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Comment by JeremyNT | Hacker News Reader

We should certainly subsidize the building of homes and give them to the homeless (or at least make them very affordable).

Can you link to the details of the program in Charlotte?

As somebody who is from NC, most home building is driven by for profit developers and it actually increases demand. They target higher end construction since the margins are higher. This is a feedback loop since the increased density of wealthy residents results in areas gaining even more amenities that the higher density will support, and thus becoming more attractive places to move for people in higher col areas out of state.

Building wealth by ensuring new units end up in the hands of low income people is a wonderful idea, but around here it seems to be the opposite occurring.

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> most home building... actually increases demand.

Is there data supporting this claim? It seems quite extraordinary that supply would create more demand than it satisfies. That's just not how economics usually works.

If affluent people from around the country are moving to Charlotte, I would think they're likely drawn by other factors, such as their jobs or family roots bringing them there, not by the mere existence of fancy housing and gentrified neighborhoods. If the new development didn't exist, those people would still be moving but would end up choosing slightly lower-end housing -- forcing up the prices and thus forcing out existing residents.

This "making fancy houses only increases home prices" argument seems like a rationalization invented by people who are looking for a reason to block such development. It seems highly unlikely to me that this would actually be true.

Politically, it's easy to be angry at developers for only building high-end housing, when it seems like the real problems are at the low end of the market. However, in reality, you can't expect it to be any other way -- and that's OK, because building high-end homes actually does help the low end of the market too.

New construction is inherently high-end. It's actually hard to build a new house or apartment building that isn't desirable to affluent people -- you'd have to go out of your way to use old design standards and bad materials that don't cost any less but make the home less desirable. This isn't economically viable for developers. So of course developers are always going to target mid-to-high end.

But that's fine, because when you build more high-end housing, then people move up from slightly lesser housing, making that housing available for people to move up to from even lower-end housing, and so on. This eventually makes housing available at the low end of the market for people who couldn't previously afford housing at all -- or perhaps for the government to rent on behalf of homeless people at an acceptable cost.

San Francisco is bizarrely full of terrible 100+-year-old apartments with high-income techies living in them, just because there's nowhere else for them to live. This is a failure. That should be low-end housing, but it's not because there's not enough high-end housing for all the affluent people.

> But that's fine, because when you build more high-end housing, then people move up from slightly lesser housing, making that housing available for people to move up to from even lower-end housing, and so on. This eventually makes housing available at the low end of the market for people who couldn't previously afford housing at all -- or perhaps for the government to rent on behalf of homeless people at an acceptable cost.

This doesn't happen here in the South. I'm aware things are different elsewhere.

What happens is that the historical small / older single family units (i.e. ~50-100 y.o., 1500 SF) are demolished one by one to make room for the highest end housing that can be sold. This occurs across the board. You have teardowns of recently renovated houses that are replaced either by multiple copies of "tall skinny" units (larger size, and upfitted with all the granite etc) or, if the lot can't be carved (or if the area is especially high end) you end up with mega-houses that take on the entire footprint of the lot and go for well over $1M

In all cases the new units go for multiple times what the old house would have gone for a few years ago.

I know why people want to live in places like this. As the density increases amenities are added that make it walkable and pleasant. Now grocery stores can be supported, coffee shops, breweries, etc., which are close enough either to walk to or a short drive. These are the sorts of businesses wealthy out of staters crave. They were not supported by lower income, less dense single family housing.

The roads in these older neighborhoods are ill prepared for increased density, and of course traffic bottles up. This makes it even more imperative that, if you work in a physical office and desire a short-ish commute, you need to buy expensive units that are centrally located. Remote working white-collar and tech workers (with full pockets from selling their homes in even higher value areas) move near the city centers even though they don't have to commute anywhere simply because they want the amenities involved.

Wages for "normal" people who grew up in the region, meanwhile, stagnate. Places that are near the physical locations they go to work are now occupied by wealthy out-of-towners. For locals without the means, they are increasingly pushed to the outer limits of the sprawl, which develops in increasingly distant rings around the urban centers. Commute times start to become stratospheric.

Southern cities almost universally hate public transit, so the congestion builds upon itself, making the QOL consistently worse for the people forced to move further and further out.

I don't have data about how adding more housing designed for rich people enhances this cycle, but I bet you have no data on how adding more housing designed for rich people will do anything to mitigate it, either.

More units are good theoretically, but almost universally people latch onto the deregulation component and fail to advocate for affordability requirements tied to it. If one out of every four "tall skinny" houses was made available at well under market rate to local, low income renters (think something like Habitat for Humanity) then maybe you start getting somewhere.

If one older unit is being replaced by multiple newer units, that's still a net increase in housing which will cause other old units to become more affordable. Again, it's expected that new developments will always be high-end, but they make other existing housing cheaper in the process.

> The roads in these older neighborhoods are ill prepared for increased density

Infrastructure is a problem. Many American cities seem to be stuck on 50-year-old (or more) infrastructure and unwilling to fund anything new. But blocking development isn't the right answer, investing in better infrastructure is. Build a damned light rail network, like Minneapolis (my home town) is doing. Rail commutes are nice, you can read or play video games. Then it doesn't matter if you can afford to live in the city center.

> If one out of every four "tall skinny" houses was made available at well under market rate to local, low income renters

This is a popular idea but I think it's naive. How are you supposed to decide which low-income renters get lucky and get to live in a much nicer house than their peers? And who pays for it? If you're going to tell developers to foot the bill then that discourages development which ultimately makes the housing shortage worse.

There’s something that I think often gets overlooked about the replacement of old buildings with new ones, and I think it’s pretty important. The lowest tier of housing in a given city is generally accessible to poor people in ways that new construction, or even properly maintained older buildings never will be. Slumlords operate at this level, and while they suck for many other reasons, they are often willing to rent to anyone who can deliver the rent money approximately on time. No background checks, no credit checks, no income requirements, just cash on the barrelhead the first of the month. That’s a hugely valuable service to the poor; no matter how bad the housing might be it still beats living on the street.

There are a surprising number of homeless people who live off of their disability benefits. If they could find such an arrangement as described above, they wouldn’t be homeless anymore. But landlords have no incentive to take that risk with them, and they won’t pass any of the income screening processes that are baked in to the apartment rental process today. As the worst of our housing stock disappears, the fraction of the overall housing market that remains accessible to people like that becomes ever smaller.

Worse, it’s a ratcheting effect: it only works in one direction. Sure, as the new high end units go up, the previously acceptable ones look less desirable, but it takes a long time for a unit to reach the bottom rung. Plus, even if it’s now the least desirable building in town, if it belongs to a landlord unaccustomed that to renting to the poorest segment of society that can technically afford housing, it’s likely that landlord will not want to change their requirements and policies to begin renting to them. The landlord is likely to preferred to sell the property instead, which greatly increases the chances it will be redeveloped into luxury housing, and so on.

But that is not actually what happens in the cities like SF. The lowest tiers of housing are not affordable. The worst apartment I've ever lived in my life (including Soviet-built flats) was in SF - a crappy 1906 victorian (or whatever you call these ugly hovels SF is full of) subdivided into 6 units; drafty, not updated in ages, no dishwasher or laundry, etc. It was also the 2nd or 3rd most expensive rental per sqft in my life (the only other ones were also in SFBA). I took it because I didn't even realize apartments SO crappy can exist, e.g. I didn't realize there was no dishwasher until after moving in... and the whole neighborhood was like that. Normally, that would all be "lower tier" housing. In SF, it was $3k/mo in 2014 and rented to either techies, or roommates (sometimes 2 unrelated people per bedroom). If someone built luxury towers in the same neighborhood, the techies would have moved there and actually made the lower tier of housing somewhat cheaper for others.

I am in NC. All the new development in my area seems to be homes crammed as closely together as possible on mowed down property - no trees or neighborhood identity whatsoever.

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