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This is normal for any investment, why would anyone want their investment to depreciate? I also don't understand why so many people in San Francisco want to own a home. Owning a home in San Francisco is a giant pain in the ass. Everything is ridiculously expensive once you own. These homes are 100+ years old and most need updates and earthquake retrofitting (that's $100k+). You pay an obscene amount in property taxes and have to go through the city to change nearly anything. Once you do get approved you have to find a contractor and most contractors are on giant month long waits because there aren't many in the city. It's a pain, honestly I don't understand why anyone would want to buy when you can rent and be on rent control and not worry about any of these headaches.

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Why should it be an investment? And why should we prioritize current winners' investments over the possibility of new entrants into the field?

Property taxes are another way that California is extremely regressive. Since property tax is paid based on the purchase price rather than market value like in other places, and since adding additional housing means that your property tax gets reassessed at the new value, tax policy highly incentivizes reduction of housing supply.

California policy can be summed up as: "I don't want any more people here after I moved here; but please bring on the jobs and the rising property values."

> California policy can be summed up as: "I don't want any more people here after I moved here; but please bring on the jobs and the rising property values."

On the east coast, we just call that "fuck you, I got mine."

The problem is housing being treated as an investment, resulting in artificially high prices and limited supply for the people who need to live in it.

We should buy housing to live in, not to extract rent from the suckers that were too late. A land value tax would help lower prices and remove the incentive to treat housing as an income source.

So how does this argument convince the population who has invested into their homes to suddenly want to devalue their property?

It doesn't. It requires building political will in the group that's been left out to override them.

I'm not sure why we need to convince those people, as we don't require consensus. We enact policy as a whole.

Also, I'm not sure what "devaluing" is going on; by pure financial value there's almost no way to build enough to actually drive down the price of any individual home; more likely as zoning increases the home will go up in value, but individual condos or townhouses will be available for much less than a single family home.

If you mean "devaluing" by "I now have apartments on the block," there's absolutely no right whatsoever for somebody to control the use of that other property.

Anybody who thinks they can drop $1.5 million+ into an asset without risk needs reality check on how entitlements don't work. Besides the world doesn't owe any one an insurance for stupid ideas.

Once again how does this argument convince the voters and home owners to change their mind?

Eventually an alternate location breaks out which offers amore compelling economic option for employees and employers, and the entire regional market implodes.

This ... kind of ... happened in Southern California in the early 1990s when the defence industry retrenched. SoCal housing prices had long led NoCal, and in the aftermath the south's values fell by a third or so. They've never really caught up. A different dynamic but similar result. Oddly, a consequence has been somewhat greater densification of the LA basin.

You could look at real estate in other and earlier times, especially industrial or extractive areas after the boom has passed.

> We should buy housing to live in, not to extract rent from the suckers that were too late

This is a really biased view of what landlords do. A landlord takes on all the risk of maintaining the home, staying in the home long-term, fixing things when things break, etc. As a renter, being able to just tell my landlord when things break means that much more convenience for myself. Moreover, as a renter, having no incentive to be gentle on my appliances, my landlord actually does quite a bit of stuff (Or pays a lot to have someone else do my stuff, hence creating a job) to make my life pretty darn easy.

Of course people don't want their investment to decrease in value, that's why they have to invent bullshit arguments to bolster their case and discourage development.

But it is important to call it what it is and not be distracted by their nonsensical reasoning. They want less development because they want their housing values to increase. And in this process, they don't care about the lives of other people who'd want to move here or about the long term negative consequences of reduced growth and economic activity as a result of their greed.

Think of all of the companies that don't get started or the things that don't get invented because they simply can't get the workers they need -- It is a sort of 'negative externality', little different from pollution or lung cancer, of the reliance on housing equity to fuel savings that we've come to rely on.

There are tons of cities in the rest of the U.S. to start a company or invent something hence why the economy is moving there. I'm not saying I agree with the home owners, I just don't see how their vote is going to change.

> I also don't understand why so many people in San Francisco want to own a home.

The rampant NIMBYism hurts renters by constraining supply as well as well. Even if you don't want to own, you're still suffering.

(Though honestly I think the rental prices are lagging behind a bit. The home prices have truly become insane; I just watched a 4 bedroom in Burlingame that was bought for $2.3M in Oct 2017 sell for $5.1M; i.e., a 118% return in 15 months.)

You get that return but also face a huge income tax payment unless you invest right into another home hence driving prices up more. Convincing someone to give away hundreds of thousands of dollars in taxes isn't easy.

The broader market hasn't gone up anywhere near 118% in 15 months so when you see an anomalous sale like that it usually means something else was going on. For example a below market sale to a relative, extensive renovation, or some kind of fraud.

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