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> They have this idea that there are a bunch of wealthy and greedy developers out to get them and their precious neighborhoods.

This narrative is so persistent because it's 100 years old. But for most of that time, developers were called greedy because they made money by introducing cheaper housing into the neighborhood, thereby "ruining" it.

Here's a Supreme Court Justice shitting on apartments in 1926:

> With particular reference to apartment houses, it is pointed out that the development of detached house sections is greatly retarded by the coming of apartment houses, which has sometimes resulted in destroying the entire section for private house purposes; that, in such sections, very often the apartment house is a mere parasite, constructed in order to take advantage of the open spaces and attractive surroundings created by the residential character of the district.

That's from Euclid v. Ambler, the case that established the constitutionality of zoning. Our cities are expensive on purpose.

Think of it in terms of a bifurcated market - high rent and low rent - and their argument makes sense. Developers who come in want to build high rent units, for the people who use low rent apartments this is not helpful. Low rent supply hasn't increased so their rents won't be effected. In the case that low rent units are razed to build new high rent units or in the case where low rent units are remodeled and converted to high rent units, low rent supply decreases even further, raising prices on the low end and pricing people out. Hence why they want you to build more low rent units, it would actually help them.

>So the more market rate units we have, the more lower end units that are available. Seems simple to me, but a lot of people seem to get this wrong.

Probably because what you're saying doesn't follow at all. The more market rate units you have, the more market rate units you have, that doesn't say anything about lower end units.

>They have this idea that there are a bunch of wealthy and greedy developers out to get them and their precious neighborhoods.

Because there are? Developers would love to take poor areas in the city and convert them all into high rent yuppie districts, it would be great for business.

>I wonder if the property owner interests only encourage these mis-perceptions since they serve their interests.

If you think everyone around you is misperceiving the world, sometimes it's important to check your own perceptions.

If it were bifurcated, pressure in the luxury segment would not affect the working-class segment. But it does. Formerly very-low-income apartments get slapdash kitchen renovations (if even) and rent to professionals for $2500. The Bay Area is rife with luxury cars parked at the seediest-looking apartment complexes. I learned early in my apartment search that essentially any apartment with a sligtly-below-luxury price and good interior photos but no exterior photos is one of these front-line gentrification units. Un-renovated crappy apartments in good locations are often listed for more than luxury glass and steel skyscrapers in merely decent ones.

Everyone is spilling over into the housing that previously served a socioeconomic level (or two) below, except those at the bottom who have nowhere to go but tents.

In an ideal world, new housing would most directly target those in need, but in the world we live in, the money for luxury towers is chomping at the bit to get started while the money for signficant subsidized construction is pending a literal revolution. A greater proportion of tech migrants living in new luxury housing is a smaller proportion bidding up formerly affordable housing.

>If it were bifurcated, pressure in the luxury segment would not affect the working-class segment. But it does.

If the market isn't bifurcated as you say then building lots of lower rent units will bring down the rents in the luxury segment. Great for everyone!

>In an ideal world, new housing would most directly target those in need

What you're arguing for is a removal of the poor from certain parts of the city they currently exist in. It's a purely political decision and an ugly one at that. We don't need an ideal world or a revolution to build and maintain affordable housing.

> lots of lower rent units will bring down the rents in the luxury segment

I'm not sure I agree that that will help anything, and it might even be a bad thing.

Assuming an area has a housing shortage because of an influx of people drawn to the area by good jobs, the newcomers' biggest problem is not a shortage of money to spend. It's a shortage of housing to spend it on.

That is, if you have 100,000 people who make $150K/year, luxury units go for $3000/month, and there are only enough luxury units to house 75,000 of those people, lowering the price on luxury units to $2500/month won't pull the remaining 25,000 people out of non-luxury units.

And the reason why it might be a bad thing is that it costs money to build new housing. The higher rent the developers can charge for brand spanking new housing, the more investors and developers it attracts and the more housing can be built. Once the new luxury housing can be built, the well-paid 25,000 who were forced into non-luxury housing can upgrade and stop being forced to take lower rent housing (that they don't even want to live in) away from people who don't want them to have it.

Well you're only considering the problems of the wealthy newcomers and not the problems of the impoverished who already exist there.

No, I am considering the problems of the impoverished. One major cause of their problems is that wealthy newcomers are forced by lack of supply to compete with the impoverished for housing.

This screws over everyone. The poor don't want to compete with the rich for housing. The rich don't want to live in housing that is below their quality standards.

Also, how do you think new housing stock gets built? It takes capital to build housing. You attract that by luring investors with the promise of returns on their investment. Who can pay for that? Wealthy newcomers who can afford to pay high rents. The way to get housing built is to tap into the gigantic piles of cash available.

>building lots of lower rent units will bring down the rents in the luxury segment

Sure. Wealthy people can lower their standards and take housing meant for the class below; people who are struggling can't exactly raise theirs, but they do group into larger/more crowded households to bid upmarket. When there are not enough small apartments, for example, people find several other working housemates for single-"family" homes that are then no longer available to 1- or 2-income middle class families. I suspect the pressure is stronger in the downmarket direction but it absolutely cuts both ways. (And homes that are too upmarket sometimes don't act as housing at all).

>What you're arguing for is a removal of the poor from certain parts of the city they currently exist in

Nope. With sufficient heights, the problem is addressable through infill development on commercial/industrial properties (ideally replacing existing uses on the lower floors) and upzoning to permit mid-rises in predominately owner-occupier single-family house zones.

>We don't need an ideal world or a revolution to build and maintain affordable housing.

The Bay Area's housing deficit over 2012-2017 is conservatively 120,000 homes based on 400,000 new jobs, 60,000 new homes, and an average household size of 2.3 (many household members are not workers). [0] The average cost to build an affordable housing unit in California (so an underestimate for the Bay Area) is $332,000. [1] So $39 billion is a lower bound to walk balk just 5 years of a problem decades in the making. Where's the money going to come from? Not property taxes: prop 13 repeal would be a revolution in itself. Not federal subsidies: do you think the Trump administration wants to subsidize coasties? Not tech companies: there's always some Bay Area municipality that's happy to keep the free tax revenue and soaring housing demand (particularly for owner-occupier areas) local. San Francisco spends tens of millions on affordable housing when what's needed is tens of billions. Even the state of California spends only hundreds of millions.

So far the best anyone has come up with is (effective) taxes on market-rate development. To get the numbers required, we're going to need a hell of a lot more market-rate development to tax.

[0] https://www.bloomberg.com/news/articles/2017-06-23/why-can-t...

[1] https://www.mercurynews.com/2017/08/16/walters-bills-would-m...

>Sure. Wealthy people can lower their standards and take housing meant for the class below

That's the point though, if the housing is actually low rent the wealthy can't just 'take it.' Some wealthy people will get apartments but so will some poor, that's definitely better than building high rent housing which only wealthy people will have a shot at.

>With sufficient heights, the problem is addressable through infill development on commercial/industrial properties

So you're gonna move the poor to industrial sections... This is just a reinforcement of what I said.

>and upzoning to permit mid-rises in predominately owner-occupier single-family house zones.

You're going to go into neighborhoods and throw up large buildings filled with low rent housing? In your dreams you're going to.

>The Bay Area's housing deficit over 2012-2017 is conservatively...

I think you misunderstand. I'm talking about housing which is affordable for the poor - subsidized housing, rent controls and the like. Housing for well to do techies is of secondary importance.

>if the housing is actually low rent the wealthy can't just 'take it.'

The only buildings which are permanently carved out for low- and middle-income households are those built as permanently affordable. You are actively hostile to accelerating the construction of such buildings, so this statement is just bizarre. Of course you can spend less than your maximum budget. Do you imagine that rich people can't buy economy cars?

With demand so far exceeding supply, all other housing (regardless of its quality or who previously occupied it) becomes "for" the well-to-do given enough time. Leases end, the units maybe get renovated a bit, and the new occupants are wealthier and whiter and paying more.

Not caring about "techies" doesn't remove the effect of a population boom from the market.

People are wildly overthinking this. Adding N + 1 households to N homes is certainly going to cause a problem, by the pigeonhole principle.

Preface: I understand what you're saying and am no expert.

Is there not also a gap before the new production? I live in a city that's been through some serious gentrification and gone from an afforable southern city to something...else. What I've, anecdotally, noticed is that the prices start before the rents.

1) Area is priced well below an adjacent or similarly positioned area but missing the amenities

2) A handful of developers build/renovate and put in something that's way above (50%?) current rate in the area

3) Marketing and salesmanship move the houses.

4) More developers/flippers enter the market, this time their marging shrinks a little or the price goes up.

5) Repeat until profits are less than moving to somewhere else in step 1

What I'm getting at is the gap in prices where the developers are looking to make several fold what they would in more established areas. That being possible shows it's still more affordable. Additionally, if it's not already more affordable, where are the people worried about getting pushed out living?

There is a price floor on housing, defined by the prevailing rent that Section 8 subsidy uses.

People getting pushed out get pushed into minimally suitable housing in out of the way areas. Those unqualified for subsidy live in unsafe conditions, live in SRO units or are in various states of homelessness.

Let me toss my anecdote in on this one.

I used to live in Koreatown in Los Angeles, my rent was $1000/month including one parking spot for a 1BR1BA. A few blocks from me a brand new building opened with micro-apartments going for ~$2600/month for a studio, around the same time a non-luxury building opened two blocks in the opposite direction but that was all subsidized housing so I never found out how much they even charged (I didn't qualify).

Within a few months of this our landlord, who owns other properties and businesses in the area, stopped accepting new tenants or actively marketing the available apartments, it's rumored they are trying to tear that building down and make a bigger one. It's only about 30 units, but it's down to the last 3 tenants, rent has consistently gone up each year by the maximum allowed amount, maintenance is nonexistent, the parking lot sits empty and they still somehow enforce the max 1 vehicle per tenant rule. The rent for it is now $1200, trying to move in to a similar-sized apartment in the same block would cost you $1450 and an extra $100 for a parking spot. It's a crummy situation all around

The crowd tends to speak the truth.

People aren’t dumb. The type of construction common today isn’t in the interest of people who own single or <4 unit property or people who rent.

Developers are absolutely greedy and generally have no interest in the impacts surrounding their work. For most, their job is to gather capital, do a deal and gtfo.

Building high-density housing is certainly in the interest of people who rent, since more rental supply equals lower prices for rent.

But you're right that it isn't in the interest of people who own a property. Congratulations, you've identified the cause of NIMBYism!

It does not. Only one thing leads to lower rent in these cities -- real estate busts.

There are probably two dozen residential or mixed use skyscrapers alone being erected in Manhattan. The annual rents of 80%+ of these units probably exceed the median household income in Manhattan, unless they are directly subsidized.

The rents will come down when rates go up and overleveraged developers go bankrupt.

I don’t think you completely understand supply and demand. If Mercedes makes more cars, that does not raise the price of a Toyota.

Unlike cars, there is a finite supply of real property, most of which is enjoyed by its owners for whatever purpose they choose.

To borrow your car analogy, there will never be a "Toyota" housing unit built in Atherton, CA or a few blocks from Rockeffler Center in NYC.

The current issues have more to do with a glut of cash than a shortage of housing.

>Unlike cars, there is a finite supply of real property, most of which is enjoyed by its owners for whatever purpose they choose.

In what world do you live in where the number of housing units in a city is bounded by some value? A cursory examination of any city's housing stock data would tell you otherwise.

>To borrow your car analogy, there will never be a "Toyota" housing unit built in Atherton, CA or a few blocks from Rockeffler Center in NYC.

This is like saying that when you go to the Mercedes dealership all you see is expensive cars, therefore there only exists expensive cars.

Each incremental Mercedes that is produced does not raise the price of a Toyota. In fact, the derivative of that price curve is most likely negative.

Why is housing any different?

>The current issues have more to do with a glut of cash than a shortage of housing.

I agree that low interest rates have exacerbated the situation, but the fact of the matter is that there is a net influx of people to large cities like San Francisco, and there is indeed a shortage of housing. Why you choose to ignore the data, I do not know.

We are nowhere near economic or engineering height limits. There will never be a Toyota housing unit in Atherton because they are illegal there.

Land sure is finite, which is why it’s so important to prefer the 500 homes of a luxury skyscraper over the 5 luxury houses that would otherwise occupy the same size site.

Why should we care about developers’ character? The management company is the one you have to live with as a tenant, and workmanship/safety are regulated and inspected. We have little social housing in this country; essentially everything that exists was put there by developer greed. It was okay for capitalism to build your apartment, but not mine?

Standards have only risen over time (at least since WWII). If anything we should want more structures to be recent.

Developer-initiated gentrification pushing demand around is a real and well-documented phenomenon, and YIMBYs do ourselves a disservice by denying it.

The problem is that it’s taken out of context. It may be true that, in a static or declining city, thwarting development tends to preserve the status quo both physically and economically. But developer scheming isn’t responsible for the massive regional demand growth in coastal megacities today. Economic and population growth are. In that context, classical anti-gentrification strategies backfire because the demand surge is so large, it fills in every crack and can’t be deflected to other neighborhoods by undesirability (only by high prices).

Is there a net increase in housing stock, or are cheaper units being replaced by higher priced luxury units?

I think there must be a net increase. In Oakland, parking lots are being replaced with mid-rise apartment complexes. There is an impressive amount of construction under way at the moment.