Post by High Priestess on Oct 19, 2018 15:00:02 GMT
Voters in California are facing a vote on whether to repeal the "Costa-Hawkins" law, which would result in a potential expansion of rent control throughout the state. Currently, rent control is limited to buildings built before 1995 and cannot apply to single family homes, as mandated by the Costa-Hawkins law. Overturning the law would eliminate those limitations.
NYT article on the matter:
www.nytimes.com/2018/10/12/business/economy/california-rent-control-tenants.html
Interesting Comments:
Todd
Key West,flOct. 13
It's funny that for all the claims of people of the right being science deniers the left still supports rent control. There is little in this world that economists across the political spectrum agree on, except rent control is a bad idea and creates unintended consequences including less new construction of housing. The perfect panacea, a law someone else pays for, too bad it doesn't work that way.
NYT article on the matter:
www.nytimes.com/2018/10/12/business/economy/california-rent-control-tenants.html
Interesting Comments:
joel bergsman
King Canute may or may not have tried to halt a rising tide by commanding it to stop. Today we have rent control which is just about as effective.
The US faces a three-way "can't get there from here:" Given our concept of what minimally decent housing is, the cost of providing it, and the unequal distribution of income, it is not possible to provide minimally decent housing to poor people. The solutions MUST lie in some combination of lowering our standards, reducing their costs, and/or raising the income of the poor or giving them subsidies.
Note that rent control does none of these, and to make things worse it has been found, time and time again, to reduce the supply of the lower end of housing services. No wonder that "economists" are against it -- anyone with any sense should be on that side.
This problem is really a Gordian knot. I can't describe any way to really fix it that would work, politically socially and technically, in the USA today. Hence the false hope of rent control -- which just makes it worse.
King Canute may or may not have tried to halt a rising tide by commanding it to stop. Today we have rent control which is just about as effective.
The US faces a three-way "can't get there from here:" Given our concept of what minimally decent housing is, the cost of providing it, and the unequal distribution of income, it is not possible to provide minimally decent housing to poor people. The solutions MUST lie in some combination of lowering our standards, reducing their costs, and/or raising the income of the poor or giving them subsidies.
Note that rent control does none of these, and to make things worse it has been found, time and time again, to reduce the supply of the lower end of housing services. No wonder that "economists" are against it -- anyone with any sense should be on that side.
This problem is really a Gordian knot. I can't describe any way to really fix it that would work, politically socially and technically, in the USA today. Hence the false hope of rent control -- which just makes it worse.
zhen
Simplistic solutions to complex problems with end in tears.
Our society has a complex social problem: large group of people can not earn enough to afford housing. There are many dynamic drivers to this problem: demand for labor at the low end of education scale, inefficiencies in regulation and construction put in place by politically powerful tradesman groups and civil service unions to protect their interests, large underlying macroeconomic trends and many others.
Treating this complex problem as simply a real estate issue will end badly. Most likely outcome: housing shortage, entrenched dependency translating into political corruption. This happened in the northeast with its rent control regimes, it will happen in California - if it follows the same path.
Simplistic solutions to complex problems with end in tears.
Our society has a complex social problem: large group of people can not earn enough to afford housing. There are many dynamic drivers to this problem: demand for labor at the low end of education scale, inefficiencies in regulation and construction put in place by politically powerful tradesman groups and civil service unions to protect their interests, large underlying macroeconomic trends and many others.
Treating this complex problem as simply a real estate issue will end badly. Most likely outcome: housing shortage, entrenched dependency translating into political corruption. This happened in the northeast with its rent control regimes, it will happen in California - if it follows the same path.
Todd
Key West,flOct. 13
It's funny that for all the claims of people of the right being science deniers the left still supports rent control. There is little in this world that economists across the political spectrum agree on, except rent control is a bad idea and creates unintended consequences including less new construction of housing. The perfect panacea, a law someone else pays for, too bad it doesn't work that way.
Economy Biscuits
Okay Corral, aka AmericaOct. 13
My 40 y/o son and his girlfriend live in central San Diego in a tiny 1-bed for $1600-/mo. He considers himself extremely lucky to have found this place. He can walk to work in 10 minutes. I'm retired and have owned my house free and clear for 10 years. It is worth maybe $300K, and is in a very desirable suburban neighborhood . I would love to live in San Diego too but view it as way beyond my means, and I'm a long way from poor. I freeze here in the upper Midwest for 6 mos of the year but the cost of living is relatively cheap. Where is it written that everyone who wants to live in CA gets to live there, even if they can't afford it? I know of a woman in SFO who lives in a rent controlled apt and regularly rents the place out on Air-BnB. Somehow this seems unfair to the landlord just based on common sense. Maybe people who can't afford CA should live somewhere else.
1 REPLY
Jim T.
AustinOct. 13
@economy Biscuits As a former San Franciscan of many years, I know people personally who are living in large, well located long term (20+ years) rent controlled apartments in the city, who are renting out rooms on a vacation and monthly basis, earning more than the monthly rent they pay. Rent control forces the landlord to subsidize the rent to the tune of thousands of dollars per month, while the tenant profits off this sweet deal. Also, rent control mystifies because it creates a favored class, i.e. people who have lived in an apt. for many years get to pay $800/month for a high quality location while many young newcomers, those who bring vibrancy and creativity to the city, double up in rooms in horrible apartments and pay $5k or more per month. Many don't last long and leave. It would seem to go against everything that those who are concerned about income inequality care about. Many of the long term rent controlled tenants seem to lead dull lives as well because for decades they've been been afraid of change if it means losing a rent controlled apartment.
Okay Corral, aka AmericaOct. 13
My 40 y/o son and his girlfriend live in central San Diego in a tiny 1-bed for $1600-/mo. He considers himself extremely lucky to have found this place. He can walk to work in 10 minutes. I'm retired and have owned my house free and clear for 10 years. It is worth maybe $300K, and is in a very desirable suburban neighborhood . I would love to live in San Diego too but view it as way beyond my means, and I'm a long way from poor. I freeze here in the upper Midwest for 6 mos of the year but the cost of living is relatively cheap. Where is it written that everyone who wants to live in CA gets to live there, even if they can't afford it? I know of a woman in SFO who lives in a rent controlled apt and regularly rents the place out on Air-BnB. Somehow this seems unfair to the landlord just based on common sense. Maybe people who can't afford CA should live somewhere else.
1 REPLY
Jim T.
AustinOct. 13
@economy Biscuits As a former San Franciscan of many years, I know people personally who are living in large, well located long term (20+ years) rent controlled apartments in the city, who are renting out rooms on a vacation and monthly basis, earning more than the monthly rent they pay. Rent control forces the landlord to subsidize the rent to the tune of thousands of dollars per month, while the tenant profits off this sweet deal. Also, rent control mystifies because it creates a favored class, i.e. people who have lived in an apt. for many years get to pay $800/month for a high quality location while many young newcomers, those who bring vibrancy and creativity to the city, double up in rooms in horrible apartments and pay $5k or more per month. Many don't last long and leave. It would seem to go against everything that those who are concerned about income inequality care about. Many of the long term rent controlled tenants seem to lead dull lives as well because for decades they've been been afraid of change if it means losing a rent controlled apartment.
Common Sense
New York, NYOct. 12
Rent control is unfair; it picks winners and losers. The winners are anyone who is lucky enough to get a rent-controlled apartment. The losers are everyone else who is renting or will rent in the future. If you guarantee me a rent-controlled apartment/house, I will vote in favor of Proposition 10. If not, I would be foolish to vote yes since I would pay the price for someone else winning the housing lottery.
New York, NYOct. 12
Rent control is unfair; it picks winners and losers. The winners are anyone who is lucky enough to get a rent-controlled apartment. The losers are everyone else who is renting or will rent in the future. If you guarantee me a rent-controlled apartment/house, I will vote in favor of Proposition 10. If not, I would be foolish to vote yes since I would pay the price for someone else winning the housing lottery.