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Comment by sologoub | Hacker News Reader

> The caps represent a windfall to one group of tenants: those, whether rich or poor, who are already ensconced in regulated apartments. Simultaneously, they hurt all other groups — especially young people and those coming from other cities — by all but shutting them out of the market.

That’s not success, that’s picking winners and losers. Same as with SF Bay Area, Santa Monica (in LA) and any other place with rent control - being in place early makes you a winner. Finding a vacant rent stabilized place is like winning a lottery. Problem is what do you do with young people that should be moving out, or moving to the city for school?

Only real answer to housing is to build more of it. Else, you force people to move, pay more and/or cram ever more bodies into the same space. The latter is also what makes poor much more vulnerable, and not just in the pandemic.

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> being in place early makes you a winner

Isn't this just the housing market in general? Why should renters not benefit from the same dynamics that owners do?

The solution is make it so that no one benefits from this dynamic (via a land tax), rather than just expanding the group that gets the benefits (which will never expand to include everyone, since land is scarce).

And then, of course, California decided to pass Proposition 13 [1] which made sure that owners who got in early also "win" vs more recent buyers.

There are owners of identical homes on the same block in San Francisco who pay 10x what their neighbors pay due only to when they bought (and the resultant purchase prices).

This is unlike saner places in the country which reassess property values regularly.

[1] https://en.wikipedia.org/wiki/1978_California_Proposition_13

That’s definitely picking winners and losers, but not inherent to the real estate itself. Just shows that populist polices are not new.

EDIT: also, why prop 13 applies to non-residential real estate is another issue.

Even without Prop 13, this problem still applies, and is inherent to real estate.

Buying land is essentially buying a monopoly (since land is in fixed supply), and getting access to its rents for perpetuity. Prop 13 gives you even more of the rents, but in places with Prop 13, property taxes are low enough that most of the rents still go to the landowner.

You can compare land to taxi medallions, and see that all the reasons taxi medallions are bad also apply to land. Allowing indefinite ownership of the rents from a scarce resource essentially gives a slice of the future productivity of the community to those who were lucky to buy early enough.

Not at all, owners take on the risk and capital responsibility. I suspect those who bought in Detroit in the peak of that market would not look like a winner today. An extreme example, but still. Other less extreme examples would be in international markets where the base currency has declined - nominally the houses are more expensive, but in real terms could have lost over 50% of value.

If the housing market is relatively flat (and the currency is stable), then owning still typically provides you with benefits, such as equity accumulation.

I think that quote refers to American style of rent control that is tied to the tenant, as opposed to the German style that is tied to the building.

Unfortunately, Berlin-style appears to mean “moving is almost impossible because 50 other people also want to view the same flat as you at the same time you’re looking at it, and you literally can’t outbid them”.

That was my experience, anyway. I eventually found a house share to get started, and after I arrived a hooked up with someone who happened to already have a place big enough for me to move into.

If I move within the city again, it will have to be by buying a place.

Which in a lot of cases will be brought by speculators see London sf and Vancouver

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