Hundreds demonstrate against high rents in Zurich
swissinfo.ch
swissinfo.ch
We also have zoning here, which as far as apartment price goes mostly interferes by limiting the maximum height of a building to just a few floors. ~All buildings have the same height. There's also price control which definitely does something to the market - I know this because the amount of applications per apartment lease contract is through the roof, and it's sometimes very hard to get an apartment even if you qualify (income) and apply to tens of them. But I don't know where would the prices be if price controls were lifted.
(and yes, the rent here is too damn high)
Whoa. That's pretty cool. It's similar in the UK I believe. Also vaguely reminds me of Speaker's Sqaure in Hyde Park.
> We also have zoning here
Why hasn't Zurich (or more like it's Canton's govt) expanded suburbs into the farmland surrounding it? For the size of city, it is quite small. And the southern portion towards Egg seems pretty flat and easy to build. Even with suburbs that have a fraction of the density that Zurich has, it would probably alleviate population pressures. I'm assuming local politics?
Actually, how is local politics (sub-canton level) organized in CH?
But another problem: the suburbs are actually nice and in demand also. So how far do you want to live from your job? Freiburg (works for Bern and Lausanne!)? It’s like, ok I’m going to commute a lot and finding a place to rent is still hard. And Switzerland is not not dense.
True! But the suburbs seem much smaller than any I've seen in plenty of other similarly developed countries.
Like downtown Zurich to downtown Egg is 10 miles, yet it's almost all farms. Just in that small a radius alone you could make 10 additional Eggs (or 3 additional Usters), and house an additional 80k people with the exact same density.
Is there some kind of greenbelt restriction like the UK?
> the suburbs are actually nice and in demand also
Same in the US. In the Bay Area, the suburbs like the Tri-Valley, San Mateo County, Palo Alto, and southern Santa Clara County are all in greater demand than the city of San Francisco (it's cheaper to buy a family house in SF than it is in any of those suburbs). It's a similar story in Boston (Brookline), Seattle (Redmond, Bellevue, Bothell), Washington DC (southern Maryland), and New York (Hudson River Valley).
Yet why haven't construction companies in CH built similar high net worth suburbs? All the ones I am seeing are basically just historic villages.
In British terms, why isn't there a Milton Keynes or Reading in the Zurich metropolitan area?
Maybe because Zurich is so much smaller than London.
We need to bring more migrants, so there are 500 applicants. That will bring price down for sure!
You either build more housing to math the demand, or you restrict the demand from the number of people coming to move in.
> If there are at least 50 applicants, arguably, perhaps the price is too low...
Yes, prices are too low. Yes, you cannot increase prices. Status quo.
Generally I agree to your point - if demand is high, prices will be high. People should move somewhere else.
Germany's rental market is absolutely insane.
(but obviously this article is not about Germany)
That's a chicken and egg problem. Most companies want to hire where the labor already is, aka the big expensive cities, and most workers, especially immigrants from abroad, want to live in the big cities as those have the most jobs and the population there is less conservative and racist towards outsiders meaning it's also easier to build relationships and get along with just English without having to struggle with the local language.
It's nearly impossible to convince companies and people to invest in small cities on the offshot that they naturally become the successes they dream of later since it's not something the government can guarantee, nor do we live in prosperous times of cheap money pouring from the sky that would enable governments to fund crazy projects of building attractive infrastrucutre.
It isn't relevant. It offers no unique insight into what is happening. It's just a report on a protest.
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Furthermore, if Human Rights do not appeal to your Political Economic leanings, nevertheless I’m sure you can agree the state should provide a firefighting and police service. Police officers and firefighters need to live close to where they work. And, should be able to afford public transport, therefore: Public Housing.
As it is apparent worldwide - at least in the West - the market is also failing to house people efficiently and effectively. Hence: Public Housing.
Should not cost more than one third of the resident’s liquid income.
Start with university residences - build (or convert to) new in mass.
The market is not failing, the govt is failing by adding onerous regulation and giving into NIMBYism.
And the solution is more govt intervention?
This does not follow. You could make it an argument that essential services should be paid enough to live close to work, which would satisfy the criteria that you've laid out.
The most you can conclude from what you've laid out is that something is wrong with the current system. Which, I think very few people would disagree with.
Expensive housing is a problem for everyone even the people who own their home
I feel like I misunderstood something here. I presume the police/firefighters were needed to live near the community because they might need to respond in an emergency. Or possibly for community relations for the police (I know some jurisdictions require you to live in the community you police, at least in the states). If I'm wrong in this assumption, please correct me and supply some more context.
It's not automatically clear why the situation you've laid out includes the additional groups you've listed.
Not really. Other than that you seem to be implying that the categories of people covered need to be able to live in the city, without stating that, and we've only only established this as a requirement for groups that need to respond in an emergency. Necessity only seems to dictate that said groups are present for the parts of their jobs that require them to be present. Commuting seems like a viable option, which should have a depressive effect on housing prices.
Fundamentally, cities with strict zoning laws tend to require commuters (most cities in the west post ~WWII or so). Some petty-tyrant always ends up on the city council and building grinds to a halt. Unless you also want to severely curtail zoning and building regulations, I don't think the proposed public housing is even actually a long-term solution. And if you do want to curtail those, I'd expect it to not be needed very much.
And commuting has a cost too, driving an hour or two each way is expensive
Expensive housing is driving up the cost of everything because, everyone in literally every job is having their wealth extracted by landlords or into buying homes
So yes, home prices means taxes are going way up because all services are now far more expensive to provide because wages need to go up because the col for workers is going up because the businesses they rely on need to pay higher wages and here we are in a vicious cycle
It really doesn’t matter how it’s solved in the long run, but it needed a to be solved
Which seems like a problem that would solve itself eventually. If people's quality of life gets too low, I'd expect a decent chunk of them to move, opening up housing for people who can't/won't move.
There's some downsides to that strategy, so the city may not want to go that route, but as someone in a low CoL area, I don't really have a say in the matter (nor should I, so long as people aren't asking me to subsidize high CoL areas).
Biggest pain point in housing is the limited amounts of land and living space, not the building cost.
> what do you expect your government to do?
There are tonnes of things governments can do:
1. build more dense public housing
2. ban Airbnbs
3. ban private equity from turning the housing market in their private casino table
4. tax the hell out of empty apartments and poorly utilized land that's not for living or relevant economic productivity
5. incentivize remote work for white collar jobs so they don't all have to live in X city just to do things that could be done from anywhere else
But that’s not the reason for expensive rents in big cities.
It’s because many (rich) people want to live there … and due to physical and regulatory limits you can’t build more housing, even for piles of money it would be worth.
By ingreasing taxes it can make the private sector less competitive and redirect virtually all resources on public projects.
In capitalists states you could even argue that this is the only role of the state. Detecting failures in the market, first trying to fix them by light interventions, like law changes or incentives and if still not successful fixing them directly.
Build public housing and only charge a reasonable fee for it.
I don’t know if at the time people protested against the foul smell of the Chicago river. But the government reversed its course to improve the life of its citizens.
Why shouldn’t governments similarly deal with the housing issue using the means they have at their disposal?
(in both cases: the construction of public infrastructure)
In Denmark, the co-operative movement led unions to construct housing for their members. With the fall of unions, the housing organisations that remain now provide thousands of low-cost homes: they weren’t built for profit.
Co-operative housing still gets built at scale in Denmark, but rarely in the big cities; the private companies will outbid them because there is always a willing renter for luxury apartments.
I protested the capital city rent increase by moving out. I understand why students can’t.
Firstly, social housing there is a very old concept, and because of that, a significant portion of the population (>50%) already lives in social housing, meaning most the population has skin in the social housing game so they make sure to vote themselves a great situation because they're the majority and that's how democracy works.
But if the amount of population in a city living in social housing is way below 50% (most of Europe) then they don't have the democratic political leverage to vote themselves a better public housing situation, so social housing turns into a low quality charity for the poor and ends up turned into ghettos leading to a bad image of social housing leading to people to further voting even less in favor of social housing not wanting more ghettos.
Vienna, having the majority of it's citizens in social housing for a long time now has reached "escape velocity", that's why it already works there but won't/doesn't work in other EU cities who want to try it now, including in the rest of Austria where social housing is not the norm but more of a safety net for poor people. Other Austrian cities have even sold off a lot of their public housing stock to private investors in the 2008 crisis (cough-corruption-cough), meaning replicating Vienna's success today would be impossible as no city could afford to buy 50% of all private housing at market prices today even assuming private owners would want to sell in the first place.
And secondly, unlike Zurich, London, Amsterdam, Berlin, Luxembourg, etc., Vienna is not a tech-hub or corpo-hub for big international companies to set up large offices of well paid workers from abroad there, and neither is it a low-tax/beach-front destination for wealthy digital nomads, so there's not such a big pressure on the rental market from overseas workers with huge salaries pushing up rents and gentrifying everything.
That's the situation for rents. But the situation for buying a property flips on its head and makes Vienna one of the most expensive cities in Europe for buying your own property, far disconnected form average wages that almost nobody could afford to buy something.
For a train system, a non-state actor will have a hard time getting one of the ground (huge upfront costs, will often make a loss, cooperation of politics super important) and if they do … they will have a monopoly (which also sucks). So having transit publicly owned in some way makes a lot of sense.
But for housing, none of that is true. It’s being built (the amount built mostly depends on government approval, there is no shortage of capital investment), there is no monopoly… what is the problem that more public housing would solve?
The (admittedly outrageous) rent prices in Zürich come from a mismatch of demand and supply. And since Zürich has a lot of rich inhabitants, enough of them are willing to bid up the market rent prices to the current level.
Having a non-market solution for this might lead to cheaper rents, but introduces a lot of other losses and crucially also strangles the supply even more (look at what happened in Berlin when they introduced their moronic rent control law).
Change zoning rules. Incentives for co-living. Reduce flat sizes. Rebuilt office spaces. Or look to Vienna: a big stock of goverment-owned flats with low prices which makes it hard to charge more than those.
Price controls = supply shortages. Basic principal of market economics.
Remember, this is Switzerland, so you need to convince the population that this is a good idea otherwise they will block it with a popular vote. So confiscation of property or forced labour or increased taxes are all out of the question.
I don't think it should be about reducing local desirability, but give the conditions for other places to become more desirable.
The Shenzhen SEZ is one extremely successful example. [1] It was established as an SEZ in 1980 when it had fewer than 30k workers. By 2000 it had a labor force over 3 million. The current population (which is predictable difficult to measure given a massive migrant population) may be as high as 14 million.
[1] - https://en.wikipedia.org/wiki/Shenzhen_Special_Economic_Zone
Landlordism, as Adam Smith himself identified, is a destructive, parasitic drag on economies that should be minimized at all costs. Otherwise, you end up with what we have now, Capital owners chasing after unproductive returns by limiting construction, bribing politicians, and generally making everyone else poorer and more miserable.
In case if Zurich, I imagine that supply is limited due to its geography as well, and of course by wanting to preserve the quality of life.
Depends. If the profit is in more expensive housing, than private enterprise will bias towards that and ergo be less efficient at building lower-margin "affordable" housing.
Ideally, in a perfect frictionless economy populated by spherical cows, yes, private enterprise will more efficiently allocate across the entire spectrum of market needs -- so in principle, I'm agreeing with you.
But spherical cows make lousy roommates.
How?
Expropriation or nationalization is de facto impossible in a developed democracy in 2023.
Any proposal as such will be bogged down in courts for a decade, and the politicians who proposed it will have been voted out of office by the 60-70% of the population that owns some kind of property.
How? This is vague.
> creation of state-housing funds
How? Who holds the liability and underwrites this?
> widespread state construction of public housing
How? Is there even a trained construction workforce anymore? In the US at least this no longer exists after 2008 [0]
I'm not trying to be dismissive btw. I used to work in the policy space and there are organizational and liability issues that acted as a blocker against a number of the stuff you mentioned.
[0] - https://www.axios.com/2023/02/10/construction-help-wanted
These will also fly the workforce in from Central Asia.
Any other suggestions? Remember this is Switzerland, so you can't do anything the population doesn't actually want otherwise they'll vote it out.