Very sensible and balanced piece but I really would not undersell the power of just MOAR! homes.
I live in a very unusual suburb of London (Croydon) which is architecturally regarded as a bit of an eyesore and is not fashionable. Unlike almost anywhere else in London where NIMByism is seriously powerful, its allowed *rampant* building of high-density private housing. It's not intended for foreign oligarchs, though plenty are owned by investors abroad. The housing is primarily spec'd for the middle class. The development I live in (one of the nicest) has 1.5 million-dollar penthouses, not 15 million-dollar penthouses. This makes it a really interesting experiment compared to the rest of the capital.
In the 5 years I've lived in my building, my rent has increased about 6% (and in the 7 years I've been living here before that, its been similarly slow to grow). This is below general inflation & WAY below the average increase in rents in far more sub-standard housing elsewhere. The picture is the same for others: its not rent controlled or anything.
The endless pipeline of new properties for rent is keeping it *relatively* really quite cheap. Obviously its only one area, but given its unusual levels of building relative to demand... it really has worked pretty well: not just for home buyers.
That being said, clearly more explicitly social house construction would be great. It would also take more renters out of the private system anyway, of course!
Thank you for using the luxury tower analogy. Every time this gets discussed everyone assumes the NIMBY’s are all about keeping out poor people. And as you point out it’s often about keeping out rich(er) people.
I’ve discussion where people think gentrification is about poor people moving in. Um…it’s the complete opposite.
IIRC retraining is almost useless for laid off factory workers. I also seem to recall surveys that showed that a substantial percentage of those workers never found work subsequently that allowed them to reacquire their old economic status. Far more common was 30 hours a week of landscaping and Uber.
So in keeping with the bifurcated economy analogy isn't the issue that luxury apartments cater to a completely different socioeconomic strata than cheap inner city housing? When you talk about expanding the supply the question is the supply for who? Isn't it possible that $3000 1BR apartments help keep rents low for coders and doctors but have no effect on the single mother with two kids who can only afford $1100 a month?
Transitions matter a lot. Unfortunately, advocates and policy makers look at, and compare, the end points, before and after. If there is improvement, they tend to neglect what happens in between. This is not just for housing and automation, of course.
There is a related, and long recognized, problem in welfare economics. A change is said to be welfare improving if society as a whole is better off after the change. But that does not account for the many individuals who are worse off. Economists have tried to solve this by having the winners compensate the losers. But in real life, although compensation may be promised, it is almost never implemented.
I'm not sure I understand the point about new luxury housing raising average rents.
Is it that having an expensive apartment building down the street from me actually raises my rent because second-order effects of some kind overwhelm the impact of increased supply, or is it just that it raises the average rent in the neighborhood in the sense that rich people raise the average income in the neighborhood without actually affecting my own income?
If it's the first, that seems relevant, but if it's the second, I don't see how that supports the point.
I'm a totally unconflicted NIMBY, as is anyone who lives in a high traffic, high real estate prices area. I don't want more people, and it's really too fucking bad if people drive 3 hours to get to work because they can't afford to live in the area. My response is get a job closer to home and if that doesn't pay as well, then driving 3 hours is your choice and sing me no sad songs.
And here's an important point: if an area is too expensive for a family of four making $150K to afford a home, then spending a single penny on low income housing is a case of go fuck yourself or join the other fools who came in with you. Give housing to the people who are contributing *less* to the tax base while the people who are paying a lot in taxes have to struggle to make the rent? Oh, and by the way, it won't bring rent prices down any time soon but traffic and education and medical are busy right away? Fuck that.
Ultimately, the way to fix housing issues is for the workers to refuse to work in expensive areas and relocate and if they choose not to do that then again, sing me no sad fucking songs. They've made their choice and it works for them. Don't bigfoot housing supply against the will of the people in that community.
A Yimby position for *all* backyards does indeed address this issue. A big reason why poorer areas are "gentrified" more often has less to do with the economics of building in that area and more to do with the fact that oftentimes those are the only areas that are allowed to build. Restrictive zoning laws preclude building greater density in richer neighborhoods. If more housing was allowed in more neighborhoods, rather than just restricted to poorer areas, the problem of rapid changes would be more diffuse and easier to handle.
Beyond that, the activist/progressive side of this discussion - the one that worries about gentrification in poorer neighborhoods - is also often pro immigration. Often pro open borders. You can't complain about rapidly changing neighborhoods and also advocate for large scale immigration. People have to live somewhere if they move to a new place!
"I dearly wish that there was more of an acknowledgment of the time-lag problem within YIMBY politics. Yes, building more housing does bring down housing prices in a neighborhood, eventually." Okay, acknowledged. But so what? We've been doing nothing for 40 years. It's also possible to have more immediate, acute buildings, if we manage to disassemble the "no" processes and veto players that dominate almost every city.
Thank you! I’m also thinking about a pattern I see a lot here, where those who are more well off can afford to frame the problem in terms of future abstractions, and those who are at risk now must prioritize their survival and the maintenance of their lives. All of these impasses hide when we use huge umbrella terms like “pro affordable housing” and neglect to talk about for whom, when, and where.
What I see as the single most important housing problem is corporations buying up more and more of the available supply of private housing and converting it to rental properties. Individuals simply cannot compete against the moneyed interests and at some point everyone becomes a renter with a significant adverse impact on our economy and (in my opinion) our democracy.
I agree that there needs to be help for housing costs now, but I am skeptical that new public housing or rent controls are preferable to expansion of Section 8 housing vouchers -- "housing is a human right" sounds overly vacuous to me, but I see no reason why SNAP should be an entitlement but Section 8 has a multiyear waiting list -- uncap Section 8 (could be funded by eliminating the mortgage interest deduction) and it will not only provide subsidies to those who need it but help provide a market for the development of lower cost rental housing without the state building and managing it (which does not have the best track record, and seems to engender the most NIMBY opposition).
Part of what makes this discussion (in the United States) so difficult is the insane overreliance on the personal automobile for all transportation needs.
The difference is that automation causes dislocation / job loss relative to the status quo. Building more luxury towers doesn't change a given individuals situation relative to the status quo! It might not help them right away but it doesn't actively cause dislocation the same way that automation actively causes job loss.
What IS true is that people associate the two in their mind since desirable neighborhoods that people are getting priced out of are the same neighborhoods that developers want to build condos in. But the only way the two are related is that they're both caused by the neighborhood being desirable.
Another problem with new housing is the emergence of homeowners associations and deed restricted neighborhoods. Ostensibly even "owners" pay a rental fee to corporate entities, and they are subjected to the will of the neighborhood's most active busybodies.
I have been looking for a house for 2 years and had "No HOA" as a rule. I wish I knew the specific stats on how much that limits me in the Raleigh-Durham area, but it feels strongly like well over half of the housing here -- and nearly 100 percent of new housing -- is just glorified renting. Not exactly the agency and autonomy I wanted for a living space.
Even the idea that new housing is going to eventually stabilize rents is counterintuitive to many people feeling forced out of their neighborhoods. I have heard, here in downtown Oakland, so many times, some variation of "they're putting in a new fancy apartment complex and all the rich people are going to force us out." They don't see the new apartments as an increase in the local housing supply; they see it as an omen that soon their coffee is going to cost $5.95 a cup and their parking spots will be turned into e-bike stands.
Very sensible and balanced piece but I really would not undersell the power of just MOAR! homes.
I live in a very unusual suburb of London (Croydon) which is architecturally regarded as a bit of an eyesore and is not fashionable. Unlike almost anywhere else in London where NIMByism is seriously powerful, its allowed *rampant* building of high-density private housing. It's not intended for foreign oligarchs, though plenty are owned by investors abroad. The housing is primarily spec'd for the middle class. The development I live in (one of the nicest) has 1.5 million-dollar penthouses, not 15 million-dollar penthouses. This makes it a really interesting experiment compared to the rest of the capital.
In the 5 years I've lived in my building, my rent has increased about 6% (and in the 7 years I've been living here before that, its been similarly slow to grow). This is below general inflation & WAY below the average increase in rents in far more sub-standard housing elsewhere. The picture is the same for others: its not rent controlled or anything.
The endless pipeline of new properties for rent is keeping it *relatively* really quite cheap. Obviously its only one area, but given its unusual levels of building relative to demand... it really has worked pretty well: not just for home buyers.
That being said, clearly more explicitly social house construction would be great. It would also take more renters out of the private system anyway, of course!
Thank you for using the luxury tower analogy. Every time this gets discussed everyone assumes the NIMBY’s are all about keeping out poor people. And as you point out it’s often about keeping out rich(er) people.
I’ve discussion where people think gentrification is about poor people moving in. Um…it’s the complete opposite.
IIRC retraining is almost useless for laid off factory workers. I also seem to recall surveys that showed that a substantial percentage of those workers never found work subsequently that allowed them to reacquire their old economic status. Far more common was 30 hours a week of landscaping and Uber.
So in keeping with the bifurcated economy analogy isn't the issue that luxury apartments cater to a completely different socioeconomic strata than cheap inner city housing? When you talk about expanding the supply the question is the supply for who? Isn't it possible that $3000 1BR apartments help keep rents low for coders and doctors but have no effect on the single mother with two kids who can only afford $1100 a month?
Thank you for this.
Transitions matter a lot. Unfortunately, advocates and policy makers look at, and compare, the end points, before and after. If there is improvement, they tend to neglect what happens in between. This is not just for housing and automation, of course.
There is a related, and long recognized, problem in welfare economics. A change is said to be welfare improving if society as a whole is better off after the change. But that does not account for the many individuals who are worse off. Economists have tried to solve this by having the winners compensate the losers. But in real life, although compensation may be promised, it is almost never implemented.
I'm not sure I understand the point about new luxury housing raising average rents.
Is it that having an expensive apartment building down the street from me actually raises my rent because second-order effects of some kind overwhelm the impact of increased supply, or is it just that it raises the average rent in the neighborhood in the sense that rich people raise the average income in the neighborhood without actually affecting my own income?
If it's the first, that seems relevant, but if it's the second, I don't see how that supports the point.
I'm a totally unconflicted NIMBY, as is anyone who lives in a high traffic, high real estate prices area. I don't want more people, and it's really too fucking bad if people drive 3 hours to get to work because they can't afford to live in the area. My response is get a job closer to home and if that doesn't pay as well, then driving 3 hours is your choice and sing me no sad songs.
And here's an important point: if an area is too expensive for a family of four making $150K to afford a home, then spending a single penny on low income housing is a case of go fuck yourself or join the other fools who came in with you. Give housing to the people who are contributing *less* to the tax base while the people who are paying a lot in taxes have to struggle to make the rent? Oh, and by the way, it won't bring rent prices down any time soon but traffic and education and medical are busy right away? Fuck that.
Ultimately, the way to fix housing issues is for the workers to refuse to work in expensive areas and relocate and if they choose not to do that then again, sing me no sad fucking songs. They've made their choice and it works for them. Don't bigfoot housing supply against the will of the people in that community.
A Yimby position for *all* backyards does indeed address this issue. A big reason why poorer areas are "gentrified" more often has less to do with the economics of building in that area and more to do with the fact that oftentimes those are the only areas that are allowed to build. Restrictive zoning laws preclude building greater density in richer neighborhoods. If more housing was allowed in more neighborhoods, rather than just restricted to poorer areas, the problem of rapid changes would be more diffuse and easier to handle.
Beyond that, the activist/progressive side of this discussion - the one that worries about gentrification in poorer neighborhoods - is also often pro immigration. Often pro open borders. You can't complain about rapidly changing neighborhoods and also advocate for large scale immigration. People have to live somewhere if they move to a new place!
"I dearly wish that there was more of an acknowledgment of the time-lag problem within YIMBY politics. Yes, building more housing does bring down housing prices in a neighborhood, eventually." Okay, acknowledged. But so what? We've been doing nothing for 40 years. It's also possible to have more immediate, acute buildings, if we manage to disassemble the "no" processes and veto players that dominate almost every city.
It is possible to build fast: https://sf.curbed.com/2018/8/6/17656118/fast-apartment-residential-building-berkeley-patrick-kennedy-prefab. We choose not to make it happen. So there's less of a distinction between short- and long-term than you imply.
Thank you! I’m also thinking about a pattern I see a lot here, where those who are more well off can afford to frame the problem in terms of future abstractions, and those who are at risk now must prioritize their survival and the maintenance of their lives. All of these impasses hide when we use huge umbrella terms like “pro affordable housing” and neglect to talk about for whom, when, and where.
What I see as the single most important housing problem is corporations buying up more and more of the available supply of private housing and converting it to rental properties. Individuals simply cannot compete against the moneyed interests and at some point everyone becomes a renter with a significant adverse impact on our economy and (in my opinion) our democracy.
I agree that there needs to be help for housing costs now, but I am skeptical that new public housing or rent controls are preferable to expansion of Section 8 housing vouchers -- "housing is a human right" sounds overly vacuous to me, but I see no reason why SNAP should be an entitlement but Section 8 has a multiyear waiting list -- uncap Section 8 (could be funded by eliminating the mortgage interest deduction) and it will not only provide subsidies to those who need it but help provide a market for the development of lower cost rental housing without the state building and managing it (which does not have the best track record, and seems to engender the most NIMBY opposition).
Part of what makes this discussion (in the United States) so difficult is the insane overreliance on the personal automobile for all transportation needs.
The difference is that automation causes dislocation / job loss relative to the status quo. Building more luxury towers doesn't change a given individuals situation relative to the status quo! It might not help them right away but it doesn't actively cause dislocation the same way that automation actively causes job loss.
What IS true is that people associate the two in their mind since desirable neighborhoods that people are getting priced out of are the same neighborhoods that developers want to build condos in. But the only way the two are related is that they're both caused by the neighborhood being desirable.
Another problem with new housing is the emergence of homeowners associations and deed restricted neighborhoods. Ostensibly even "owners" pay a rental fee to corporate entities, and they are subjected to the will of the neighborhood's most active busybodies.
I have been looking for a house for 2 years and had "No HOA" as a rule. I wish I knew the specific stats on how much that limits me in the Raleigh-Durham area, but it feels strongly like well over half of the housing here -- and nearly 100 percent of new housing -- is just glorified renting. Not exactly the agency and autonomy I wanted for a living space.
Even the idea that new housing is going to eventually stabilize rents is counterintuitive to many people feeling forced out of their neighborhoods. I have heard, here in downtown Oakland, so many times, some variation of "they're putting in a new fancy apartment complex and all the rich people are going to force us out." They don't see the new apartments as an increase in the local housing supply; they see it as an omen that soon their coffee is going to cost $5.95 a cup and their parking spots will be turned into e-bike stands.