4 ms·

I have an external garage building that I'd love to turn into a small ADU, but it's not allowed in my area. Additionally, if you look at historical cheap renta

I have an external garage building that I'd love to turn into a small ADU, but it's not allowed in my area. Additionally, if you look at historical cheap rentals of the past, you see things like tenement buildings, which were arguably horrible, but provided a cheap alternate to homelessness. You can also see examples of what low rent places look like today in Asian countries, such as Hong Kong tiny apartments. Many of those types of residences are not allowed by local government policies. An actual $500 a month rental is going to be really tiny, might have a shared bathroom and kitchen with other units. And these are all things that are often disallowed by government policies.

cogman10 3y ago
In 2010, I had a $600/month rental with a kitchen, living room, bedroom, bathroom, in apartment washing machine/dryer and a fairly large walk-in closet. With 13 years of inflation, that'd be $850/month. That apartment now goes for over $1200/month (Almost certainly hasn't been renovated). [1] The issue is oligopolies. Few large businesses that own the majority of available rentals and thus can set prices to whatever they like to rake in the profits. And the way you can tell it's not government policy driving up prices is this trend has been seen across states. There's no federal zoning laws, so why would everywhere from California to Idaho see the same drastic spikes in home prices? Why are existing units that have existed since at least 2010 (and I believe back to 2005) commanding $400 premiums over what inflation would dictate? Do you think back in 2010 they were losing money renting to me? [1] https://www.camdenliving.com/apartments/irving-tx/camden-valley-park/available-apartments/cypress-floor-plan?unit=1019&floor=5 https://www.camdenliving.com/apartments/irving-tx/camden-val...
- carom 3y ago
  It is government policy. Specifically, it is restrictive zoning. Landlords do not get to set prices to whatever they want, they set prices to what the market will pay. If rent has gone up faster than inflation it just means that demand has increased or supply has decreased in that time. You can build apartments for ~$250 per sqft. The issue is that local governments make it really hard to build more apartments. If you disagree I implore you to go get a construction loan, build some housing, and rent it out.
  - Draiken 3y ago
    Isn't that what lobbying is all about? You effectively have companies paying politicians to keep these zoning laws that keep the rents as high as possible. Profit above all else. Arguments that boil down to "government policy" can basically be translated to "big companies policies". Whether it's through illegal or legal bribing (lobbying), it's what we see after decades of influence.
    - ushtaritk421 3y ago
      It’s big companies but it’s also (mostly?) the nice retired insurance agents and school teachers who like their quiet neighborhood and the fact that the house they bought 30 years ago can be sold for 4x its inflation-adjusted purchase price when they’re ready.
      - Draiken 3y ago
        100% agreed. Our individualism and own greed are also a great contributing factor. After-all we ultimately elect those politicians and also have to profit similar to a company (hopefully not at all costs though).
      - jjav 3y ago
        > It’s big companies but it’s also (mostly?) the nice retired insurance agents and school teachers Those retired agents and teachers have exactly zero influence on local and state politicians. Those big companies who host fund raising dinners at the CEOs mansions and contribute millions? Yes, a lot of influence. To the point where we've seen plenty legislative bills which turn out to be just cut & paste from what some corporate sponsor wrote.
        AnthonyMouse 3y ago
        You're talking about national politics or state-level politics in big states like California. The mayor of a random town with 50,000 people is not getting a million dollars donated to their campaign by anybody. It is actually the local voters who decide who governs the town. But when residency in the town requires you to own a house, the existing residents vote for people who make housing prices go up.
- doubled112 3y ago
  Seems to be happening all over. These are South Western Ontario (yes, Canadian bucks) numbers. The 2 bedroom apartment I rented in college (ended around 2013/2014) was $719/mo. It is now $1699/mo. It wasn't exactly in a nice area, either. Recently the news caught a story about somebody's drug dealer setting off fireworks in his apartment, which I suppose is pretty exciting if not in the worst ways.
- cipheredStones 3y ago
  > The issue is oligopolies. Few large businesses that own the majority of available rentals and thus can set prices to whatever they like to rake in the profits. Even if it's true that a few large businesses own most rentals, that kind of oligopolistic behavior should be undercut by new people entering the market by building more apartments - unless there's a big barrier to entry, like the difficulty in building things when there's restrictive zoning! > There's no federal zoning laws, so why would everywhere from California to Idaho see the same drastic spikes in home prices? The incentives that produce NIMBYs - wanting to keep supply low so that housing prices stay high, and not wanting to deal with any of the annoyances of increased density - are the same everywhere. > Why are existing units that have existed since at least 2010 (and I believe back to 2005) commanding $400 premiums over what inflation would dictate? Do you think back in 2010 they were losing money renting to me? No, but now there are more people who want to live there and they haven't built enough housing to keep up, so the bidding is more intense.
  - fzeroracer 3y ago
    > Even if it's true that a few large businesses own most rentals, that kind of oligopolistic behavior should be undercut by new people entering the market by building more apartments - unless there's a big barrier to entry, like the difficulty in building things when there's restrictive zoning! You're missing the forest for the trees here. The 'new people' entering the market sell the apartments and buildings they create to the big businesses in question. I've lived in apartments for my entire life, eventually they all get acquired by Greystar. Even the smaller ones.
    - AnthonyMouse 3y ago
      Either these companies have an unlimited amount of money and the construction companies should thereby hire everyone in the city to build ever more housing so they can make an unlimited amount of money, or they have a finite amount of money and the construction companies will eventually have taken all of it and yet still be able to build more housing after that.
- oceanplexian 3y ago
  Inflation isn't a single number that applies to all goods and services. The price of inputs to residential construction have practically doubled since 2018, nevermind 2010 (https://www.nahb.org/blog/2022/05/building-materials-up-more-than-19-percent-year-over-year https://www.nahb.org/blog/2022/05/building-materials-up-more...). If it costs twice as much to build a residential structure as it did 10 years ago, then rent will cost twice as much. There's no conspiracy, it's not Blackrock buying up all the houses, it's not the greedy politicians. It's caused by government spending beyond its means, expansion of the monetary supply, and the increased regulations that create more risk for investors and causes prices to go up.
  - AnthonyMouse 3y ago
    The price of inputs went up because of COVID supply chain issues and higher demand for inputs. There are all indications of the high prices being temporary and they're already starting to go back down.
deleted 3y ago
[deleted]

cogman10 3y ago

In 2010, I had a $600/month rental with a kitchen, living room, bedroom, bathroom, in apartment washing machine/dryer and a fairly large walk-in closet. With 13 years of inflation, that'd be $850/month. That apartment now goes for over $1200/month (Almost certainly hasn't been renovated). [1] The issue is oligopolies. Few large businesses that own the majority of available rentals and thus can set prices to whatever they like to rake in the profits. And the way you can tell it's not government policy driving up prices is this trend has been seen across states. There's no federal zoning laws, so why would everywhere from California to Idaho see the same drastic spikes in home prices? Why are existing units that have existed since at least 2010 (and I believe back to 2005) commanding $400 premiums over what inflation would dictate? Do you think back in 2010 they were losing money renting to me? [1] https://www.camdenliving.com/apartments/irving-tx/camden-valley-park/available-apartments/cypress-floor-plan?unit=1019&floor=5 https://www.camdenliving.com/apartments/irving-tx/camden-val...

carom 3y ago
It is government policy. Specifically, it is restrictive zoning. Landlords do not get to set prices to whatever they want, they set prices to what the market will pay. If rent has gone up faster than inflation it just means that demand has increased or supply has decreased in that time. You can build apartments for ~$250 per sqft. The issue is that local governments make it really hard to build more apartments. If you disagree I implore you to go get a construction loan, build some housing, and rent it out.
- Draiken 3y ago
  Isn't that what lobbying is all about? You effectively have companies paying politicians to keep these zoning laws that keep the rents as high as possible. Profit above all else. Arguments that boil down to "government policy" can basically be translated to "big companies policies". Whether it's through illegal or legal bribing (lobbying), it's what we see after decades of influence.
  - ushtaritk421 3y ago
    It’s big companies but it’s also (mostly?) the nice retired insurance agents and school teachers who like their quiet neighborhood and the fact that the house they bought 30 years ago can be sold for 4x its inflation-adjusted purchase price when they’re ready.
    - Draiken 3y ago
      100% agreed. Our individualism and own greed are also a great contributing factor. After-all we ultimately elect those politicians and also have to profit similar to a company (hopefully not at all costs though).
    - jjav 3y ago
      > It’s big companies but it’s also (mostly?) the nice retired insurance agents and school teachers Those retired agents and teachers have exactly zero influence on local and state politicians. Those big companies who host fund raising dinners at the CEOs mansions and contribute millions? Yes, a lot of influence. To the point where we've seen plenty legislative bills which turn out to be just cut & paste from what some corporate sponsor wrote.
      - AnthonyMouse 3y ago
        You're talking about national politics or state-level politics in big states like California. The mayor of a random town with 50,000 people is not getting a million dollars donated to their campaign by anybody. It is actually the local voters who decide who governs the town. But when residency in the town requires you to own a house, the existing residents vote for people who make housing prices go up.
doubled112 3y ago
Seems to be happening all over. These are South Western Ontario (yes, Canadian bucks) numbers. The 2 bedroom apartment I rented in college (ended around 2013/2014) was $719/mo. It is now $1699/mo. It wasn't exactly in a nice area, either. Recently the news caught a story about somebody's drug dealer setting off fireworks in his apartment, which I suppose is pretty exciting if not in the worst ways.
cipheredStones 3y ago
> The issue is oligopolies. Few large businesses that own the majority of available rentals and thus can set prices to whatever they like to rake in the profits. Even if it's true that a few large businesses own most rentals, that kind of oligopolistic behavior should be undercut by new people entering the market by building more apartments - unless there's a big barrier to entry, like the difficulty in building things when there's restrictive zoning! > There's no federal zoning laws, so why would everywhere from California to Idaho see the same drastic spikes in home prices? The incentives that produce NIMBYs - wanting to keep supply low so that housing prices stay high, and not wanting to deal with any of the annoyances of increased density - are the same everywhere. > Why are existing units that have existed since at least 2010 (and I believe back to 2005) commanding $400 premiums over what inflation would dictate? Do you think back in 2010 they were losing money renting to me? No, but now there are more people who want to live there and they haven't built enough housing to keep up, so the bidding is more intense.
- fzeroracer 3y ago
  > Even if it's true that a few large businesses own most rentals, that kind of oligopolistic behavior should be undercut by new people entering the market by building more apartments - unless there's a big barrier to entry, like the difficulty in building things when there's restrictive zoning! You're missing the forest for the trees here. The 'new people' entering the market sell the apartments and buildings they create to the big businesses in question. I've lived in apartments for my entire life, eventually they all get acquired by Greystar. Even the smaller ones.
  - AnthonyMouse 3y ago
    Either these companies have an unlimited amount of money and the construction companies should thereby hire everyone in the city to build ever more housing so they can make an unlimited amount of money, or they have a finite amount of money and the construction companies will eventually have taken all of it and yet still be able to build more housing after that.
oceanplexian 3y ago
Inflation isn't a single number that applies to all goods and services. The price of inputs to residential construction have practically doubled since 2018, nevermind 2010 (https://www.nahb.org/blog/2022/05/building-materials-up-more-than-19-percent-year-over-year https://www.nahb.org/blog/2022/05/building-materials-up-more...). If it costs twice as much to build a residential structure as it did 10 years ago, then rent will cost twice as much. There's no conspiracy, it's not Blackrock buying up all the houses, it's not the greedy politicians. It's caused by government spending beyond its means, expansion of the monetary supply, and the increased regulations that create more risk for investors and causes prices to go up.
- AnthonyMouse 3y ago
  The price of inputs went up because of COVID supply chain issues and higher demand for inputs. There are all indications of the high prices being temporary and they're already starting to go back down.

deleted 3y ago

[deleted]