's pretty hard to secure financing for a housing project which you plan to sell/rent below cost. It's combined code compliance, materials, labor, and financing. If it costs $300 to build a square foot just in the labor and materials then it comes up at $150K for a tiny 500 sqf 1br and you'd need to rent that for more than $2000 per month to break even on the commercial loan you took. Throw in maintenance, lapses in occupancy and some profit and you are looking at close to $3K for a 500 sqf 1br. Unless it's on Manhattan or on an ocean beach somewhere, it's going to be very hard to find tenants. It appears that America had ran up its credit card to the limit. Mass produced goods from China are still cheap but the hoses are just expensive, can't ship those in containers from Shenzhen. Playing with zoning is rearranging chairs on the deck of Titanic, it's not going to lower the cost of construction. And yes, adding more housing would lower the price but the problem is that adding housing is held up by the cost mostly and the developers only want to build in very limited prestigious areas where they hope to get tenants/buyers willing to pay their cost. It's not sustainable.

AnthonyMouse 3y ago
> You can build high rise apartments in any big city and multi-family anywhere. You can't build them except in the places they already are. Converting existing high density housing to even higher density housing is prohibitively expensive. What you need to do is go to the edge of the high density area where it meets the low density area and convert the low density housing to high density. But that area is only zoned for low density, so you can't. > The reason prices on housing go up is that it costs a lot to build housing and it's pretty hard to secure financing for a housing project which you plan to sell/rent below cost. Who is requiring them to sell below cost? Just build more housing at the market rate as long as the market rate is above your construction costs. If you want a lower market rate, find a way to lower construction costs. > If it costs $300 to build a square foot But what causes that?
- pandaman 3y ago
  >You can't build them except in the places they already are. I.e. in all big cities? So are you really arguing that the rent in SF goes up because you cannot build a residential tower in Redding, CA? > Converting existing high density housing to even higher density housing is prohibitively expensive. You don't need to convert. You can change zoning on existing lots, it happens all the time. >Just build more housing at the market rate as long as the market rate is above your construction costs. But it is not in most places. This is why developers are trying to get into prestigious areas where it's still possible. Nobody prevents you from building a residential tower in the East LA, you just won't be able to sell it. But yes, nobody will let you to build one in Malibu, where you'd be able to move units. The issue is that as soon as you filled Malibu with commie blocks the area won't be prestigious anymore so somebody will be left holding the bag, developers are desperate enough to enter this game anyways. > If it costs $300 to build a square foot Just read the message, I've explained what.

AnthonyMouse 3y ago

> You can build high rise apartments in any big city and multi-family anywhere. You can't build them except in the places they already are. Converting existing high density housing to even higher density housing is prohibitively expensive. What you need to do is go to the edge of the high density area where it meets the low density area and convert the low density housing to high density. But that area is only zoned for low density, so you can't. > The reason prices on housing go up is that it costs a lot to build housing and it's pretty hard to secure financing for a housing project which you plan to sell/rent below cost. Who is requiring them to sell below cost? Just build more housing at the market rate as long as the market rate is above your construction costs. If you want a lower market rate, find a way to lower construction costs. > If it costs $300 to build a square foot But what causes that?

pandaman 3y ago
>You can't build them except in the places they already are. I.e. in all big cities? So are you really arguing that the rent in SF goes up because you cannot build a residential tower in Redding, CA? > Converting existing high density housing to even higher density housing is prohibitively expensive. You don't need to convert. You can change zoning on existing lots, it happens all the time. >Just build more housing at the market rate as long as the market rate is above your construction costs. But it is not in most places. This is why developers are trying to get into prestigious areas where it's still possible. Nobody prevents you from building a residential tower in the East LA, you just won't be able to sell it. But yes, nobody will let you to build one in Malibu, where you'd be able to move units. The issue is that as soon as you filled Malibu with commie blocks the area won't be prestigious anymore so somebody will be left holding the bag, developers are desperate enough to enter this game anyways. > If it costs $300 to build a square foot Just read the message, I've explained what.