
Welcome to the Future: Middle-Class Housing Projects - saeranv
http://www.newyorker.com/culture/cultural-comment/welcome-to-the-future-middle-class-housing-projects
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natrius
It's self-evident why the middle class can't outbid rich families for single
family homes near employment centers: the rich have more money and they want
to live there too. But for dilapidated homes that are ready to be torn down,
the strategy for outbidding the rich is clear: rich families who want to build
a big home with a big yard can be outbid by several middle class families who
are willing to live in smaller homes with smaller yards.

The problem is that we've made it illegal for the middle class to outbid the
rich. Single family zoning laws have always been intended to segregate people
by income, but the economics of urban growth have made the middle class the
victims of the segregation laws they've always supported.

The effects are most egregious in high employment areas with predominantly
single family zoning, like Silicon Valley, Seattle, and Austin, where I live.
In Austin, the vast majority of the city is blanketed with laws that make it
harder for the middle class to outbid the rich than any city in Texas. Where
Houston allows four families to build homes to outbid the rich, Austin only
allows one. It's no surprise that we're the most economically segregated city
in the country[1], and the only growing city that has a shrinking black
population[2].

We must fight to desegregate our cities. The middle class is suffering not
because they can't afford to outbid the rich, but because it's illegal to
outbid the rich.

[1] [https://www.texastribune.org/2015/02/23/austin-most-
economic...](https://www.texastribune.org/2015/02/23/austin-most-economically-
segregated-metro-area/)

[2] [http://kut.org/post/austins-population-booming-why-its-
afric...](http://kut.org/post/austins-population-booming-why-its-african-
american-population-shrinking)

~~~
jseliger
_We must fight to desegregate our cities. The middle class is suffering not
because they can 't afford to outbid the rich, but because it's illegal to
outbid the rich._

No: The middle class is suffering because it's illegal to building housing for
them. See [http://jakeseliger.com/2015/09/24/do-millennials-have-a-
futu...](http://jakeseliger.com/2015/09/24/do-millennials-have-a-future-in-
seattle-do-millennials-have-a-future-in-any-superstar-cities/) or _The Rent Is
Too Damn High_ [http://www.amazon.com/TheRent-Too-Damn-High-Matters-
ebook/dp...](http://www.amazon.com/TheRent-Too-Damn-High-Matters-
ebook/dp/B0078XGJXO).

If you restrict the supply of a good in the face of increasing demand, prices
rise. The rest is commentary.

~~~
jordanb
You're violently agreeing. The point is, you take a large lot, you could build
a condo building on it with five units, or you could build a large SFU. The
OP's argument is five middle class people could outbid the rich guy. Except
that the condo is illegal, the area is zoned for single family.

Another issue here is the wealth disparity. I think your typical millionaire
could easily outbid five middle class families or even ten middle class
families.

~~~
46Bit
> Another issue here is the wealth disparity. I think your typical millionaire
> could easily outbid five middle class families or even ten middle class
> families.

They often could, but would they choose to? Less trivially.

~~~
Eridrus
Assuming they did not have to abide by height restrictions, why wouldn't they?

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jedberg
Palo Alto is utterly stupid, and here's why: The last time a multi-unit
building (ie. Apartments) were built in PA _was in the 70s_. They haven't
approved one since, despite many hundreds of applications to build such things
since then.

The middle class don't need subsidies, they need affordable housing. The best
way to get that is to _let people build affordable housing_.

It's the same as with SF -- the city won't let people build to meet demand.
You don't get to complain about the high price and then not let someone who
wants to fix it actually fix it.

~~~
maxsilver
>the best way to get that is to let people build affordable housing.

Can you name an example of where this actually happens? I've never seen
affordable housing built unless it was mandated by law or had some sort of
government subsidy.

Even out here in tiny flyover midwest cities, where developers have no
restrictions of any kind , there's no affordable housing being built that
isn't government mandated or subsidized.

Lots of new developments, all 100% luxury apartments, or luxury homes. I wish
it was as simple as "let them build it", but experience has taught me that if
you let developers "just build", the only thing they ever build is impossibly
expensive luxury units.

~~~
jedberg
I meant that when supply meets demand, all housing will be affordable.

But even barring that, you can still do it with only limited mandates. You can
put a limit on a property that says the rent can only be X% of the median, and
as long as it's possible to build housing for that price, someone will build
it and make a profit on it.

One example of no restrictions working out is (was) the city of Berkeley. In
1997 they got rid of rent control. All of a sudden, tons of new buildings went
up, and at first rents were very high, but then they stabilized. It all got
ruined in the last year when people in SF started to move to Berkeley in
droves and shove out the students, but that's really SFs fault, not
Berkeley's.

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xfactor973
The bay area is screwed. I moved to Portland and never looked back

~~~
Ocerge
If you SV types keep moving to Portland, it's just going to be another SF
housing debacle.

~~~
dkopi
Perhaps Portland can learn from SF's mistake, and actually allow massive
building of new housing if there's a spike in demand.

~~~
teacup50
I've never seen a _single_ example of this idea working.

I've seen this idea lead to higher rents, with fewer people owning and more
people renting.

I've seen it lead to developer hand-outs in the name of tax incentives, zoning
variances, and outright grants for subsidized (but still rental) housing.

I've seen it overload local infrastructure, allowing developers to reap the
profits while externalizing the costs.

We need to address the root cause -- ever-growing income inequality -- not
exacerbate the root cause by building an ever-higher wall between individuals
and home ownership.

~~~
verg
Tokyo, Toronto, and Houston are all examples of large cities where it is
relatively easy to build housing and housing is relatively cheap.

~~~
dagw
Frist time I've heard anybody use Tokyo as an example of cities with cheap
housing.

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frozenport
How about we build a ton of homes?

~~~
techsupporter
Fantastic idea. Now you just have to convince the existing landed gentry--most
of whom have the bulk of their personal wealth wrapped up in their primary
residences--that building more won't actually cause their house to devalue to
less than the cost of a Happy Meal. Or that building anything more dense than
a single, regular-style house every 5,000sqft doesn't result in a Blade Runner
dystopian future.

At least in Seattle, this has been a tough slog.

~~~
cylinder
Only an idiot thinks this. Imagine rezoning a single family home lot to permit
a 15 floor tower to go on it. How can any functional human think that would
result in a lower land value?

~~~
maxsilver
Because people don't think rationally about hosing.

Everyone says "the solution to expensive housing is to build more housing.
Supply vs demand".

That's not accurate, it never has been. But if you believe that (as most
people do), then you must also believe that building a 15 floor tower will
lower land value (since it is "more supply" so demand and prices _must_ drop
because of it). Belief in one, implies the other.

\--

In truth, a 15 floor tower would raise land value, for itself and properties
around it. But that also means that "simply building more housing" won't
actually make housing affordable. Because the new 15 floor tower and the
single family home next door will _both_ be worth more afterwards, making
_both_ less affordable.

Repeat that process a thousand times, and you have the US housing market. Lots
of beautiful places getting built (and they should get built, because we need
that new housing). But almost no one can afford to live in any of the new
housing, and old housing never really gets cheaper, so "affordable housing" is
this huge issue, despite new construction happening in every city nationwide.

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mchahn
In the thirty years I lived in SV I made more money from home appreciation
than I did from salary, and I made top dollar.

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api
Someone should tell Silicon Valley about this global telecommunications
network that lets people connect in all kinds of ways to cooperate over vast
distances.

~~~
erikpukinskis
It does seem like VR is the missing piece. When you can work in Google's VR
campus and live with your family back in Knoxville* I suspect property prices
in Silicon Valley will come down a bit.

* where your kids can $0.80 autonomous cab ride to their grandparents 20 miles away, or $20 to put them on the same cab ride with a licensed babysitter. Things gon' change.

~~~
nostrademons
More generally, _presence_ is the missing piece. VR is one possible solution
to that, if you can solve the motion-sickness issues. Holographics (if real-
time holos ever reach commercial viability...there's some interesting research
on it now) is another possible solution. Perhaps there are other possibilities
that people haven't found yet. Wrap around screens, like the Google Liquid
Galaxy display? Projectors?

But someone needs to invent a way for office workers to feel like they can
have an impromptu conversation, casually, with a coworker thousands of miles
away before remote work really takes off.

~~~
erikpukinskis
To me, VR _is_ presence. The metaverse has existed since the first network was
turned on. It's the sensation of presence in the metaverse that people are
referring to when they say "VR".

