>disastrous policy
it's literally the only reason most of the remaining long time citizens who aren't wealthy can live there still
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.”___