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If you sell a house these days, the buyer might be a pension fund (wsj.com)
671 points by zpeti 14 days ago | hide | past | favorite | 1082 comments

Here's why investors buy up houses: they know your neighbors will do the dirty work of artificially constraining the housing supply, which makes it a good investment.

Here's one who comes right out and explains this:

> Meanwhile, local opposition to building is so commonplace and the approval process so cumbersome, time consuming, and expensive, even when a proposed project complies entirely with requirements, approvals are not forthcoming, at least in an expeditious manner and needed supply is simply not provided. Recently I heard of a new acronym to add to my vocabulary: CAVE, Citizens Against Virtually Everything, to be added to NIMBYISM and BANANA (Build Absolutely Nothing Anywhere Near Anyone).


Support groups like https://yimbyaction.org/ if you want to 'stick it to the investors'. If there's a credible threat to build plenty of housing, they'll move on.

I've been trying to build a house for myself. Going through all the hoops is not only cumbersome and expensive - but nearly impossible. I've run into legal tiff's between the county and nearby city. The city wants me to pay $40,000 for a sewer hookup for a single family dwelling when the sewer line is literally right along the road in front of where we will build the house. This is because the city has a beef to pick with the county and they are charging me based on the size of my parcel rather than the number of hookups I need. My house is actually in the county (but in the city impact zone). So now I'm spending my time combing through legal records, state supreme court case rulings, etc. all relevant to my situation to try to get things resolved. Literally everything is a fight. I even had to push and fight to get a build-right for the parcel - because it is currently zoned ag - which my country requires a max house density of 40 acres per house. I could rezone - but that would require me to get permission of all my neighbors to rezone so that my new residential zoning would be contiguous with existing residential zoning. I've had to fight to get permission to have an arch/rainbow driveway. Then I wanted to have an accessory dwelling, but ag zoning doesn't allow this either - never mind that this is totally allowed for all residential zoning types in the county and nearby city. And on and on. I've spent several hundreds of hours and tens of thousands of dollars trying to jump through all these hoops - and I haven't even started building anything yet!

States with this amount of obstructive ossification, such as the Byzantine Empire or Austria-Hungary, don't generally stand the test of time. Just before Austria-Hungary's collapse following WWI, the collection of taxes in Dalmatia (now Croatia) cost twice as much as it raised [0]. We still use the word Byzantine today to describe systems that are "complicated, secret and difficult to change" [1].

I don't know what this could mean at the city or county level. Keep an eye out for wayward Sultans and Allied powers?

[0] https://taxfoundation.org/taxes-and-late-austrian-empire

[1] https://www.oxfordlearnersdictionaries.com/definition/englis...

While I totally agree with the point you're trying to make, to be fair to the Byzantines, having a continuous state structure for a near millennium (500-1200 CE) is actually the near opposite of ossification leading to speedy collapse.

To Western Europeans coming from the very loose state structure of feudalism, the fact that the Byzantine Empire was effectively a modern state (similar to ancient China) was practically incomprehensible to them. Hence the phrase! On the flip-side, the level of institutional capacity let the Romans and Byzantines ride out incompetent Emperors fairly well compared to feudal states that would quickly disintegrate with one bad roll of the "off-spring lottery".

This is one reason I'm wary of any big structural changes to the US tripartite system. "Abolish the Senate!" or "abolish the Supreme court!" sounds like a fun adventure in governance but, regardless of personal political tilt, the system gives people time to organize against bad policy. It's hard to get policy I like, but the same processes slow policy I don't like down enough to organize against it.

Even the most blatantly tyrannical presidents through history hit a wall of bureaucracy. It's slow, but people like me tend to get murdered when tyrants take over, so I'll take it over a quick changing system that can easily turn against me.

> States with this amount of obstructive ossification, such as the Byzantine Empire or Austria-Hungary, don't generally stand the test of time.

Even if you only count from the time it didn’t share an Emporer with the West, rather than viewing it as a linear continuation of the Roman State, looking at the Eastern Roman Empire as somehow a state that did a substandard job of standing the test of time is, well, implicitly setting a really high bar, since even counted from the partition its, what, the second longest lasting state in history?

There is lots of ag zoned land around me. nobody wants it rezoned to residential as that means more people and most people don't want more people around. People always buy the ag lots cause they are cheap and have low taxes if you have ag activity, and then want to build more housing on them than the zoning allows, because that is lucrative.

just use a septic field instead of the sewer hookup if the county won't play ball. then they can't increase your sewer rates every year.

Unfortunately, the health district won't issue a permit because of the existence of the "will serve" letter from the city. So this is turning into quite the ordeal to get sorted out. I'm really hoping to keep things out of the courts, but that is a very real possibility. And I live in a relatively low-regulation state. I don't know how anybody ever builds anything in CA or NY.

> And I live in a relatively low-regulation state. I don't know how anybody ever builds anything in CA or NY.

I'm not an American so I don't know anything about your system. But perhaps the existence of many state level regulations crowds out the city and state level regulations and therefore you get less uncooperativity and more straightforwardness?

Really I think the state ought to be setting complete menus that the local governments can pick from and apply in specific areas. If it's not possible to build a house in some location, it should be clear that it's not possible to build a house in that location. And if it is, it should be clear that it is.

> I'm not an American so I don't know anything about your system. But perhaps the existence of many state level regulations crowds out the city and state level regulations and therefore you get less uncooperativity and more straightforwardness?

It's less that it's any more straightforward in NY or CA, it's just that zoning and NIMBYism regulation is not the sole domain of either American political party. You can't escape it by moving to a red state.

The usual canard is something like "California won't build more dense housing, so I'm moving to Texas," but housing is even less dense in Texas, so lower costs are not caused by less regulation around housing density! It's just that the ratio of supply to demand isn't as out of whack yet, as metro area populations have been lower and the cities themselves less landlocked, so building out has been easier and cheaper.

Rural Montana here: you can do pretty much whatever you want. From time to time I muse about building a nuclear waste dump...

I have not lived in Rural New York in over thirty years, but when I did, there were unzoned areas in the Southern Tier, and looking at what got built there, it was clear that it was unzoned. I am certain that many of the properties were uninsurable. I knew one resourceful individual that built his own house, basic carpentry, started with tar paper exterior over open stud frame, no windows, just one door, no interior walls. None. There was the kitchen sink, five feet away, there was the toilet and bathroom sink. The interior 'insulation' and walls were discarded carpets nailed to the wall studs. Power came into a fuse panel, that only had (first year) a single double plug outlet, and a single ceiling light. The next year, he picked up a dozen windows from the dump, someone else had upgraded, and installed windows, and sheet rocked the external walls. As he 'rocked', starting low and working up the walls, he filled the voids with crumbled newspapers (also from the dump) for insulation. Are we having fun yet? So at the end of year two, he had tar paper siding (and roof), newspaper insulated exterior walls, no interior walls, and an newspaper insulated sheetrock ceiling. He also installed plugs around the perimeter exterior walls, and added a couple more ceiling lights. Almost entirely from found and recycled material. That is what no zoning will get you. I moved away around then, and have not been back. I don't know anyone that lives in that particular county any longer.

Makes me miss the Rockies

I had >30 acres (12 ha) in a famously restrictive county in CA in 1999. Zoned for timber production, one house per parcel.

Before the building permit was issued I had spent $120k on a fourteen-inch stack of documents and fees, for a house of 2200 ft^2 (~200 m^2).

It has got much more restrictive in the intervening time. New construction in the timber production zones has just about halted.

Why did you buy a lot zoned ag when you clearly wanted one zoned residential? A little due diligence before purchasing the lot and you would either know what you in for and still buy or decide it's too much of a hassle and walk.

I didn't buy it until I figured out the (very convoluted and possible) way to build on it while ag. Because rezoning is a long, expensive process that can trivially be blocked by a single neighbor that doesn't want to rezone with me. I wanted the parcel because it was in what I considered a desirable location for a reasonable price. In my region, finding property is getting very difficult - and unless you want to go super far away from civilization, you don't have so many options.

It sounds like you signed up for something like the fight you’re having.

You are lucky that you can even abuse it that much. My home country seems a bit stricter. My grandparents split their farm between my uncle, aunt and mother, with the later two only inheriting a house. When my mother tried to pass it on to my brother someone noted that it handn't been part of a farm or used to house farmworkers for years and should be torn down. The plot it stood on had to be converted to residential to deal with that surprise.

They probably bought a lot smaller than 40 acres and assumed that logically, a single dwelling would be allowed since otherwise a dwelling would be impossible.

That is not a logical assumption.

If "a dwelling would be impossible", the logical conclusion is that zero dwellings would be allowed.

This situation is the norm in US unincorporated zoning. I have never heard of any unincorporated jurisdiction with a "minimum residences per parcel regardless of parcel size" exception. If there is such a jurisdiction, it's the exception not the rule.

There is a limit to how many dwellings an area can support without major infrastructure upgrades (sewerage, water lines, new roads, additional sheriff's deputies). This limit has to be divided among the parcels. The fairest way to do it is by acreage. "Minimum acres per dwelling" is just the reciprocal expression of "maximum dwellings per acre" and more well-behaved since fractional acres make sense but fractional dwellings do not.

Giving tiny postage-stamp parcels the right to build one dwelling would be a windfall for all the kooky "sliver parcels" created by things like railroads and surveyors' errors. Those obnoxious error parcels are made undevelopable in order to encourage that they be merged into a neighboring parcel.

I've been trying to build a house for myself. Going through all the hoops is not only cumbersome and expensive - but nearly impossible. I've run into legal tiff's between the county and nearby city. The city wants me to pay $40,000 for a sewer hookup for a single family dwelling when the sewer line is literally right along the road in front of where we will build the house.

Costs like for all city services are standard everywhere in California.

The reason is proposition 13. Cities can't raise taxes to pay for services so they basically have to charge for each service "a la carte". That sewer charge is more or less for what you and others are going to get from the city over some longer time frame. It suck but the alternative is home owners paying taxes, which home owners have decided they don't want to do.

I would suggest subdividing the parcel.

what if you just build it? What are the sanctions? Can you legalise it later?

They force you to tear it down. If you don’t they will and charge you for it.

That being said there was one guy in LA who built a massive house called the enterprise I think. Edit: he lost in court and is being forced to demolish it.

I've never been able to wrap my head around why things work like this. If what you build isn't a nuisance to neighbors, houses the same number of people as before, and doesn't pose a safety or environmental hazard, what business is it of anyone else?

I've met a significant number of otherwise carefully law abiding people with various non-permitted remodels and even outbuildings. (I guess the latter won't work so well in the future now that we have regularly collected high resolution elevation maps). It really seems like something is wrong with how this is handled across most of the US.

Devil's advocate: without regulations and permits, how do we know that what you're building isn't a nuisance etc. etc.?

That's why I never suggested the (obviously fatally flawed) idea of abolishing regulations and permits. Rather I raised an objection to the current state of their implementation.

Building codes are written in blood.

I assume you're referring to the safety and environmental aspects that motivate them? Which (to reiterate from above) I recognize the importance of. The trouble is all the things that run afoul of local zoning rules (and sometimes even local code!) for no obvious reason other than "that's what it says".

The refusal to issue a septic permit noted in a nearby comment is a prime example. Such things should be "will issue" so long as they won't cause any health or environmental problems in that location.

> The refusal to issue a septic permit noted in a nearby comment is a prime example

The problem isn't that they're forbidden from using a septic field when there's a perfectly good sewer line nearby. The problem is that they're being charged $40k for a sewerage connection. Where I live, it costs only $1000 for all the permits and inspections required for a new connection.

"Only" $1000. That's an absurdly high amount for what amounts to a visual compliance inspection in my opinion.

I would have to disagree that the unreasonably high fee is the only problem there. Charging a captive customer an unreasonable amount is certainly abusive. But so is arbitrarily forbidding what is permitted on private land. Such restrictions should require clear and articulable justification based on real world impact.

> That's an absurdly high amount for what amounts to a visual compliance inspection in my opinion.

This is really outside my wheelhouse, but I could see an argument being made about the capacity of the larger system.

E.g. The direct, marginal cost of installing service to your house is $200 to review the plans, send the guy out for an inspection etc. But the added capacity requirements of you and the 10 new houses in your development puts an upstream sewer out of capacity, costing $50,000 to upgrade. If you don't charge the full marginal cost through the whole system for the upgrade, either the rest of the city is subsidizing your marginal cost, or there's a significant monetary shortfall on the short (say 1-3 year) timeframe, and you'll hope a rate increase is approved to make up for it.

It's an interesting point, but bear in mind that the scenarios raised in this and adjacent threads didn't involve subdividing but rather just hooking up an existing lot. One would hope that system capacity was at least sufficient for the lots that already existed when it went in.

If there were a need to charge for capacity upgrades, it seems such things should be billed separately and explicitly. (My electric bill itemizes hookup, transmission, and generation among other things.)

And absolutely none of it explains why septic should be disallowed!

If the infrastructure is available, it had to be built, and someone paid for it. If there wasn't a hookup before, then it seems reasonable to pay the full share to recoup the investment, even if the line is right there. Otherwise the infrastructure investment would have to be paid by someone else, or from other taxes.

These days, septic should be disallowed, if a reasonable sewer is available, as these days the effluents contain all kinds of toxic and non-degradable stuff that poisons the land and ground water. Over here, lossy septic tanks are illegal. You can either hookup to a sewer, treat your wastewater in situ via certified processes or, under some conditions, use a non-draining septic tank and have the wastewater treated.

> "Only" $1000

I don't know your profession but let's take a statistical guess and say you're a software developer.

If I asked you to drive out to my place to take a look at 500 lines of Javascript, and tell me if the code is kosher, and if you're wrong I'm going to sue you. How much would you want to be paid to do that?

> if you're wrong I'm going to sue you

I think the local municipality typically sends an employee out to do the inspection? At least that's how it worked for me in the past (tbf that wasn't specifically sewer though). Permits having a nominal paperwork fee is understandable.

I very much doubt that the inspector only visits one property per day, or that they are paid anywhere near $1000 per day.

The legal risk is on the provider of the service, which is not the employee. Obviously the employee is not getting the entire fee themselves.

$40k only gets you permission to hook up. The inspections, excavation, and most of the plumbing work needs to be paid for by the owner independently. So all the work that actually costs resources to do is not part of that $40k fee.

No, a fair number are written in green ink. Green for someone else.

They know that the current government planning regulations mean that getting anything built is extremely difficult. They know that due to supply and demand that this makes property a wise investment. Blame planning regulations. I read recently that Japan and new Zealand scrapped various regulations and this led to stabilization / lower of property prices.

Near me, someone is sticking up protest letters at bus stops complaining a developer wants to build flats. For heaven's sake, people need to live somewhere, please do build.

Japan not so much scrapped various regulations as their regulations are just different - and nationwide.

One of the effects of how their zoning classes work is that you don't have "residential-only" zones with no shops or other amenities - instead you have zones defined along the lines of maximum nuisance and with overlapping uses. You have a total of 12 zones, which start from "exclusively low rise residential" that are essentially low density houses that can be also small shops or offices + schools, to exclusively industrial zones that prevent residential or other construction - but it's a spectrum between them.


Every now and then I watch one of these Japanese "video walk" channels on YouTube and find myself despairing at how wildly better their land use is than in the US.

Obviously some of that is to be expected of an island nation versus a continent-spanning one. And yet, so much of Tokyo seems like it's built at the scale of a small-town main street: Between the major roads with their skyscrapers sit networks of pedestrian-friendly streets with little shops and restaurants, often crossed by even smaller yokocho which themselves have bars and flats. Quiet side streets intermix residential buildings and even single-family homes, and yet somehow these little districts are all linked up together into the world's largest metropolis.

> Obviously some of that is to be expected of an island nation versus a continent-spanning one.

It has little to do with "island nation", most nations use mixed zoning, it's certainly the standard in europe (and recent developments are gravitating towards more mixed zoning e.g. Amsterdam's eastern docklands). It could have to do with being an old nation, but even then that's not actually true, the US existed for a while before cars happened.

In the US, we invented zoning, mostly to exclude black people from white neighborhoods. And now we use it to prop up property values and continue to keep poor people out of wealthy neighborhoods.

Now I'm speculating, but I wonder if Japan, being mostly Japanese people, didn't have such a large group to exclude from certain neighborhoods? So they didn't entrench the institution of local control and exclusionary zoning?

Japan traditionally had a caste system where certain people were restricted to certain neighbourhoods. There was a lot of official effort to break that up after the war, but you can still tell which neighbourhoods are which.

google burakumin

The public schools I taught at in Japan kept (private) lists of which kids came from burakumin families.

It's my understanding that Japan's housing regulations are mostly driven by a long history of all their buildings falling over in an earthquake every couple of decades.

This was one of the biggest things that struck me when I visited Japan. Their cities are just so much friendlier/better than 99% of American cities.

Thank you for posting that.

I've lived in Japan for 30 years, and I've never seen the topic so clearly explained.

Edit: BTW, in case you were wondering about the special zoning classification, "bathhouses with private rooms" are in a very different business than bathhouses without private rooms.

I live in Edinburgh in Scotland. Best feature is tenement flats with shops or bars below. Old town is especially mixed use and it's brilliant because of it.

One of the more personally infuriating aspects of Brexit for me is that I can't just drop in to Aberdeen or elsewhere in Scotland and move there for longer. :(

Deregulation of the construction market was a disaster for New Zealand, and cost the country billions of dollars [1].

Also, New Zealand has some of the least affordable housing in the world, and it's only getting worse.

[1] https://en.wikipedia.org/wiki/Leaky_homes_crisis

> I read recently that Japan and new Zealand scrapped various regulations and this led to stabilization / lower of property prices.

I don't know about Japan, but that can't possibly be right about NZ. Nobody in our generation will ever be able to afford a home in Auckland.

Land Value Tax sorely needed.

Same in Canada. I am in the top 3% of wage earners in the entire country and can not "afford" to buy. Average price is > 1 million. At > 1 million, a 20% down payment is required in cash. That would basically take my well balanced portfolio into pure real estate holdings not to mention a massive tax hit to sell 200k+ of my portfolio. I used quotes in afford because I could afford it, but I feel it would be a huge mistake

Similar story here. We modified our expectations and bought a smaller home AND kept the well balanced portfolio. So far so good.

Sounds like you need to grow balls like your fellow Canadians and go “all in”. Most folks I know buying throw every dollar they have into a house plus a hundred thousand from the bank of mom and dad.

You’ll never be able to afford unless you do it.

I'll stick with never. Rents keep dropping. It's almost like it's... pure speculation with no fundamentals. Surely that can't be the case, otherwise rents would keep dropping! Oh no!

Rent is not dropping. It is going up, rapidly.

Oh you checked the numbers for me? Oh darn. If rent is rapidly going up and purchasing is more and more impossible, I guess the only natural conclusion is everyone making mid six figures will all be unable to live in homes any more. Maybe even homeless? I should probably just drop out.

NZ has not got anything near price stability. It’s going mental as they all sell the same houses to each other over and over

Throwing Canada in the mix! We got excited over our 5%+ GDP growth in Q1 until we realize 4% of it was housing!

It probably didn’t hurt that Japan has a declining population, so supply > demand

> so supply > demand


Japan has a declining population, but the population keeps urbanising. So while there's hefty supply (literally millions of unoccupied housing inventory) in places nobody wants to live in, there is not in places where people are moving to (large cities).

There's very regularly news and posts about unoccupied houses ("akiya") being literally given away by government and local authorities because even at auction for pennies nobody wants to bid on rural properties. There was one going through here just last week.

Some prefectures are nearing 20% vacancy rates, but they're places like… well basically all of Shikoku which is largely mountainous and rural, and has been bleeding population at a rate of 5%/decade since 2000.

>>>Some prefectures are nearing 20% vacancy rates, but they're places like… well basically all of Shikoku which is largely mountainous and rural, and has been bleeding population at a rate of 5%/decade since 2000.

That's crazy to me, Tokushima in Shikoku was on my short list of "ideal relocation spots". With just a few hours of scenic driving, you can be in Kochi, Takamatsu, Matsuyama, Okayama, or Wakayama. All with populations of 300,000-700,000 (so decent mid-tier cities). So you could easily geographically distribute 4-5 girlfriends across those towns and combine them with some awesome driving experiences in-between.

Osaka and Kobe aren't much further if you really want a big-city party nightlife occasionally too.

> So you could easily geographically distribute 4-5 girlfriends across those towns

This comment took an unexpected turn. Why can you not have girlfriends in the same town?

You'd be surprised at how easily they can run into each other, or have overlapping social circles. It's a drama risk. Different cities that are hours apart is a "good enough" risk mitigation compromise short of dating women in different countries and flying them (or yourself) around regularly.

The parts of Shikoku that are right next to bridges to not-Shikoku are doing alright. But even then, it's hard to make a case for Tokushima over an equivalent place across the water (I guess Himeji?).


Japan's urban population is somewhere between stagnating and declining, not increasing. The contraction trend is even worse in most of their cities other than Tokyo.

Simultaneously the percentage of the population that is urban, is very slowly increasing.

Those are two very different things. Their cities are net contracting in population. They're now nationally losing people faster than they're urbanizing. They're currently losing around a quarter of a million people per year nationally. Their cities are not expanding faster than that drop. And given their already very high urbanization rate (and very slow rate of urbanization increase), it's unlikely anything will significantly change in that regard. This decade will see either a mostly flat population trend in Tokyo, or a modest contraction. What it won't show, is a meaningful expansion, as their national population contraction gets worse.

The pandemic put enough pressure on Tokyo that it actually contracted for the first time in ~25 years.

February 25, 2021

"Tokyo, Feb. 25 (Jiji Press)--Tokyo's estimated population fell by 662 from a year before to 13,952,915 as of Feb. 1, marking its first year-on-year decline in about 25 years, the metropolitan government said Thursday."


However, if you go back further, you can see the trend was already toward decline. This is from 2019:

June, 2019, The Guardian

"Has Tokyo reached ‘peak city’?"

"One could argue that the world’s biggest city has hit a sweet spot: a flatlining population, pervasive transit and little gentrification. But is ‘peak city’ even possible – and where does Tokyo go from here?"

"Unlike many megacities, the world’s largest metropolitan area has largely stopped growing, either in land or population."


California and NYC have a declining population.

If you cherry pick data during COVID that's true. But it was the first year since 1900 with any decline and state forecasters say it's more to do with over 50,000 COVID related deaths and less migration from other countries (the largest source of population growth for CA for many years now) because other countries were locked down. As far as I know, no one expect that decline to be anything more than a very temporary thing.

California's population expansion clearly hit a wall back in 2017-2018, pre-pandemic. 2019 saw their population expansion de facto stop. The rate of growth has been dropping rapidly toward zero for much of the past decade, and they reached that line before the pandemic hit, it's not a new trend due to Covid.

This decade it'll go negative. The exodus - a desperate flight from California's particularly horrible governments and epic mismanagement - will get worse yet, not better.

Fewer people want to live in California and it's very obvious why.

2010 to 2020, California saw a 6% population expansion. The slowest decade of population growth in a century for the state. Year to year, it went from very slow growth at the beginning, to zero by the end. Next is a contraction.

Texas by contrast saw 16% expansion in that time. It's booming and it's also very obvious why.

> This decade it'll go negative. The exodus - a desperate flight from California's particularly horrible governments and epic mismanagement - will get worse yet, not better.

"You can tell that the government has failed and nobody wants to live their by the fact that it's too expensive" doesn't really add up to me...

Texas cities have lots of empty surrounding land to sprawl into further, which massively helps with supply and prices. This is not some magic feat of government. They're less dense, not more dense.

People leave California primarily because of housing prices, or because they are in industries which are leaving California because they're not longer growth companies (e.g. HP)

First of all, the data actually shows that while 90-100k people moved from CA to TX every year since 2019, about 40-50k moved from TX to CA, and the demographics of the TX->CA move is higher income, educated earners, and the move from CA->TX is far less Silicon Valley elite, and far more from the central valley, and tends to be blue collar.

Growth follows an S-curve, and in every major successful city in the world, be it NY, London, Seoul, Shanghai, or Tokyo, eventually you run into a slowdown, as cost of living increases.

A contraction in CA's population won't be bad, because CA is still brain draining the rest of the country and still receiving a higher chunk of investment funds compared to other states.

https://www.jec.senate.gov/public/index.cfm/republicans/2019... https://www.statista.com/statistics/424167/venture-capital-i...

Reducing the burden of non-growth industries by sending them to TX along with blue collar workers, while taking the lions share of immigration of people with advanced degrees, as well as the lionshare of VC investment, seems like a good trade.

Honestly, Arizona is looking a lot better to me than Texas over the next decade. With 6 new state of the art semiconductor fabs under construction (2 TSMC, 2 Intel, 1 Samsung, 1 NXP) totalling $50 billion, another $100 billion in investment promised by TSMC, and the recently enacted $50 billion Senate semiconductor package, if you're looking for the next Silicon Valley, the Silicon Desert looks more like an early real estate opportunity than the Silicon Hills.

I don't think California has much to worry about, everything that makes the state great: It's natural environment, weather, colleges, parks, industry nexii, it's diverse culture, food, wine country, etc is still there. I know you desparately want to run with the conservative talking points on taxes and regulations, but CA's population growth issues have little to do with "high taxes" as many conservatives claim. Median CA household income is $57k, the State effective tax rate on that income is 3.7%, which puts CA in the middle of the pack when it comes to state tax burdens. CA only really takes a big bite of you if you make a lot of money, but as I've already explained, CA has net positive migration of high income earners, and net positive business migration/creation too.

The proposed semiconductor fabs seem legitimately crazy. It's a desert state with 87% of the desert in extreme drought. The state is already planning on needing "mitigation" water. Don't fabs need water? I recall reading something about tsmc and water usage.

Fled California a dozen years ago. I miss the weather, but otherwise glad to have left.

Gang violence, over regulation, out of control prices, etc.

Can’t imagine going back with all this nonsense around legalizing shop lifting, segregation coming back.

Let the downvotes start

It doesn't need to be downvoted. You identified yourself with your word choice.

Separately I hate the over usage of the word "fled". No one was chasing anyone. In an age of basically yearly refugee crises in the world it's terrible to see its overuse.

Fled means to “run away”. What does have to do with “chasing” and refugees?

I’m sure the place you moved is perfect with no problems whatsoever. Just like California used to be back in the good old days before things changed.

Yeah, I note that these kinds of spammy comments used to always mention Texas.

Now I note they don't mention Texas quite so much, anymore.

Along with huge portions of the rural midwest.

It all has to do with meeting the demand where the demand exists.

Just distorted number because of increases homelessness. Sarcasm , however, there is a bit truth to that.

A neighbor was complaining just the other day about a developer want to build two houses on a sliver of land in our small historic town. I've got no reason to support this. There's space to build an apartment building near me but no one want to do that (a building, in fact, burned down a while back and hasn't been rebuilt).

Neighbors want no development. Developers want to build more of the ubber expensive houses the neighbors want to protect. You need regulations that encourage dense, ideally very dense, housing. Enough dense housing and you can "preserve the character" (if not the home values) of the smallish towns.

Of course, those regulations to support dense housing need to be supported by other things; like money for streets, sewer, water, etc. If the town's streets are already crowded with traffic and it's sewer system can barely keep up, then building dense housing it going to destroy the town. And for a town that is already "in place", adding a bigger sewer system is hard. Widening streets is even more difficult because you'd need to buy up the land that the current builds are on. It's not as simple a solution as "build dense housing" makes it sound.

What about throwing as much money as it takes to not only build new towns with dense housing in places where those towns don't already exist, but to make those new places to live much more desirable than a pre-planned new development normally would be? I imagine the political will isn't there. The answer to me would be an ultimatum. Either yes in your backyard, or a tax is levied for a new development that won't be total crap.

This sounds like the original motivation of some ghost towns in China.

Yeah I agree. I can't think of many examples where this seems to have worked. Very much a chicken and egg problem, but I'd think with enough funds available there would be a way to make it work.


Generally the area gets bootstrapped by some major need or force that is so potent that it establishes a vibrant economy around, and if it's potent enough, even after the need has passed.

Major civics projects like damns might do this. (Grand Coulee damn along the Columbia River comes to mind.)

Ongoing jobs like military bases might provide enough logistical need. Or a factories / exploitation of natural resources (fishing, forestry, coal, iron, processing / shipping along waterways) where there's sufficient density. Sometimes it's conditions favorable for the flow of talent, like good worker protections and a rich field of jobs so that someone can settle and build resources: Opportunity that, IMO the rich have largely denied those born in the 80s and after via housing policies and investments exactly like those mentioned in the article.

You've got it exactly backwards. Density is cheaper and more sustainable than running miles and miles of brand new sewerage, roads etc into spread-out suburbs.

The big difference between Japanese and American cities is that Japan is built for trains, which scale up really well, and the US is built for cars, which don't.

I don't have it backwards, you're just not following what I'm saying. I agree that denser housing and construction in general is far more efficient. However...

I'm not talking about constructing a town from scratch. I'm talking about an existing town. Adding the infrastructure for high density housing to a town that wasn't originally designed for it is very expensive.

Current "trend" is medium density housing, with smaller roads. Most of US is 9+ months out of the year a walkable climate.

Putting down a small self driving street car for short trips removes a lot of road congestion in town. And if you just place navigation tags into the pavement - you avoid the need for expensive AI based nav system.

In addition to the other replies, I've see cases where the city only approves construction on the condition that some of the land is allocated to city use. That means if the edges are developed first, it's possible for the city to get the room to expand infrastructure.

Japan sometimes don't care much about such issues caused by building large apartment, like extremely crowded station/train and lack of nursery school. I don't know it's good thing, but these are often complained.

You can't just ignore things insufficient sewers or water. And insufficient roads isn't much better.

Density brings in more tax revenue to pay for expanding the sewers and can support more mass transit to reduce traffic -- no street widening needed.

In many cities, it's the poorer denser neighborhoods that subsidize the more affluent less dense neighborhoods.

Scroll down to red and green map here: https://www.strongtowns.org/journal/2015/5/10/lafayette

You can really add things like sewers after the fact. You either need to add them before or during the addition of more (higher density) housing. Generally, this means that the builder of the new housing is required to foot the bill for that added capacity, which can make it not worth the cost.

The same tends to be true of roads, but with less catastrophic results. In a town where going 2 miles can take 20 minutes, adding a lot more housing without adding road capacity is not a great plan.

I meant to say that you can't add sewers after the fact, but now it's too late to edit. My apologies for any confusion.

I just experienced something similar to this and it makes me wonder if much of this is just perception.

We recently dealt with an out of state builder pushing to have a property that was zoned Neighborhood Commercial to be rezoned to something more flexible so that he could build 49 town homes with 49 parking spots on 5 acres of land.

Everybody opposed the rezoning and fought to defeat it. The project would have been the most dense townhome development in 4 counties.

There is uniform agreement that people want commercial projects built there as zoned, but I wonder if the opposition would be classified as NIMBY?


If you believe that no town homes should be built in the U.S. than you might not qualify as NIMBY.

But if you believe that town homes shouldn't be built next to you that's the definition of NIMBY. Of course every instance has a long list of reasons why next to them is especially bad, character of the neighborhood, parking issues, infrastructure, etc....

But the end result of everyone fighting increased density in their neighborhood is we have a less density (bad for environment) and more expensive housing.

The irony is that density means more people, more homes, more availability.

That means more jobs open up and makes the place more lively. More desireable.

That means the house property value will go up.

They are thinking "will this make the property value go down in the next 5 years"? vs "will this make the property value skyrocket in the next 10 years".

We are catering to short-term gains at the expense of long-term.

Many NIMBYs aren't purely financially driven. What they want is for their neighborhood to stay exactly as it was when they moved in, with the same type of people, and same amount of traffic.

Bay Area has plenty of this type. Many of them already have had property value skyrocket (50K -> 2M is not uncommon), so they can just have both (high property values, and preserve their neighborhood exactly as they want it).

Honestly I think this would be fine. The problem is they allow FANG to build giant offices, which brings new 400k-income jobs and bids up the restricted supply.

I think they should be forced to choose one or the other. Keep their SFH and say no to FANG, or accept townhomes and condos to balance out the new jobs.

This is also in part due to tax revenue. Because of Prop 13, residential units in CA generate very little property tax revenue (revenue which doesn't grow much until the property changes hands, which is unpredictable). Commercial units don't have this problem, so municipalities can depend on a decent amount of property tax, with predictable increases over time.

Prop 13 applies to commercial property too, I'm pretty sure.

I think commercial property just doesn't burden the city. A Google office has private security, a fire suppression system, and doesn't house kids who need to attend the school district.

Commercial property does burden the transit systems (LOL for CA) and roads. The road issue is pernicious because they take up enormous amounts of real estate to begin with and are extremely difficult to expand after the fact. This is one of the primary arguments against building high-rise housing in SoCal. Neither the transit systems nor the roads are able to deal with the additional people. The roads probably never will at this point--there is no room to expand them. Yet the transit systems are woefully underdeveloped for the size of the population and would take years to catch up even if the local politics supported them.

I see a lot of this from People on Nextdoor. They see their favorite landmark demolished to build yet another block of apartments and condos. I've seen a sporting goods store gone, a furniture store gone. A bowling alley was saved but it will be built around. Some places I've seen low density industrial being replaced with housing. Some people fear that at the end it will just be housing and big box stores left.

That’s only true up to a tipping point when poor people move in. Parts of Detroit are a great example where poor people are diving down the value of houses around them.

People essentially want to be surrounded by people of almost exactly their economic class to somewhat richer. To rich and stores they can’t afford to stay ie gentrification, to poor and you have to move ie white flight.

I'm not sure what parts of Detroit you're talking about, I can't think of a single neighborhood that is struggling with that problem, blight and abandonement? Sure.

Blight is a direct result of people in the area being to poor to afford to maintain infrastructure.

As to driving prices down, some houses in good condition are selling for ~25-50k which would be worth more basically anywhere else in the US.

That's not because a bunch of poor people moved into the neighborhoods. That's because the middle class moved away or lost their jobs.

It’s not just a question of the middle class moving away, people die which means you need more people moving in. As soon as the mix of people moving in starts to include less affluent people it eventually gets dominated by them simply because their are more people as you move down the income curve.

The transition within a city is rarely about some specific employer shutting down. The more general case is homes age and different areas become attractive over time. You can find areas where nearly identical homes where build across a wide area, yet one community falls into disrepair while another becomes desirable simply based on school zoning.

Honestly, Detroit had nowhere to go but up. The city was so poor that even a decade ago downtown was a hot mess where there was virtually nobody there after 6 PM.

I think you have it exactly backwards the cost goes down due to the area being a less desirable location allowing the poor to afford the houses there. If you analyzed the situation better it is extremely likely that there is an underlying cause that isn't poor people moving in. The economic situation in Detroit has been shit and getting shittier for years now leading to the people who are more capable and therefore able to command a higher salary to tend to move elsewhere.

A house that a doctor and a lawyer are competing to buy is going to be go for more than the one an auto mechanic and a fireman are competing for.

It is a little bit of both, at least when it comes to maintaining a local public school’s rating. People will oppose lower income housing to prevent the children of lower income people from attending the same schools, which might cause the school’s rating to go down. Which would then be downward pressure on the price of the land.

Every real estate website has school ratings for each house listing because it is such a sought after amenity.

It also means you can get walkability and nice things like shops and leisure activities without having to buy a car and drive literally everywhere.

Maybe. If zoning is fluid and organic, you might get those. And they are nice things that many people value.

But, in existing zones? Maybe not - you'd have to convince people to change residential to commercial/retail. And changes to parking minimums, which always seem to screw up projects (they almost always require more parking than a "free market" would dictate).

That also means "those people" can walk into your neighborhood, and many are motivated not to let that happen.

I lived in an area that, for years, refused to let an old railroad track be converted into a trail because it would connect a working class area of the town to an upper middle class area via a miles-long footpath.

That needs a commitment to commercial space on the first floor and underground parking for tenants so that surface parking is available to customers without the need for massive lots. Builders who want to extract maximum profit with the cheapest construction won't go for it.

So, the status quo has to change. Not an easy job, but the rest of the world shows how it can be done.

More homes and more people doesn't necessarily make an area more desirable. Many people prefer space, privacy, and quiet. Those things are more important to them than property values.

That is fantastic for retirement but 80% of people who live in Urban areas value above all else seemingly proximity to jobs which are driven themselves by the proximity of many people which is often driven by the proximity to desirable features like ports.

Retirement isn't the issue. Most people who live in suburban areas today close to live in low density areas. They don't want their neighborhoods to become urban regardless of what that would mean for proximity to jobs and other desirable features.

Stop trying to tell people what they ought to want. Not everyone agrees.

Not the parent, but upthread we're talking about density and zoning in cities, not in suburban or rural areas. I get that people who want to live in a suburban or rural environment have different priorities, and they're free to set building policy to achieve those goals.

But it feels like (in SF at least) we have people with conflicting goals: they want to live in a city, but they want their experience to be similar to suburbia.

I want to live in a city and for it to actually feel like an urban environment! I want to walk everywhere for my day-to-day needs, and take transit for everything else. I want to sell my car and rent one only for the times I want to leave the city. But we're in this weird middle state where that often doesn't work. My guess is that the only place in the US where it really does work is NYC, and then maybe even only really in Manhattan.

>My guess is that the only place in the US where it really does work is NYC, and then maybe even only really in Manhattan.

It's probably the case that it's the only place in the country where it's considered perfectly normal as an adult not to own a car even if you have plenty of money.

There are--especially given Zipcar/Uber/etc.--other cities where people can get buy without owning a car, especially if it's a young post-college lifestyle. But it probably requires organizing your life around not owning a car to a certain degree.

"[T]hey want to live in a city, but they want their experience to be similar to suburbia". I would agree for all quadrants except the northeast quadrant. That is the most dense for population and mass transit. There is a real urban vibe in northeast quadrant.

I have been told that central Washington D.C. and Chicago are also very transit and pedestrian friendly. It is not a requirement to own a car in those places.

>who live in Urban areas value above all else seemingly proximity to jobs

Many jobs are in the suburban areas near metros rather than in metros themselves. SV is somewhat unusual in that a large swath of suburban area is as expensive or more expensive than in the city itself. This isn't the case with a lot of cities.

Look at any typical city in North America, your priciest neighborhood likely has low density.

People tend to work away from where they live (at least for high paying jobs) and prefer having ample space at home therefore I don't think higher density would increase property value as you stated.

The priciest neighborhood ($2MM+) in my city is low density and full of mansions for sports stars and execs for of all the local F500 companies. But the next tier in price ($1MM-$2MM) is actually pretty high density housing abutting downtown.

Once you get into the $500-$1MM range density falls again, as these are the McMansions in suburbia. Density keeps dropping as price goes down until you get into the slums territory, which are basically the pockets of urban blight that haven't been redeveloped yet.

Can you share the city name? I'm curious to learn more.

You're looking at one half of a normal distribution and seeing "more is less" (more money is less houses per square meter), and you're reacting to someone looking at the other half of the normal distribution and he's seeing "more is more". You're both right, just not looking at the entire picture.

When I worked in New York City, there was a stark contrast between senior management. Some lived very rich & urban -- West Village single family townhouse or Upper East/West side high rise, and others lived in a huge suburban home in Greenwich, Connecticut or Long Island. It was a weird mix. I could never figure out why they chose one over the other.

You are probably looking at price per home, not price per acre.

> They are thinking "will this make the property value go down in the next 5 years"? vs "will this make the property value skyrocket in the next 10 years".

Not even. Near here, there was a proposal from the city to increase middle-density housing.

They hired economic forecasters. Their projection, that property values would "decrease" from 13% YOY increases (we are in one of the highest increasing cities in the country) to 9% YOY.

In other words, you'd still see your home value _increasing_ 53% in five years (versus 84%), not decreasing...

... and people still acted like the city wanted to shoot their first-born in the streets.

Exactly. Parents bought a house in relatively scarcely populated area. Then 10000 neighbours moved in. Now they own the largest property in the neighborhood. Guess what that does with the price...

Not everyone cares about greed-driven financials (houses as "investments") nor wants to live in a "lively" place. I'll take my peace and quiet, thanks...and my stable property values and town size.

No. People always say density helps availability, and price increases are due to the denser areas being more desirable.

The major factor driving housing inflation is restricted supply, which is relative to demand. Demand is created primarily by jobs. The difference between jobs and employed residents (with overhead for non-working family members etc) drives the imbalance. If demand was being met, prices would plummet.

This factor is orthogonal to overall density. The Bay Area is expensive because there is not enough housing for the jobs. If San Jose became as dense as SF, it would not help anything, unless that growth was focused primarily on housing. But San Jose already supplies net housing and SF supplies net jobs. These are not small imbalances either; they are both 6 figures in 2008 ACS commute data. (Unfortunately that dataset seems to be compiled very infrequently, but I doubt things have changed much other than density increasing.)

What if you're someone who thinks building stack-and-pack residences is the incorrect response for an investor-manufactured housing shortage?

Then your thoughts are incorrect.

Portland, Ore. is facing a huge housing crisis because single-home zoning prevented increasing density. Without the ability to create more housing on existing land, there is a shortage. It's that simple. They recently passed a law allowing more dense developments, and that will create more supply. There are currently 10 apartment projects in flight in the city, so there is no cabal conspiring to not build housing as you suggested.

Unfortunately, current homeowners love the shortage because it is increasing the value of their homes in ways we haven't seen since ... ever. Which is incredibly short-sighted because the economy will stall without housing, which will crater the boom. Moreso because if they sell, where are they going to move in the same town? They would need to sell and leave town to someplace cheaper. It is amazing to me how many people don't think one more step ahead.

Yes, I’m familiar with that narrative. Perhaps it is reality in _Portland_and_handful_of_other_places. In that case, you’re actually specifying the different case of solving a real housing shortage, not a manufactured shortage.

I routinely take 3-mile walks through my neighborhood in NE Los Angeles. There are at least two homes on each block that are unoccupied. The nearby stack and pack developments don’t offset the inventory sitting idle.

If I understand your argument correctly, you are making an un-evidenced claim that a cabal of housing developers are conspiring creating a housing shortage despite the biggest housing boom in the US since post WW2, while also claiming single-dwelling zoning as the root cause is somehow just an anecdote?

No, I'm making an evidenced claim. I have observed this with my own eyes. And you're moving the goalposts.

I'm saying by taking inventory off the market by buying houses and leaving them vacant, investors are contributing to the housing shortage. I'm pretty sure collectively controlling a small percentage of the market, investors can cause an increase in the cost of housing, per the law of supply and demand.

it doesn't take some kind of cabal to do the incentivized thing, plow millions/billions into properties and don't bother with the hassle of renters when the amount they increase is far more than you would have gotten from rent before you flip them.

Vacant houses do not match the behavior of private equity investors. PE will rent out houses and viciously profit maximize at every step.

Vacant homes from "investors" are almost certainly older residents that have moved, or passed away and left it to kids that haven't figured out what to do, or just owners in the area that have locked in low property taxes and don't want to bother with the hassle of renters.

These are precisely the small-time landholders that benefit the most from stopping apartments from being built, because the source of their investment games is entirely from scarcity.

And the cure is precisely to take away their ability to limit housing by building what you call "stack and pack."

Handwave much?

I would like to engage constructively, but I'm not sure what you doubt, and you seem to be holding me to a far different standard than you hold your own comments to.

Here's the behavior of PE firms when it comes to renting houses, they rent them out and charge for everything:


As for the vacancy rates, how do you know the homes are vacant, and what is the proper vacancy rate? These can be looked up in from Census ACS estimates, though I hear that the Post Office sometimes has better data.

I would say that a healthy vacancy rate is at least 7%, possibly higher.

I'm quite familiar both with Vancouver's and Oakland's vacancy taxes, and have endeavored to get them enacted in my town. Not because it will solve any housing problem, but because it's a nice revenue stream for various much needed services, and it eliminates one way that people try to wriggle out of the need to build more homes.

If anything, Vancouver is solid evidence that vacant homes are not the problem, despite so many current homeowners being desperate to use them as an excuse not to build more homes. In Vancouver, the tax provides a small income stream, but has changed nothing at all structurally. And that's in combination with the foreign purchaser tax.

The one solution is to start building what people want, what you derisively call "stack and pack", in sufficient numbers over a long enough period of time to satisfy everyone's desire for housing.

We are not off the mark by 10% in the amount of homes needed in LA or the Bay Area, we are 30%-50% off or more. We have been under building for decades now.

Portland has an Urban Growth Boundary [1] that makes it very difficult (de-facto illegal) to build new housing on undeveloped land. That is a major cause of the housing shortage, but it was passed by people like you who wanted it to artificially densify the city. Current homeowners who want to maximize their house's value would be in favor of keeping the urban growth boundary (it restricts the supply of houses) and encouraging high density projects (if apartments can be built on a lot, it makes it more valuable), which coincidentally is the status quo in Portland and other cities on the west coast. You may personally hate sprawl for various reasons, but there is a reason why the sprawling cities of the South and Midwest are cheaper than the densifying cities of the PNW, despite many of them having larger populations. Building apartments and tearing down houses lowers the price of apartments and raises the price of houses; it's simple supply and demand. Repealing both zoning regulations and the urban growth boundary would result in a free market, but don't be surprised if people make lifestyle choices you don't approve of and the suburbs sprawl outwards in such an environment.

[1] https://www.oregonmetro.gov/sites/default/files/2020/02/24/U... Anything outside the yellow line can't be developed without a massive legal fight.

> Building apartments and tearing down houses lowers the price of apartments and raises the price of houses; it's simple supply and demand.

Do you have evidence of this? I would think increasing the supply of housing would have a downward effect on all housing. Sure, if you're really set on a SFH and there are fewer of them, you'll have to compete. But I think people who want a SFH want a SFH _neighborhood_, and there's an unanswered question to what extent different types of housing can substitute for one another.

The value of _land_ may increase with zoning because development rights are still in limited supply, and the profit opportunity for a developer has gone up. But I don't see many SFH owners clamoring to let their neighbors on both sides be replaced with 5-over-1.

The housing market is not perfectly fungible. A three bedroom house is not replaceable with a studio apartment, and building a studio apartment would only lower the price of houses if there were a lot of people living in houses who would prefer to live in such an apartment. Generally the reverse is true, as more Americans aspire to own a house than live to in an apartment. This survey[1] shows this; look at the difference between live in city and want to live in suburb versus live in suburb and want to live in city. It's not a perfect proxy because many cities have houses and many suburban areas have apartments, but it should give you a general idea. This means that building houses may lower the price of apartments because there are people living in apartments who would prefer not to be. Once they move out, they open up a spot for someone who wants to live there. Three bedroom apartments are much less frequently built than 0-2 bedrooms (the smaller the floor plan, the more tend to be built), but there are still many intangibles like owning the land underneath your building and physical separation from neighbors that lead some people to prefer a house over an equivalently sized apartment/condo.

In addition, many suburban areas are not exclusively single-family houses; they already contain a mixture of apartment buildings and commercial areas, so I dispute your point that single family home buyers insist on exclusively single-family neighborhoods. In most suburban areas I've seen, the apartment buildings tend to cluster together, often near a commercial area, so if you're deep in a sea of houses it's unlikely that your next door neighbor will sell to a developer. People may not be excited if their next door neighbor sells to a developer who plans to build an apartment complex, but that doesn't change the value of their lot, which has increased because the developer is willing to pay more for it if they can build bigger buildings on it.

I was talking about a market with no rules restricting what can be built, and in such a market the neighbor has no say, so their personal opinion is irrelevant. The guy I was arguing with wanted restrictions on housing types he liked to be repealed, but wanted restrictions on housing types he didn't like to be enacted, and I was trying to point out that hypocrisy. Building houses versus apartments is a balancing act governed by demand, but market distortions like banning one type of housing or another can cause an undersupply of certain types of housing, which leads to an increase in prices for the type of housing that is undersupplied and for the substitute it's would-be buyers end up using.

[1] https://news.gallup.com/poll/245249/americans-big-idea-livin...

Didn't say it was perfectly fungible, just fungible enough that a significant enough increase in other types of supply might bring down SFHs. Either that or the true value of a SFH in a no longer housing constrained San Francisco really is $2.5 million.

If you believe that SFH buyers do not insist on SFH neighborhoods (whole cities are not neighborhoods), and should welcome denser zoning because it makes their lot more attractive for redevelopment, go circulate a petition for this among SFH owners and see how far it gets.

You're thinking far too narrowly on SF. In SF, there are people sharing a rented house and treating it as de facto apartments, so my argument still holds. Outside of college towns, that is normally a rare thing, so it isn't applicable for most metro areas that haven't been frozen in time for decades. The Bay Area is a terrible example because they've banned ALL types of housing, not just apartments. They have an urban growth boundary and haven't upgraded their infrastructure to support their growing population, which means that for a given commute time, people must live closer to work than they would with better infrastructure, which increases the number of bidders for each property near offices. I suspect though that even if enough apartments are built in SF so that single-family homes become single-family again, the price of a house there will still be millions. For example, look at the Upper East and West Sides of New York, where there are townhouses worth millions to tens of millions, just like there are in SF, but they are surrounded by massive apartment buildings. Those townhouses are also protected by zoning (In the local government's words: "R8B contextual districts are designed to preserve the character and scale of taller rowhouse neighborhoods."), and they'd be worth even more if a skyscraper could be built there. You could argue NYC still needs more apartments there, but the value of that townhouse's land would still be high, as the developer who wants to build another skyscraper with hundreds of units can afford to pay far more than all but the very richest potential homeowners. A regular New Yorker who wants a house, while they may be priced out of Manhattan, still has the option of moving to New Jersey or somewhere on Long Island and commuting in, as NYC sprawled in addition to building up. If they want to stay a homeowner in Manhattan (or a San Francisco) then they have to outbid the developers.

To your other point about insisting on SFH-only neighborhoods, in large parts of the country, there are apartment buildings and large commercial areas spread between and in single family neighborhoods, and that hasn't stopped people from buying houses there. I wasn't arguing that they all should support higher density zoning, just that it is in their financial best interest to do so. Another major problem is that because the Bay Area has refused to build anything for decades, it has decades of unmet (or to use urbanist language "induced") demand for houses, apartments, roads, transit, etc. that has to be met before prices and congestion will start to go down. To maximize housing affordability you need a mix of sprawl and density with appropriate infrastructure for the type housing built, and if you only do one type of growth you will have many people who are unhappy, which is why in another comment in this thread I accused the YIMBY urbanist of being the same as a NIMBY SFH owner, just with a different preferred housing type. The Gallup survey I linked earlier shows that there are more people currently living in cities (presumably in apartments) who wish to live in suburbs or rural areas (presumably in houses) than the reverse, so there is an unmet demand for "sprawl" and options like remote work.

My major point if a SFH owner in SF was purely motivated by money, they would welcome development on their land and wish to limit it on others'. Many of them aren't though, and they aren't lying or using euphemisms when they say they want the character of their neighborhood preserved. I hear tons of arguments that they are opposing multi-family housing because it would lower their property values, and that just doesn't make sense. A San Francisco with an apartment built for everyone there who wants one and no other changes would most likely still have million dollar houses, though the rent of the apartments would be less.

That's great. I really appreciate the growth boundary. It is one of the reasons I like Portland. That's not at all what I'm referring to. In fact, my position, is that removing the single-family zoning restriction is a good thing. That works against sprawl.

> people like you

I think you may have been triggered by poor reading comprehension and gone off in a fit of ignorant rage and assumed I thought sprawl was a good thing.

My reading comprehension is fine. I'm well aware you're an urbanist who hates sprawl and cars and loves density and transit. You need to work on yours, because I never said that you like sprawl (in fact, I said the exact opposite: "You may personally hate sprawl for various reasons"), only that urban growth boundaries raise the cost of housing and that "NIMBYs", if they were motivated by increasing their property values instead of concerns over the character of their neighborhoods, would support policies like urban growth boundaries and upzoning because they result in a reduction in the supply of houses and an increase in the potential land usage value. You argued that they loved a shortage of housing because it increases property values, and I pointed out that the reality is more nuanced.

How are you any different that the someone who doesn't want an apartment building built because it would change the character of the neighborhood? Both of you support policies that increase the cost of housing in the hopes that everyone will live the lifestyle that each of you prefer. You prefer multi-family housing and want people to live in it, and support policies that make it expensive to live in single-family housing. The hypothetical NIMBY (who is, as mentioned previously, not someone who is purely interested in maximizing their house's value) prefers to live in single family homes and wants it to be expensive to live in multi-family housing. I'm sure you'll reply with some handwavy thing about sustainability and externalities, but the NIMBY can similarly bring up crime, noise, congestion, and other issues with dense living. There is no difference other than which housing type the two groups prefer.

I would be less hostile if urbanists like yourself would just admit that they want to force everyone to live their prefered lifestyle instead of hiding behind bogus economical and questionable environmental arguments. If you truly just wanted the option to rent apartments then there would be no need for policies like urban growth boundaries. Removing both the zoning rules and the boundaries would allow for housing that people want to be developed, but what would you do if your neighbors make the "wrong" choice?

> I would be less hostile

You've been nothing but hostile in this discussion (and apparently from your history, many others). Also you literally edited a comment to deny a claim you made. Just stop.

You edited a comment to change your reply from being an attack based on something I did not say to including an actual argument, and I have not edited a comment beside grammatical changes/minor clarifications and my argument is consistent. Just stop commenting if you can't address my points or hold a discussion.

I think if you are using derisive terms like "stack and pack" for apartments then you are probably precisely the investor that is manufacturing the housing crisis.

Apartments create greater affordability, they allow for designing cities with lower carbon impact than single-unit homes, they allow better community, more connections, cradle-to-grave living, they allow people to survive without having to get in a car to do any task during the day. They are fantastic. I would live in a "stack and pack" home in an instant if they were allowed in my community.

try living in one. they are great maybe from age 24-29. they typically cost more than a mortgage in my area. you don't talk to people when you are that close. I find the greater the distance between neighbors the better the relationship.

I am right at the end of your range and noticing similar trends among my similar-aged peers. We all talked of condos a few years ago, but the single family home with room to breathe and quiet is overtaking our previous desires. I am still conflicted due to my hate of commuting, but the more I read about and experience the downfalls of busy-area living (noise pollution, air pollution, inability to change much about the property, etc) the more I feel the desire to buy straight up acreage in Wyoming.

I also see a lot better community with less people, and I'm sure there are many reasons for that.

I lived in a few recently, after living in a detached house, and my experience was not as you describe. The buildings housed all ages and we were all friendly with each other, and if someone was in the shared outdoor space, a neighbor would quite often come to join them. In the building before that, there was no shared space, but everyone was friendly, no different than the detached house place where I live now.

Which isn't to say anybody should be forced into a multi-unit building and mixed-use neighborhoods. But as you point out, prices for these types of settings are often higher than detached homes, indicating that they are under supplied and more people want them then are currently allowed to live in them.

Your points are true, and I’m in favor of building more housing, however the single family home has traditionally been a financial boon for lots of Americans, and having to pay for rent every month vs keeping some of that value in your mortgage is hard to discount.

I guess I’m just saying there should be cheap smaller houses and condos in cities too, not just rental places.

It's weird, people say the same things whether it's condos or apartments. Where I live, they will typically be derided as "luxury condos" despite being less than half the price of detached homes in the area.

(One of my more heretical opinions is that homes and land shouldn't be considered investments, and should perhaps not be a method of wealth building, as it turns every person into an investor whether they want to be or not. Which fuels regular people to take control of the local political processes that block new homes with talk of "luxury condos" and "stack and pack." If we are going to do something like this I'd favor a sovereign wealth REIT that redistributes the wealth more evenly and removed the financial incentive to be anti-competitive in land use decisions. That, or tax away all profits from speculation on land gains.)

How can investors decrease the supply of housing?

By backing policies and politicians that constrain the expansion of public and affordable private housing in the face of an increasing population. Or by purchasing homes they do not intend to use as a primary residence.

An investment property still has people living in it?

I've never heard of investors lobbying against social housing (in the UK at least).

Forcing investors and developers to provide "affordable housing" arguably makes the problem worse. I.e. it makes it harder to make a profit and therefore disincentivises building new homes.

> An investment property still has people living in it?

Investment properties don't always turn into occupied rentals; sometimes they turn into vacation/secondary homes, airbnbs, &ct. They can also end up vacant if the dwelling is being used purely as an investment vehicle or if the landlord is uninterested in lowering rent in response to market forces, although it's hard (for me, a lay person who doesn't want to spend more than a couple minutes googling) to know if those are significant quantities of homes or just a rounding error.

>I've never heard of investors lobbying against social housing (in the UK at least).

I don't know how UK politics works, but in the US, large investment banks and lobbying groups pour huge amounts of money into our political system, and individual investors also happen to be voters. For example, the last CA ballot measure which would've improved housing justice somewhat (2020's prop 21) saw heavily-financed opposition from landlord associations.

>Forcing investors and developers to provide "affordable housing" arguably makes the problem worse. I.e. it makes it harder to make a profit and therefore disincentivises building new homes.

I don't really have opinions about whether you should force developers to provide affordable housing in new developments, since I think trying to wield market forces to fix social problems has a poor track record in general. If you (well, the government, civil society, whatever) want to incentivize building new affordable homes, you should just build them yourself.

Without knowing more, it sounds complicated: denser infill housing is good in so many ways. Mixed use, with commercial on the ground floor and housing above is even better in many situations, but not all developers do that kind of thing. So it kind of depends on what the alternatives are and what the housing situation is like where you live. There are places where "the perfect is the enemy of the good" in terms of what gets built.

Commercial is critical for '15 minute neighborhoods': https://www.strongtowns.org/journal/2019/9/6/7-rules-for-cre... - but without the density to support local commerce, it's tough to justify it.

But I don't think 15 minute neighborhoods are likely what your angry neighbors had in mind, so most likely just NIMBYism.

Where I live now is planned to be a 15 minute neighborhood. I moved into one of the first new developments of many, all residential, all within a 5-10 minute walk of a train station.

There are about 1000 housing units being built, and there has been zero commercial development. It's great that they are building dwelling units here all around transit, but the only businesses that already exist are industrial, a gas station, and a dollar store. Commercial land owners have been refusing to sell to developers as they watch their land value increase. It's a real shame, but it does seem better than what existed before and the area certainly has potential.

Yes, this is what NIMBY means. "I am ok with more housing, just not by me."

The specifics will vary in every case, but in every case it will be some argument on why THIS is not the right place to build more housing. For every possible value of this. Areas that don't have extremely local control over zoning do a better job of combatting this.

This is kind of textbook NIMBY although it is possible taking away the commercial zoning could make the area too light on commercial activity.

But one of the main contributors to housing shortages is that areas have been overly permissive with commercial zoning (since they don’t have residents, city expenditure is low) which causes imbalances in the amount of jobs:people in an area. That in turn not only increases prices but increases traffic as some portion of people must be commuting from afar to fill those jobs.

Bingo. Balance is way more important than density. It should be mandated by state law. Doesn't need to be per-city; you could have a system to trade jobs vs housing with neighboring cities or something.

A major irony is that California is approaching this all wrong. The "let Scott Wiener build whatever he wants" laws are in some cases being used to make the problem worse. See: Vallco Mall redevelopment plan, more jobs than housing.

I had to laugh at “the most dense development”. 400sqm is absolute luxury in Europe, and plenty of space for a massive detached house with a garden and garage. A house on the high end here sits on less than 150m2 (northern europe).

> 400sqm is absolute luxury in Europe, and plenty of space for a massive detached house with a garden and garage. A house on the high end here sits on less than 150m2 (northern europe).

Just how "massive" can that house be with a garden (say, 35sqm) and a garage (36sqm)? You can probably build a fine house in the remaining 330sqm, no doubt, but I'd hardly call it "massive". Maybe "generous".

OTOH, it might be a point-of-view problem: I'm in South Africa, with a 700sqm building on a 2000sqm plot, in a nice area near the train/bus stop, near all amenities.

It's definitely a point of view problem. We currently own a 90sqm, 3-bed house in the UK and it's not small by any measure here. On this street there are definitely smaller houses than this and people live here with families just fine. Also quite a wealthy area not a dump.

From that point of view, 400sqm sounds positively like a mansion to me. Sure, would love that much space, but I have no idea if houses this large even exist anywhere nearby to buy, I've certainly haven't seen any.

Exactly. The largest homes around here are barely above 200sqm, and cost 2-3 million. Most houses have two or three floors though.

Yes. But birthrate is only half in the Europe compared to the U.S.

And what does that have to do with anything? The USA would need 3 billion citizens to rival the density of the Netherlands.

Or are you implying you need a 500sqm house to raise two kids?

"Everybody" opposed it except I imagine the process did not gather the input of the fifty families who could live there.

To me, the issue depends in large part on the context: What kind of area are you in? Rural? Urban? And what is the availability of housing and the economic diversity of the neighborhood?

I don't think it's useful to try to determine if some loaded, politicized, pejorative term applies by definition.

The developer used a Variance to change zoning rules.

Many Bay Area (I only know this market)counties will happily acccept the fee (upwards of $1000), and 99.99% of the time the Variance is not granted. I truly believe counties count on the fees for revenue.

I 've noticed a slight lightening up though.

Gavin Newsome made it much easier to build certain structures. He made in-law units (ADU) easier to build.

What happened is wealthy people took advantage of the laws, and added extra feet to their already huge house. These ADU will not be rented out to low income, or even strangers. The wealthy found a loophole, and used it to remodel their homes. Oh yea, their is still a lot of kissing town officials ass in order to build anything.

Neusome also mandated new apartments, and reasonably hosing, to be built. It is a great move. He slashed a lot of red tape. It's still a pain though. You will have town officials arguing over siding, window placement, gardens, exactly whom will be living in the ADU.

NIMBY's are alive and well in my county. Just about everytime we want to build a homeless shelter; homeowners scream, and officials listen. (Towns are panicking now over homeless. The homeless camps are getting bigger, and Thurston Howell III does not like looking at them. The Supreme court gave the homeless some rights though. Cops can't just harass them to move quite as easily as they did in the past.)

I have watched towns/counties harass homeowners who want to build since the 80's. (I was going to buy a cabin, and I knew the foundation would need to be replaced. Half the cabin was sitting on a redwood stump. I just wanted to put a foundation in, and it wasen't possible due to zoning.)

I don't like our building system. They make the process rediculiously expensive, and complicated (remember you, tge architect, the contractor, will be going to many meetings with town offivials begging to remodel, or build. They love saying no.

It's become a disensentive for middle class homeowners to remodel.

I currently have one fear over new residential building. It's water in the Bay Area. This drought does not feel temporary.

I woukd like to see apartment complexes build adjacent to 101, but the water shortage needs to be addressed.

At this point, I only trust care about very low income, and the homeless. I have never seen so many people without a roof over their heads.

Congratulations, Central Planner! It sounds like individuals and markets almost won.

lol, that’s not even that dense. We have SFH here in the Bay Area just like that. Lots of places where people have 4000sqft lots with their relatively normal houses.

> I wonder if the opposition would be classified as NIMBY

If a protected classification like gentrification or environmental impact can be found, then it isn't NIMBY anymore.

Say for example, if the town homes projected to be priced higher than the neighborhood, there is a gentrification angle. Density often requires some environmental impact review. For example, a change in development density might have significant water runoff impacts that require a retention area large enough to make the development economically unviable.

I think finding a potential habitat for an endangered species is the strongest reclassification from NIMBY because it doesn't require any change to existing structures, mostly freezes things in place and has regulation from redundant inscrutable jurisdictions and the support of outside organizations that are generally successful and seeking new cases to work on.

Yes lol.

For one thing, the zoning was probably there because the local NIMBY opinion.

> Everybody opposed the rezoning and fought to defeat it.

Why? That's kind of an important point.

For example, unless this is NYC or similar, 49 townhomes is going to need a minimum of at least 110 parking spots (just to hold the occupants alone, assuming no one ever has guests ever). A realistic parking minimum should be 2.5 spots per townhouse.

A lot of builders outsource their pollution to the local neighborhood, especially on infrastructure (parking, water, sewer, electrical, natgas, etc). It's a common reason to opposed development, and it's a good one.

It's usually done to save cash, and it saves literally just pennies. (Parking on these projects, for example, is always less than 6% of the total cost. Cuts to sewer and electrical are less than 12% of total cost). Builders do it anyway, builders will generally build the literally shittiest thing code lets them get away with -- they'd build buildings that fall apart in the slightest breeze, if it were legal to do so.

This is why zoning rules, building codes, and the large piles of regulations are so important.

> The project would have been the most dense townhome development in 4 counties.

Ok, that means it would likely carry the highest prices per square foot in 4 counties, which means it would immediately make that neighborhood the most expensive neighborhood in 4 counties. Could that be a reason it was opposed? Density isn't free, it's a form of financial pollution that the other residents will mostly have carry the burden of. Not everywhere is California, not everywhere gets free unlimited property tax lock-ins. If you built a luxury townhouse next to a generic house, their taxes will spike 200%+ to cover your luxury development, and all nearby rents would spike in a similar way against nearby renters.

I get that California and San Francisco specifically is it's own unique terrible experience. But here in the Midwest, generally speaking, locals are pretty reasonable. You can get away with building almost anything you want, so long as you don't screw over the locals. (And I mean that quite literally, we have almost 100 new developments here in our small city, including the worlds gaudiest ugliest castle monstrosity -- zoning never stops builders ever, you can build anything you want anywhere you want, as long as you don't hurt too many people)

What is actually happening in most cases, is that some sort of builder wants to screw over all residents, residents rightly complain, and then those residents get labeled "NIMBY". The only time a project gets cancelled is when it makes residents bleed so much, they push back hard. And even then, local residents only win that fight about ~40% of the time.

If you can only build dense housing in the places where there are no few jobs and few people it doesn't help much. The fact that the locals are by definition negatively impacted by new development is a great reason to take virtually all say away from the locals.

Anyone who is already a home owner will find that increasing supply of homes a necessary function of the society decreases the value of the asset in which they have parked most of their wealth. Even when it increases the value you can't get them on board. Look at your own logic.

> my taxes will spike 200%+ to cover your luxury development

You aren't covering the cost of their development they are actually increasing the value of your property. For your taxes to spike 200% they would literally have to triple the value of your property. It's like they are throwing hundreds of thousands of dollars in bags full of hundred dollar bills over your fence and you are complaining about income tax.

Presumably if someone did something like build a crack house and halved the value of your property you wouldn't thank them for halving your tax bill!

Basically for any given project locals have interests that are almost always out of alignment with the rest of society. The some people in aggregate elect your state wide officials but at least those folks are apt to think and plan based on a broader perspective than the locals whose attitude is universally "I've got mine"

This is both the worst timeline and the worst most selfish nation.

> It's like they are throwing hundreds of thousands of dollars in bags full of hundred dollar bills over your fence and you are complaining about income tax.

They aren't throwing dollars over the fence, they're throwing debt over the fence.

Sure, my property is on-paper worth more. If I cash that out, I just have to spend it all (every other house got more expensive by an equal amount, and I have to live somewhere). And the new person who buys it now has to cover all that extra debt directly in their mortgage, they get soaked too!

Property values are not real wealth, it's not real money. It's fake. Coastal folks can treat it like it's real, because they can play markets against each other, they can depend on moving to some "low COL" area as their cash-out-to-real-money exit strategy. Those of us in low COL already (or who can't play markets, because they have to stay here for family/work reasons) don't have similar luck, the chain ends here, there's nowhere left to go.

> Presumably if someone did something like build a crack house and halved the value of your property you wouldn't thank them for halving your tax bill!

I would thank them, actually. Property should depreciate. It's the only way housing will ever get affordable for real humans again. I don't expect to get every dollar I paid for a house, back again. No one should.

> locals have interests that are almost always out of alignment with the rest of society.

Locals are the "rest of society". Locals don't all own property, half of our locals rent. Locals who own, still often have kids who need to buy houses, and they want them to be able to afford to live near them. The selfish behaviour seems to be coming entirely from developers or 'urbanists' who think if they just keep ignoring the ramifications of their actions, they can strongarm society into accepting forever-increasing housing costs. Why you paint "Locals" with that brush, when Locals carry every penny of those increased costs, I have no idea.

The utility of your argument relies on it being something burdensome like a 200% increase but in fact if your property went up by 200% for building a complex it would in fact be extraordinary not only for the nation but for your area as well. If your 200k house for example went up to 600k you could in fact sell it and have a money fight with hundreds of thousands of dollars of real profit in your new living room even after you paid off the capital gains especially when the first 250k single or 500k married couple is tax free.

When you reduced the projected change in price to a more reasonable increase like 10% your argument about not being able to move to a lower col area becomes true because everything has gone up equally but it is hard to argue that the increase has greatly burdened your life to the point that people ought not be allowed to build on property they own.

For example locally if assessed value went from 200k to 220k my taxes would increase 16 per month. 400-450k would net me a cool $41 per month.

Looking at actually realistic figures makes it much harder to justify constraining housing supply which negatively effects all of society in order to optimize your tax bill.

> but in fact if your property went up by 200% for building a complex it would in fact be extraordinary

It's not, at least in the us. In the past nine years, my house went from a real-world value of ~$90k (2012), to now being worth ~$240k (2021), despite wages being mostly flat. This is not uncommon, most homes in this or any nearby city have posted somewhat similar gains (plus or minus 10%). This property specifically, recorded it's highest jump ($40k over a single year) in the year after they built luxury apartments in the lot directly behind it.

And that's not a NYC / SF / Chicago / Seattle / Austin type hip place. It's just generic small-city Midwest nowheresville. A place with no restrictions on housing construction whatsoever, and has entire neighborhoods of new development in the past decade to prove it.

> If your 200k house for example went up to 600k you could in fact sell it and have a money fight with hundreds of thousands of dollars of real profit in your new living room

You are not getting it. No, I literally can not do that. If my house went from 200k to 600k, then every other house has also gone up a similar amount. If I sell my house to cash out, my family is homeless, I don't have a "new living room". And if I want a "new living room" to live in, I have to give every single dollar of that 600k back, for some new property at similar high prices. It's not real money, it's debt that I happen to be holding in my hands in paper form, and the future occupant of my house is now on the hook for.

Californians simply can not seem to wrap their head around this. They just assume the money is real, because "move to the south or the midwest" is always an option for them, so they can cash out and keep a bunch of it. Some of us already live in these places, and don't have a magic "high quality housing at cheaper-than-my-home-market rate" place to escape to.

> justify constraining housing supply

Literally no one is arguing to constrain housing supply. Blocking a shitty luxury development never constrains housing, it frees it to be used for real housing.

Fighting against Poisoned Milk sales is not "justifying constraining milk supplies". Fighting against cost-raising developments for private equity firms is not in any way "justifying less housing". You can want more housing and not want everyone's rent to spike, these are not in conflict in any way.

To be clear housing went up 18% per year for 9 years which is materially different than a housing development causing your house to go up 200%. Teasing out the effect would involve looking at similar areas with different development profiles and would be complicated by the fact that the luxury development is more likely to be built in areas that have themselves recently become more desirable..

Whatever you discovered assigning all growth in your property value to that singular event is clearly erronious. As you mentioned all houses in urban areas have gone up substantially. If we assign 10% of that effect to adjacent luxury development we would conclude they had added 15k to your property value. Of course tax calculations vary by state but lets go with WA for a for instance.

It costs you about $12 a month if you save monthly towards your annual property tax. If we assign 20% to the presence of the luxury development which is almost certainly too much it cost you closer to $25 a month.

The truth is certainly underwhelming.

>They just assume the money is real, because "move to the south or the midwest" is always an option for them, so they can cash out and keep a bunch of it. Some of us already live in these places, and don't have a magic "high quality housing at cheaper-than-my-home-market rate" place to escape to.

Yeah, it's absolutely disgusting.

> Property values are not real wealth, it's not real money.

I don’t know, having $100k+ more in equity than a couple years ago it acts like having an asset with real monetary value when I go to a bank looking for credit, having a big effect on both the amount of funds I have access to and the terms on which I can get them.

It’s not liquid like cash, so there is more work to take advantage of it, but its definitely real.

> It's like they are throwing hundreds of thousands of dollars in bags full of hundred dollar bills over your fence

Surely you realize that's not how it works. If the appraisal value goes up, the only receiving any money is the government from their increased tax collection. The owner didn't receive a penny.

The developer wants to build the densest housing in four counties with little parking, and nobody has asked the real question: is this planned as Section 8/affordable housing? It sounds like it. Section 8 is guaranteed income for the landlord and probably a headache for the neighbors, especially if they had no poverty in the area before. A very similar situation happened in my rural village, where a developer decided some commercial property would make a great spot for dense, low-income housing; the village fought it and got called racist by the courts, who forced the village to rezone and the village council to undergo racial sensitivity training.

I guess the other option is that poor people should just be homeless?

The social services costs will be higher than the tax base. City planning involves carefully balancing priorities. If the community is made up of 100 rural homes introducing 100 townhomes used for section 8 property incomes creates chaos.

The developers building the complex are going to be insulated from having low-income housing in their vicinity.

I don't believe you. Civil court judges don't have the authority to order elected politicians to undergo racial sensitivity training. Citation needed

I hope they appealed that ruling. Elected or appointed judge?

Where do you expect poor people to live exactly?

In the big city where they currently live. The rural village I'm in now has a 7% poverty rate, while the nearest big city has a 21% poverty rate. The big city would like to redistribute its poor to suburbs and rural areas and redevelop ("gentrify") the land the poor used to occupy. Poor people don't suddenly come into existence ex nihilo: they exist and live somewhere now. They just need to move into the countryside because the urban real estate is worth too much for them to live on it.

The standard answer has a convenient acronym: NIMBY.

In places that can support additional social services not available in remote communities. The poor are being kicked out of cities.

> Ok, that means it would likely carry the highest prices per square foot in 4 counties, which means it would immediately make that neighborhood the most expensive neighborhood in 4 counties. Could that be a reason it was opposed?

Artificially constraining expensive housing isn't a good thing. If the demand is there in the first place, doing so just means that the people who are interested will insteaad buy or rent existing homes that could have otherwise gone to lower-wealth families.

> Artificially constraining expensive housing isn't a good thing

Again, this isn't California. This is the Midwest. We have gentrification problems even in cities that are still losing population. And we've never constrained housing, for our cities that are slowly growing, many have built more new units than residents for years now. Most cities have no meaningful housing shortage here, but every city currently has a housing market manipulation problem.

> If the demand is there in the first place, doing so just means that the people who are interested will insteaad buy or rent existing homes that could have otherwise gone to lower-wealth families.

Or you could just reduce demand. Perhaps Pension Funds shouldn't be allowed to buy housing at all. Make them invest in something that doesn't hurt citizens. That would reduce prices instantly, without requiring the construction of fake-unusable for-equity-firms-to-hold-only housing.

In what world does it make sense for real humans to have to compete with private equity firms or pension funds for housing? Real humans are constrained by their incomes (incomes that famously haven't grown in decades), everything else is not.

I'll do you one better maybe people that don't intend to live in them at least half the time shouldn't be able to buy a second home.

I agree 100%

>A realistic parking minimum should be 2.5 spots per townhouse.

A realistic approach in the face of coming climate doom would be max 0.5, for the people that really need cars as primary transport due to disability etc.

In theory sure, but that's not realistic, it just induces sprawl.

Great, you manage to artificially limit parking. So the new housing development moves another 10 miles outside of town, to get away from your artificial limit, and now their mowing down a cornfield out there instead for their build, so they can get the parking residents actually need.

If cities want to be a solution to climate change, they have to let people actually live in them. That means, they have to care about the price points of developments (they can't just keep deflecting and saying "luxury housing lowers prices in 50+ years when it trickles down") and they have to care about supporting residents actual transportation needs. (they can't just hide behind "everyone will bike or whatever").

Everytime they deflect on either of those, another farm or forest gets razed instead.

^ So accurate!

Los Angeles is suffering from this. Towers and towers of expensive apartments left empty at 4000+/mo meanwhile the homeless population grows and the population on the border of homelessness grows.

Traffic increases as people move out of the city center and need to commute in and then those people are taxed through congestion charges or tolls and provided with no, or tremendously expensive, parking.

The whole effort seems to conspire against exactly what made the city a city. Dense, mixed zoned, mixed class living

I’m not opposed to people who want to live out in the boonies, but given the extra cost of infrastructure to service them, they should have to pay for the privilege.

They never do though. It’s always the poor neighborhoods close in that subsidize the rich people in the suburbs.

There is no extra infrastructure cost.

Longer roads, longer sidewalks, longer water and sewer pipes. Longer electric and phone cabling. Of course it costs more.

You have no idea what you're talking about. Towns in the boonies don't fund themselves the same way as cities, nor do they provide the same level of public utilities and services. Many small towns only provide electrical service and basic copper phone service--no water, sewer, high-speed internet, etc.

> Longer roads, longer sidewalks, longer water and sewer pipes.

Digging a trench for that new pipe out in boonies over a dirt field can be done in an afternoon by one guy with a backhoe. Putting in the same length of pipe underground in Manhattan will probably take a decade and astronomical amount of money.

When you live in the boonies, utilities are provided for by the local municipality. Water is usually well water. Waste goes to a septic tank.

There is no additional infrastructure cost placed on cities. You are just plain wrong.

The suburbs in my area are all served by the local city. I’m not talking about rural areas.

Ah, your original comment said "boonies" which denotes rural areas far outside of a city.

Parking minimums should not exist, for about 1000 reasons. For further reading on the topic, check out 'the high cost of free parking'. They are a failed experiment from the mid-20th century.

Many places are switching to parking maximums instead of minimums.

I think they exist because in reality, people start parking in driveways (blocking in people that may need to leave home for, say, work/school) or worse - they double-park or loiter in ever more congested circular drives around the neighborhood looking for parking.

49 parking spaces for 49 houses seems like a disaster in anywhere other than the densest of US cities. Surely most houses have at least 2 drivers?

5 Acres is 2 Hectares, so that's about 25 houses per hectare. Typical new housing estates in the UK is about 25 hours per hectare, with minimum of 3 parking spaces (including a garage if given) for a 4 bed, and 2 for a 3 bed.

Even that number of spaces is too low - especially when one is a garage (which nobody uses to park their car)

What if I told you that in many areas households don’t even need a single car?

If you require large amounts of parking everywhere and commensurately large roads, everything ends up so spread out that car based transportation seems like a necessity. It’s a self perpetuating cycle. If you don’t require so much land to be dedicated to cars you can build things denser and lower or even remove the need for personal cars.

I think one car per household is fine for townhomes assuming most are 2-3 bedrooms. A lot of families only need one car.

It's just not like that in reality. There is a townhouse neighborhood near me with 1.25 spots per house, and it is a disaster. A lot of places are occupied by people with roomates, not families. It's the kind of place where most people need a car for their job- work trucks abound, people drive uber or doordash, etc. Not everyone takes a laptop to the office every day. The roads are nearly impassable, people park 1km away. I knew someone trying to run a small business out of their home there (piano lessons) but there was nowhere for customers to park. There is bus service there, but they reduced the number of routes due to insufficient usage.

Yeah, there is for sure a chicken-egg problem here. If the existing public transportation isn’t good then people will just not have enough parking. If everything is still spread apart, or there aren’t sidewalks or biking infrastructure, there won’t be walking or biking to the office or work site.

Although I will say, living in a neighborhood with very little parking, I am sure people who insist on owning a car anyway will think it’s a disaster too. But I love it because everything is close by and I can get around through a variety of non-car methods. But to get to that point takes time.

> What if I told you that in many areas households don’t even need a single car?

Any part of the US where a street of townhomes would be more dense than the existing status quo is not one of these areas.

In my city (Milwaukee Wi) there are plenty of areas with single family houses, less than 10 units/acre with 0-1 cars per house.

It’s not that uncommon in the US, especially in poorer areas

> What if I told you that in many areas households don’t even need a single car?

That's in very dense urban cities. Given the numbers in question (low density 10 houses/acre) that's not going to be the case.

This really depends on too many variables of the surrounding area. There are places this could work, but I would argue there are more areas where this would not.

> What if I told you that in many areas households don’t even need a single car?

Sure, if they live near public transportation. I would vote down a dense housing development of it didn't have access to public transportation

So, what? What business is it of the local government? Why can't we just let consenting adults make their own personal decisions about the details of the housing and parking they choose to live in?

Some people may only need limited parking. Some people may not need any parking. Maybe they're making a mistake and will regret it. Maybe not. Maybe nobody wants that, in which case the developer will pay the cost. Who cares! This is how freedom works. Can we please just stop ramming regulations down people's throats. "Well, no trust me. I'm from the zoning board and I know you're really gonna need two parking spots."

Imagine if we had a clothing board, and anytime a company came out with a new apparel style they had to get approval. "I just don't think anybody wants shorts that far above the knee. Permission denied". Just let the market decide, for God's sakes.

Because there are external costs. The “consenting adults” narrative is false. Not enough parking means people living there will use street parking in nearby areas affecting the residents of those communities. This happens all the time.

This line of dialogue is a very strong demonstration of how car-centric transportation model leads to a perverse anti-social urban development mindset. Unused parking is quite literally the least productive and least attractive use of land, I simply can't fathom seeing it as attractive.

If the discussion was about high density living then sure. It's not, it's about 10 houses per acre, that's decidedly low density - lower than the tipping point where people don't own cars.

Sure, I'm saying it's a mistake for governments to have planned to support such districts in the first place (by building wide roads with on-street parking, the highways to connect the district to the productive parts of the city, presumably lots of car-oriented policy in other parts of the city to keep density low for the sake of traffic, keep parking high for the sake of those in low-density districts, etc).

This problem only exists because street parking is heavily subsidized at below market rates. In urban cores, street parking is often 90% cheaper than garage parking.

True, but again, if there exist people who currently rely on street parking and your solution is to raise prices so that new residents could compete for street parking then this still affects old residents. Gentrification is an externality too.

I am not saying we should stop doing everything that has externalities -- clearly we can't do that. It's just important to know that these transactions are not "between consenting adults" that dont affect others. Just because an owner of some land, some developers, and some perspective tenants agree on something doesn't mean it wont negatively affect a bunch of other people. And ignoring a bunch of other people entirely is not the correct choice.

The market doesn't decide, and everyone suffers. Ban people from storing their vehicles on public property and you're fine, but until that happens you're stuck with the externalities.

Oh and stop low density housing like this being built in cities.

The real disaster (environmental and economic) is that so many places regulate parking so strictly rather than being more market-oriented and allowing people to figure out how much they want.


If nobody was allowed to park on public land, that could work

Certainly in the UK it's common for people to expect to own an extra 50 square foot of land for a car or two, usually abandoned to block the pavement. This impacts everyone, especially those of us who don't drive.

It's not really market oriented, it's tragedy of the commons oriented, as developers will build the cheapest thing they can on the premise that new residents can use existing parking, resulting in a reduction of value for others utilizing those commons. By not having parking minimums, it allows developers to pass those costs onto surrounding residents. There are townhouse neighborhoods near me with nearly impassable streets, people crossing 4 lane roads, spreading into surrounding areas, having to walk over 1km to their home from their parking due to insufficient parking minimums. Everyone sees it is a giant problem now, but it is too late to fix. These minimums are there for a reason.

The solution isn't to build more parking, its to reduce the need for car trips. Improve transit and support commercial development in the neighborhood.

The fact is that we're in a housing affordability crisis. We need builders to build "cheapest thing they can" right now because housing is insanely expensive in most urban areas. Parking minimums make housing more expensive, and the fact that people are buying these homes is saying something important: housing is more important than parking.

Yes parking is nice, and there are costs associated with not having a dedicated parking space for each person. But those costs pale in comparison to the costs we pay for having a severe housing shortage. The economic costs, the costs paid in rents, the costs paid in health.

There isn't a world where you can have it all. But its clear that we need more housing, not more parking, and there is an unavoidable trade-off between the two.

Improved transit works in megacities because of rapid transit but in this case they might add a bus route or the bus might come every 1/2 hour. You still do not have the scale to make public transit work unless you turn this place into an actual city.

You can't improve the transport until you start building high density housing, that's not 10 units per acre.

10 units per acre is 1 house per 5k sqft lot--this is plainly single family detached housing. No one in that zoning is having parking issues. When you start talking about 35duc then you start having parking issues--but at 35duc, you're totally within the realm of being able to justify more frequent bus service for a town with 200k+ people. But if you're in a small town with very progressive density allowances like that, then the solution is simple: improve zoning to encourage more neighborhood commercial. No need to worry about transit in that case.

But 10 units per acre is what was being proposed with just 1 parking space per dwelling. That acre is not going to get increased commercial (not enough customers in walking distance, no parking for people driving in), or transit (not dense enough)

Go for 35 per acre sure, you don't need 70 parking spaces then, because (assuming it isn't literally 35 units in the middle of suburbia) you get commercial and transit (people still got to get to work - maybe in WFH stays around that will change)

I'd be interested to see the land use code where this 10 duc with one allowable parking spot is going. This must be a HUUUGE townhouse to go there if its only permitted to fit one car.

is it 1 car garage or literally, a garage with no driveway? if a link to a specific example was mentioned above in this thread i missed it

Another solution is robotaxis. If ridehailing becomes easily affordable You will have your nice neighborhood back. Robotaxis can pick you up in a minute and go to park and recharge in some distant multi story parking.

If you have an area dense enough to have reliable uber then perhaps it works, but uber (and taxis in general) fall down with families with young children - the kind of people buying low density housing being suggested

That is a science fiction fantasy, not something we can plan on in any reasonable time frame.

The issue is that in areas with sufficient parking, on-street parking has few restrictions; maybe you have to move your car every few days and might have a scheduled street cleaning that you need to move for, but you don't need to obtain a permit or feed a meter or worry about where guests might park.

If you put a building with insufficient parking near there, users of that building are likely to park on the nearby streets and that reduces the utility of the street parking for the existing residents; either they may no longer be able to find parking readily, or they need to manage permits, etc.

It's different if you build in an area that already has tightly restricted parking. If you move into a downtown LA building without enough parking for your vehicles, you're not going to be able to find a free spot nearby and you won't reduce the utility of your neighbors.

It's impossible to take a "market-oriented" approach to parking when street parking exists. Either you remove the street parking, you regulate the space somehow, or you have a tragedy of the commons that pisses everyone off. In context, it sounds like the developer was obviously planning to take advantage of existing street parking to reduce the number of spaces built; it was, as described, the densest development in the area, at a below-normal spaces-per-unit for such an area.

>Minimum of 3 parking spaces for a 4 bed in the UK?

This is certainly not my experience, unless you are counting on street parking and even then, that's a stretch

I'm only thinking of new developments

I'm thinking 5 bed sorry, yes 2 spaces for 3/4, 3 spaces for 5 - at least in my local authority.

Given that almost always one of those is a garage which almost never has a car, reality is tons of on street parking (or rather on pavement parking)

What if that development was walking distance to transit? I live in SF Bayarea suburb in a SFH with a wife and a elementary school aged kid. We have 1 car that is parked in our driveway(on our property). For everything else there is a commuter train within 10-15minute walk and uber within reach.

Limited parking does incentivize non-car-oriented lifestyle. Im all for it.

> Limited parking does incentivize non-car-oriented lifestyle. Im all for it.

No it doesn't, it incentivizes parking arguments and a tragedy of the commons, and creates people who will vote for policies that will convert public land into parking spaces.

I would prefer to reduce on street parking, and increase on street cycle lanes. It sounds like you would too.

By only providing 1 parking space per dwelling you end up with an increased demand for on street parking.

I'm all in for subways everywhere but do you feel as comfortable getting in a rush hour car after covid? I'm starting to think subways and megacities might not be the safest way to live.

I do actually feel safe getting in public transit while covid’s ongoing, and I’m in Tokyo (and taking two of the busiest lines in the world as part of my commute - Chuo and Yamanote).

At this point it seems obvious to me that having windows open, everyone wearing masks, and everyone shutting up, is sufficient to make public transit safe. Because if it wasn’t Tokyo would be in a _much_ worse situation. I fully admit I don’t have rigorous data to back this up, but I kind of can’t see how it could be otherwise.

I feel perfectly safe using public transit. 36,120 people died in traffic in 2019 in the United States. When there isn't a pandemic going on and I'm getting the annual flu vaccine, I feel pretty darn safe compared to driving

But there is an ongoing pandemic going on we can't go back to 2019. The new delta variant makes the vaccine weak. What are the chances this mutates again and again? It doesn't seem like a healthy approach for humans anymore.

The US has notably low public transport usage, yet has one of the highest death rates in the world

Singapore has high barriers to car ownership and has one of the lowest.


Another example that cars take too much space. Public transportation is the answer.

and bikes

And, at least in California, realtors will always push prices up. It’s pretty much never in their best interest to lower the price. Even the buyer’s agent gets paid a percentage of the sale price, so if they try to lower it they’d be essentially working against themselves. And this is without even accounting for all the schemes realtors create (like listing below market to get a lot of offers and create artificially high demand to put pressure on the top offers to increase their bids as high as possible, as well as make them waive their contingencies).

This depends heavily on the market at the time, since there are pressures from multiple directions.

All else being equal, 6% of a higher price beats 6% of a lower price. But 6% of a lower price today in exchange for an hour of work beats $0 if the buyer walks and is not so easily replaced, and it might even beat 6% of a higher price if the higher price comes after many additional hours of work.

Over a long enough timeframe, the trend is toward higher prices, but it's not clear how much of a factor agents are in that, compared to many other factors.

> Over a long enough timeframe, the trend is toward higher prices, but it's not clear how much of a factor agents are in that, compared to many other factors.

I can't imagine agents would have much of an impact when compared to other causes of rising house prices. The way I see it, is that they are more of a kind of facilitator to increase the efficiency of the market, and don't have as much of a role in market behavior.

There is a half-open set of prices the buyer will pay: [0..max).

There is a half-open set of prices the seller will accept: (min..$\infty$]

If these sets do not intersect, there's no deal no matter what the agents do.

If the sets do intersect, the agents collude to ensure that the sale closes at the HIGHEST price in the intersection.

That is why realtors are such a big factor in the housing crisis. They collude to push all of the transactional surplus to the seller, because both agents work for the seller.

I have yet to encounter a realtor that competent, or possessing perfect information, but your mileage may vary.

Blaming real estate agents is just silly. They're salespeople so of course they're going to try to maximize commissions. Ultimately it's up to the buyer to agree on the price or walk away.

Listing prices are almost totally meaningless. At most they're just a starting point for initial negotiations.

> Listing prices are almost totally meaningless. At most they're just a starting point for initial negotiations.

Not sure if you have no experience in real state at all, or just want to play devil’s advocate.

The listing price can have a huge effect. Like I described before, if the listing price is lower than the perceived value of the listing, it makes it attractive to a wider audience, because people that wouldn’t be able to afford the property at the “real” price will think they can now afford it, thus there will be a lot more offers and that gives the realtors (and seller) very good leverage. This happened to me personally, on “the first round” the seller got 40 offers, so the agent used that to pump up the price and make it look like there was a lot of interest (surely there was, but for an unrealistically low price). There were only 3 offers on the “second round”. After 3-4 rounds, the property ended up going for 20%+ over asking and the buyer had to waive all contingencies. Without the artificially low listing price, they would have probably gotten one or two offers at the most and most likely would have not been able to get the buyer to waive contingencies.

Conversely, if the listing price is too high, the property might take a long time to sell, and lowering the price signals that the seller is either in a hurry or that there’s an issue with the property, either way the seller loses a lot of negotiating power.

I have experience in real estate. Listing prices are largely irrelevant. Your concern is completely misplaced and you don't understand causality. Multiple rounds of bidding are common in high demand areas regardless of whether the listing price is aligned with the market value.

Some of this is changing - I've heard that Redfin agents (who are employees - they don't split commissions the way other brokerages do) get paid a bonus structure that's tiered based on list price. So at the time they show you the house, the bonus they get if you buy it is already set, regardless what you pay for it. They still do have an incentive to show you more expensive homes, but they don't have an incentive to jack up your bid during the negotiations so that they get 3% of a bigger sale price. They also get paid for a bunch of other activities (like giving tours, writing offers, typing up agent notes that you see on the website), so it's not a total loss for them if you don't end up winning the bid.

See, I used to think that maybe with the different compensation structure, Redfin agents' interested might end up being more in line with the buyers. I ended up working with one, and realized that is absolutely not the case.

First, yes, Redfin agents don't get commissions the way traditional real estates agents get commissions. However, Redfin agents do still want to close as many deals as possible. Also, while real estate agents have a tough job finding good leads (especially given that leads don't exactly keep buying property) Redfin agents do not have a tough time finding leads (they have one phenomenal website that just gives them constant leads). What it results in is that a good traditional agent will put in a lot more work to find an appropriate place for you, because not only do they rely on you buying through them, but more importantly, they rely on you being happy enough that you recommend them to other people.

Redfin does not need your recommendations, as they've got a line out the door. So if anything starts getting difficult with your purchase, Redfin has no incentive to stick around and figure it out.

I've bought three properties and made an offer that fell through on one, and looked around other times. I've tried both traditional agents and a Redfin agent, and will never again work with Redfin.

It works for a certain type of buyer, one who basically wants to drive the process themselves and just needs an agent for guidance. This described us pretty well, and many other Millennials. We basically just wanted an agent because we were househunting during COVID and needed one to literally get in the door, and to help guide us through the paperwork and process since we were FTHBs. Redfin was great for this; our agent didn't pressure us to buy or steer us toward any particular homes, then he had a bunch of useful information when it came time to negotiating and putting in an actual offer.

So, I wasn’t a first time home buyer and didn’t hand holding. What I did need was an argent which was actually working for me, not just trying to close at all costs.

I think in situations where the property doesn’t have any issues, where you’re just going in to buy a place, they can work out fine. Unfortunately you have no idea what kind of place you’re looking at until you’re trying to buy it.

Every worthwhile agent will have a ton of useful information before and after you purchase.

Yes, I have seen this too. It works against sellers too, in a cooler market; they are more incentivized to close quickly than to find the best price. Considering it's relatively trivial to list and find just about any kind of good these days, I just don't see the added value that agents bring to either side being worth much at all.

Fun fact: Listings in California used to contain a unilateral offer of subagency by default. So _all_ realtors were legally bound to work in the seller's interest, even if a buyer had reached out to them in the first place. So you can imagine how often you would disclose your buying criteria to "your" agent only to have them utilize that against you.

I'd like to add my n=1 as a counterpoint to this.

I sold a house just before the pandemic struck. The realtor I chose, via a friend-of-friend connection, operated several agencies each with several agents; I would guess he had a few dozen people total working under him.

One thing quickly became apparent as we moved through the various processes involved in selling a home – he had his agencies and his agents optimize for volume. In the regions of CA where he operated, "throughput" was definitely not an issue, and so deliberately pricing homes low would cause them to sell faster and allow him / his agents to move onto the next client faster. Given the context, it seems clear to me this would yield more over the long term than fighting tooth and nail to drag out individual transactions to eke out every possible penny.

I caught onto this just before officially listing my house, and insisted we increase the asking price (recommended by him / his team) by 10% – a move he / his team objected to rather frankly. Nonetheless, the sale was completed within 6 weeks or so, at my asking price.

(And seems worth adding he never said thank you for the 10% [relative] extra he earned on the commission)

> Even the buyer’s agent gets paid a percentage of the sale price, so if they try to lower it they’d be essentially working against themselves.

This makes me hopping mad. On what crazy world can they be considered the "buyer's" agent when their incentives are exactly opposite to those of the buyer?

It's like if defense attorneys were expected to argue for the prosecution, and everybody was okay with this.

> Even the buyer’s agent gets paid a percentage of the sale price, so if they try to lower it they’d be essentially working against themselves.

Yeah, I really wish we normalized fee-for-service for buyer's agents. Agree on a fair hourly rate for their time, plus some constant fee for actually closing. The agent can have more consistent income over time, and the buyer can know that the agent's incentives are not misaligned. Buyers at the lower end of the market also don't get lesser attention.

But I think because we have normalized the commission structure, there's now also a bias effect, where the agents who are most willing to agree to a fee-for-service arrangement are the agents who are least successful/satisfied under the commission model.


Prices are set by supply and demand. Realtors don’t control that.

Build 1-10 million 400 sq-ft studio apartments will solve the housing price problem.

Existing inventory can cover families.

Supply and demand. I think of demand as people looking to live in homes, not investors. If that was the case, demand should have dropped off a cliff after covid when they closed the borders. Our countries have negative birth rates. Immigration is the only source of new people. So you must have come to the conclusion at this point that the demand is purely investment driven via speculation. Now see a problem with just building more houses? They will just keep driving speculation until it all collapses leaving us with many many homes that will be wayyyy too cheap. And it will collapse, investors are purely just trading with themselves at this point as less and less people are participating in the market.

People moving around inside of a country is also a source of demand.

The price of condos in San Francisco dropped 10% with COVID-19. The prices in the Tahoe area are up about 20 - 30% over the past 12 months.

The demand moved to single family homes, because people wanted a yard, when they were locked down at home, with few things open.

Now that California and San Francisco is opening back up, the real estate demand is coming back, as are the prices. Yes, speculation and investment is part of the story. But also a lot of people made a lot of money in the stock merket over the past 12 months, and are looking to upgrade their housing.

Please no. There is no need to squeeze new buyers and force them into subtandard conditions. There's no reason cities can't redevelop 2 neighborhoods to 10 stories instead of 1 neighborhood to 5 and still have livable 1-2br apartments. The "where will we fit everything" issue is manufactured by NIMBYs who think a designated area for micro-housing or single story ADUs in the backs of lots will spoil their views less. It's another way to maintain the class boundary while appearing socially responsible.

Interesting theory. My CA realtor told me to bid below asking price and we got the house.

Repeat business is a good motivator. We were happy with the realtor after our first purchase, used them to sell that property and again, in our second search and then recommended them to friends who made purchases. The marginal income they could have gotten by pushing us to a higher price are dwarfed by their combined earnings.

That sounds insightful, but there's no point in screwing a buyer for a tiny today payday.

Those agents work on volume, so if you think they're pushing you to not get the lowest price, it's so they can close the deal, not because their incentives aren't aligned with yours. If they're telling you to offer more, it's because they have better knowledge of the market and the game than you.

They're banking on many commissions a month, not on the fractional share of that extra $10k you don't want to fork over.

It’s similar (if symmetrical) to the situation with recruiters — most of their money comes from getting you an offer and you then accepting it. Negotiating a better salary gives them more money, but costs time that would’ve been better spent getting another person a job.

> That sounds insightful, but there's no point in screwing a buyer for a tiny today payday.

Except: 1) most people will only buy a property once, so there’s very little potential downside for the agent, and 2) is not about screwing the buyer over, is about driving the whole market higher so they can keep pumping their commissions up and convincing more owners to sell. The latter is specially easy to do in smaller cities/communities served only by a small number of local realtors.

There’s plenty of people trying to game almost any valuable market in the world. You don’t think at least some realtors (of course not all of them) are trying to do the same? Specially when most of the buyers and sellers are in it for just one transaction in their whole lives, and there’s so much money involved?

Think of it as the prisoners dilemma. If you play once, the optimal is to screw over the other player. That’s what realtors are facing 90% of the time, a sequence of one-time prisoners dilemmas. Except if they do it right, they get to increase the value of the outcomes over time.

> most people will only buy a property once, so there’s very little potential downside for the agent,

Agents do get repeat and referral business if they don't suck; the agent we use has been involved in several sales and a purchase for our extended family in a few years, and we've referred other people to her, too.

> Specially when most of the buyers and sellers are in it for just one transaction in their whole lives,

The median person who buys a home at least once buys significantly more than one in their lifetime (the lowest estimate I’ve seen is around 3, 5+ seems more common), “first-time” homebuyers (which are just people who haven't owned and occupied a home in the last three years, not people who have never owned a previous home) only make up about third of homebuyers.

> the agent we use has been involved in several sales and a purchase for our extended family in a few years, and we've referred other people to her, too.

Great, so you are wealthy and have wealthy friends and family. Cool. That still doesn’t mean agents are not trying to get prices up.

Your experience could mean that your agent noticed you had money and decided it would be in her best interest to treat you well.

You got me about how many times someone buys property. I looked it up and it seems like “most people can expect to own three homes during their lifetimes”. So, let’s say you buy your first home at 30 and die at 81, and own each house for the same time, then you’ll buy a new house every (81-30)/3 = 17 years. It’s very hard for me to believe that an agent will try to get someone a lower price just so they can work with them again 17 years later.

Also, given rising housing prices and the state of overall student debt/rising costs of education, I would bet that the average number of houses someone buys/owns in a lifetime is going to drastically go down in the next few decades (thus reducing even further the possibility of an agent of getting repeat business from a single client, unless maybe they are as wealthy as you and your friends and family).

> Great, so you are wealthy and have wealthy friends and family.

Relative to HN, probably not; globally, definitely, for California...that’s sort of a fuzzy matter of perspective (probably not for a California homeowner), but, eh, whatever. Not the point. My point is that satisfaction is not completely irrelevant for agents.

> That still doesn’t mean agents are not trying to get prices up.

Maybe, though even if they aren't hoping for repeat or referral business the incentives are more for agents to close deals as rapidly as possible; most buyers are going to be looking near the limit of what they can afford anyway, a buyer's agent trying to push them higher is just going to make the process slower. A seller's agent wanting to maximize price would actually be acting in their principal’s interest, but even on the seller side the incentive is to get a deal and close rather than drag things out for a little bump; spending twice the work for a an extra 10% on thr sale price (and thus commission) isn’t a winning move even though it may be what the seller would want.

> Also, given rising housing prices and the state of overall student debt/rising costs of education, I would bet that the average number of houses someone buys/owns in a lifetime is going to drastically go down in the next few decades

The sources I’ve seen have shown it going up recently (increasing economic inequality and buy/rent price ratio should probably have that effect by cutting some of the people that would buy the fewest houses entirely out of homeownership.)

The fact that they're focused on volume is exactly why their incentives are not aligned with yours.

In Queens and Brooklyn, before the Amazon NYC Headquarters was derailed, they had bus tours of Chinese investors, driving around, looking for for sale signs. It was crazy.

That has been very common for the last 30 years and AFAIK hasn't slowed down.

30 years? That seems like a long time for China. Maybe the Japanese and/or Koreans?

30 years ago was only the 1990s, its on track.

Consider that:

- Most American households own their home.

- Homeowners vote at substantially higher rates than renters.

- Home equity is one of the largest components of American wealth (roughly equal with retirement accounts).

Taken together it's difficult to see how home values will be allowed to fall.

> Taken together it's difficult to see how home values will be allowed to fall.

If you allow increased density, and you use it to provide actually valuable homes (rather than studio/one/two bed apartments or the like mostly intended as a store of wealth), then land value can go up while unit value goes down.

This means people joining the market can buy for a couple of years salary, while people already in the market can exit and downsize for a decade's salary.

I would very much like this to be true. Do you have a citable source?

> Most American households own their home.

Do you have a reference for that? I'm interested to see how it breaks down. I have to assume this is true because of America's aging population.

There's data released directly by the US Census Bureau for this: https://fred.stlouisfed.org/series/RHORUSQ156N

I'd say the tax advantages have a lot to do with it to.

A portfolio of several thousand Prop 13 jackpots is a pretty good situation to be in.

Makes me wish that they would increase property taxes for multiple residence owners & make sure to include residential conglomerates.

It should be that each additional house after the first has a tax penalty that increases on a logarithmic scale to make it financially unsavory for people to own more than one house. In an ideal world, owning multiple homes would be an ostentatious display of wealth and not a common investment vehicle.

That's a lot more complicated than a land value tax.

I know Californians are sickened by the idea that taxes could go up when the house you live in is worth more but this happens all over the world and it's honestly just fine.

The wealthy will just create a bunch of LLCs that own one house each.

Then single family homes owned by LLCs should be taxed out the ass. I know it's a cat and mouse game, but if a corporation is the owner of a home that should be a dead give away that it should be taxed at a higher rate than for one owned by an individual.

Indeed— like a lot of these things, it would punish upper-middle class families who inherit a cottage, but not affect anyone with >5 residences since at scale the work needed to evade becomes worthwhile.

There's already multiple rules for "primary residency", you could structure a progressive property tax off of that.

Also, the low supply of new houses already created a market for them to control. If there’s already a bottleneck, then half your job is already done. Buy everything up, and continue buying new ones at a decent rate to maintain the bottleneck. A veritable housing OPEC controlling the outflow and production of homes. Sinister stuff.

Congress absolutely needs to do something about this.

Not only investment but also as a safe holding of value or shadow banking unit of account. Once you get enough money there's no safe place to keep it. While banks are relatively low friction, real estate ownership is like an account with the state, "guaranteed" by our attachment to the structure of our society and the government's "monopoly" on legitimate violence.

Love CAVE and BANANA acronyms! Very good summary of world in 2021 (sadly).

DILDO (double income large dog owners)

> Support groups like https://yimbyaction.org/ if you want to 'stick it to the investors'.

I’m pretty sure you’re not sticking it to investors if you support development.

You might be sticking it to different investors.

The word "investor" is conflating two things. On one hand you've got "investment" where someone pays up front for materials, construction workers, and equipment, producing a building, and then makes money by selling or renting that building. This is good, because it resulted in a building that people can live in. On the other hand you've got "investment" where someone purchased a preexisting building, in a way that's disconnected from the process that caused it to get built in the first place. This is usually neutral or bad.

So yes, it's sticking it to different investors. But that's a good thing! Stick it to the investors for whom "investment" means pushing dollars around, rather than the ones for whom investment means construction.

A major reason the first investor built the building is because he/she knew someone else would buy it later.

Otherwise people can only invest things they're ready to run themselves basically forever. This would destroy the economy.

Disincentivize the rent-seeking investors.

Incentivize the investors creating and selling something of value.

Precisely. Also, really, the vast majority of benefits from housing scarcity accrue to existing homeowners:


Investors in passive assets can go screw themselves.

Developers aren't passive asset investors, they ... you know ... actually create things.

This is a dumb investment. In order for the entier country to not descend into dysfunctional chaos there will have to be statewide laws that prevent this sort of brain damage.

When that happens there will be nothing keeping the prices of individual housing units in these areas up.

By that time - funds will have charged their fees, personnel will have earned their bonuses, etc.

After I spent my entire net worth plus a good chunk of my future net worth on this house you can be damn right I’m going to vote to protect its value.

Hmmm this just seems like a bad decision on your part. I bought my house in 2018 and it was expensive, yes, but definitely manageable on my salary. I definitely would not buy a house right now, especially if it required spending 'my entire net worth plus a good chunk of my future net worth'.

Almost everyone spends more than their present net worth on their house. It’s great for you that you didn’t have to but I’m not in the minority.

It's a vicious cycle – OP and others are forced to commit most of their wealth to own a home because of all the NIMBYs that came before them, and on and on.

Nah... That's just ignorance.

It's like the American opposition to pedestrianization of blocks. Pedestrianized blocks increase local business footfall and increase high margin economic activity.

New developments in your community increase value of your home, far better than restricting development.

How's that? Genuinely curious.

Opposition to development hurts the homeowners value, a lot.

The value of your home doesn't only depend on the fact that it's in a rich neighborhood with beautiful lawns, but the services and proximity to said services.

NYC is desireable, not because it's a big city... but because you can get services there. Take away the services - you take away all of the value proposition.

In my area, we have everything around us (big retailers, malls, nightlife, etc.) in the suburbs in a well-off area in South Florida. How would adding more houses appreciate my property's value?

More people = more service consumers = more jobs = higher demand for housing = higher demand for services

For most Americans, if you want to own property you drain most of your savings and take on debt worth many times your annual income. If people did not do this the demand for real estate would crater.

What key metrics do you observe when it boils down to determining whether or not you feel it is a good or bad time to buy?

It is worthwhile to recognize that there is nothing unusual in this response, many homeowners feel this way.

But then by same token we can also move to justifying other things, like not hiring people without CS degrees (I spent $xxx,xxx on my CS degree, I want to protect its value), only hiring other MBAs, only hiring people with prior experience in tech companies etc. – which can perpetuate and amplify inequality in opportunity among society.

At what point do we move from that to a more altruistic viewpoint? I am genuinely not sure.

There's "wanting to protect the value of your home" and there's "I'm going to vote NIMBY/BANANA and screw everybody else out of a place to live because I decided to 'invest' all my money in this house and expect it to be a nest egg that catapults me out of the working class." It sounds like the parent is in the latter category.

Is the problem "losing value in my house" or "not realizing astronomical gains like my peers"? And if building much-needed housing does decrease your house's value then hey, maybe your house was overvalued at the price you paid and you made a bad 'investment'. Why punish everyone else and artificially strangle housing supply to cover your bad decision?

If "protect its value" means maintain and strengthen it, retrofit it against likely disasters, plant gardens and craft way to preserve the products, add off-grid energey infrastructure, etc., then that's great.

If it means try to use the heavy hand of the state to prevent others from living their best life, then you aren't protecting anything; you're violently stealing the future net worth of others and making it your own.

It’s all violent stealing back to the white people who took this land from its settlers at the wrong end of a gun. I got ripped off and I’m not going to be the bigger man and be the first person in this chain to say “it’s ok, I don’t mind losing a million dollars on this.”

Hyperbole doesn't help here. Legalizing four-plexes in your neighborhood will almost never knock a million dollars off your home's value. I bet it'd be hard to find many examples of upzoning causing SFHs to drop significantly in price anywhere.

Gambling your entire net worth on a single hyper-local investment is not a good idea.

Sadly in many parts of the US, that is how one gets access to the best public schools -- via home purchases. Many of the best public schools are in districts w/o a large number of rentals.

It’s a great idea, it means that my kids will go to school with other kids whose parents care a lot about their education. A large amount of money shouldn’t be needed for that, but I didn’t see another way to achieve that outcome.

Schools can go downhill pretty fast, and often do.

Markets also go downhill. If you really went all out with paying for it, you also need to hope that your employment will remain stable. People who are very comfortable with their job and predict no downsides are often the ones getting bitten when the market changes, as it always does.

“Screw you, I got mine!”

The capitalistic attitude in a nutshell.

More like "I got screwed and I'd rather other people get screwed than get screwed further." Obviously not selfless, but I don't think the housing market is their fault.

BANANA results in higher homeless rates, that means that denying any building anywhere... you're actively supporting increase in homelessness.

Yeah why fix anything ever? If it was bad for me it should be bad for them too right?

In fact, I'll actively try to make things worse for them to try and eke out a little profit.

Do you own/mortgage a house you're willing to lose what you put in?

This explains why the price per unit is very high, but the land itself is valuable in the first place because there's high demand for it and that land would be even more valuable if it were legal to build more units on it, which would lower the price per unit, but increase the overall value of the investment.

This is what's called a win-win.

Another reason to consider: money printing and inflation

I would not call it artificially constrained supply. New construction in the vicinity has an effect on the quality of life in the existing houses/flats. In the end space is indeed physically constrained, especially where people want to live. Even from that scarcity perspective a lot of low density construction just seems like waste.

I guess you could get both perspectives behind a Georgism type land value tax.

Is there a market in the US where density and population growth has made land cheaper? I can't think of one.

Development increases the value of land in the long run, that's nearly tautological; investors in land will benefit from this increase just like the developers themselves do. I think there's a high likelihood that the markets for "home with land" and "condo" diverge further in the future. Increased demand and density only increases the scarcity of single family homes with actual plots of land in popular areas.

There are a lot of vacant/under-utilized properties, especially ones zoned commercial, next to high-demand residential areas in my town. The owners seem to be just sitting on the property and waiting, vs actually fully making use of it currently.

I'd go a step further: why are we arguing about single-family homes when we have homeless people camped out around unused commercial and industrial properties? That's the property that's being wasted and could most-easily be re-utilized. If you have continual high demand it will be difficult to add supply fast enough once you run out of empty surrounding land (that's the biggest difference between the big coastal cities and the Phoenix/Dallas/Atlantas of the world) because it requires demolition and higher-density construction), but at the very least if you're in that situation, attack the empty areas harder!

(Whether or not there's ANY good sustainable long-term solution for perpetual demand growth is another question entirely...)

Why artificially? People move into single family dwelling neighborhoods because they have lower crime and better schools. There’s nothing artificial about selecting the best environment for yourself and your family.

Is it necessary to artificially editorialize when you’re making what is, at its root, a thinly veiled socio-political point?

> Why artificially?

Artificial in the sense of "caused or produced by a human and especially social or political agency" (see https://www.merriam-webster.com/dictionary/artificial).

When prices of something get higher, people naturally try to make more of it to increase supply and cash in on that demand. If a law or zoning regulation or whatever prevents that from happening, that's artificial.

It's not really a statement about whether those laws or regulations are better overall. It's a comparison to other types of investment alternatives which follow the normal laws of supply and demand and have the (lower) earnings to go along with it.

So why would people like you oppose development of other single family homes in your area? Or go out of your way to oppose development of high density buildings around transit stations? (Don't take it personally, but you know that many people will in principle oppose a mixed density development in not far from their homes - 5-10miles. Or pedestrianization of a street, in the middle of their town)

Look at the map of LA, where there's miles upon miles of low rise buildings... That need not be there, if a few high density blocks were created.

Or the insanity of San Francisco...

I agree. I moved to a suburban single family home neighborhood specifically because I like the environment of a neighborhood with suburban single family homes. That suits me and my family. Others might like low-rise apartment buildings and townhomes, and they should have access to neighborhoods with that type of housing. Others might like high-rise apartments, and those neighborhoods should be available too. Why is it so bad that many different types of neighborhoods exist?

Nimbys fight against higher density housing everywhere. Read the BANANA definition up thread.

As an Oregonian I’m a little disgusted with social activists in Portland couching their impending rape of many neighborhoods across the state as YIMBY when this policy was designed to attack rural Oregon specifically.

If you could unravel all perverse effects of American localist planning and regulation, it would be great.

But if the idea is just "let the developers build where they want and that solves everything", that idea is wrong. Developers don't want to build the dense, affordable house that's needed. Developers want to take advantage of the existing housing and housing expectation and build one bigger house or bigger development one ring out among the suburbs.

What's needed is dense construction near to cities and regulations to support that. And "Yimby" and so forth aren't supporting no regulations, they're supporting pure developer friendly regulations, which won't do anything but give them a piece of the present perverse "gold rush".

What is this nonsense? Yimbys are support upzoning property, so denser housing can be built. They support removing parking minimums so denser housing can be built.

Most places (where I live, Nevada City, for example) upzoning and reducing parking limits would just create problems. It's the actual central areas where you want to allow much greater density. A denser outlying suburb isn't a win.

Outlying suburbs should see an increase in the sorts of things that make them "places". Cafes, bakeries, bars, restaurants, offices, markets, schools, plazas, bookstores, and so on. Then they can further densify without automatically driving more commute traffic into the city.

Doesn't make sense that increasing density from very low to merely low in an outlying suburb would result in cafes and bakeries. You're talking places already oriented to the automobile, where people drive to the whatever cafe or bakery they already like in a large area.

You're assuming that those local businesses can just spin up and wait what, months? years? for the density to reach levels that will sustain said local businesses. Most people don't have the money to throw down the drain like that merely wishing for the urbanist utopia to arrive. In the real world, money matters, timescales matter, customers matter, etc.

Developers make money by building what people want.

> they know your neighbors will do the dirty work of artificially constraining the housing supply, which makes it a good investment

...until your neighbors are all renters, at which point the tide turns?

A lot of renters are nimbys as well, due to misconceptions, or other factors such as rent-control affecting their outlook.

Err…no one wants their neighborhood to suddenly have a bunch of new unknown people in it, right? You don’t have to be a nimby to be concerned about who you live next to. It’s not a “misconception” in that sense, especially if moving is impossible because of rent control, as you mention.

Perhaps we need better protections around dealing with insufferable neighbors and other neighborhood changes’ negative impacts, and people will object less?

I live in a big city, and currently know maybe 1% of the neighbors if lucky. Unknown folks are not a concern.

I believe you, on the other hand, you’re one data point, and apartment buildings have stricter rules about acceptable activities and behavior (as I propose above).

Even in the biggest cities, apartment buildings often have board that approve sales and/or new residents.

It’s low rates and the realization that they can artificially constrict supply. It’s rent seeking and until a decade ago, it was absent in SFR.

this is interesting, when supply is artificially limited so reliably you can bank long term investments on it. Pretty amazing.

> they know your neighbors will do the dirty work of artificially constraining the housing supply

And then the same middle-class (mostly white, with some Asian mix on the West Coast) plays the "revolt game" of supporting the Afro-American and Latino US population, blaming the latter's condition only on racism, totally ignoring the class war now unfolding in the States of which they (said middle-class) are the "baddies" part. Absolutely appalling.

This comment is too on the nose, but there is truth to it. In the hypocrisy of urban nimbys, oblivious to the fact that their actions directly contribute to income inequality.

I think also that high lumber prices combined with tariffs contribute quite a bit.

How does this not play out like Archegos in the end?


If you’re politically connected and influential, you get bailed out. Also, Blackrock is intermediating people’s pensions, so they’re ultimately just levering up retirees against the future generations of home buyers (empowered by the Fed). Think the politically connected Fed/DC/Davos crowd is simply going to just hand over power and influence?

Aha. So, basically, there are some failures in this particular market that make it more difficult for prices to correct themselves?

The Fed buying $40B of MBS bonds a month sure isn’t helping

Housing is not a normal rational market like a market for shoes, every ecobonist knows that much.

Housing supply cannot, and never could fix the problem. There is no city or country in the world where this has ever succeeded.

The house prices are rising because of increasing financialisation of our economy, cheap credit and low interest rates.

700,000 people left London during pandemic, put prices keep rising.

If we offered 300 year long mortgages that get passed on to your next of kin, house prices would quadruple overnight. The price of a house has no relationship to it's utility, like it does for all other goods. You know you will always be able to sell it for more to the bext sucker.

False, false, and false.

True, financialisation is a factor, combating that must be part of the solution.

"False" is a hell of an elaborate argument, very convincing when placed against 50 years of data across 5 countries, all leading to same skyrocketing housing prices.

Nothing more needed to refute an argument of said quality. If I delivered one million finished apartments to your city anywhere in the world today, the average price would go down. How about ten or a hundred million? Q.E.D.

Housing scarcity is real, whether you believe it or not.

I'm really not sure that's true. I don't know exactly how many were built, but Melbourne (Australia) added a lot of CBD apartments and the price continued to shoot up.

Those were overwhelmingly tiny/cheap/low-quality/investor-bought apartments, but the fact is they were still there.

That there are places where foreign buyers outnumber locals ten to one, or other govt interference happens, do not refute basics of economics. Australian cities are tiny compared to Asia or even LA, and certainly units built were not in the millions.

i.e. if your locality has additional issues, the solution is to fix them. Don't use them as excuses to build less housing for folks that need it.

You accuse others of economic illeteracy while yourself fail to grasp or address basic concepts like inelastic goods and market failure.

I see the church of free market is strong here.

Open an article by an actual economist, not a political pundit. They know for a fact you can't build your way out of the housing bubble.


Lead, follow, or get out of the way.

You lost me at the end. You lack political acumen if you think this is how politics works: " If there's a credible threat to build plenty of housing, they'll move on."

The Yimbies supported Mayor Breed. She hasn't changed the political problems in SF that you're (for the most part, accurately) diagnosing here.

The problem with most anti-activist government screeds like this is that they lack the same nuance and sophistication they would bring to, for example, commenting on a market analysis. I'm almost certain your position here is "end zoning." I'm fine with that. But it takes way more than shit posting, and the people who believe what you do are literally at the top of the city's government in San Francisco, and nothing has changed.

You need a better understanding of politics and a sharper theory of change. Just applying your own premise to this comment, investors are actually relying on people like YOU failing to learn more about politics and failing to understand how to better communicate about politics. YOU are part of the problem, not above it.

I don't live in San Francisco, and our local YIMBY group is getting things done, thank you very much. We helped nudge our local representatives towards passing HB2001 in Oregon, which will add to the supply of more affordable homes. We've helped get apartments built locally. We speak regularly with our city councilors.

It takes a lot more than being 'highly online' and YIMBY groups are doing that work.

Now that duplexes are allowed, how long does it take to get one approved?

Still too long. The bill has not been fully implemented as cities have a few years to adapt it into their code.

But you just keep pushing where you can.


I've found density laws wildly accepted, its a building boom in Newberg as people add ADU's and more housing. I don't know where you get your information, but if you own a home in a growth boundary in a small town in Oregon, its "Lets build an ADU" time like never before.

You’re kidding, right? This flies contrary to what I’ve seen. Anyway Newberg is a suburb of Hillsburrito at this point.

I don’t even understand this comment at all. So the solution to NIMBY activists controlling local government is to do... nothing? You know YIMBY is itself an activist movement right? Activist isn’t a code word for “crazy left wing people I don’t like”, it just means people who are hyper politically active (moreover N/Y IMBY is not clearly demarcated on political lines IMO).

All you have done is said the person you are replying to is an idiot for YIMBY but the only argument is that they support Breed. That’s definitely part of the problem but in SF the board of supervisors also hold a lot of power and those are more important. Also, Breed is supported as a least-worst candidate.

If you don't understand the comment "at all," I suspect replying to you won't resolve the issue.

>All you have done is said the person you are replying to is an idiot for YIMBY but the only argument is that they support Breed.

That's not all I've said. Read slower.

"Read slower"

Write clearer

More clearly?

Since you understand politics so well you understand Mayor Breed can't unilaterally write housing policy. She has to work with the Board of Supervisors. The Board is dominated by a group of politicians that aren't really YIMBY supported as far as I know.

Since your reading comprehension is so high, you'll agree then that supporting yimby groups won't be sufficient to generate the credible threat that the original comment suggests will be sufficient to dissuade investors

Since yours is, you'll see that the original comment didn't say it would be sufficient. Those were two separate sentences.

This is one sentence: "Support groups like https://yimbyaction.org/ if you want to 'stick it to the investors'."

I'm done here. Feel free to defend bad activism or advance whatever incorrect semantic interpretation you have of our exchange.

Do you have any ideas to propose then, as actionable advice for activists to improve their effectiveness?

Yes. Do better than this: "If there's a credible threat to build plenty of housing, they'll move on."

What's needed is a mainstream, national name-n'-shame strategy that identifies specific officials and offices that are causing the block in housing. Make the target highly specific and concrete, and ensure the messaging is big tent -- don't make it anti-municipal government. Make it anti-zoning.

It's a waste of political bandwidth that most Americans know the name of at least one random House Rep that represents their partisan opponent either because Fox News or MSNBC, but none of us has any idea about the bureaucrats who are making terrible anti-housing policy decisions every day and driving up the cost of owning shelter.

Read this article and tell me how the amount of pro-YIMBY energy hasn't yet turned this into a major, populist outcry against specific people and specific government agencies: https://www.sfchronicle.com/bayarea/place/article/The-quest-...

Maybe it's because people disagree with you--people who like where they live and don't prefer radical changes and ideas. Maybe you should go talk to some of them and learn about what they want and why they prefer stable policies.

What you call "anti-housing" others call "pro-stability."

I think this assumes that diversity of opinion among an electorate is what's responsible for one movement's ineptitude. The movement to change zoning can improve AND reasonable people can disagree about it's outcome. If your only point is that there are pro-zoning people who disagree with me -- that point is obvious and does not conflict with anything I've said.

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