
If You Can’t Afford the Rent, It’s My Problem, Too - jseliger
https://www.bloomberg.com/opinion/articles/2019-03-26/if-you-can-t-afford-the-rent-it-s-my-problem-too
======
captainbland
This article makes some interesting points, but I do find it strange that they
reference George without referencing his famous idea of a land value tax in
this context, a proposal which would at the very least put a sizeable dent in
the ability of landlords to directly benefit from the increase in value of
their land resulting from municipal service improvements while also
encouraging better use of property in general.

Rent controls could be another alleviating factor. As could indirect
competition from subsidised/social housing.

I'm not really comfortable with how the article attempts to frame municipal
social improvements as something which must implicitly also drive wealth
inequality, despite the other potential remedies to this.

~~~
Symmetry
Rent control is good for the people who already have housing who don't see
their rents go up, but it's bad for people who might want to move to an area.
It's very much a "pull up the ladder behind you" sort of policy and in the
case that the article addresses it will tend to weaken coalitions in favor of
reducing housing prices for new home buyers/renters and will tend throw
currently homeless people under the bus.

~~~
throwawaysea
Why is it important to accommodate people who might want to move to an area?
Does everyone have the right to live anywhere they want to live without having
to pay the necessary price to be there? For example, does everyone have a
right to expect a residence on a Hawaii beachfront? And if not, why is it
reasonable to portray a city as somehow lacking because it serves existing
constituents above new ones?

~~~
mochomocha
In San Francisco the return on land is so much higher than the return on work.
There's no scenario under which this leads to a healthy society. NIMBY
excesses created a modern feudalism. Why would the new hard-working generation
subsidize the previous one and suffer taxes order of magnitude higher than the
previous one (through property tax for example)? This is like a Ponzi scheme.
There's nothing fair nor sustainable with this model. That's when in a
properly working society you would have the State or Government take over and
override the local policies to implement what's good for the greater good. Not
what's good for the SF boomer wanting to sell his shack for 2M and retire in
Florida. A couple of billionaires in Atherton should have no say on Caltrain
improvements that could benefit millions of working people at the expense of a
couple of trees in their backyards.

~~~
ModernMech
I realized this when my landlord came home with a brand new Mercedes SL one
day, and I was still taking the N to work despite having a 6 figure tech
salary. I was basically subsidizing his car payment. I worked at a 6 person
startup that received a few million in funding, and between our personal rents
and the rent of our office, probably around 40% of that investor money went
into the pockets of landlords. If our startup was somewhere cheaper, yeah we
wouldn't have raised $X million, but we wouldn't have needed that much just to
exist.

~~~
rootusrootus
Sounds like the solution is to become a landlord ;-)

~~~
asdff
Right after I get approved for my small loan of one million dollars to buy a
2br bungalow that will turn to dust the next earthquake.

------
sokoloff
FTA> Consider an increase in the quality of public services — say, garbage
collection, or perhaps in San Francisco the elimination of public urination.
... Why exactly would non-landowners press for improvements in their cities?
The value of those improvements will be captured mainly by other parties.

Gee, I don't know. Maybe I don't want to live a city that reeks of urine and
has garbage all over the place...even if the effect of that is that more
people want to come live here as well.

~~~
jfnixon
Then don't live in a city that reeks of urine and has garbage all over the
place. Cities are ancient relics of a time when human beings had to have their
atoms in the presence of each other to communicate rapidly. Don't live in one
unless it has the quality of life you can accept. If you keep supporting sub-
par cities, they'll never improve.

~~~
SketchySeaBeast
> Cities are ancient relics of a time when human beings had to have their
> atoms in the presence of each other to communicate rapidly.

You're forgetting the transfer of material possessions and wealth, safety, and
employment. It's great that you've found a way to work remote, but that's the
not the reality for the majority of people. I also wonder whether 5 million
people living in less than a thousand square kilometers is more or less
wasteful than 5 million spread out over a billion square kilometers. You'd
have to spend a lot more to transfer all the goods everywhere, as well as
moving people around.

~~~
jakeinspace
Earth's surface area is half a billion square kilometers.

~~~
SketchySeaBeast
Sorry, I was wrong in my orders of magnitude. 100,000 square km then?

------
crazygringo
This article contains an central economic fallacy.

> _Take the example of San Francisco; with nicer streets, even more people
> might want to move there. That would push up rents by an amount roughly
> equal to the value created — putting the gains from the higher quality of
> life into the pockets of landowners. ... The political economy problem now
> should be obvious: Why exactly would non-landowners press for improvements
> in their cities? The value of those improvements will be captured mainly by
> other parties._

This is equivalent to saying, why would anyone want a Starbucks to open in
their neighborhood when the value of the Starbucks is captured mainly by
Starbucks shareholders? (Assume, for the sake of example, you like Starbucks,
otherwise replace with whatever you like.)

The answer, obviously, is that enough people find it to be a beneficial trade
for both parties: people _want_ to spend more money for better coffee. That's
the invisible hand of the market that improves the sum of things.

Similarly, gentrification is about people _wanting_ to pay higher rent to live
in a nicer neighborhood. Yes the landlords get more money... but the tenant
gets the nicer neighborhood! (Or closer access to more jobs, or whatever.)
That's the _whole point_. That's free trade.

The author tries to claim that "residents just won’t care enough about the
quality of life in their city." That couldn't be more wrong. On top of it, the
author literally contradicts themself with the earlier line "with nicer
streets, even more people might want to move there". You can't have it both
ways, sheesh...

~~~
cf141q5325
>Similarly, gentrification is about people wanting to pay higher rent to live
in a nicer neighborhood.

Not the same people though. The quote from the article holds true for tenants
who cant afford higher rents. Gentrification is generally a processes of
displacement. There the old saying, that graffiti tags keep the rent low holds
true.

~~~
crazygringo
Well of course. But that's just how the economy works.

Workers whose skills are no longer needed get let go and have to retrain to
more productive skills. People who live in a neighborhood that gets too nice
for them to afford wind up moving to a neighborhood they can afford.

If you argue that neighborhoods shouldn't improve because rents will go up,
you're basically arguing against economic progress in general.

It's the same as saying a longer-lasting higher-quality product shouldn't be
released because it will cost more than the lower-quality one.

~~~
nepeckman
But the point of the article is to break down the economic incentives. If
you're personally disadvantaged by economic progress, you're incentivized to
oppose it. I'd argue there's significant empirical evidence of this throughout
history. The author posits that a large number of people in major cities are
incentivized in this way, and while I don't know what the numbers are, I'd
argue the theory is sound.

~~~
cataphract
I'm yet to see any resident going to council meetings complaining that the
streets are too clean, that public transportation is too good. I don't think
most people connect the two things, plus a good chunk of the residents are
property owners and would prefer the land value to go up. Finally, I also
doubt that the improvement of public services is the main factor driving land
prices up. For instance, here is Lisbon, it's mostly due to the foreigners
buying up the stock (more than half the buyers are foreigners). I suspect the
cause is similar in London.

~~~
lmm
> I'm yet to see any resident going to council meetings complaining that the
> streets are too clean, that public transportation is too good.

You'll see them complaining that rents are too high. And you'll see them
objecting that better public transportation would "change the character of the
neighbourhood" or whatever, which tends to be code for pushing up the rents.

> Finally, I also doubt that the improvement of public services is the main
> factor driving land prices up. For instance, here is Lisbon, it's mostly due
> to the foreigners buying up the stock (more than half the buyers are
> foreigners). I suspect the cause is similar in London.

No respectable economist agrees with you. Foreign investors are a bogeyman who
are easy to blame for everything since they're not there to defend themselves.

~~~
crazygringo
The main factor is neither public services nor foreign investors.

It's economic growth. With the exception of retirement communities, it's
locally-situated companies producing more value, hiring more employees, paying
them more, which results in those employees wanting nicer homes, nicer
neighborhoods and better public services. And why shouldn't they?

------
johnrob
I’m still waiting to hear a good explanation for why expensive housing is
desirable but expensive food/water is not.

~~~
dredmorbius
Housing (or rather, real estate) is an asset, a durable store of wealth.

Food and water are consumables.

Not durable, not wealth stores.

There's a great deal that hinges off real estate, especially in finance.

[https://web.archive.org/web/20190115035057/https://plus.goog...](https://web.archive.org/web/20190115035057/https://plus.google.com/104092656004159577193/posts/eDscpi6Kg7L)

(And no, I'm not saying that high housing prices are good, but explaining the
dynamic which drives them.)

~~~
johnrob
But there are certainly ways a subset of the population could profit from
increasing food prices too. The question is a moral one.

~~~
dredmorbius
The ultimate question to me is how the common weal benefits. A question for
which in part the problem is in not having a good measure. Certainly not GDP
or mean income, though measures of net happiness or well-being exist.

But individual advantage is a false measure.

~~~
johnrob
BTW - your link from above is great - thanks for posting.

~~~
dredmorbius
Thanks. Consider that highly speculative, though somewhat plausible.

------
yonran
This matches some of Greg Clark’s descriptions of a preindustrial Malthusian
economy in _A Farewell to Alms_ ([https://www.amazon.com/Farewell-Arms-Ernest-
Hemingway/dp/068...](https://www.amazon.com/Farewell-Arms-Ernest-
Hemingway/dp/0684801469) or see his lecture
[https://www.youtube.com/watch?v=uYJJlnyDpps](https://www.youtube.com/watch?v=uYJJlnyDpps)).
When the population is limited by scarce natural resources and the technology
to alleviate the scarcity does not exist (or is forbidden in the case of San
Francisco), then virtue is vice and vice is virtue. For example, disease
increases mortality, leading to increased average incomes, so he argues that
the dirty Europeans had higher average incomes than clean Japanese.

~~~
yonran
Oops. I linked to some other book with a similar name. This is the correct
book: [https://www.amazon.com/Farewell-Alms-Economic-History-
Prince...](https://www.amazon.com/Farewell-Alms-Economic-History-
Princeton/dp/0691141282)

------
Necromant2005
Rent control as any other control tend to more control. I may say unpopular
opinion, but if you can't afford to life in SF - f __k SF and the valley and
move to the place witch fits you more. Look at amount of angel investors in
the valley, their amount is decreasing year to year. People are leaving SF
/valley for a better places for better costs/proposition value. It's a general
economical factor. All those will eventually, led to describing
popularity/population of the area and decreasing rent as result. When a tech
giant will leave sunny California, all those NotInMyBackyard will be happy to
get a new block next to their place in order to get a job.

~~~
UncleMeat
If everybody who can't afford to live in the area moves then we won't have
people staffing grocery stores or cooking in restaurants or teaching
kindergarten.

~~~
daenz
Exactly, and allowing that ebb and flow of the market to work is a _good_
thing. As other people pointed out, it's not like there wouldn't be grocery
store staff and that's the end of it. The demand is still there. And when the
supply is low but the demand stays the same, the wages go up. All of these
things are connected and tend towards an equilibrium.

The thing that keeps things from flowing properly are artificial regulations.
For example, artificially low housing (like gov subsidized) in expensive areas
make it so low income people can work in high income places for low wages.
They can't afford to eat at the restaurants (or buy other higher income things
local to the area), but they can afford to work at them. The regulation is
artificially boosting supply to match demand so wages do not trend upwards.

~~~
goodpoint78
> As other people pointed out, it's not like there wouldn't be grocery store
> staff and that's the end of it. The demand is still there. And when the
> supply is low but the demand stays the same, the wages go up.

The reality is that this doesn't happen when it gets really bad. A few real-
world examples:

Nebraska had (as of December 2016) 11 counties without a lawyer[0].

In California, when immigrant labor started getting deported, celery farmers
kept increasing wages to attract new labor, and even after more than doubling
their wages, couldn't get enough people to pick all the celery.[1]

[0] [https://www.npr.org/2016/12/26/506971630/nebraska-and-
other-...](https://www.npr.org/2016/12/26/506971630/nebraska-and-other-states-
combat-rural-lawyer-shortage) [1]
[https://www.npr.org/2018/05/03/607996811/worker-shortage-
hur...](https://www.npr.org/2018/05/03/607996811/worker-shortage-hurts-
californias-agriculture-industry)

~~~
daenz
>Nebraska had (as of December 2016) 11 counties without a lawyer[0].

A court-appointed attorney is a constitutional right (6th amendment). The
government guarantees you will have the option of legal representation if
accused of a crime, and you can take it all the way to the Supreme Court if
you don't get that.

>In California, when immigrant labor started getting deported, celery farmers
kept increasing wages to attract new labor, and even after more than doubling
their wages, couldn't get enough people to pick all the celery.

Then wages weren't high enough. It really is that simple. And if the farmer
can't get anyone to buy the celery priced high enough to support the costs of
labor, then he shifts away from labor intensive crops, or outsources the
crops, which is exactly what the article says he did. This is a healthy
functioning market, responding to supply and demand pressures. And $$$ awaits
the man or woman who invents a cheaper way to harvest celery at lower labor
costs.

------
ramphastidae
The author’s main point seems to be that in a market dominated by landlords in
which rents are rising, cities do not have an incentive to improve public
services as any improvement in their quality will only benefit landlords
through further increases in housing prices.

Am I missing something, or wouldn’t higher tax revenues from growing property
values easily offset this issue in such a scenario?

~~~
lordalch
This is why California's property tax system, in which taxes don't increase
until a property is sold, is often cited as a major factor in its housing
dilemma.

~~~
timerol
To be pedantic, 1978 California Proposition 13 (Prop 13) limits property tax
increases to a max of 2% per year. In the decades since, especially in areas
with high growth, the overall tax being paid on property has become a tiny
percentage of the property value. This tax is reset to a reasonable rate when
significant construction or a sale happens.

~~~
georgeecollins
Can't stress often enough the problem that the unintended consequences of this
bill have caused. Most people that voted for it though it would just limit the
increase of property taxes on homes. They didn't realize it affected
warehouses, factories, etc. It's a mess that has to be changed.

~~~
mcguire
If I remember my government class, it was primarily backed by the owners of
multifamily rental property. While most single family houses at the time
changed hands every few years, apartment buildings were typically kept for
decades.

------
mixmastamyk
Am familiar with George, but hadn't put this together before:

> Why exactly would non-landowners press for improvements in their cities? The
> value of those improvements will be captured mainly by other parties.

Always wondered why some folks want the city to be as shitty as possible.
First compelling reason I've read.

~~~
rootusrootus
But does it really work that way? I.e. the effect may be real enough, but
among the non-landowners, who actually considers that the net effect of
improving the city would result in them personally paying more to live there?

~~~
mixmastamyk
See my cousin comment.

Many vocal folks online in the neighborhood, though don't know their numbers
are significant or not. (Measure S in Los Angeles was soundly defeated.) In
another neighborhood (East LA) new businesses were vandalized allegedly by
anti-gentrification groups.

------
cletus
> Why exactly would non-landowners press for improvements in their cities? The
> value of those improvements will be captured mainly by other parties.

Good example of this: residents in the Tenderloin (successfully) fought
planting of trees because of gentrification. I can't find the original source
but this [1] mentions the opposition.

Overall I found this article pretty shallow. For one it ignored recent history
where American cities were in decay up until the 1990s.

A core problem here is that homeowners gnerally consider rising prices to be
good. Thing is, it's only good if you cash out. Take Vancouver where a rundown
Victorian might cost you $4m+. You might have bought that for $175,000 in the
90s but that $4m won't help you move to another part of Vancouver (unless you
move much further out or move to something much smaller) because everything
else is just as expensive.

You definitely can't trade up to a nicer area or a bigger house either. Where
that gap might've been $50,000, it's now more likely $500k+.

Another problem not mentioned is Dutch Disease [2]. I'm firmly of the belief
that Australia is pretty much at this point. What people don't realize is that
when property prices go up so much this also affects commercial prices and
those higher prices are inputs into everything you buy. You still need
workers. They need more money. Again, that makes everything you buy more
expensive. It seems to converge on a point where there's very little economic
activity.

One reason I like NYC is that even though prices are generally high there are
options for lower-income people. Sure they might not be Manhattan below 96th
street (well, probably 125th at this point) but you can still leave much
cheaper in the outer boroughs. You'll note that the article said "Manhattan"
not "New York". That's not an accident.

Compare this to the Bay Area where all the nurses, firefighters, teachers, all
the tech company ancillary workers (bus drivers, cafeteria staff, security and
so on) are living 2+ hours away because that's all they can afford. Honestly,
the Bay Area is just one giant middle finger to the poor.

As for solutions, it's not rent control. It's not outlawing investment
properties either. People seem to forget that to rent a place to live someone
else needs to own it.

I actually think the Swiss have done the best of developed countries here. The
Swiss tax property speculation punitively (it may have changed but at one
point it was 100% capital gains tax if you owned for less than 2 years) and
made it somewhat more difficult to simply park money there in property.

That's a big problem in NYC, SF, LA, London, Sydney and the other major
developed cities: capital is now global so it goes and parks in the form of
real estate in major cities. That does absolutely nothing for the city.

Things I would be in favour of:

\- Higher property taxes for nonresidents

\- Higher property taxes for owners of unoccupied properties

\- Restrictions on foreign ownership of property

\- Owning property in NYC makes you a resident of NYC so all your income is
taxable by NYS and NYC

\- Higher capital gains on non-principal residences with a teiered structure
like the Swiss where the rate goes down the longer you hold it.

\- Withholding state and federal taxes on all rent earned that you can only
claim back against other US expenses.

[1] [https://www.sfexaminer.com/news/residents-seek-greener-
tende...](https://www.sfexaminer.com/news/residents-seek-greener-tenderloin-
despite-obstacles/)

[2]
[https://en.wikipedia.org/wiki/Dutch_disease](https://en.wikipedia.org/wiki/Dutch_disease)

~~~
tathougies
> \- Owning property in NYC makes you a resident of NYC so all your income is
> taxable by NYS and NYC

So what do you do when the 5% tax rate in the 20 cities in which you own
property all claim 100+% of youur income?

~~~
cletus
Same as you do now when you work in one state and live in another: pay taxes
in one. Get credit for those taxes in the others. Net effect: you pay the
highest of the tax rates.

This is a solved problem.

~~~
tathougies
If the end result is paying the highest tax rate, then you haven't actually
changed anything by your policy proposal.

~~~
cletus
Sure it is.

Tax is withheld at source and the only thing that offsets it other US taxes.
This is substantially better than current situation that allows transfer
pricing to move profits to a lower tax jurisdiction.

~~~
tathougies
Thanks for the explanation. That makes more sense.

------
major505
Don`t know about London or Ny, but I see people complain of high rents in SF
area, but they don`t want to fight stupid zoning laws that don`t allow the
construction of tall buildings, because it would "disfigure" the city.

I say, take the politics out, and let market decide what to do.

~~~
allengeorge
People do complain about high rents in NY and Toronto, but - and this is a big
one - homeowners vote consistently and so politicians listen to them.

I would _speculate_ that:

1\. renters are more transient, so are less invested in the community

2\. most people don’t make the connection between restrictive zoning policies
and rent prices

3\. It’s politically unpalatable to be shown as “against homeowners”,
especially given how much ownership is prized

~~~
mcguire
" _renters are more transient, so are less invested in the community_ "

This is the theory behind the US support for home ownership.

------
SubiculumCode
It may be a dream but I hope that a tech like Hyperloop could expand the range
of a reasonable commute much loke the introduction of the automobile did in
decades past. Being able to live in Utah but work in California would do
wonders.

------
zerogvt
Everywhere I look I see the same story unfolding and hurting the productive
parts of the economy (productive as opposed to rentier ones). Jobs move in a
place. Cost of living (largely dominated by rent) is reasonable. Workers move
in. Cost of living starts to rise and rises till the point where a lot of the
workers actually pay most of their income just to get by. Pockets of them
(e.g. married high earning couples and singles that are lucky to have a place)
still save a lot but the proportion of people that actually makes no sense to
live and work there any more is getting too high.

In my eyes this is a highjacking of the productive capitalism by the rentier
parts of it and it is demoralizing, unproductive (by definition) and
destructive. An apartment does not produce value. It is a mere necessity. The
people living there may produce value if they are allowed to. But sinking all
their energy and finance in just securing a roof over their head leaves less
and less for any productive risk taking.

Disclaimer: Living the renting/housing drama in Ireland.

~~~
leetcrew
I don't know exactly where people get this idea that landlords just sit on
their hands and collect money for doing nothing. maybe it's a result of the
"divergence of incentives" other posters have mentioned in highly regulated
markets.

where I live, mortgage payments are significantly less than typical rent for
comparable structures, but I am quite happy to pay my landlord the difference
for taking the cognitive load of caring for a house of my shoulders. anything
goes wrong with the house and I just shoot him an email and his guy fixes it
by the end of the week. when we came to see the house for the first time, he
was there with his guy scrubbing the floors on his hands and knees.

what I'm saying is, maybe an apartment doesn't _produce_ value, but it doesn't
maintain itself either.

------
smallgovt
Why does the author look at each city as a closed system?

If we improve one city's community and rents go up due to increased demand,
that necessarily means rents went down somewhere else in the US. So, net-net,
landowners didn't necessarily get richer.

Furthermore, when the non-upgraded city eventually decides to invest in
improving their neighborhood, people will move back, and the system as a whole
will equilibrate.

------
ilaksh
I work for a bootstrap startup and my solution for not being able to afford
the rent in California has been to just move to Mexico. So far it's been
working out great since I have actually been able to save a little bit of
money. Only problem is occasionally it smells bad and once every few months
the water doesn't work. Which is the problem I am dealing with today.

------
legitster
So much time oxygen is burned trying to get San Franciscans to change their
ways. Why don't businesses shop around for cities more? Make it in the city's
incentive to solve these problems? Why does San Francisco deserve a monopoly
on high paying tech jobs? It is pretty clear that nothing is getting done
because no one is worried about the big businesses moving away?

~~~
ghobs91
Outside of having top notch universities, the biggest indicator of a city's
ability to have a big tech industry is the size of the VC community.

VCs are largely already wealthy, and SF is a pleasant city to live in if
you're already wealthy. As such, they have little incentive to move, and so
founders will continue to flock there to start their companies.

I completely agree that shopping around for cities should be easier, so that
city governments like SF are forced to get their head out of their ass and
make their city competitive.

However, until SF becomes unpleasant to live in for rich people, not much is
going to change.

~~~
selectodude
There is nowhere on earth that can't be made pleasant to live if you have
enough money to do it. More to the point, I'm always confused how VCs actively
encourage pissing away their own money on somebody else's rent. Sure, spend
your own scratch on an $8 million 1000sqft half-lot house, but why not
actively encourage others to make your money go farther.

~~~
lotsofpulp
No amount of money can fix humidity, lack of sunshine, or lack of
mountains/ocean and the corresponding activities possible with them (or
whatever other natural feature one prefers). Saudi Arabia and UAE can spend
all of their natural resource wealth building shiny buildings, but it's still
a desert. Also, no one has the amount of wealth needed to stabilize a whole
country to make it politically stable and secure.

~~~
qaq
San Diego is pretty good and not that far :)

~~~
geggam
and that is why San Diego rents are heating up.

~~~
gusmd
Talk about heating up! My rent in Carmel Valley increased by 10% last month!

------
nautilus12
First things first. There are entire buildings in NY and SF just sitting empty
because foreign investors use it for money laundering and long term
investment. This HAS to be made illegal, people need these homes. I am even a
staunch libertarian and I think it should be regulated to buy homes and just
let them sit empty. Does anyone know of any movements in goverment or
elsewhere to combat this?

~~~
chairmanwow
This generates pressure, driving up prices by constricting housing supply
sure, but what is preventing SF from constructing lots and lots of new
buildings? If there is pressure to increase the amount of available housing,
then the government of SF has a Civic responsibility to create an environment
where the housing supply can increase. Full stop. Property speculation will
always take place.

~~~
nautilus12
Because...there is a housing shortage. The definition of a housing shortage is
that houses cannot be produced fast enough for people to consume them.
Assuming that the supply is what it is, if a large percentage of that supply
is being used for investment, then people can't live in them. You have to
assume that the economic machine is doing everything it can to increase the
supply because then those who benefiet from selling expensive house can _make
more money_....

------
robbyt
Can anybody explain to me why NIMBY is the common explanation for high rent in
SF, but in other cities with high rent have tons of development? There's tons
of development in NYC, London, but prices are higher than ever.

To me, NIMBY-hating seems to benefit the land developer far more than the
renter.

~~~
thereisnospork
Different cities different problems. Manhattan is expensive because its
covered in tall buildings (minus central park) and more or less 'full'. SF on
the other hand, and even more so the bay area in general, has massive amount
of open space (parking lots, land preserves, etc.) in addition to large
amounts of detached single family homes. Specifically in the bay area,
greasing the political and regulatory wheels is so onerous that upscaling
these homes and parking lots is expensive, so comparatively few dwellings are
built relative to demand (see: Manhattan-esque pricing at some fraction of the
density).

~~~
harryh
Manhattan is nowhere near full. There are huge swaths of the city that don't
have tall buildings due to overly restrictive building codes.
#UpzoneTheWestVillage

~~~
zjaffee
The west village isn't primed for tall buildings (they can certainly be taller
than they currently are) and is much denser than most people think it is,
since the brownstones are often multifamily. But more than anything else,
streets are much narrower there than other parts of Manhattan. I'd argue that
the east village is more adequate for upzoning than the west village even
though the east village is taller.

~~~
harryh
I agree with your EV vs WV comparison. I just like the highlight the WV
because it's such a rich person enclave with a community board that way way
overdesignates buildings as "historic" as a way to stifle development.

------
Causality1
Human beings did not evolve to live in a population density of sixty thousand
people per square mile. The fact urbanization is increasing even while larger
and larger chunks of the economy become location-agnostic as they move online
is insane.

~~~
harryh
Humans didn't wear manufactured clothing or have access to antibiotics for the
vast majority if our existence either.

Things change.

------
abalone
_> But San Francisco is a “not in my backyard” locale where the amount of new
construction just isn’t that high, for legal and regulatory reasons._

I’m so tired of hearing this. It’s not accurate. It’s a simplistic political
slogan that the YIMBY crowd keeps repeating and it’s time to correct it.

The SF Chronicle just ran a story on how multiple _approved_ residential
construction projects have stalled along the Van Ness corridor, right next to
a new hospital. The key reason? Multiple interviews with developers paint a
clear picture: Skyrocketing construction costs.[1]

[1] [https://www.sfchronicle.com/bayarea/article/Turns-out-SF-
s-b...](https://www.sfchronicle.com/bayarea/article/Turns-out-SF-s-big-new-
hospital-on-Van-Ness-13698405.php)

~~~
jplayer01
Hmmm, the article doesn't go into where the rising construction costs are
coming from and it seems incredibly dishonest not to address it. It could just
as well be that NIMBYism is leading to legal/regulatory issues which are
driving up construction costs. It could be something else entirely, but we
can't tell from the article and without that information, there's no way to
draw your conclusion that NIMBY isn't the problem.

~~~
abalone
Or it could be, you know, all the construction happening in the city. But who
knows! It’s probably NIMBYs somehow! Definitely not a massive influx of
techies in a boom economy, nope, definitely not anything to do with tech.

~~~
jplayer01
Well, that isn't constructive at all. I don't know why the construction costs
are suddenly so high. Do you? Or do you just think you know? Do you actually
care or do you just want to further your own views, despite any obvious bias?

------
apexalpha
A few days back there was an article here on HN on Amsterdam's plan to block
people from renting out homes that where previously occupied by the owners of
the building.

I commented [0]: "Good [...] A city of renters is a soulless city; less people
are long-term invested and no one really buys into the community they live in.
¨

And this article seems to agree with me on this point. One sentence in
particular captures my thought:

"The political economy problem now should be obvious: Why exactly would non-
landowners press for improvements in their cities? The value of those
improvements will be captured mainly by other parties."

This article has given me more and better arguments to formulate my stance on
this topic. Good post!

[0]
[https://news.ycombinator.com/item?id=19451013](https://news.ycombinator.com/item?id=19451013)

~~~
darksaints
The thesis behind this editorial is in direct contradiction to your idea. The
reason that people become apathetic is only tangentially related to
ownership...it is actually about incidence: who benefits from improvements in
public services? In a world where landowners successfully push for land
scarcity, all benefits of public services go to landowners, _regardless of
whether or not they are residents_ , pushing non-landowner residents to apathy
towards public service improvement.

If you don't restrict land uses, allowing everybody to live in the city
without being sucked dry by landowners' economic rents, then both renters
_and_ resident-owners will be pushing for public service improvements, while
the institutional or non-resident owners will be the ones apathetic towards
improvements. Renters don't make the city worse, concentrated economic
benefits going solely to landowners does that.

------
peterwwillis
The problem isn't the rent, it's that we're renting. Even if your economy is
strong, if the citizens don't have equity, market volatility puts them at
significant risk, which then puts your economy at risk. As more and more labor
is shifted to cities, more people have to move to cities, which puts more of
the economy in a dangerous position when the market can no longer support
those people.

I think we need to increase people's economic security by increasing home
equity, and stabilize the labor market to make it easier to get and keep a job
regardless of where they live. This will require other changes, such as
methods to encourage businesses to spread to neighboring cities, improvements
in transportation, and probably legislative reforms to de-incentivize
landowners' ability to destabilize markets.

------
jpdus
This is a huge problem.

Prices and rents are left to "the market", but construction is not at all.
Strong rent control should be introduced everywhere and ownership for
investment reasons should be massively discouraged (e.g. by strong taxation).
On the other hand protection of existing landlords should be reduced to
encourage new building. Rent seeking is damaging the economy and the society
and only privileged landlords benefit from current conditions.

Unfortunately most economists seem to be biased or are probably benefitting
themselves, thus there is no concentrated effort to push for better policies.

~~~
hammock
This article feels like a strawman to me. Infrastructure improvements are not
the cause of SF rents. You just need to walk down any block, or sit on BART
(if it's working!) and step in a pile of excrement to prove that.

Having lived in a few places I see rent control and legislation like Prop 13
as major contributors.

When people cite the average rent in SF, that's based on what's currently on
the market. What is not counted is the (much greater) inventory that is
currently occupied, with rent-controlled tenants paying far less than market
rate.

When someone cites "the unaffordability" of rent in order to justify rent
control, what you also don't see is the high cost of MOVING that comes with
rent control. My SF neighbor had been in her unit since the 90's, paying less
than half my rent, and she can't afford to move if she wanted to! If she were
to move she'd have to leave the Bay Area. She's trapped. Rent control doesn't
improve housing choice in that sense.

~~~
philipov
Do you think it's more likely that without rent control she would have been
_forced_ to move earlier, or that her income would be higher than it is now?
Something about this situation seems circular, but your argument doesn't admit
to there being a feedback loop involved, which makes me suspicious.

~~~
PhoenixReborn
It doesn't seem too circular to me. Rent control keeps your rent low despite
rising rents around you. So in the case of the OP's friend, her rent is now
vastly below market. In a non rent-controlled world she would absolutely have
been forced to move earlier due to rising rents.

~~~
bigmanwalter
Some rent control schemes keep all rents low. In Montreal, the government
limits all rent increases to 1% per year. Even between tenants.

------
golemotron
> To see why, step back and consider two 19th-century “classical economists”
> who focused on high rents: David Ricardo and Henry George. Both built models
> where land is so scarce that the cost of renting land absorbs most of the
> social surplus. We are not (yet?) at that point, but these models give
> insight into where today’s most expensive cities are headed.

The thing is, land is not scarce. There is an incredible amount of land in the
US. When rent is high in a city that is the market telling you that you need
to develop new cities. There's no reason why people have to be piled on each
other like rats in San Francisco and NYC.

~~~
SketchySeaBeast
> There's no reason why people have to be piled on each other like rats in San
> Francisco and NYC.

Yes there is. It's where all the economic and social momentum is, not to
mention the infrastructure - what steps does someone take to encourage people
to flock to a new city that has no infrastructure, no businesses, and no
population? What branch of government or enterprising individual builds out
the infrastructure for such a project?

~~~
mcguire
Then what's the problem? You don't expect to get those advantages without
paying for them, right?

~~~
SketchySeaBeast
I look forward to the "let's build Hipsterburg" gofundme - the $1 billion
stretch goal of basic sanitation will be really nice.

------
linuxftw
> By the same token, the incentives are skewed when it comes to the cost of
> problems. Say air pollution or homelessness gets worse. You might think that
> would degrade the quality of life in a city. But don’t leap to that
> conclusion too quickly: To the extent land is truly scarce, the main effect
> would be a decline in rents and real estate prices. Landowners would be
> worse off, but the typical city resident might find that the cheaper cost of
> living offsets the deterioration in conditions.

There's a seemingly endless legion of morons moving to these mega-cities that
can't afford to live there. I don't know what their ambitions are, but it's
obviously unsustainable.

Fortunately, I think CA and NY are going to tax themselves out of existence in
the next generation or so. Everything is cyclical, and I believe these cities
are anomalies reaching end of life.

~~~
reidjs
Those “morons” are moving there because there are more opportunities to earn
money than in their hometown.

~~~
linuxftw
And then complain about how they don't make enough money (aka, the rent is too
high) and the place is nasty?

A simple cost/benefit analysis shows that living in SF or NYC is a losing
proposition for most.

~~~
goobynight
It's only a losing proposition for those that are borderline retarded and
think that driving Lyft or bartending is worth it in the city. Who cares
though? They opted to grind it out and provide services to rich people and
middle class engineers while making some landlord rich. More power to them if
they enjoy that.

Once you're clearing SF costs by $50k+ per year, it could start to make sense,
right?

I would only move to the bay for $150k+ and that's the desperate low end.
Probably more like $170k is the minimum to have it make sense vs the
alternatives available in 2019.

