Mountain View approves razing rent-controlled units for $1.5M homes
mercurynews.com
mercurynews.com
I have spent a lot of time in various cities in eastern Asia, namely Hong Kong, Singapore, Tokyo, Seoul, and Taipei.
I was always amazed at how much more efficiently space was utilized. Dense, high-rise housing. Smaller apartments for single occupants. Vending machines and convenience stores near ubiquitous so one did not have to go far for basic necessities.
Also, the public transportation was wonderful. Whether subway, taxi, or bus one could get around without any need for a car.
I always wonder why our cities can't be "denser". Perhaps we are too used to our cars and driving everywhere? I'm sure there are a myriad other reasons though.
It's cars. Designing for cars is mutually exclusive to designing for pedestrians. Cars require lots of space, wide roads, parking areas which immediately make it impossible to do quick, effective trips on foot. So, if you design for cars you have to use cars. And if you drive you want more of that space yourself while, if you design for walking, it's quite cumbersome to drive, even in small cars which Europeans like a lot.
There was something similar in the small town era of USA when cars weren't yet everywhere. And that is what people seem to instinctively long for: for example, in movies and TV series you see sets built to depict city squares, narrow streets, and people walking around. Of course, the more realistic picture would be a half-dead city centre while everyone keeps driving to that big box retail park around the nearest highway junction...
Now we seem to be nostalgic for the urbanized town square with walkable shops and residences above - basically the 1900-1930 time period. Maybe when we're old and feeble we'll get to see our kids pine for the suburbanized developments, green grass lawns, and big-box retailers as they live in their arcologies and have all consumer goods delivered to them through matter-compilers.
There is a large contingent of people who own single family homes who want to keep things exactly as they are now. They vote in elections. The contingent of people who DO want development largely doesn't live here, so they don't vote. There is no constituency of people who will live here in 10 years when we have higher density!
SMH.
https://en.wikipedia.org/wiki/Demographic_history_of_Japan_b...
https://en.wikipedia.org/wiki/History_of_Tokyo#Edo_or_Tokuga...
Its sprawl is rooted in the logistics of desert development. You had to develop large tracts to cover the costs of the water infrastructure. Without water infrastructure, you weren't going to develop anything.
There are myriad forces that shape given cities. I'm disinclined to accept the notion that our current car cult mentality is inevitable, irreversible, etc. and we can't do anything good anymore "like they used to do."
Mt View: 2,300/km2
Tokyo: 6,224.66/km2
http://marginalrevolution.com/marginalrevolution/2016/08/lai...
Seems like "becoming Tokyo" would be an improvement. (But I still find the comparison hyperbolic and ridiculous. It sounds like a deluded scare tactic, frankly.)
https://www.youtube.com/watch?v=Jv6SbFlZMbU
Short answer: a decent house for a family can be had for about $400k in Tokyo and that's considered expensive.
I hear this argument a lot, but I’m not sure I buy the financial angle. If MV became Tokyo, the land alone in which a single-family home sits would be worth vastly more than it is today.
I legitimately think that they want to continue to live in a detached house with a yard, in a low-density neighborhood, like they have for a long time (or recently bought into).
The ones who have been there for decades don’t feel the increased prices (thanks to prop 13) and the ones who recently moved in are clearly wealthy enough.
Is it that hard to believe that people just don’t want their neighborhoods to change?
I think once we acknowledge that, we can work to preserve that neighborhood feel without dismissing that desire as being a disguised financial interest.
> But one way to nearly know for sure would be to observe the turnover of housing supply in that area.
Could you describe what you mean? What direction of effect would you expect?
But building skyscrapers would mean more units could be sold, thereby greatly increasing the value of land - as long as demand is there in the lower price ranges.
Why is this necessary? What requirement is satisfied only by increased density?
I could equally say Google needs to stop growing and start moving projects elsewhere.
and how are they going to do that without allowing the city to be denser?
Lots of people don't have kitchens you can cook in for instance.
* Actually, it might be in Hong Kong, but I don't think it's true in the others
Yeah that's the last thing people need for a healthy lifestyle.
"Since the project fully complied with the city’s zoning code and met all the application requirements, City Attorney Jannie Quinn told council members Tuesday that it would be “very difficult” to “come up with a rationale to deny the project.”
Quinn also informed the council that placing a moratorium on the demolition of rent-controlled apartments could put the city in a legal predicament due to the state’s Ellis Act, which protects landlords who want to leave the rental market."
Nonsense. The restrictively zoned cities in the Bay Area are leaving a lot of value on the table in order to protect their squat neighborhoods. If Mountain View truly preferred tenant protections over protecting neighborhood character, I’m sure they could have made a win-win solution with the developer to provide replacement rent-controlled units in exchange for an upzoning, even late in the process.
I suspect if you put it in place it becomes politically impossible to end and even harder to build new housing.
Getting things done in politics is about political will, organization, sacrifice and being determined to accomplish a cause, not really much to do with how good or bad of an idea it is.
The economic costs of rent control are real, but distributed and I think its difficult to make people resonate with that. I don't think it would have a significant effect on the viability of other projects one way or another.
I generally agree with you, but would argue that in this case evidence suggests that building housing in the bay area is extremely difficult given the local government situation and how it leads to all local areas incentivized to not allow development while the larger group as a whole would benefit from it. This is why I tend to think the only way to fix this is at a higher level (like SB827) where you can avoid some of these affects by coordinating for the entire state.
I understand that this doesn't solve the issue of long term residents who can't afford current rent so I think reasonable people can disagree about this issue. I just tend to think that the negative affects of rent control outweigh that benefit.
The negatives being:
- Creating a bimodal market where new comers have even more extreme rents to subsidize the rent controlled units
- Landlords incentivized to do the absolute minimum maintenance because they want their tenants to move out so they can increase rent to market rates.
- Developers less interested in building units if renting them will be market controlled and ROI is less certain.
- People living in rent controlled units caring less about housing getting built.
Rent control seems to only help existing tenants - with high levels of immigration to the state it probably causes more problems overall.
I agree with your point that it's about political will, but I think rent control reduces some of that support for building housing (and creates a large contingent extremely in favor of never removing rent control).
Unless you wouldn't mind them crashing on your couch, in the meantime, that is.
I think the question of whether a prosperous region can have both urban growth boundaries and affordable housing is an open question. The Bay Area has not set a good example in this manner; we listen to environmentalists when it’s time to put walls around the region but we don’t listen to them when they call for greater infill development (to their credit, the Greenbelt Alliance has a subsidiary called the SF Housing Action Coalition that promotes infill development, but in SF politics they are often written off as developer shills).
https://www.mountainview.gov/depts/comdev/sustain/climate_ch...
/s
These houses would cost less than half this amount in 99% of the country. So long as too many people insist on living in the same zip code, the problem is not solvable.
https://sf.curbed.com/2018/7/12/17565192/housing-needs-trend...
It's a disastrous policy, and one of the main reasons SF housing is such a mess. Tenant laws also tend to incentivize booting everyone at once and converting to condos instead of renting units.
it's literally the only reason most of the remaining long time citizens who aren't wealthy can live there still
The victims of rent control are everyone who is pushed out of the city -- or those who cannot move there -- because of how rent control makes building rental units unprofitable.
In Mountain View units have to be built before 1994 to be subject to rent control. This actually incentivizes developers to build new units, because they will be market rate units.
There are problems with rent control, but making building rental units unprofitable isn't one of them.
And market housing rewards well-paid, rich professionals at the expense of everyone who isn't pulling in a FAANG salary.
Neither is a 'fair' distribution of shelter - that much is true.
> The victims of rent control are everyone who is pushed out of the city -- or those who cannot move there -- because of how rent control makes building rental units unprofitable.
If you remove rent control tomorrow, there's going to be no shortage of immediate, acutely suffering victims of that political decision. Forgive me that I have more sympathy for those individuals, then some nebulous group of 'People who, for whatever reason, really want to move to SF, and can afford a $2,800 apartment, but not a $3,400 one, so they don't move to SF.'
That's how rent control works in a high demand area by design.
people suffer from high rents -> rent control is introduced -> people suffer less -> people oppose higher density because they don't suffer -> prices of real estate increase in the meantime -> rent control ends (moving/displaced) -> people suffer from high rents even more
The ideal scenario would be this:
people suffer from high rents -> higher density is introduced -> people benefit from low rents
I have no dog in this race but I'm curious how this would play out long term. The people that are made homeless and have to move are all working in jobs necessary to a functioning society, cutting hair, stacking shelves, cleaning toilets, etc. How do these functions get replaced?
Would higher salaries be offered? If so the relative pay of tech workers would go down and it could create a real inflationary feedback cycle, surely tech workers would probably price themselves out of the market at some point.
Would people commute from further away instead? Surely the number of people willing to commute 2 hours each way for low pay would be limited. This would also cause a whole heap of traffic issues.
Would these sorts of jobs simply move out of the city? It's hard to imagine but what if a grocery store simply couldn't afford people to stack shelves and they all closed down? Does everyone order from Amazon?
In most cases it seems having a viable working class in the area is what allows tech workers to be rich.
When rent started increasing in Seattle all renters were immediately effected and so that segment of the population mobilized and applied pressure to do the one thing that keeps housing prices down in a free market: Increase supply. Lots of people were forced out but after over a decade of non-stop, fevered construction prices are finally starting to get under control.
In San Francisco a large portion of the rental market is insulated from rent prices until it's time to move. At that point if you're priced out, you tend to leave. Some people try to tough it out and fight but that rarely lasts more than a year or two. This staggering of resistance to increased rents into smaller chunks of the renting population makes political change almost impossible as no small chunk has a chance against the more consistently committed land owners.
The biggest injustice in the US is that thanks to globalization jobs are now concentrated in few major cities. But people cannot move where the jobs are because of opposition to new housing. Those cities are basically taking "jobs" hostage by pretending to care about the character of their neighborhood.
As long as more construction is allowed and matches the number of new jobs then it simply doesn't matter how much some magical number called "rent" increases because the jobs that can pay for the market rate housing are already there but what's missing is housing capacity.
Also all I can find about Seattle migration outflow is that there was a big dip in Q1 2018 but in Q2 there was a net inflow again. [0]
[0] https://www.redfin.com/blog/q4-redfin-migration-report-seatt...
On paper, rent control is a failed solution to high prices resulting from under supply in the market. Build more housing.
And the crazy thing is it applies to everyone regardless of need.
I know a few people clearing almost $1M per year and they love their rent controlled unit that has a rent 30% of market rate.
We need more new housing, period. We can at least agree on that. I don't see how rent control prevents the creation of new housing. The city and its voters do that all by themselves.
The agreement cuts across the usual political spectrum, ranging all the way from Nobel Prize winners milton friedman and friedrich hayek on the “right” to their fellow Nobel laureate gunnar myrdal, an important architect of the Swedish Labor Party’s welfare state, on the “left.” Myrdal stated, “Rent control has in certain Western countries constituted, maybe, the worst example of poor planning by governments lacking courage and vision.”3 ___His fellow Swedish economist (and socialist) Assar Lindbeck asserted, “In many cases rent control appears to be the most efficient technique presently known to destroy a city—except for bombing.”___
https://www.mountainview.gov/depts/comdev/preservation/rents...
I imagine that you, posting this story, or even some reading this thread, are doing so with the sentiment that "oh no, these unfortunate long time residents are being displaced", and that some cruel unfeeling capitalist society is allowing this travesty to happen. "How can we let big tech keep on doing this to our region??"
You, who are likely one of the many tech workers in the Bay Area, should be cheering every development project like this. You should be cheering when cities start to free up housing and make it available to people who want to move here, or are already here and can't find anything affordable. Even if those people buying the houses are making "big tech salaries", you should be for it.
Stop being blinded by the symbolic cases of the anti-gentrification sentiment, that the elderly widow is being forced out of her home to make way for ungrateful young tech workers. For every 1 of those stories, there are 50 families trying to make a new life in the area, unable to find a house for less than $1M or $6000/month in rent.
For every 1 of those stories, there are 10 families that have lived here for 40 years, and are sitting on empty houses, maybe even 2nd houses that are underutilized. They're the rich ones.
For every person occupying a rent controlled home, that's one unit of housing unavailable to someone else, and moreover, one additional unit of competition and higher prices imposed on everyone else who needs to find a place to live. Few among us will ever get to have the benefit of a rent controlled apartment.
Everyone reading here has some degree of numeracy and literacy better than average. Think about the numbers, not symbols -- and don't let yourself fall into the trap of thinking that the news is good at reporting the deeper story.
And think about what kind of system you want to incentivize when you vote or support knee-jerk policies. How does a region / city renew itself and make sure that it doesn't stagnate and turn into a place only for those people who got there first, screw everyone who comes afterwards? By ensuring that people with rent-controlled housing never have to leave? By tying up development for decades?
I take the side of the majority who no one feels comfortable speaking up for. The thousands of young people and families who want to live, work, and be productive here. Not those who already got theirs and want to keep the rest out. Time for them to move on, and if they need a nudge, it's well past due.
Rent control is not an economically efficient process. If you want my support in ending it, first work with me to address housing.
> Not those who already got theirs and want to keep the rest out
I agree. So maybe let's start by repealing Prop 13 so that everyone pays similar property taxes. Let's also start ending single-family zoning, minimum lot sizes, and minimum parking requirements.
> For every person occupying a rent controlled home, that's one unit of housing unavailable to someone else
For every person occupying a single family home bought 30 years ago, paying low property taxes locked in with Prop 13, that's 2-4 unites of housing unavailable to someone else.