5 ms·

The overall idea is pretty good, but I take issue the image that shows the $1M plot turning into $2.5M by building small homes. This makes sense in a vacuum (m

The overall idea is pretty good, but I take issue the image that shows the $1M plot turning into $2.5M by building small homes. This makes sense in a vacuum (maybe) but in reality, the areas that get subdivided like this will become less valuable with each new division. There needs to be a feedback mechanism that prevents every lot from being turned into a bunch of micro-lots in a race to do what the image depicts before the area loses value.

Maken 2y ago
Isn't homes becoming more affordable an intended side effect of this legislation?
- Workaccount2 2y ago
  Yes, but you want a system that can dial in a level of affordability rather than a "rapidly multiply every home in an area by four" race to the bottom. I don't know the specifics of the bill, but if it's a 2.5x investment cheat code for the fastest actors, it's going to cause mayhem and hard backlash.
  - bryanlarsen 2y ago
    If by "rapidly" you mean "over several decades". That's the scale at which neighborhoods turn over.
    - Workaccount2 2y ago
      By "rapidly" I mean on the span of a few years. If your neighbor subdivides their lot, the smartest thing for you to do is subdivide yours (after all, it will turn your $1M into $2.5M, no?). It will have a domino effect because the last house in the neighborhood full of subdivisions will have the lowest sale value (and the first house to subdivide will be the most valuable). The intent is good but the system needs a moderating factor to prevent runaway.
      - meragrin_ 2y ago
        > after all, it will turn your $1M into $2.5M, no? Um, no. The graphic intends to show money spent by all parties on housing. The original party pays $1M and receives $300k for the plots of land. The subplot parties then spend $500k to build houses. There is nothing magically turning a $1M home into multiple homes without additional capital.
        TheCoelacanth 2y ago
        Exactly. This probably makes the land somewhat more valuable, but nothing close to 2.5x.
      - thaumasiotes 2y ago
        Why do we want to prevent runaway? You're worried that houses will be too affordable?
        michaelmrose 2y ago
        Yes. Homeowners of different political stripes are united in their unabashed desire to prevent the building of housing in order to maximize their own home's value. Rather than an outright attack on their fellow citizens, which it is, this is always phrased as protecting the value of their investment as if the outsized growth if the real estate sector was something their family earned rather than the result of piss poor policy.
      - cco 2y ago
        Just to be clear, your concern here is the destruction of wealth for middle and lower class homeowners?
      - Gerardo1 2y ago
        If the capacity existed to build residential properties at that scale (much less at a price that wasn't absurd), there wouldn't be a need for this bill.
      - achierius 2y ago
  - meragrin_ 2y ago
    > if it's a 2.5x investment cheat code for the fastest actors It isn't a 2.5x investment cheat code. You're spending $1M for the original home. You're spending $500k on the construction of each new home. That's $2.5M invested. They would need to sell each house for more than $1.5M each for a "2.5x investment cheat code". If the original house cost $1M, how are they going to sell 4 houses with less land at a higher asking price? Even if they somehow managed that, do you honestly think sellers in the area aren't going to catch on?
  - crooked-v 2y ago
    Most US cities are literally decades behind on the home supply. x4 isn't a race to the bottom, it's barely getting started.
  - pjc50 2y ago
    The constraint you're looking for is construction labour availability. You can't get millions of houses overnight.
deleted 2y ago
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barryrandall 2y ago
How many of these would it take to drive down property values in a neighborhood?
- Workaccount2 2y ago
  How much more would you pay for a house with 1 or 2 neighbors instead of 4 or 8 neighbors? There is your answer.
  - tptacek 2y ago
    That's what North Dakota is for.
    - wglb 2y ago
      The number might be smaller. If you take the Empire Builder from Chicago towards the northwest, one of the trains goes through North Dakota at night. Every farm in the area has one of those mercury vapor lights in the yard, which are visible for tens of miles. If you sit in the scenic car then, you will see one of those farmstead perhaps every hour. It is very not populated.
      - tptacek 2y ago
        If you're worried about how many neighbors you have, it sounds idyllic.
        wglb 2y ago
        Well, if you fall ill, then you might decide that you have too few neighbors.
        tptacek 2y ago
        I agree! I think density is good, which is why I live in an urban area. What I don't get are the other people who live in urban areas who want them to be more like North Dakota.
meragrin_ 2y ago
I think you missed the actual point of the graphic. It is to point out that the laws enable cheaper housing. Instead of people having to pay $1M for a single home, you're enabling 4 homes at $700k or less each.
- deleted 2y ago
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mr3martinis 2y ago
That’s absolutely not true. Higher population density almost always increases land values and it certainly would increase the total value of the land that was subdivided.
awongh 2y ago
Except that this is California, where real estate prices are crazy. And not just recently, prices have continually been getting less and less affordable for 40 years. There could be macroeconomic forces that affect that estimate, but in Berkeley in the historical context of home prices it makes perfect sense.
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shitpostbot 2y ago
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michaelmrose 2y ago
The goal of housing is not to grow or even maintain the wealth of the people who live there it is to to house people. If it should come about that A given neighborhood triple's in population and everyone's house is worth half as much I should count it as a success.
kelnos 2y ago
Not sure I agree. The extent of the increase is certainly up for debate, but in a place like California where we have a housing affordability crisis, packing more housing units onto the same lot absolutely increases the value of the lot as a whole. Now, certainly each individual house will be worth less than a single house on the lot would be. But the value of the lot+improvements will likely go up quite a lot. Also consider that the value of the lot, unimproved, doesn't just magically go up once you get approval to build your friend compound. To get that $1M -> $2.5M increase in value, you probably have to invest a cool million into building the rest of the homes.
CalRobert 2y ago
Why? More, cheaper homes is a good thing
alistairSH 2y ago
Do you have a source for this? From what I've seen with infill in my area (Reston, VA, outside DC)... infill might slow the appreciation of adjacent property, but rarely/never hurts it. Surrounding property (>1 parcel away, give or take) generally increases in value, because along with the infill housing comes more amenities (commercial/retail redevelopment). And for the property that was "infilled", the per unit price might be slightly lower, but the value of the entire property has gone up. Say the land cost $1 million, got split into 4 parcels, and each is now worth $275,000 (fabricated numbers). EDIT - this isn't quite apples to apples, since we don't have the same rules as CA - we just have a massive amount of infill development happening along approved "density" corridors.

Maken 2y ago

Isn't homes becoming more affordable an intended side effect of this legislation?

Workaccount2 2y ago
Yes, but you want a system that can dial in a level of affordability rather than a "rapidly multiply every home in an area by four" race to the bottom. I don't know the specifics of the bill, but if it's a 2.5x investment cheat code for the fastest actors, it's going to cause mayhem and hard backlash.
- bryanlarsen 2y ago
  If by "rapidly" you mean "over several decades". That's the scale at which neighborhoods turn over.
  - Workaccount2 2y ago
    By "rapidly" I mean on the span of a few years. If your neighbor subdivides their lot, the smartest thing for you to do is subdivide yours (after all, it will turn your $1M into $2.5M, no?). It will have a domino effect because the last house in the neighborhood full of subdivisions will have the lowest sale value (and the first house to subdivide will be the most valuable). The intent is good but the system needs a moderating factor to prevent runaway.
    - meragrin_ 2y ago
      > after all, it will turn your $1M into $2.5M, no? Um, no. The graphic intends to show money spent by all parties on housing. The original party pays $1M and receives $300k for the plots of land. The subplot parties then spend $500k to build houses. There is nothing magically turning a $1M home into multiple homes without additional capital.
      - TheCoelacanth 2y ago
        Exactly. This probably makes the land somewhat more valuable, but nothing close to 2.5x.
    - thaumasiotes 2y ago
      Why do we want to prevent runaway? You're worried that houses will be too affordable?
      - michaelmrose 2y ago
        Yes. Homeowners of different political stripes are united in their unabashed desire to prevent the building of housing in order to maximize their own home's value. Rather than an outright attack on their fellow citizens, which it is, this is always phrased as protecting the value of their investment as if the outsized growth if the real estate sector was something their family earned rather than the result of piss poor policy.
    - cco 2y ago
      Just to be clear, your concern here is the destruction of wealth for middle and lower class homeowners?
    - Gerardo1 2y ago
      If the capacity existed to build residential properties at that scale (much less at a price that wasn't absurd), there wouldn't be a need for this bill.
    - achierius 2y ago
- meragrin_ 2y ago
  > if it's a 2.5x investment cheat code for the fastest actors It isn't a 2.5x investment cheat code. You're spending $1M for the original home. You're spending $500k on the construction of each new home. That's $2.5M invested. They would need to sell each house for more than $1.5M each for a "2.5x investment cheat code". If the original house cost $1M, how are they going to sell 4 houses with less land at a higher asking price? Even if they somehow managed that, do you honestly think sellers in the area aren't going to catch on?
- crooked-v 2y ago
  Most US cities are literally decades behind on the home supply. x4 isn't a race to the bottom, it's barely getting started.
- pjc50 2y ago
  The constraint you're looking for is construction labour availability. You can't get millions of houses overnight.

deleted 2y ago

[deleted]

barryrandall 2y ago

How many of these would it take to drive down property values in a neighborhood?

Workaccount2 2y ago
How much more would you pay for a house with 1 or 2 neighbors instead of 4 or 8 neighbors? There is your answer.
- tptacek 2y ago
  That's what North Dakota is for.
  - wglb 2y ago
    The number might be smaller. If you take the Empire Builder from Chicago towards the northwest, one of the trains goes through North Dakota at night. Every farm in the area has one of those mercury vapor lights in the yard, which are visible for tens of miles. If you sit in the scenic car then, you will see one of those farmstead perhaps every hour. It is very not populated.
    - tptacek 2y ago
      If you're worried about how many neighbors you have, it sounds idyllic.
      - wglb 2y ago
        Well, if you fall ill, then you might decide that you have too few neighbors.
        tptacek 2y ago
        I agree! I think density is good, which is why I live in an urban area. What I don't get are the other people who live in urban areas who want them to be more like North Dakota.

meragrin_ 2y ago

I think you missed the actual point of the graphic. It is to point out that the laws enable cheaper housing. Instead of people having to pay $1M for a single home, you're enabling 4 homes at $700k or less each.

deleted 2y ago
[deleted]

mr3martinis 2y ago

That’s absolutely not true. Higher population density almost always increases land values and it certainly would increase the total value of the land that was subdivided.

awongh 2y ago

Except that this is California, where real estate prices are crazy. And not just recently, prices have continually been getting less and less affordable for 40 years. There could be macroeconomic forces that affect that estimate, but in Berkeley in the historical context of home prices it makes perfect sense.

deleted 2y ago

[deleted]

shitpostbot 2y ago

[dead]

michaelmrose 2y ago

The goal of housing is not to grow or even maintain the wealth of the people who live there it is to to house people. If it should come about that A given neighborhood triple's in population and everyone's house is worth half as much I should count it as a success.

kelnos 2y ago

Not sure I agree. The extent of the increase is certainly up for debate, but in a place like California where we have a housing affordability crisis, packing more housing units onto the same lot absolutely increases the value of the lot as a whole. Now, certainly each individual house will be worth less than a single house on the lot would be. But the value of the lot+improvements will likely go up quite a lot. Also consider that the value of the lot, unimproved, doesn't just magically go up once you get approval to build your friend compound. To get that $1M -> $2.5M increase in value, you probably have to invest a cool million into building the rest of the homes.

CalRobert 2y ago

Why? More, cheaper homes is a good thing

alistairSH 2y ago

Do you have a source for this? From what I've seen with infill in my area (Reston, VA, outside DC)... infill might slow the appreciation of adjacent property, but rarely/never hurts it. Surrounding property (>1 parcel away, give or take) generally increases in value, because along with the infill housing comes more amenities (commercial/retail redevelopment). And for the property that was "infilled", the per unit price might be slightly lower, but the value of the entire property has gone up. Say the land cost $1 million, got split into 4 parcels, and each is now worth $275,000 (fabricated numbers). EDIT - this isn't quite apples to apples, since we don't have the same rules as CA - we just have a massive amount of infill development happening along approved "density" corridors.