Hacker News Reader

Comment by adjkant | Hacker News Reader

At the general level, I doubt anyone is surprised to see this story, and there will likely be more to come as tech flocks to Austin (though it was already a notable tech hub with some of these pressures already before the billionaires decided to give it the seal of approval).

To me, the more interesting question here is how does Austin avoid what happened to SF, where tech hollowed out nearly all of its existing culture and then tech workers began to complain it was bland.

Real estate and zoning policy is going to be key here. I've seen a decent deal of discussion about "Yuppie Fishtanks" [0] recently and generally it seems to be supported that massively increasing the housing supply is one of the best ways to keep rents intact and avoid hollowing gentrification. For the existing Austin residents here, how is the city approaching it thusfar? Do people think this is another SF gentrification story in the making, or is something different?

[0] http://noahpinionblog.blogspot.com/2018/07/yimbyism-explaine...

View on HN

I've been here for seven years. It definitely feels like we're on the track toward what people describe SF as. Several cultural institutions have gone out of business in my time here, everything's getting more shiny and less weird, the homeless camps are growing enormous due to rising rents/displacement, etc. We're not SF yet, but we will be before long if nothing changes.

I held out a small hope that covid and the remote-work wave would stem things a little bit, but it's hard to say whether that's happened. If anything, the influx could have increased due to the exodus from SF.

Overall I don't feel optimistic.

> I held out a small hope that covid and the remote-work wave would stem things a little bit, but it's hard to say whether that's happened. If anything, the influx could have increased due to the exodus from SF.

This is exactly what we're seeing in the Seattle area. A lot of people in the various circles I'm in thought, as we entered the early stages of this pandemic really settling in for the long-haul, "well, phew, at least it'll put a breather on housing costs."

Nope.

Because of the "work wherever you want" and Seattle and Puget Sound still being a wonderfully attractive place to live, the pace has accelerated. Housing prices here have shot up by double-digit numbers, even inside the city limits from which people are supposedly "fleeing." Both the north and south ends of Seattle, even West Seattle where the main road link has been severed for a year (as of today), have seen massive upticks.

The Department of Licensing has released statistics that show that the number of California driving licenses and vehicle titles exchanged for Washington ones is the second-highest it's been in ten years, with only 2018 being higher, and that's with most DOL offices being closed or heavily restricted due to in-person limits from the virus. (The influx of cars isn't going to do our "pristine environment" any favors, either, and I look forward to the even-louder rants about how terrible traffic is driving by oneself from Marysville to Queen Anne for a hockey game).

Meanwhile, people around here continue to insist that building is bad and, I shit you not, that if we simply don't build then the people will stop coming. I don't know why anyone still thinks this; it hasn't been true for twenty years, why should now be any different? And the new arrivals aren't keen on building more or making sure newer arrivals have space because, well, they moved here, to this spot because they liked it that way and, gosh-darn-it, this space is going to stay like this forever.

It's getting quite frustrating. After many, many years of waiting and hoping and moving around, I finally live near where a light rail station will be opening in the coming year-ish and I fear, even on my moderately good tech salary, I'm not going to be able to afford to live here before the train arrives, or shortly thereafter.

Similar feelings here. I simply don't know where else to go; it seems like every nice-to-live-in medium-sized city that isn't SF is going through this same song and dance. Money comes in like a flock of locusts, consumes the city, and SF is one of the first examples we're seeing of the husk that gets left behind. Then they move on to the next one.

Where's a person supposed to lay down roots, without retreating deep into a suburb? I don't need or want a job at FAANG or the next "unicorn"; I'm happy with my normal tech job/income and the life it affords. Why couldn't those things stay confined somewhere else and leave the rest of us in peace?

Odd answer, but go to the megacities that show resilience and are building housing. In the US, so far that may only be NYC. I know that's not amazing to hear if you have other reservations about NYC, but I think it's the reality until mid-sized cities catch on and get their shit together.

The other answer IMO is to pick a city no one in tech is even thinking about, and the growth rate is expected to be slow. Not to jynx them but places like Cleveland, Richmond VA, Indianapolis, Philadelphia, Detroit, Columbus, San Antonio, Milwaulkee, etc.

Personally, I far prefer the megacity, but that second list is a potential option.

From an urban development perspective, to me it seems that the best course of action would be a massive federal investment in existing mid-sized cities. Build large public transit networks in some of these becoming desirable cities and distribute the strain tech is putting on our urban centers. Massively increase housing density, but with this foresight, avoid doing the short term luxury development that won't hold up longterm and build some old fashioned 3-5 story brownstones.

The risk is that the people never come, but the alternative is the consistent hollowing out of all major US cities. Something has to give.

DFW is another such megacity. The construction happening there reminds me of parts of China.

The problem is, from my perspective (and having lived there), the Dallas/Fort Worth Metroplex is neither resilient nor a megacity. Outside of the 635 and 820 loops, it is just suburban sprawl that gets scorching hot in the summer and everyone who lives there has to be reliant on a car.

DFW is going to be in a world of hurt when the water runs out and that day is coming somewhat soon. There are already places in central Texas where the aquifers are dry and the lakes don't refill during the formerly-rainy season. North Texas is reliant on a set of manmade lakes that are already slower and slower to refill, with more and more taps being added every year.

I came from DFW (technically one of its suburbs). You're either in the suburbs, or you're living in a sea of hot concrete. Unless you retreat to one of the less-wealthy (read: genuinely middle-class) suburbs, everything from the restaurants to the billboards is steeped in corporate pretension and wealth-signaling. And then you're still, well, in the suburbs.

In my first round of interviews out of college I interviewed with a company in Dallas. It was going well, but towards the end of the day I was frank with my interviewer and told them I simply didn't want to live in DFW. I didn't have another offer yet, but I found one in Austin and moved there.

No kidding, I grew up there as well! The not-wanting-to-ever-return feeling is very relatable. I wouldn’t have re-explored DFW were it not for the current state of life in the Bay Area. As it stands, things have changed a lot in the past 10 years, or perhaps I’ve grown up. There’s a lot going on in DFW, and as an adult having explored all over I’m comfortable giving DFW another look.

I guess my question is why DFW given its flaws, for better or worse? Why not NYC or Boston or Chicago or LA or DC, to name a few?

NYC is building pied-a-terres for money launderers. The whole Hudson Yards was engineered as a phony rehabilitation of Harlem so they could sell visas to millionaires who could then turn around and buy a luxury apartment in the "blighted" neighborhood they revitalized.

No argument here, but what does this have to do with the countless other neighborhoods in NYC and the consistent expansion of housing that has happened in them over the past few decades while other cities experienced far worse gentrification pressures by not building housing?

Hudson Yards is not what I'm referring to in any way in my posts on this article. I'm mainly talking large towers in Williamsburg, along Atlantic Ave in Brooklyn, in the East Village edge near Alphabet City, some in Gowanus, Long Island City, and many others I'm probably forgetting.

> The whole Hudson Yards was engineered as a phony rehabilitation of Harlem

Hudson Yards is not anywhere remotely near Harlem, and was built on a deck over what's been a rail yard for a century.

I'm don't love what was built there, but it certainly wasn't rehabilitating Harlem and not a single person was directly displaced by building there.

It isn't anywhere near Harlem but they created a special zone that connected HY through central park to Harlem so that it could qualify for special redevelopment incentives.

Yeah, I have casually looked towards San Antonio and even Waco. The problem with the "look where nobody's looking yet" angle is that you're potentially just kicking the can down the road. In 10 years when "the market catches up" it'll be back to square one. Perhaps you'll have equity by that point, but that'll be the only difference.

There's an implicit assumption there that this problem will continue until it consumes most every small city, which I don't think is true. At a certain point, it will either stop at a larger/more popular city level or will spread itself so thin that the original set of cities becomes affordable again full circle. I suspect the first case as the cumulative growth rate of tech slows, but of course that guess is just as good as yours likely.

> I simply don't know where else to go; it seems like every nice-to-live-in medium-sized city that isn't SF is going through this same song and dance.

Not to sound too defeatist about it, since let's be honest we are still sitting pretty high on the list of people doing pretty well for ourselves, but I'm not sure there is any real escape.

In addition to more people moving here, one of the other reasons the Puget Sound housing market has shot up so dramatically is because lots of us didn't lose our jobs during this pandemic, but we for damn sure lost what we usually spend money on. With so much money sloshing around, people make the decision of "well, surely now I should buy a house, right?" And then they do. And since more money is available to them, housing prices are driven upward.

What sucks is if we have this worry, those of us of the high-five-figure/low-six-figure brigade, how must it be to be of even lesser means? If we're feeling the creep--the only reason I didn't get hit with yet another $100/month rent increase is because the Governor said they couldn't--then what is everyone else doing? I am anxious not only for my family, but for society at large.

I don't know how much longer that can last. Maybe it can last forever, since the monetary policy in this country seems to be that housing prices Must Never, Ever, Ever Fall, because housing is both a required good and the primary "investment" vehicle of everyone with lower net worth than an Apple executive.

My employer has taken up the work from wherever mantle and has said that where our company has offices, even internationally, are places where living is acceptable. As I'm an EU citizen, I wouldn't need work permission to go live there, maybe I give there a go for the second half of my life.

> I am anxious not only for my family, but for society at large

Absolutely; I didn't mean to underplay how privileged I still am, that my worst-case scenario is spending more than I'd like to on housing or moving somewhere less-pleasant to live. Lots of people are in much worse positions right now and I'm really hoping something gives at some point. I just wanted to air/discuss the source of my own (much smaller by comparison) frustrations, given that lots of people here can probably relate.

> Absolutely; I didn't mean to underplay how privileged I still am

Just to be clear, I was all but certain we were in agreement, and I didn't think you were (deliberately) leaving anyone out. What I wrote was more of a "this is gonna suck...for most of us...pretty damn soon...and we all know it...and that sucks."

> Where's a person supposed to lay down roots, without retreating deep into a suburb? I don't need or want a job at FAANG or the next "unicorn"; I'm happy with my normal tech job/income and the life it affords. Why couldn't those things stay confined somewhere else and leave the rest of us in peace?

Pick a city with cold winters and high humidity and not near mountains or ocean.

>Where's a person supposed to lay down roots, without retreating deep into a suburb? I don't need or want a job at FAANG or the next "unicorn"; I'm happy with my normal tech job/income and the life it affords. Why couldn't those things stay confined somewhere else and leave the rest of us in peace?

Literally anywhere in the upper midwest. "Oh but the winters are brutally cold and the summers are too hot and humid" you say. Well, there's a reason you can get a $150k/yr tech job and a nice $300k house in a good neighborhood. And there's no aversion to building homes up here.

Way too many people think the only place to make a living in tech is on the coasts. But you can get tech jobs in any major city. And some are ridiculously cheap to live in. Just look outside the "normal" places.

> Literally anywhere in the upper midwest (snip) a nice $300k house in a good neighborhood

I assume that's what the parent commenter meant by "retreating deep into a suburb".

Not at all. Many midwest and high-plains cities make it easy to be near a pleasant urban core for reasonable cost.

Lincoln and Indianapolis are two random examples that I've looked into recently.

> To me, the more interesting question here is how does Austin avoid what happened to SF

It doesn't.

There is a limited number of cities with weather conditions humans prefer.

Some people think others care about culture - no, they mostly don't. They care about weather conditions, safety and job opportunities. Culture is a nice to have feature.

Unless governments get busy building new cities/towns, every existing city with favorable weather conditions will turn into rich people, next to homeless people, or just rich people, if they enact laws against homeless people to get rid of them.

By the way, if governments get busy building new cities/towns, you don't get rid of the problem, you just delay it until every favorable location has a city, and then you're back to having this same problem.

It's the same as dating - we can't all have miss universe, because it's a zero sum game. If you live in a small town and got to date miss universe, who didn't get discovered yet, you shouldn't get mad when a talent agency visits your town and takes your miss universe to New York to be a fashion model and date a super athlete. You should be grateful that you got to date miss universe for a while not due to merit in a zero sum game, but due to pure luck. But, you know, good luck explaining that to the guy who lives in a small town, had a beauty and now doesn't anymore. Those fucking talent agencies, maaan.

This. I do look back at Austin in the 80's and 90's wistfully. Was fully cognizant how lucky I was but realized where it was heading and had to let that pretty girl go.

>Some people think others care about culture - no, they mostly don't. They care about weather conditions, safety and job opportunities. Culture is a nice to have feature

This does not track at all with what happened to the Bay Area. Silicon Valley historically means the peninsula. GOOG, FB, AAPL and most of the other tech giants are all closer to San Jose than to San Francisco. Yet it’s San Francisco (and to an extent Oakland) who have experienced incredibly growing pains. If the culture factor didn’t matter then people would have been happy to live in San Jose which has identical (if not better) better weather, safety and job opportunities.

Those traditional black neighborhoods were bought up, demolished and turned into luxury apartments at insane prices.

At one point I was on the east side and saw an old black woman rocking on her front porch in front of a 70's shotgun shack, next to an ugly post-modern 2 story house with a lambo and a tesla sitting outside of it.

I don't think increasing housing density is the answer. We really don't need more luxury apartments or million dollar condos.

> I don't think increasing housing density is the answer. We really don't need more luxury apartments or million dollar condos.

This was my first natural instinct maybe 5 years ago, but seeing the differences in gentrification stories has made it clear it's far worse to keep density the same. If nothing in the city changes and rich people decide they want to flock to your city (in this case, tech workers), it's a given that the existing poorer people will be forced out and prices will increase. Measures like rent control only slow the process, holding back a rising tide.

I've seen this personally in my backyard in Brooklyn. What has happened there is that massive luxury towers have been built along a busy street (central to transit but still not "neighborhoody"). While rents have still gone up, it seems this real estate and luxury market has helped stave off the insane hikes SF has seen, for example. Million dollar condos, probably not a good idea. But luxury buildings with high density turn into normal real estate in 20 years, and that top of the market ease keeps a lot of that tech money out of existing minority and poor neighborhoods.

The question for Austin if they accept that is where to put them. Finding a balanced place would be key here IMO.

What about the people who own houses? For all their faults, those houses were affordable and many residents owned them. Now they've been forced out by increased property taxes.

Those luxury buildings are going exclusively into poor neighborhoods because they have the cheapest land and least restrictions.

I don't see where I say anything about those, you might be assuming things here. The whole point is to maintain many of those houses affordability and current residents. If done right, property taxes should not increase significantly, and the local government has the levers to ensure that if they make it a priority.

> Those luxury buildings are going exclusively into poor neighborhoods because they have the cheapest land and least restrictions.

That sounds like what the cities should precisely fix. Use zoning and legislation to herd these buildings into more desirable places. Real estate will still come and build. Many cities have done this before, this is very much possible.

If not private, then we get back to the idea of public housing being built. This is much more of a political longshot, but I think it would actually be quite interesting to see public housing at the top of the market. "Affordable housing" approaches are a bandaid on the issue. By the city building the luxury buildings themselves, they can select the exact places they want them instead of just generally herding.

Cities generally want poor neigbourhoods to get developed and upgraded; if a poor neighbourhood becomes a rich neighbourhood, that's a win for the city, no matter if it's populated by the same or different inhabitants. Cities can focus and redirect development in various ways, but they are explicitly redirecting that development to the poor neighbourhoods because they don't want these neighbourhoods to stay poor.

For many in SF, they should imagine a Fillmore district with ~3000 more Victorians. Because that's what got bulldozed by enlightenment.

https://hoodline.com/2016/01/how-urban-renewal-destroyed-the...

This is a really good point. Urban redevelopment can go awry and lead to reduced density if not planned well.

Is property taxes control (similar to rent control) a thing? It seems it would avoid some of the issues of rent control (lack of maintenance for instance), since they actually own and live in the house, so they have an incentive to keep it nice.

That's what California's Prop 13 is. It works as originally intended to prevent people being priced out by rapidly rising property taxes but has other, necessarily linked negative effects. Lots of reading and analysis available by googling California Prop 13.

Those negative effects were not necessarily linked. Prop 13 was written by a lobbyist for commercial landlords, and corporations have always benefited the most from it.

https://www.pbs.org/video/the-first-angry-man-lnpy07/

There are other ways to provide relief for rising property taxes. For example, Washington has a property tax deferral program, so seniors don’t have to pay the increased property tax until they or their heirs sell the house; the capital gains that increased the property tax will pay for the deferred property tax.

That's interesting. It seems like it runs the risk of making a long-held house extremely hard (or money-losing) to sell. If a $1M property has $900K in deferred property taxes against it (which would be possible to accrue in a 50+-year timespan). That house would never get sold, because the holding costs are based on 1970's tax rates (maybe with some annual escalator), so I can hold a $1M house for $5K/year and keep adding $20K/yr to the deferred balance or I can give up the house and put $60K in a real estate agent's pocket, $900K in the city's pocket, and $40K in my own pocket. I'm never doing that.

Texas has a limit of I believe a 10% increase in tax assessment per year, so this prevents the worst outcomes but only slows down the rest. If you think of property tax as crudely analogous to rent (from a budget perspective), most families would not be able to endure 10% rising rent every year for an extended period. Yet this future sure seems to be baked into the market here in Austin right now.

As a sibling comment mentions, California Prop 13 is property-tax control, and it did solve the issue where astronomical increases in property taxes ran families out of their homes. But the side effects and unintended consequences are terrible.

It is hard to tell the poison from the cure with these things.

Texans could, you know, opt for income taxes in lieu of property taxes.

No Thanks!

Y'all will when enough of you get old enough and can't pay your property tax on retirement.

78704 is in your future too.

When the population of a city suddenly jumps, increasing density is the ONLY answer. Without extra housing, where do you think all those extra people will live? In the apartments of current residents of course. This is not a view held solely by freemarket enthusiast or "neoliberals" or whatever. Even the DSA understands this. Their only disagreement is that they think the government should be the ones building the housing. I can't get my head around the prevalence of this anti-density view. It's the climate denialism of the left.

> We really don't need more luxury apartments or million dollar condos.

Of course we do. If condos are a million dollars we need more of them so that the price decreases. All housing is "luxury" housing when there isn't enough housing.

Reply on news.ycombinator.com