Just so you know weekend protests in Zurich are extremely common, people living in the city center sometimes don't even bother to look at them passing by their apartments. They are well secured and well scheduled, sometimes back-to-back with other protests, as one would expect from the Swiss.
We also have zoning here, which as far as apartment price goes mostly interferes by limiting the maximum height of a building to just a few floors. ~All buildings have the same height. There's also price control which definitely does something to the market - I know this because the amount of applications per apartment lease contract is through the roof, and it's sometimes very hard to get an apartment even if you qualify (income) and apply to tens of them. But I don't know where would the prices be if price controls were lifted.
When I lived in Lausanne in 2005-6, getting an apartment was really tough. The rents were high but not unaffordable, but every apartment had a hundred applicants. Ya, they couldn’t just jack up rents to be more selective, so no one was priced out but supply was still limited.
> They are well secured and well scheduled, sometimes back-to-back with other protests
Whoa. That's pretty cool. It's similar in the UK I believe. Also vaguely reminds me of Speaker's Sqaure in Hyde Park.
> We also have zoning here
Why hasn't Zurich (or more like it's Canton's govt) expanded suburbs into the farmland surrounding it? For the size of city, it is quite small. And the southern portion towards Egg seems pretty flat and easy to build. Even with suburbs that have a fraction of the density that Zurich has, it would probably alleviate population pressures. I'm assuming local politics?
Actually, how is local politics (sub-canton level) organized in CH?
You actually can live in the suburbs, like Renens in my case when I was living in Lausanne. But your commute sucks so no one wants to, even with decent public transit people still want nice lives. But the suburbs are definitely an option (I don’t know specifically about Zurich).
But another problem: the suburbs are actually nice and in demand also. So how far do you want to live from your job? Freiburg (works for Bern and Lausanne!)? It’s like, ok I’m going to commute a lot and finding a place to rent is still hard. And Switzerland is not not dense.
True! But the suburbs seem much smaller than any I've seen in plenty of other similarly developed countries.
Like downtown Zurich to downtown Egg is 10 miles, yet it's almost all farms. Just in that small a radius alone you could make 10 additional Eggs (or 3 additional Usters), and house an additional 80k people with the exact same density.
Is there some kind of greenbelt restriction like the UK?
> the suburbs are actually nice and in demand also
Same in the US. In the Bay Area, the suburbs like the Tri-Valley, San Mateo County, Palo Alto, and southern Santa Clara County are all in greater demand than the city of San Francisco (it's cheaper to buy a family house in SF than it is in any of those suburbs). It's a similar story in Boston (Brookline), Seattle (Redmond, Bellevue, Bothell), Washington DC (southern Maryland), and New York (Hudson River Valley).
Yet why haven't construction companies in CH built similar high net worth suburbs? All the ones I am seeing are basically just historic villages.
In British terms, why isn't there a Milton Keynes or Reading in the Zurich metropolitan area?
The main reason cities in Switzerland do not have new large suburbs is that since the last version of the federal spatial planning act has been accepted by the voters in 2014 there is a strict restriction on the buildings that can be built outside designated urban areas (in canton Vaud where Lausanne is it is 1 % of additional population per year, details may vary by canton). The planned amount of buildings outside these areas is enforced via zoning rule (only some land can be built and ant a given density. The main idea of this law is to avoid destroying farm land (which is important for strategic and ecological reasons) and increasing density of cities (which reduces various infrastructure costs compared to urban sprawl).
A lot of farmland is protected by local and federal laws. The Swiss don’t want to abandon their farmer roots even if they import most of their food these days.
That makes sense. I was doing some further digging into local govt in CH and I think this pro-agrarian viewpoint seems to be an SVP thing (who vaguely remind me of the Farmer–Citizen Movement in Netherlands, but a bit more mainstream)
Helping to rent a room in apartment of a friend in Germany. Normally a room costs from 600€ in Munich. And it’s cheap. Decade ago same room was going for 300€. Small apartment goes for 1000+€. And for both room for 600€ or 1000€ apartment you get at least 50 applicants. That sounds crazy to me. I would go and protest too, luckily I moved away.
Basic ecomoic theory tells you that when there is more demand than there is supply, prices will go up. If 50 people are applying for a single room at 600 EUR then even that is probably still too cheap. The only reliable way to change that is to increase supply (build more, create incentives to rent out places) or lower demand (improve transport into the city, make other parts of the country more attractive to live in).
>or lower demand (improve transport into the city, make other parts of the country more attractive to live in)
That's a chicken and egg problem. Most companies want to hire where the labor already is, aka the big expensive cities, and most workers, especially immigrants from abroad, want to live in the big cities as those have the most jobs and the population there is less conservative and racist towards outsiders meaning it's also easier to build relationships and get along with just English without having to struggle with the local language.
It's nearly impossible to convince companies and people to invest in small cities on the offshot that they naturally become the successes they dream of later since it's not something the government can guarantee, nor do we live in prosperous times of cheap money pouring from the sky that would enable governments to fund crazy projects of building attractive infrastrucutre.
In Berlin you'd get hundreds of applicants, and when you go show up to check out the apartment there will be 50+ people waiting in line scheduled at the same time you were.
They are. But it’s official loophole that if you put a bed, table and shelf from IKEA it’s suddenly furnished and all rent limitations do not apply anymore.
Berlin is actually "cheaper" than many other larger German cities like Munich, Hamburg, Frankfurt. Rent is not so bad in small towns but as you can imagine, neither are the economies.
There's your problem. You can't regulate your way out of supply shortage by capping prices below their market value. Venezuela tired that, ask them how it's going.
You either build more housing to math the demand, or you restrict the demand from the number of people coming to move in.
> Please don't complain that a submission is inappropriate. If a story is spam or off-topic, flag it. Don't feed egregious comments by replying; flag them instead. If you flag, please don't also comment that you did.
Actually, I like random things like this posted from time to time. Not because of the content itself, but because of the comments where I can often read relevant and thoughtful insight.
The state provides Public Transport (trams, buses, etc.), it should also provide Public Housing - after all, it’s a Human Right.
Furthermore, if Human Rights do not appeal to your Political Economic leanings, nevertheless I’m sure you can agree the state should provide a firefighting and police service. Police officers and firefighters need to live close to where they work. And, should be able to afford public transport, therefore: Public Housing.
> Police officers and firefighters need to live close to where they work. And, should be able to afford public transport, therefore: Public Housing.
This does not follow. You could make it an argument that essential services should be paid enough to live close to work, which would satisfy the criteria that you've laid out.
The most you can conclude from what you've laid out is that something is wrong with the current system. Which, I think very few people would disagree with.
Ok, be prepared to pay a ton more taxes to afford that, all to the benefit of landlords - now what about all the people needed to maintenance, groceries, schools, etc?
Expensive housing is a problem for everyone even the people who own their home
> now what about all the people needed to maintenance, groceries, schools, etc?
I feel like I misunderstood something here. I presume the police/firefighters were needed to live near the community because they might need to respond in an emergency. Or possibly for community relations for the police (I know some jurisdictions require you to live in the community you police, at least in the states). If I'm wrong in this assumption, please correct me and supply some more context.
It's not automatically clear why the situation you've laid out includes the additional groups you've listed.
Because expensive housing means they all need to charge more meaning your fighter fighters and we’ll every Goverment employee needs a higher wage to account for it, meaning landlords can charge more meaning wages need to go up.. you see the problem here?
> Because expensive housing means they all need to charge more meaning your fighter fighters and we’ll every Goverment employee needs a higher wage to account for it, meaning landlords can charge more meaning wages need to go up.. you see the problem here?
Not really. Other than that you seem to be implying that the categories of people covered need to be able to live in the city, without stating that, and we've only only established this as a requirement for groups that need to respond in an emergency. Necessity only seems to dictate that said groups are present for the parts of their jobs that require them to be present. Commuting seems like a viable option, which should have a depressive effect on housing prices.
Fundamentally, cities with strict zoning laws tend to require commuters (most cities in the west post ~WWII or so). Some petty-tyrant always ends up on the city council and building grinds to a halt. Unless you also want to severely curtail zoning and building regulations, I don't think the proposed public housing is even actually a long-term solution. And if you do want to curtail those, I'd expect it to not be needed very much.
Where I live there is literally not cheap option for housing, no matter how far you commute lol
And commuting has a cost too, driving an hour or two each way is expensive
Expensive housing is driving up the cost of everything because, everyone in literally every job is having their wealth extracted by landlords or into buying homes
So yes, home prices means taxes are going way up because all services are now far more expensive to provide because wages need to go up because the col for workers is going up because the businesses they rely on need to pay higher wages and here we are in a vicious cycle
It really doesn’t matter how it’s solved in the long run, but it needed a to be solved
Under those conditions, I'd expect living in that city to be expensive, yes.
Which seems like a problem that would solve itself eventually. If people's quality of life gets too low, I'd expect a decent chunk of them to move, opening up housing for people who can't/won't move.
There's some downsides to that strategy, so the city may not want to go that route, but as someone in a low CoL area, I don't really have a say in the matter (nor should I, so long as people aren't asking me to subsidize high CoL areas).
I don’t totally get this point. The main problem in big cities is the quantity of housing as well as the distribution of it.
For a train system, a non-state actor will have a hard time getting one of the ground (huge upfront costs, will often make a loss, cooperation of politics super important) and if they do … they will have a monopoly (which also sucks). So having transit publicly owned in some way makes a lot of sense.
But for housing, none of that is true. It’s being built (the amount built mostly depends on government approval, there is no shortage of capital investment), there is no monopoly… what is the problem that more public housing would solve?
The (admittedly outrageous) rent prices in Zürich come from a mismatch of demand and supply. And since Zürich has a lot of rich inhabitants, enough of them are willing to bid up the market rent prices to the current level.
Having a non-market solution for this might lead to cheaper rents, but introduces a lot of other losses and crucially also strangles the supply even more (look at what happened in Berlin when they introduced their moronic rent control law).
It's silly how some people believe in infinite power of "The State". Government can't just will new housing into existence just by passing a bill. Housing costs money. And when I say "money" I really mean "raw materials" and "human labor" and "time". If a city is desirable place to live, with a lot of people coming in then the housing will be expensive. You cannot really work around supply/demand here. Protesting against high rents is like protesting against bad weather - what do you expect your government to do?
The social democrats built 1 million units of housing in Sweden in the 60s or something like that, because of a housing crisis. They solved the housing crisis just like that.
If a lack of capital investment (or skilled companies) is the problem, that’s a great solution.
But that’s not the reason for expensive rents in big cities.
It’s because many (rich) people want to live there … and due to physical and regulatory limits you can’t build more housing, even for piles of money it would be worth.
It’s silly what some people describe as the “infinite power of the ‘State’” when they’re actually just talking about something that has already happened in many wealthy countries (e.g. Austria and Japan).
Build public housing and only charge a reasonable fee for it.
I don’t know if at the time people protested against the foul smell of the Chicago river. But the government reversed its course to improve the life of its citizens.
Why shouldn’t governments similarly deal with the housing issue using the means they have at their disposal?
(in both cases: the construction of public infrastructure)
The government literally controls the creation of money.
By ingreasing taxes it can make the private sector less competitive and redirect virtually all resources on public projects.
In capitalists states you could even argue that this is the only role of the state. Detecting failures in the market, first trying to fix them by light interventions, like law changes or incentives and if still not successful fixing them directly.
You don’t want the state as your landlord. The government is an elephant graveyard for talent.
In Denmark, the co-operative movement led unions to construct housing for their members. With the fall of unions, the housing organisations that remain now provide thousands of low-cost homes: they weren’t built for profit.
Co-operative housing still gets built at scale in Denmark, but rarely in the big cities; the private companies will outbid them because there is always a willing renter for luxury apartments.
I protested the capital city rent increase by moving out. I understand why students can’t.
In Finland municipal housing seem to do pretty well. They are build and rented at cost so rents are basically as affordable as they can get without going to pure charity. Ofc, also being renters of last resort the neighbours might not always be the best or the areas. But still I believe state or local government is one of the most reasonable parties to rent from.
Yeah, that’s the reason why Vienna has some of the most affordable housing in the EU. Oh wait, no it’s actually because the government is a lot of people’s landlord.
Vienna is quite of an outlier in the EU and even in Austria itself. Here's why:
Firstly, social housing there is a very old concept, and because of that, a significant portion of the population (>50%) already lives in social housing, meaning most the population has skin in the social housing game so they make sure to vote themselves a great situation because they're the majority and that's how democracy works.
But if the amount of population in a city living in social housing is way below 50% (most of Europe) then they don't have the democratic political leverage to vote themselves a better public housing situation, so social housing turns into a low quality charity for the poor and ends up turned into ghettos leading to a bad image of social housing leading to people to further voting even less in favor of social housing not wanting more ghettos.
Vienna, having the majority of it's citizens in social housing for a long time now has reached "escape velocity", that's why it already works there but won't/doesn't work in other EU cities who want to try it now, including in the rest of Austria where social housing is not the norm but more of a safety net for poor people. Other Austrian cities have even sold off a lot of their public housing stock to private investors in the 2008 crisis (cough-corruption-cough), meaning replicating Vienna's success today would be impossible as no city could afford to buy 50% of all private housing at market prices today even assuming private owners would want to sell in the first place.
And secondly, unlike Zurich, London, Amsterdam, Berlin, Luxembourg, etc., Vienna is not a tech-hub or corpo-hub for big international companies to set up large offices of well paid workers from abroad there, and neither is it a low-tax/beach-front destination for wealthy digital nomads, so there's not such a big pressure on the rental market from overseas workers with huge salaries pushing up rents and gentrifying everything.
That's the situation for rents. But the situation for buying a property flips on its head and makes Vienna one of the most expensive cities in Europe for buying your own property, far disconnected form average wages that almost nobody could afford to buy something.
Like the army. It’s funny how military institutions with virtually unlimited funds are basically socialist institutions. They provide health, housing, stable employment and early retirement. What many dream of - minus the being in the army bit.
You add more properties by forcing sale of those owned for investment purposes to the state and operating them on a cost-recovery basis. Simultaneously, abolish most forms of zoning and have the state engage in home building directly.
Landlordism, as Adam Smith himself identified, is a destructive, parasitic drag on economies that should be minimized at all costs. Otherwise, you end up with what we have now, Capital owners chasing after unproductive returns by limiting construction, bribing politicians, and generally making everyone else poorer and more miserable.
A lot of the housing is owned by the pension funds. Effectively, young people paying rent is how the old people eat and pay their rent. If you take it away, old people will starve and won't be able to pay their rent.
Any other suggestions? Remember this is Switzerland, so you can't do anything the population doesn't actually want otherwise they'll vote it out.
I doubt that the state will be more efficient in building houses than private enterprises can if allowed to do so. If they are not being built and added on marked, the effective price will only crawl up.
In case if Zurich, I imagine that supply is limited due to its geography as well, and of course by wanting to preserve the quality of life.
> I doubt that the state will be more efficient in building houses than private enterprises can if allowed to do so
Depends. If the profit is in more expensive housing, than private enterprise will bias towards that and ergo be less efficient at building lower-margin "affordable" housing.
Ideally, in a perfect frictionless economy populated by spherical cows, yes, private enterprise will more efficiently allocate across the entire spectrum of market needs -- so in principle, I'm agreeing with you.
> forcing sale of those owned for investment purposes
How?
Expropriation or nationalization is de facto impossible in a developed democracy in 2023.
Any proposal as such will be bogged down in courts for a decade, and the politicians who proposed it will have been voted out of office by the 60-70% of the population that owns some kind of property.
There are a number of ways to do this without nationalization, e.g. the imposition of onerous taxes on investment properties, rental income, or real estate speculation, coupled with creation of state-housing funds to purchase properties that are now not worth it to own. If you do this while simultaneously engaging in widespread state construction of public housing, increase supply will also make investment ownership unattractive and force sales.
> imposition of onerous taxes on investment properties, rental income, or real estate speculation
How? This is vague.
> creation of state-housing funds
How? Who holds the liability and underwrites this?
> widespread state construction of public housing
How? Is there even a trained construction workforce anymore? In the US at least this no longer exists after 2008 [0]
I'm not trying to be dismissive btw. I used to work in the policy space and there are organizational and liability issues that acted as a blocker against a number of the stuff you mentioned.
They should give a Russian developer like PIK or LSR a blanket licence to build scores after scores of 25 floor buildings with 20-30 sq.m. units until they plead for mercy.
These will also fly the workforce in from Central Asia.
What kind of policies you believe would affect rents in the short to medium term? Progressive cities have tried all kinds of things, with little in terms of results.
Short and medium? That's probably a tough ask besides subsidiaries. But also allow fast redevelopment of office space. In Germany there was and is the "Munich" effect. Zone too many office districts so office space is cheap and companies move there. So also more mixed use zoning for white color work places for short commutes
The current market still suffers from other forms of government regulation. The Mietendeckel still exists in some form via the Mietenspiegel, and basically the entire city under what Americans understand as rent-control.
How does it suffer to make it illegal to charge 10% more or less than the average for comparable housing? It seems to make it more stable and less volatile.
But how does the market suffer from that? It implies that the Mietenspiegel is a bad policy. It only protects from price gauging or price dumping. If you are living in Berlin I would highly recommend looking up if you're paying too much.
Lines of 50 people to see an apartment sounds like a huge waste of man hours, which cost money to economy. This waste also grows quadratically: more people searching for longer.
Which government policies exactly would you suggest that don't involve building more houses or convincing people to move elsewhere?
Remember, this is Switzerland, so you need to convince the population that this is a good idea otherwise they will block it with a popular vote. So confiscation of property or forced labour or increased taxes are all out of the question.
I agree I should have written a more constructive comment with more details. But I thought it was clear how policy can help in the short/medium/long-term. Please read the answers I wrote to the commenters below/above
So what? government just orders lower rents for current renters? That might work short term, but in the longer one it will simply destroy the local property market. No one will be willing to build housing anymore, as it won't be profitable. The city will slowly gentrify and die.
As I posted below and also public transport as mentioned in other comments
Change zoning rules. Incentives for co-living. Reduce flat sizes. Rebuilt office spaces. Or look to Vienna: a big stock of goverment-owned flats with low prices which makes it hard to charge more than those.
If you give tax incentives for both people and businesses who start somewhere other than a highly desirable place. To the locals who live there as well of course.
I don't think it should be about reducing local desirability, but give the conditions for other places to become more desirable.
There are international migrants as well. How do you make a town in rural Romania or Latvia as desirable and opportunity rich as Zurich? The weather is probably crappier there, for starters.
All you need are business/personal incentives. One extreme example of this is SEZs, Special Economic Zones. You set up a legal structure for region within your territory to be able to offer the sort of benefits one would normally have to seek out tax havens and legal loopholes to achieve. This motivates development and growth in these regions, which drives opportunity and expansion.
The Shenzhen SEZ is one extremely successful example. [1] It was established as an SEZ in 1980 when it had fewer than 30k workers. By 2000 it had a labor force over 3 million. The current population (which is predictable difficult to measure given a massive migrant population) may be as high as 14 million.
Yeah I am partly a YIMBY but if investors can just keep buying up all the new properties and rent them out for ludicrous amounts then rents will never go down.
Extra capacity, if not protected from predation, will result in a cycle of high property values and rent.
Cornering the market on an entire city seems prohibitively expensive but hey, maybe somebody will roll in with a trillion dollar investment that has massive downside someday.
Yes, thats a good solution. Ban investments mean more or less ban renting houses. When no one can rent a house, no one can complain about a too high rent.
Interested in the new living models that are coming then.
Depends on scale. During much of the pandemic, I rented a house from an elderly lady who owned one other rental property. She only asked for very modest rent increases as rents and property values skyrocketed because I always paid on time and fixed small things myself, which made me a low hassle tenant. Had I been renting from an institutional investor with thousands of properties, I'm betting my rent would have gone up the maximum they thought they could extract.
Just in case you're in a position to change anything about the housing market where you live:
Change zoning rules. Incentives for co-living. Reduce flat sizes. Rebuilt office spaces. Or look to Vienna: a big stock of goverment-owned flats with low prices which makes it hard to charge more than those.
Pseudoscience? That's rude. I answered your question in good faith and you take pot shots. Lame dude.
To elaborate, if you eliminate investment property, AirBNBers and Blackrock liquidate their house holdings. The houses come from the previously off market investment properties.
We also have zoning here, which as far as apartment price goes mostly interferes by limiting the maximum height of a building to just a few floors. ~All buildings have the same height. There's also price control which definitely does something to the market - I know this because the amount of applications per apartment lease contract is through the roof, and it's sometimes very hard to get an apartment even if you qualify (income) and apply to tens of them. But I don't know where would the prices be if price controls were lifted.
(and yes, the rent here is too damn high)