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Comment by njepa | Hacker News Reader

It seems extremely unlikely that affordable housing will ever happen in the Bay Area, since that would essentially mean a crash of the housing market (maybe even by government intervention). This would of course be extremely unwelcome. As such any acceptable solution would have to be ineffective. And an ineffective solution have little chances of counteracting the inertia of current developments.

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Property values don't usually go down when you increase density. Look at NYC or Tokyo or Paris. If anything it usually makes the land value go up, especially if a developer knows they can buy it and put four units in it's place.

Knowing a few NIMBYs among older generations, I suspect that the real objection to densification isn't actually property values, it's character of the neighborhood. Having the single-family home you raised your children in torn down for a luxury highrise feels like a tragedy whether you get $1M or $3M for it. That's why so many senior citizens don't sell at any price - they'll take out reverse mortgages and fritter away their retirement savings so that they can stay in the home that is familiar to them, even if they could just sell it for a few million and retire someplace cheaper with a higher quality of life.

On one hand, you have sentimental value. On the other hand, you have a crushing housing crisis that is causing incalculable financial strain on millions of people. I wonder which of these we should consider more important.

I suspect most housing advocates would agree that the end goal isn't more affordable land - it's getting more affordable units on the market.

> Tokyo

Do you have a source on that? Tokyo is famously known for having largely flat housing prices over the last 20 years[1]. In fact, in Japan, most houses are considered depreciating assets [2].

[1] https://marginalrevolution.com/marginalrevolution/2016/08/la...

[2] http://freakonomics.com/podcast/why-are-japanese-homes-dispo...

Exactly, it's flat. The property values didn't fall.

I’m not sure we have enough information to conclude that property values will never fall with increased density.

It could also be that property values never went up to begin with in Tokyo, and remained at market equilibriumm, I.e. prices there reflect simply the cost to produce the unit, plus some profit margin. Things never got out of hand in Tokyo like they have in SF and NYC (though the latter, to a much lesser extent).

The value of most commodities stays flat once it reaches that equilibrium (eg. most food, clothing).

The argument that housing prices in SF would fall with increased density seems to be another way of making the claim that SF housing is currently experiencing “surge pricing”, so to speak.

I never said, and don't believe, that housing prices would fall if the city were up zoned (per square foot). I think that prices per unit will fall if you make more units available.

Only if you sell. Otherwise, if you are truly successful with up zoning for affordable housing, not only will the market rate of houses fall but land to build on won't be scarce anymore either.

It is difficult, if not impossible, to on the one hand supply large amounts of affordable housing and on the other to not negatively affect those benefiting from the lack of it.

But ultimately it isn't me you have to convince, but those who would risk their property values. If you do that, then you have a solution to the situation.

Hard to say. SFH owners typically own the dirt beneath their house. A lot with the right to build a 3-story block of 3/2 flats might be worth considerably more than a lot with a single 3/2 SFH.

Would a crash of the housing market be unwelcome?

The people that lose in such a crash are property developers, landlords, and home-owners that planned to sell and buy in another region.

The people that benefit in such a crash include people who currently can't afford to live here, renters that currently can't afford to buy here, renters who currently have too many roommates, renters who can't afford to leave their rent-controlled unit, people who could buy a larger or nicer place, businesses where people spend the portion of their income which no longer goes to housing, businesses that can hire into the region more easily, and everyone who enjoys a community with a more diverse range of residents.

You take it as a given that a crash associated with actually affordable housing would be unwelcome. I think it should only be unwelcome to those who see the housing supply as an investment vehicle, rather than as housing. To those who just want to live here, or live here more comfortably, a crash might be very welcome indeed.

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