As long as it's nearly impossible to create housing, there will be a reasonable need for rent controls. Otherwise, there is a huge benefit to artificially reducing housing supply in order to drive up prices. At least, with rent control, one is protected from supply based price manipulation over time.
If we truly live in a free market when the market demand will drive housing creation, then it all just magically works, but when you have impossible to understand planning codes and nearly every housing development requires a legislative action to get approved, you have to have something on the other side balancing things out.
Post by High Priestess on May 21, 2017 14:38:29 GMT
This is an interesting NYT article about how, due to the increased costs of housing, there is a move towards renting of rooms as opposed to renting of whole apartments. The article points out how boarding and rooming houses were more common in the past....and thus there is the suggestion that they should become common again, to meet the needs for lower cost housing.
In many ways, matchmaking brokers are reinventing a once popular, expansive housing concept in the city. “Boarding, lodging and rooming houses stretch back to the very founding of the country,” said Alex Armlovich, a fellow at the Manhattan Institute, a policy research group.
Not only was renting by the room common, it also was not isolated to the low end of the market. There were middle-income and even some very high-end residential hotels, both transient and longer term. The Barbizon Hotel for Women, on East 63rd Street, for example, received landmark status largely because of residents who went on to become household names, including Grace Kelly, Liza Minnelli and Joan Didion. At the end of World War II, rooms-for-rent hit a peak with about 200,000 available units.
When he was underwriting the project, the economics worked. But now, Tao said construction costs have increased a whopping 50 percent in the past five years — which he attributes largely to the worker shortage driving up wages for skilled labor — and now he can’t turn enough of a profit on the SoMa building. So he’s shelving it until conditions improve, and that means fewer options for the 500 to 600 people who could have lived in the new building.
Tao says he’s not the only one with this problem. “There’s probably a few thousand housing units in the San Francisco area, Oakland, that can’t be built because construction costs are too high,” he said.
The construction worker shortage, along with lengthy permitting procedures, complex building codes and strict environmental rules, is contributing significantly to rising construction costs that have made San Francisco the world’s second most expensive city to build in, according to a new report from UC Berkeley’s Terner Center for Housing Innovation. Fewer experienced workers also means today’s labor pool is less skilled than 10 years ago, resulting in decreased productivity, more reported mistakes and higher insurance and litigation premiums as developers use new subcontractors, the report’s authors said.
It’s not a problem that’s unique to the Bay Area. In a recent study by the National Association of Home Builders, 82 percent of builders surveyed said the cost and availability of labor was a significant problem last year — up from 13 percent in 2011.
California’s construction workers are some of the best paid in the nation, according to 2016 data from the U.S. Bureau of Labor Statistics. Workers earned around $50,200 in the South Bay and $52,200 in the East Bay. But that’s still not enough for many to afford homes in the Bay Area, and that’s driven some out of the industry, said Ben Field, executive officer of the South Bay AFL-CIO Labor Council. It didn’t help that after the housing bubble burst in 2008, droves of workers fled the trade and never returned.
“An awful lot of guys retired from the industry, and young people aren’t interested in doing this type of work,” said David Lorber, the owner of Superior Bay Builders, a remodeling company. “Nobody is replacing them, and nobody cares.”
When factoring in inflation, wages for blue-collar construction workers in California have declined almost 25 percent since 1990, according to a 2017 study by pro-labor non-profit Smart Cities Prevail.
This article has info on legal issues related to Airbnb renting in Massachusetts, and in it, you can find bald evidence of one of the most common types of discrimination in housing...discrimination so entrenched that it is literally written into city laws in many locales.
Note under "Licensing and REgistration Requirements", this bit about blood relationships which I think is clear evidence of major discrimination going on in housing laws....the bias towards nuclear families (and in opposition to intentional communities, groups of unrelated adults living together) is actually written into city law in many places:
The Licensing Board for the City of Boston requires a lodging house license if lodgings are rented to four or more persons not within the second degree of kindred to the person conducting the lodging.
Post by High Priestess on Dec 13, 2018 17:29:07 GMT
This news pertains both to short term rentals, and to housing in general. As many are aware, the "housing crisis" which is effecting so many areas of the country, is often used to scapegoat Airbnb and short term rentals. Activists claim that Airbnb causes "units to be taken off the market", precious units, apparently, such that each individual one has to be protected from being able to be used as their owner sees fit.
But some people have the capacity to see the larger picture, and realize that the housing crisis and dearth of housing, or of affordable housing, has not been caused entirely by Airbnb.
ANd they realize that other things need to be addressed in order to fix this problem.
In Minneapolis, a bold new vision -- end single family zoning.
Portland and SEattle are also changing single family zoning to add multiunit buildings.
I'm not sure if that's a great solution for every city or every neighborhood, but the term itself --"single family" should be questioned and revealed for the discriminatory term that it is. Many cities have explicit statutes forbidding more than X number of unrelated adults living together -- eg, a bias in favor of "single families", or nuclear families, is codified in law.
My concern is more with this bias and its impact on a single household, than with limiting neighborhoods to single-unit residences. However, I think allowing duplexes and triplexes in traditionally single family home zones can also be helpful - However, I don't like this part of this political move:
“We’ve tried very hard to work with the city to say, ‘Let’s find a rational approach to this,’” she said. “And instead, what the city has basically done is say, ‘If you’re not for this plan, you’re a racist and an elitist.’”
Calling people racist (or elitist) because they disagree with you is an abusive and highly illogical argument and it's got to stop.
HOw does this relate to short term rentals?
Well, I think that it would weaken one of the arguments some communities use to oppose allowing short term rentals in their neighborhood, namely, that doing so would "destroy the neighborhood character" and result in more people coming and going. Changing zoning will do that too. The future of the bigger cities in particular may be in allowing more kinds of housing and in general having more open and flexible policies, rather than rigid policies, regarding use of property.
Helps explain why government regulations and the permit process is much more to blame for housing crises, than Airbnb
A man spent $1.2 million and 4 years trying desperately to add housing to San Francisco, which desperately needs housing. But the city turned him down, because the building would cast a partial shadow on an adjacent schoolyard.