City council passes bill enabling tenants to report vacant apartments | Hacker News Reader

City council passes bill enabling tenants to report vacant apartments

thecity.nyc

108 pointsPaulHoule172 comments

Long long ago in a galaxy far far away when I was doing CS as and undergrad we had an assignment to build a model on how to maximise rental income for a commercial property. It was just a toy model but it showed that as you increased rent your vacancy rate would go up. Not surprisingly. But the interesting bit was you Maximised income at about a 15% vacancy rate. So in an unregulated market driven situation you would be leaving money on the table if you did not keep reaching prices until you priced some people out. It was a light bulb moment for me to see that this was a rational result even if it “felt” greedy to me. Now I think about these kind of issues as being unbalanced models. Add tax, Air B&B, local regulations, portfolio structure, and a range of other factors and typically the state of vacancy rates in and area will make sense.

Did that model also factor in risk of damage, liability, and normal wear and tear that a tenant brings over a vacant unit?

It sounds like your model assumed all apartments would be the same price for the same unit. But that isn't how the real world works. You start with the high rent and then come down as it sits vacant. Different units in the building with the same amenities might rent for different amounts.

If your rent is $2000 and no one will come in, it makes sense to drop your rent to $1850 if it gets someone in now, because at the end of the year you'll break even vs sitting just one extra month vacant at $2000.

The main reason that doesn't happen in NYC in particular is rent control/stabilization -- dropping the rent lowers your baseline.

In most cities, you can make up that rent with an increase at the end of the year. But not in NYC. So landlords are incentivized to keep units empty.

Actually, one of the controversial of RealPage rent price fixing software is it encourages landlords to keep units empty to reduce supply.

https://www.propublica.org/article/realpage-accused-of-collu...

> The main reason that doesn't happen in NYC in particular is rent control/stabilization -- dropping the rent lowers your baseline.

I was in a few "rent stabilized" apartments in NYC over the years, they always had a clause in the contract that "the official price is $1750, but there is a rebate so you will pay $1450" or something like that.

After you move out, regardless of the state of the apartment, they spend 2 weeks painting it. This is required to be able to maximize the increase in the "official price" ... though that seemed completely independent of the lower market price.

(That was the case 6+ years ago, I've been in slightly more expensive apts since.)

This has been illegal for several years. Now, rent increases for both new and existing tenants are based on the rent actually paid (the preferential rent).

> You start with the high rent and then come down as it sits vacant

My experience in recent years is that what you really do is something akin to a casting combined with a (not advertised) auction and select your tenant based not only on price, but estimated probability of trouble and being late on rent, so religious college freshmen are high on the list, while single mothers on the other end.

You don't want to do this every month, so you set the price high enough for some people to self-select.

Not legal btw but impossible to enforce. Small landlords will do this, big ones just run the algorithm

This effect only works if ownership is concentrated or there is otherwise a mechanism for collusion (the theory of collusion via Realpage is compelling to me). In a competitive market, nobody wants to leave _their own_ inventory vacant, because even if it would increase the aggregate revenue in the industry, that revenue will go to their competitors and not themselves.

Now consider the meteoric rise of Airbnb and ponder for a bit on it. “Vacant” units are more lucrative than occupied ones in some markets these days.

> This effect only works if ownership is concentrated or there is otherwise a mechanism for collusion

This is the current state of all modern economies, so this equates to “it works.”

Maybe in some small-/mid-size housing markets where rentals are not the main form of housing. In a city like NYC, the rental market is way too large for anyone to control it.

A good example was during the pandemic when vacancies shot up, rents came way down. Landlords were not “holding the line” at previous prices, presumably because they knew that renters would just go to a competing landlord.

strong disagree. I own a rental and it is more general than that, even if you are a tiny player in market. 15% depends on your inputs, but zero is never the answer.

It isn't specific to apartments either.

If you are selling a car and need it gone today, you will have to set the price lower. Same is true with apartments.

I could wait 3 months to find someone to rent at 2k/month, or wait 1 month to find a renter at $1800/month, or wait one day at $1500/month.

Having an optimal vacancy isnt about monopoly, but the economic transaction cost associated with search [1].

https://en.wikipedia.org/wiki/Search_cost

You don’t want the 1500 a month tenants as there is too much variance in quality of tenant.

That idea would transfer to plane seats? But airlines famously sell the the same standard of seats at all kinds of different prices and fill the plane.

With the commercial property it might be profitable to sell that 15% on ultra short leases cheaper knowing you can kick em out when the high payer comes along.

> That idea would transfer to plane seats? But airlines famously sell the the same standard of seats at all kinds of different prices and fill the plane.

Airlines also famously sell _the same_ seats multiple times and hope people don't show up. You can't do that with housing.

You could! Had that shit happen to me once. Signed a lease to being X and they changed the date last minute.

I don’t think that’s legal. You could have sued them for damages or hotel

That model assumes that there's only one owner and that identical units have identical rents.

... as is the situation in many real world apartment blocks

Hardly. Identical layouts maybe, but part of the property owner's advantage is exploiting asymmetric information and charging each tenant what they're willing to pay, not just what the other tenants already pay. (This is one reason why talking to your neighbors is important.)

To add to what the previous commenter said, It's wrong to imagine the market as one big block apartment building.

> you Maximised income at about a 15% vacancy rate. So in an unregulated market driven situation you would be leaving money on the table if you did not keep reaching prices until you priced some people out.

That is perhaps the motive of massive collusion in rental markets around the US: A company named RealPage sold software to landlords that coordinated the rents they charged in order to maximize income, and the outcome was high rents, of course, and many empty apartments. (Essentially the landlords hired RealPage to organize their collusion.)

https://www.propublica.org/article/doj-backs-tenants-price-f...

Considering it's a model, I wouldn't read too much into it since there are a ton of factors that influence it.

But the point stands.

It's like renting out a single apartment. If tenants stay for years on average, holding out for an extra $500 per month is worth 3 months of vacancy since for places where rents are ~$3,000, you'll make back the loss in only 18 years. Then it's an extra $6,000 per year thereafter.

Reminds me of my landlord in SF. She was going to retire and sell the building. Empty units fetch almost $200,000 more when sold. So as tenants moved out, she left them empty. The rent was about $4,000 per month, so as long as all the tenants moved out within 4 years, she was still ahead by leaving it empty.

I was the last tenant to leave after about 2 years. She made an extra ~$400,000 by leaving units empty.

> you'll make back the loss in only 18 years.

You meant to say “18 months” there.

Indeed! I was going to write 1.5 years, then thought months would be better but only changed the number!

You could simulate which penalty they have to pay for leaving an apartment vacant to get any desired lower vacancy rate.

Empty apartments are also the supply needed by anyone moving into the city, so it's important to have some. My city recently went through a housing shortage and I heard of cases of about 50 people trying to rent one house.

Somewhat high vacancy rates are good if they're 'organic' -- if they're simply the result of there being more supply than demand. When that's the case, tenants and prospective tenants have more leverage, and landlords compete for their attention. Conversely, if supply is too low, it's tenants who compete for landlord attention.

"It was a light bulb moment for me to see that this was a rational result even if it “felt” greedy to me."

I am not that surprised. Systems with some slack in them tend to be more resilient when absorbing shocks in demand, and demand varies over time.

If the vacancy rate is, say, 0.1 per cent, pretty much no one can move into the city unless they build their own unit or swap with someone moving out. That sounds like a recipe for stagnation.

Similarly, if you run a web service, you shouldn't want your server to run at 95-100 per cent load all the time. Having some slack is valuable.

In queuing theory you also need to operate at some fraction of your full capacity (some slack) because otherwise wait times trend to infinity.

Sorry for the hijack, is there a good exposition for the mathematical treatment of this?

I am sure it is in a lot of stats books, here is one treatment

https://web.mst.edu/~gosavia/queuing_formulas.pdf

> Intro 195 “would divert critical resources from HPD’s enforcement,” testified Assistant Commissioner for Housing Policy Lucy Joffe, remarking that the debate on apartment warehousing “has become a bit of a distraction in the press in the past few months.”

Based on my time in this city, I would go with what a civil servant says over what a councillor says.

FWIW HPD does support it now after they were included in the process (and probably after negotiating future budget increases to compensate for any increased load on the dept).

I don't care what the problems are: what we need is not people reporting other people to the kommandantuur. It simply isn't.

The solution has always been to build more housing. Onerous zoning laws are preventing supply and demand from coming into balance. Single-family zoning needs to be banned. It's not actually that complicated, and to your point, it doesn't involve reporting your neighbors to the authorities.

How much single-family zoning is there in New York City?

A surprising amount, but of course that's not the only way of impeding construction. See San Francisco's shadow aversion.

New York City is around 15%. Note that Manhattan has among the lowest prevalence of single-family zoning in the US, and a density of almost 70,000 people per square mile.

83% of the Bay Area is zoned single-family and has a density of just 400 people per square mile.

[edit] If you look at NYC-adjacent counties, Bergen, Fairfield, Nassau, and Westchester the numbers get far worse. About 56% of all housing near rail stations in these counties is classified as detached single-family houses. [1]

[1] https://rpa.org/latest/lab/our-region-needs-more-housing-end...

> About 56% of all housing near rail stations in these counties is classified as detached single-family houses.

That could be totally fine. Many people like living in detached housing and having that near rail service to a major city seems like a good thing.

If the concern is zoning that precludes other uses, that’s a different thing, but a mere observation that X% of housing in some area is of a particular, often very desirable, type isn’t conclusive to me.

If you want public transport to be seen as something everyone uses, it’s probably good that outlying counties like Westchester have detached SFRs in addition to the 44% higher density housing.

If detached single family homes are so popular, you wouldn’t need the government to prevent people from building what they want. Those rules were designed to ensure that certain neighborhoods were only for “the right kind of people”, not because Moses came down from the mountain with a single-family zoning plan.

They are wildly popular. It's not the government preventing people from building what they want (though that's the proximate mechanism).

It's people who live there and voted in the government and advocated for those policies. This is not a government problem, but a people's preferences problem.

You have to consider selection bias here: people live where they can afford to, not necessarily where they’d like. You aren’t seeing what people who were excluded on price or racial lines would want, and you’re not seeing how many people truly want only that style versus not disliking it enough to organize a political movement, since depending on the area that can require things like supermajorities and even nullifying covenants in deeds.

This also hits the tension cities have for balancing the interests of long-term residents against the future. Lots of places have this dynamic now where old retirees block any changes either because they’re opposed to change or fearful of losing the equity which is most of their retirement, but anyone looking at the city finances knows that they need more residents, especially of working age, and that includes lower income families if you want to be able to have service workers, city employees, etc. actually live there. This is especially true in places like California where old residents pay far less in taxes but have equally high, if not higher, expectations for city services.

> and has a density of just 400 people per square mile.

Oh wow, that's low enough to count as rural in the UK.

> The solution has always been to build more housing

The US has more than enough housing, and very cheap at that. You can buy a house for $1 in some places.

However, toxic policies lead to over-concentration of housing in a small number of cities. This drives up prices in a never-ending spiral.

You can't ever build enough housing in dense cities. It will ALWAYS be expensive.

> You can't ever build enough housing in dense cities. It will ALWAYS be expensive.

Interesting, Tokyo hasn't seen house prices increase since 1995 in either nominal or real-dollar terms.

One of the most affordable major metros in the US is Houston.

One thing they have in common is no real constraints on zoning.

> The US has more than enough housing, and very cheap at that. You can buy a house for $1 in some places.

The problem is supply and demand have to be co-located. You can't commute from Iowa or Detroit to the Bay Area or Manhattan for work.

Studies show the US is short about 5-6M homes thanks to a decade of under-building. [1]

> However, toxic policies lead to over-concentration of housing in a small number of cities. This drives up prices in a never-ending spiral.

Concentration of housing is good, actually. It's far more efficient in every way, it's environmentally friendly and gives us access to all sorts of services and social groups. Concentration of talent makes the Bay Area the Bay Area.

[1] https://www.marketwatch.com/story/u-s-has-a-shortfall-of-6-5...

Yeah the existence of a cheap house doesn’t make housing cheap, or even scalable at that cheap price, since things are priced at the margins, if suddenly a few people flocked to cheap town it’s prices will go up fast.

A $100000 house going up to $105000 is not the same as a $1000000 house going up to $1050000.

Moreover, land cost outside of big cities is pretty much nothing. It's cheap to build new housing as needed.

> Moreover, land cost outside of big cities is pretty much nothing. It's cheap to build new housing as needed.

This is far too sweeping a claim. It’s comically untrue unless you’re defining “outside” as multiple hours of driving, and “big cities” as anywhere over, say, 50k people.

It’s also obviously untrue once you learn that people leave their houses. Yes, you can build new housing cheaply in a rural area but for people to live there you also need stores, schools, jobs, etc. and that means things like roads. Now your cheap house involves buying a car for each resident, paying for a lot of gas and tires, paying for road construction and maintenance, and not having anything you’d prefer to be doing other than spending all of those extra hours driving (don’t forget the increased health care costs). Things like utilities, roads, snow plowing, etc. all cost most on average because that low density means more infrastructure but the costs are spread over fewer people.

You can save money that way but it’s nowhere near as much as portrayed.

> This is far too sweeping a claim. It’s comically untrue unless you’re defining “outside” as multiple hours of driving, and “big cities” as anywhere over, say, 50k people.

I haven't looked at _every_ city, of course, but it's generally true in many areas. For example, the same-sized plot of land will be 20 times less just 1 hour away near Seattle.

> It’s also obviously untrue once you learn that people leave their houses. Yes, you can build new housing cheaply in a rural area but for people to live there you also need stores, schools, jobs, etc. and that means things like roads.

Schools, stores, and roads are, in general, either cheaper (roads) or cost insignificantly more (school), or about the same (stores).

I did the math. The city efficiency peaks around 200k population, and then it starts to go down. Mostly because you need extra layers of bureaucracy and/or fall down the rabbit hole of mass transit.

And then the denser the city, the more money it needs to maintain itself. And new infrastructure quickly becomes overwhelmingly expensive.

Think about this: one mile of Manhattan subway costs about the same as 1000 miles of a modern new 6-lane freeway.

> You can save money that way but it’s nowhere near as much as portrayed.

By not forcing the densification, you WILL save money and make peoples' lives better. The main issue is job availability. We need to make sure remote jobs and distributed offices have more advantage, via cap-and-trade or taxes.

> Interesting, Tokyo hasn't seen house prices increase since 1995 in either nominal or real-dollar terms.

It's interesting that Tokyo is used by people all the time after just quick googling. Probably because it's an "exotic" location.

Tokyo real estate prices are growing: https://www.reuters.com/markets/asia/surging-tokyo-property-...

If anything, Tokyo is a fucking horror show. It shows the result of failed "urbanist" policies. They managed to force people to jam-pack into "microapartments" where you can sit on a toilet, while cooking food _at_ _the_ _same_ _time_. All while a couple of hours away, beautiful traditional houses are falling down.

And the punchline: this is all while the overall population is dropping.

> One of the most affordable major metros in the US is Houston.

Yes. Guess why? You have three guesses.

> The problem is supply and demand have to be co-located. You can't commute from Iowa or Detroit to the Bay Area or Manhattan for work.

Yes, that's why we must stop new offices from opening in Manhattan. Tax the office space, or do a cap-and-trade based on the city area.

> Studies show the US is short about 5-6M homes thanks to a decade of under-building. [1]

No. The US has around the historical number of housing units per capita: https://fred.stlouisfed.org/graph/?g=j9kH

> Concentration of housing is good, actually. It's far more efficient in every way

No. And no.

It's not good, it's absolutely terrible. It's inhumane to force people to live in human anthills. And it's not even that efficient: https://journals.sagepub.com/doi/10.1177/1091142107308302

Oh, and wait until you hear about new public transit infrastructure cost!

> It's interesting that Tokyo is used by people all the time after just quick googling. Probably because it's an "exotic" location.

Also, if GP wants to make a point that housing prices can be stable somewhere, they probably shouldn’t pick a spot in a nation with a legendarily stagnant economy. 23Q3 even showed a contraction.

> Also, if GP wants to make a point that housing prices can be stable somewhere, they probably shouldn’t pick a spot in a nation with a legendarily stagnant economy. 23Q3 even showed a contraction.

I disagree. The argument that I was pushing back on is that it's somehow impossible to balance supply and demand in a major city in such a way that housing prices are stable. This is false by counterexample.

By picking somewhere in Japan you’ve left yourself open to the counter-argument that you have to kill economic growth to do it. If you want to prove your point without implying the necessity of unacceptable sacrifices — in other words, if you want somebody to be persuaded — cite some high density locations where economic growth was strong but housing prices were stable.

> It's interesting that Tokyo is used by people all the time after just quick googling. Probably because it's an "exotic" location.

lol, it's not that it's 'exotic' it's that they are a major metro in a country that has federalized zoning that city councils can't make capricious decisions in. There aren't many to pick from. Also Japan housing CPI [1] vs US housing CPI [2].

> No. The US has around the historical number of housing units per capita: https://fred.stlouisfed.org/graph/?g=j9kH

As I said they're not near jobs, and you can't commute from the middle of Iowa to New York or SF. You're pointing to a useless metric.

> It's not good, it's absolutely terrible. It's inhumane to force people to live in human anthills. And it's not even that efficient: https://journals.sagepub.com/doi/10.1177/1091142107308302

That's a great opinion for you to have, but that's not one most people share. You know everyone in these cities could live elsewhere. They elect to live in cities. In fact they pay through the teeth to live in most of these cities. Don't project. If you want to live out in the middle of nowhere, by all means do so, but don't force everyone else to through anti-development policies.

[1] https://fred.stlouisfed.org/series/JPNCPIHOUAINMEI

[2] https://fred.stlouisfed.org/series/CPIHOSNS

I'm not keen to report my neighbor, but my landlord is not my neighbor. They could hardly be more not my neighbor if they tried.

When my rent skyrockets amid lots of vacant new construction (I'm not in CA, we're actually building around here), "gee, I'd like to help these fine fellows cheat on their taxes" is not the first thought to cross my mind.

It is saying remarkable things about the human condition that we have a tenant and a landlord, their only interactions are to organise the world so that there is somewhere for the tenant to live, and the default relationship is adversarial.

Landlords do have an unfair advantage; see also Georgism. Trying to make a land value tax work will get good results. Reporting people to mother will lead to a lot of fighting and the economic market rates are still going to win in the end.

The system is run by the rich, for the rich. The unfair advantage is the entire point. You will run face-first into a titanic wall of money if you try to deprive capital of the various rent-seeking advantages it grants itself.

Sometimes naïvety is a superpower, so godspeed on the Georgism but I will not hold my breath and I will enjoy my wins where I can find them, thank you very much.

The 3-step plan you just outlined is: (1) Identify a group of people with insurmountable, systemic advantages that you don't expect can be overcome. (2) Develop an adversarial relationship with them. (3) Assume you're going to get some wins from time to time.

You should reflect on that. There are a surprising number of problems in the approach you're going with there - both logical and strategic. Picking fights is actually a political tactic for preserving the status quo; it creates a force to oppose the change you want. If you don't like the status quo you should avoid taking adversarial stances. Like setting up hotlines to report people to the government; it rarely ends well.

> The 3-step plan you just outlined

Speak for yourself.

> (1)...

Holy shit your fevered imagination came up with a bad plan. But they are your words, not mine. Your plan, not mine. You should reflect on that. There's nothing insurmountable about the fights I'm picking and that's the entire point.

> Picking fights is actually a political tactic for preserving the status quo

> If you don't like the status quo you should avoid taking adversarial stances

Oh, tell me about your plan for winning without picking a fight. I'll wait.

Fights are inherent to good political strategy, it's quite silly to suggest otherwise. Politics when people agree isn't politics, it's administration.

Strategy is about picking the correct fights or inducing your opponent to pick the wrong fights. Georgism and socialism and other causes that strike at the heart of the ownership issue are the wrong fights because the opposition is too entrenched. You will lose. If you win it will be by destroying the country, but realistically speaking, you will lose. If I wanted to be politically ineffective, I might join you in your cause, because in principle we agree, but I don't want to be ineffective.

Instead, I will continue to go after the tax and zoning laws. There is a lot of good to be done on that front. It's messy, dirty, non-utopian, and has no use for someone afraid of a fight -- but these are fights that can be won and that makes them infinitely better fights to pick.

> Oh, tell me about your plan for winning without picking a fight. I'll wait.

The obvious approach to me would be to put together a plan for how to implement a land value tax, then propose bringing it in in exchange for dropping some other property-based tax or removing rent control so that in the short term landlords get a slightly good deal. Maybe try to get it implemented in a few districts first to see what happens so it doesn't get scaled up if it turns out to be a bad idea; these things are tricky.

Then with luck that'll be enough because the unfair part of rents is dealt with. If it isn't, get some people like you together to figure out what upsets them and keep tweaking policies to line incentives up. There is probably a lot to do around construction that is not getting done because people keep trying to fight instead of turn comfortable living into an administrative matter.

> Fights are inherent to good political strategy

They aren't. That is how you get all the pointless grudges that go back centuries, never get resolved and don't let people get ahead. People end up with multi-generational conflicts over trivia or long-gone disputes that are wasteful and destructive. Great political leaders tend to be the people who hammer out compromises and balance different interests without letting things spill over into conflict. Great leaders period are the people who heal rifts and promote reconciliation and peace.

There are occasional political battles, but it is nearly always better when there is a space devoid of them. Compromise, tolerance and all those sort of concepts lead to better living standards. most people persue policies of destruction and end up much poorer for it. But they have enemies to blame so they feel good about having less than they could. I'd rather be live in a wealthy society myself.

> Politics when people agree isn't politics, it's administration.

I dunno, I still see you taking a position there where you seem to expect housing policy to be a fight and don't see a world where it can become just a quiet administrative matter. I continue to put it to you that this is a terrible approach to securing somewhere to live. Everyone getting a fair deal on somewhere to live should be a quiet administrative matter. As principles go, I don't think there is a lobby group that wants people to be homeless.

Housing is exactly the sort of thing where it really is better to de-escalate tensions and set up win-win situations. This is a situation where incentives can be bought into alignment. There is no need for conflict.

> ...the opposition is too entrenched. You will lose...

US government spending is 40% of GDP and has been steadily rising for around 100 years. The evidence that taxes are hard to bring in is thin; all that money is coming from somewhere.

There is a lot of room there to negotiate tax reform. Tax increases are probably a no-go, the burden is already high. But change is possible, and realigning incentives is an option.

> Georgism and socialism and other causes that strike at the heart of the ownership

Georgism isn't socialistic, it is a profoundly capitalistic policy. And it isn't striking at the heart of ownership; although it is meddling in the market. But far less invasively than the average policy.

> If you don't like the status quo you should avoid taking adversarial stances.

This is ahistorical. And it’s essentially the argument which has always been used by defenders of the status quo to avoid taking responsibility for the defense as such. But worse, you’re conflating mere recognition of an extant adversarial relationship with initiating it in the first place. You’re arguing that it’s strategically superior to unilaterally concede not just tenants’ interests but any acknowledgment that there even are tenants’ interests.

It is fairly pro-historical, take the development of democracy as an institution - it depends on an understanding that we'd really all rather see ourselves on the same side and trying to get the best outcome for everyone. Compare that to communist revolutions where they overthrew the hated landlords, then everyone starved. It isn't a be-all and end all, sometimes the only option is to fight. And on the small scale I've had mostly good results by being friendly towards my landlords.

But I don't think real estate in New York is the place to draw that line. I suspect the regulation of the market is creating these toxic relations and it is making everyone worse off, except for a few lottery winners presumably.

> You’re arguing that it’s strategically superior to unilaterally concede not just tenants’ interests but any acknowledgment that there even are tenants’ interests.

I think it is implicitly obvious that the tenants have interests. What I'm saying is if I'm living in someone else's house and my interests don't align with there interests, plan A is to find a way to align our interests. Taking it as a given that our interests conflict then picking a fight, on the other hand, strikes me as dangerously stupid.

what about the capitalist revolutions where they started murderous authoritarian “helicopter rides” and burning people alive inside oil barrels and stuff, or generally just starving or mistreating the populace? funny how that always gets left out of the example, some of these killings likely range into the millions, many backed by US taxpayers.

“helicopter rides for leftists” is very much a meme for a reason, after all. And many of those that receive such rides or are burned alive in oil barrel are not, in fact, insurgents, they’re just ordinary citizens who might have spoken out against the regime etc.

https://en.m.wikipedia.org/wiki/Indonesian_mass_killings_of_...

https://en.m.wikipedia.org/wiki/Operation_Condor

https://en.m.wikipedia.org/wiki/Red_Drum_killings

https://en.m.wikipedia.org/wiki/White_Terror_(Spain)

yes, “tu quoque”, but these things do happen after many social upheavals, the framing of capitalism as being a bulwark against authoritarian repression is fundamentally misplaced. Many of those capitalist upheavals do go on to oppress their populations too, whether acutely or chronically. The us has hundreds of thousands of people dying from lack of access to health care and general poverty-related deaths every year, our own ongoing holodomor.

Violence after a political upheaval is, in fact, rather orthogonal to what system it is rebelling against or who is in control afterwards. Like it’s not tu quoque, it’s just an irrelevant red herring. Plenty of people get murdered by authoritarian capitalist regimes after upheaval too. Because it’s social/political upheaval.

Of course, some people's landlords actually are their neighbors.

I wonder what the ratio of tenant landlords to corporate rentseekers is?

I don't have hard figures on this but I've been in the sphere long enough to gather some knowledge.. in NYC there are a few orders of magnitude more apartments owned by corporate rentseekers than there are tenant-landlords, but there are a few orders of magnitude again between the number of tenant-landlords greater than the number of corporate rentseekers.

One pays deadweight loss, the other receives deadweight loss. If they are literal neighbors, they are not metaphorical neighbors.

Our landlord lives downstairs from us, and we have two preschoolers. He is a saint.

Are they actually the landlord or just an onsite manager? I've seen both, but the onsite manager has been much more common in my experience

Actually the landlord. He hires a separate management company that we deal with for maintenance, but when they've messed up we've dealt with him directly. It's a small building - just 4 units. (This is in Japan)

Japan is a special case where housing is largely a depreciating asset and small-time landlording isn’t a very profitable business. Small-time landlords in Japan couldn’t collude to screw over renters like they did in the US with RealPage even if they wanted to. There are also strong renter protections relative to the US, including fairly limited ability (by law) to raise rents on existing tenants without justification.

This is a weird position: it sounds like you’re saying the problem is enforcing laws irrespective of the merits of those laws. I would respectfully suggest that people reporting code violations their landlord is abetting is not the same as authoritiarian military rule.

Note the kind of conditions here:

> Tenants living among empty apartments have described trash, mold, open windows, leaky gas pipes and rodents as scourges in their buildings.

All this bill does is increase the odds of that neglect having consequences for the landlord, and it seems especially fair when there’s been a noted trend of units being left empty during a housing crisis hoping to jack the rent up in the future. This kind of thing has a real impacts on people because the rent controlled apartments they’re talking about are the only option for a lot of working poor.

It's really amazing that we've gone full 180 on "see something, say something" being good and not a horribly dystopian reaction to 9/11. These kinds of laws are the human equivalent of recruiting every Amazon Ring to detect and report crimes. The intent might be noble and it might even be in response to a epidemic of break-ins but turning all eyes into a tool of the state is not a can of worms we should be opening.

Even worse is this, making everyone not just the eyes but the prosecutors themselves.

> The new bill also empowers tenants to sue landlords to force owners to open up vacant apartments for inspection.

Literally using citizens to do something the state is legally not allowed to do. It was bad when the abortion law did it and it's bad here. Throwing away our principles as long as the right people get hurt makes us no better than those far-right nutjobs.

> Literally using citizens to do something the state is legally not allowed to do.

This is also the engine that powers every piece of the Civil Rights Act.

> These kinds of laws are the human equivalent of recruiting every Amazon Ring to detect and report crimes.

Well, let’s step back and look at impact. If we used Ring cameras to have 100% enforcement of jaywalking laws, that’d be widely recognized as extreme because there’s no damage to everyone else. If we used the same cameras to have 100% enforcement of mugging, the reverse would be true because the only consequences are on people who everyone agrees deserve punishment. This seems to be in the latter camp: buildings whose owners have neglected them to the point that there are actual hazards to the residents. It isn’t some vague hypothetical future risk but a very clear question: the citizens of New York have decided that nobody should have to live in a building with rats or mold, should landlords be required to follow that law?

The other concern with Ring cameras is that they could be misused for other purposes. That’s real there but not applicable here because this isn’t general data collection and everything funnels through a city office with a neutral third-party. The government can only get data when someone is bothered enough to report it, and if a report is specious the city inspector is going to quickly realize this.

> I would respectfully suggest that people reporting code violations their landlord is abetting is not the same as authoritiarian military rule.

There are two orthogonal concerns:

authoritarian vs. democratic: whether ordinary citizens have a say in which laws are passed

Centralized vs decentralized reporting: whether primary responsibility for discovering whether the law has been broken lies with the police (e.g. conducting patrols), or with citizens making reports (e.g. 911 calls).

To be fair, neither extreme is desirable - 911 is a life-saving measure in the case of violent crime. But turning everyone into their neighbor's spy is deeply detrimental to social cohesion. We see that deep social divide here, turning tenants against landlords, the continuation of American class warfare. Of course, enabling tenants to report on their landlords is not the cause of that social divide - it is simply a step in the wrong direction.

Tenants are already against landlords, that's how it works.

"Allowing workers to report their employers for labor violations is only deepening the social divide between labor and management."

> Tenants are already against landlords, that's how it works.

I'm sorry you feel that's an inevitability. There's the economic agreement, where it's mutually beneficial for the tenant to receive housing and the landlord to receive a rent check, and then there's civil relations. Better civil relations improve the economic agreements.

"Allowing workers to report their employers for labor violations is only deepening the social divide between labor and management."

Again, the social divide is not inevitable. There isn't even a clear line where someone switches from labor into management, and your sarcasm left out the divide between management and ownership/capital. The CEO of a Fortune 500 is not in the same position as the CEO of a struggling one-office startup who basically answers to her investors. Should early employees overlook small offenses committed by founders? With the emphasis on the caveat "small", absolutely yes. What matters more, true in general but especially in early stages, is trust.

If you cannot trust your leaders, start planning an exit. You are not doomed to spend your life working for only one employer in whom you have lost faith, and thus require the assistance of the law to protect you. Life is too short to force yourself to work for people like that.

> Again, the social divide is not inevitable.

Not inevitable, just the default and probably(?) the majority, in both the landlord case and the employer case.

> There isn't even a clear line where someone switches from labor into management, and your sarcasm left out the divide between management and ownership/capital.

I mean labor vs management in the union/labor-relations sense of the words, where the management is representing the interests of the owners.

> Should early employees overlook small offenses committed by founders? With the emphasis on the caveat "small", absolutely yes. What matters more, true in general but especially in early stages, is trust.

In the early stages of a company, I might be inclined to overlook things if I had equity, as is common in the industry. And there's a reason for that: my labor is creating profit partly for my own gain — so I'm not being exploited.

If a small-time landlords want their tenants to overlook issues that they can't reasonably fix, maybe they should be offering their tenants equity ¯\_(ツ)_/¯.

> just the default and probably(?) the majority

One can decide whether to respond optimistically or pessimistically to that reality.

> union/labor-relations sense of the words

I disagree that unionization fundamentally sets interests of labor against their employer. Sure, sometimes they diverge, but happier labor is more productive. Having a channel to communicate common grievances, so they can be addressed, is a key ingredient for also making labor happier and improving profits.

> my labor is creating profit partly for my own gain — so I'm not being exploited

You're rationalizing. Without equity, you're still gaining - it's called your salary. You don't actually get equity in early stage companies; you get options on equity, and even if you decide to pay money to exercise those options, you have no vote in board elections, dividends are highly unlikely to ever be issued, and you cannot sell your shares unless a highly unlikely exit (which you have no control over) occurs.

> If a small-time landlords want their tenants to overlook issues that they can't reasonably fix, maybe they should be offering their tenants equity ¯\_(ツ)_/¯.

A, not all landlords suck; it is possible to find a small-time landlord who cares about the property and finding a good tenant (my mother, who owns a studio apartment she inherited, happens to be one of them). If you don't like your landlord, you should consider moving. B, splitting equity in real estate amongst several / dozens of people is a really bad idea; since everyone gets a veto, the more people who get a say, the more unlikely it is to achieve consensus on anything from repairs to renovations to selling to a developer so that land which has a few housing units on it can have dozens or hundreds of housing units on it.

> I disagree that unionization fundamentally sets interests of labor against their employer.

lol I didn't say anything close to that.

> You don't actually get equity in early stage companies; you get options on equity

Depends on the company, but it's the same alignment of incentives either way.

> not all landlords suck

Only the sucky landlords should have an issue with this legislation.

40 years of pressure-cooker zoning: not class warfare.

Blatant tax advantages for capital: not class warfare.

Reporting tax cheats: class warfare. Oh no! (Clutches heart dramatically.) How detramental to social cohesion! We must do something!

> continuation of American class warfare

> continuation /kən-tĭn″yoo͞-ā′shən/: The act or fact of going on or persisting; the state of continuing in the same condition, capacity, or place; an extension by which something is carried to a further point.

"I spent 1 word giving lip service to side A and the rest of my post scolding side B. I am very fair and balanced."

I admit, I could be wrong. Maybe if I go through your history I'll see attention paid to the prior rounds of class warfare in proportion to their severity rather than in proportion to your opinions. But I doubt it and it's getting late.

To pick favorites, selective attention is all you need.

>> continuation /kən-tĭn″yoo͞-ā′shən/

/kənˌtɪn.juˈeɪ.ʃən/

Abusing the market is also deeply detrimental to social cohesion.

Many market actors have an expectation of fairness with the parties they transact with, but this expectation can only be realized if parties maintain some degree of honesty with each other.

One set of actors (some landlords) is not being honest by withholding a very constrained resource (housing) from the marketplace. Their dishonesty is causing a direct impact to many tenants by artificially raising rents.

The increasing cost of rent is very noticeable and only encourages a growing adversarial relationship between tenants and landlords.

> 911 is a life-saving measure in the case of violent crime

Is it really though? Where I live (major US metro area with 4-5m population, middle of the city), response time from 911 if you're actively being murdered is like... 6-7 minutes on average. If it's not a tier 1 call, response time is slower than that.

6-7 minutes is an eternity during the act of a violent crime. Police don't have the capacity to save your life from violence.

That's a fair point, and I'm not arguing people should rely solely on police for their personal security. I'm more pointing out that it's clearly correct and appropriate to report crime when your safety is in danger; that I'm not trying to argue for some extreme where crime is never reported to the police.

> But turning everyone into their neighbor's spy is deeply detrimental to social cohesion. We see that deep social divide here, turning tenants against landlords, the continuation of American class warfare.

I just want to second all of the other people pointing out the logical flaws here. It’s rare for people to be neighbors with their landlords and almost non-existent for the large multi family buildings this is targeted at: if your grandmother is renting out a room, she’s probably not leaving the rest of the house empty hoping to creatively renovate out of rent-control laws. This is going to be used against landlords who’ve already broken the “neighbor” contract by letting their buildings decay to the point where it’s affecting other people, and refusing to rent rooms to people who need them because they don’t make as much profit as they want. Those are wealthy people looking for tax shelters, not your neighbors!

As to the class war claim, I believe it’s been noted how the right-wing only deploys that particular distraction when it’s something which helps poor people. I would suggest that starting point for any skirmish in that war might be when a landlord lets their property decay to the point where it no longer meets the minimum legal standard but still expects people to pay full price to live there. Having to clean up the mess they created seems like an impressively mild form of warfare.

I don't care much about people investing in apartments, but citizen reporting is not flat out a wrong thing.

E.g. reporting illegaly parked cars is highly positive. So is reporting domestic violence or animal cruelty.

You're not reporting other people, you're reporting the state of their property.

I read this entire article but I’m still confused. What exactly is the financial motivation for keeping units empty? And is the concern the fact that the units are empty or are they concerned about the conditions of the empty units?

The financial motivation is in keeping rents high. The units are empty because no more people want to pay as much as they are charging. Then it becomes a balancing act. An empty unit might cost you X, but to find a tenant for it might require you to lower rent by Y. If X * # of empty units is less than Y * # of occupied units, then it makes more sense to leave them empty.

As noted elsewhere in the thread, that simplified model assumes all the units must have the same price.

No it doesn't. It assumes some of the units have correlated prices, because units are, to some extent, fungible - if there are no one-bedroom apartments in the price range, then you'll drive up the price of pricier two-bedroom apartments due to the increased competition.

It isn't just a hypothetical. Landlords use companies like RealPage to collude on pricing and keep units vacant.

I wasn't suggesting that the net result was false, just that the model suggested in the comment I was replying to wasn't accurate, because landlords do sell the same model of apartment to different people at different prices based on when their lease started.

You make more money by raising prices higher even when that means pricing some people out. More people will pay the higher price than will get priced out.

It's because of laws against charging the market price, which unsurprisingly has led to perverse outcomes. From the article:

Landlord groups don’t dispute that thousands of rent-regulated apartments are vacant, and blame 2019 changes to state rent laws that severely limit how much they can charge new tenants for after longtime renters move out.

I don’t understand why someone would hold a vacant apartment. Why give up on the substantial rental income?

I know a house, privately owned, that's been vacant for six years or more. Nice place, good neighborhood. The current owner lives far away, is well off, so well off that they don't care that they're paying money for maintenance (including heating) and getting no return.

Appreciation might be more than enough return for them.

The house next door to me has been vacant for about five years. (It was rented when I moved in.) The owner, who has several houses in the area, comes by a couple of times a week and picks up trash; but, that's it. It's paid for and he could sell it; but, he won't. (I know he's gotten offers.)

Because housing is a basic need. Pricing people out allows you to raise the floor; keeping units vacant artificially restricts the supply and makes people more desperate.

https://www.propublica.org/article/yieldstar-rent-increase-r...

Unless you hold the majority of housing in the market, I don’t see how such a large scale collusion can work.

A single bad tenant can wipe out a decade of rental income.

From the perspective of Vancouver this reads very differently. I would have thought the apartments were vacant because of foreign speculation, like mid level bureaucrats in China trying to secure a condo. Not landlords charging high rates and not being able to find a tenant.

> Tenants, advocates and elected officials rallied outside City Hall on Wednesday ahead of the Council vote, championing the bill and other measures to rein in “warehousing” — in which landlords keep apartments vacant in anticipation of future rent increases.

> Landlords reported more than 60,000 vacant rent-regulated apartments to the state in 2021 — a figure that dipped to about 39,000 the following year, roughly the same as pre-pandemic levels.

>Landlord groups don’t dispute that thousands of rent-regulated apartments are vacant, and blame 2019 changes to state rent laws that severely limit how much they can charge new tenants for after longtime renters move out.

>“This bill will do absolutely nothing to address the current problems with empty rent-stabilized units, or improve renting conditions for tenants,” said Jay Martin, executive director of the Community Housing Improvement Program, an organization representing landlords of rent stabilized properties. “If HPD issues violations or writes fines on vacant units, it will just suck more money out of struggling rent-stabilized buildings.”

New York's rental market is a huge mess that needs a lot of work.

As we've seen from how the city finally said "No more" to all of the immigrants and asylum seekers sent their way, this is a very politically difficult problem to solve. The city's politicians are publicly very pro-immigration, but the city's housing stock is limited by zoning and shadow ordinances that heavily restrict the ability of anyone to build more housing. When faced with any situation that requires unwinding this mess, which would be _very_ unpopular with too many people, doing nothing takes precedent, the other supposed values and beliefs crumble, and rent rises another $1,000/month.

New York City needs more housing. But that's not going to happen easily. There was a huge outcry when the wealthy neighborhoods of SoHo and NoHo were planning to be upzoned, and although it went through, it proved how much of an uphill climb it is to say "You are allowed to build tall buildings in Manhattan".

A lot of people here with some awareness of the housing market in the US will see claims of apartment warehousing, and refuse to believe it. In the entire rest of the country, they would be right to not believe it. But in New York, with its insane implementation of rent control (applying to apartments, not tenants), this frequently means that some rent-controlled apartments, upon being vacated, require repairs to meet code that cost more than could ever be recouped at the legal amount it can be rented for. I don't know what counting these apartments is supposed to achieve. These apartments are only ever vacated upon death. Tenants literally pass them down to their children, who get to enjoy huge Manhattan apartments for $1,300/month: https://twitter.com/mualphaxi/status/1700952175508168819

I don't know of anyone who believes passing down rent-controlled apartments as an inheritance is a good system. You get to pay 1/4-1/5 rent because your parents lived there for decades before you when it became rent-"stabilized"? This is the kind of Nativism you wouldn't expect from a city run by Democrats, but if you ask the renters who live there, the only problem with this system is that it didn't stabilize rents for everyone. The huge shortage of housing doesn't even factor into the equation, despite being the single biggest cause of rent going for $4,000-6,000/month.

Rent control (and generally, all price controls) should be used rarely and judiciously, only in the extreme case where a necessity in very short supply is being sold for obscene prices. We saw what happens when you do this en masse to all housing in Berlin and in Ireland. In a housing shortage and with strict price caps, you trade a crisis of too-high rents with a crisis of too-few units available for rent. There is huge pent-up demand for housing when there are shortages. When not managed by prices, it's managed by rationing, by long lines, by sending dozens and hundreds of applications, by being considered "likely to vacate/move out" by the landlord not wanting to get stuck charging the same rent for 60 years. The solution to the shortage isn't to ration and control housing prices, it's to increase the production of housing.

But of course that's not happening. In Europe, North America, and Australia alike, you have a hodge podge of zoning laws restricting 80% of _urban areas_ to detached single family homes, "historically" designated buildings and neighborhoods (that can never be torn down), and all kinds of ordinances that prevent buildings from casting shadows, from using too much of the lot, from not having enough parking, from having too-small units, from not having enough affordable units (often defined such that building profitably and legally is impossible), and for many other ridiculous and absurd reason.

I really have zero patience for these "Count the purposefully vacant apartment units!" political positions, given how severely divorced this is from the real nature and causes of the housing affordability crisis. It's silly. It's absurd. It's a public display of gross ignorance at best, and malicious misdirection at worst.

Prices are high because you made it illegal to build enough apartments. Apartments are being kept empty because of your absurd system of rent stabilization and tenant protections that go too far. Condos are kept empty because your property taxes are too low.

The solutions to this problem are very technically simple. The politicians, landlords, property owners, and tenants just don't want them because they each have very strong incentives to not solve the problem.

By your own admission, it’s nearly impossible to address the core issue here, so I can’t blame people for trying to nibble around the edges of the symptoms. It’s all that seems possible.

If tenant protections went too far then landlords wouldn't find it worth it, yet they still do.

If you build more housing in NY and rent goes down, more people will move to NY because they can now afford it and push rents back up.

London is also very expensive to rent and it's not rent controlled.

So let’s get this straight:

Parents pass down rent controlled appartment $1300/m = horror

Parents pass doen paid off owned appartment $0/m = meh

This is just a transfer of wealth between 2 people: the apartment owner got less wealthy and the rent control inheritor got more wealthy. It is about as shocking as someone inheriting anything at all.

If you want to see more housing created, instituting economic policies/conditions that support and reward that creation is probably going to work out better than policies that do the opposite.

I can’t see any way that passing down non-market rate rent does that.

Passing a property to my kids requires me to have bought it previously (rewarding the creator of it, either directly or indirectly via a chain of transactions).

In Spain they just passed a ruling making it legal for building communities to ban tourist apartments.

Has this been tested elsewhere in the US? I'd be curious to see the outcomes.

I wish that someone would make a little app that takes a camera pointed at a building overnight, and counts the lights that come on in the windows. Thus inferring whether an apartment is occupied. Fallible of course, but would be a very good indicator of vacancy.

cue the arms race of automated lights then timing synchronicity of lights coming on then randomly perturbed automated lights then light detection that factors in lifestyle models, then randomly perturbed but realistic lights then... maybe eventually invasion of privacy.

In a low inventory market, make it a requirement to occupy a unit X days per year so that speculators cannot just come in, snap up real estate, and sit on it or extort the people who actually live there. People may shout "Communism" but the reality is that housing is becoming a winner-take-all vs. have nots dividing line that is further repressing the economic mobility of regular people. Free up the inventory to people who actually need to use it.

Why not just let developers build as much as they want by relaxing zoning? That's where the entire problem is. There's no problem building as much real estate as necessary, construction per se is cheap.

Sure, where possible. There are places that cannot build anymore because there is something everywhere. This describes most of NYC.

The issue is that places where there is limited inventory and an inability to create more inventory cannot afford to let any units to go to Airbnb or to speculators.

NYC's construction regulations are completely fucked and prevent tons of new apartments being built, I'm not sure it's a good example.

Too bad because I'm talking about it. NYC is the original big city with big city problems that cannot be avoided by changing the subject.

Airbnb won't go there if they were not filled, and every city needs visitors as well as residents. So airbnbs aren't a problem. Speculation isn't a problem as long as they keep the units occupied. And vacancy rate is lower than average in NYC.

So it sounds like a simple fact that demand outstrips supply. Only way to "fix" it is by making NYC a less attractive place to move into (increase local taxes, reduce spending thus stimulating crime, etc.), or make it harder to move (something along the lines of Soviet registration system). Both appear to be less than desirable, to say the least.

Face it: there is no way people could move limitlessly into a desirable city and keep it affordable. Whole point of attraction is unafforability.

Houston, TX has no zoning at all.

If this is such a great idea, I assume you've already moved there and love it?

Houston, TX has some covenant system which is equivalent to zoning but with a different name.

Um, no.

I think this is what GP was referring to: https://www.houstontx.gov/planning/Neighborhood/deed_restr.h...

From a YIMBY/increased density advocate point of view, it sounds to me like it has a similar effect to zoning in preserving low density single family home neighborhoods.

Deed restrictions exist in all 50 states. There's nothing special here.

They even have them far, far outside the cities. I know a guy whose neighbor's property has a deed restriction preventing cattle grazing within 200 feet of a neighboring property's water well (even if the grazing isn't on their land).

Yes, it is very common for there to be housing restrictions.

Thats the entire point and is what people are saying is the problem!

Therefore, in order to allow the building of higher density housing, those regulations, whether they be actual laws, or deed restrictions, need to be removed.

HTX is, by and large, a hell hole of sacrifice zones for hurricane flooding, exploding refineries, and petrochem pollution.

more transparency of the supply is sorely needed for a more efficient market

I don't think this is the way, but a reflection of the sentiment and a step

Less regulation is needed, no sane landlord is leaving their place empty in hopes of market based rental increases. Regulation creates perverse market incentives like what you see here.

Are you sure?

https://www.propublica.org/article/yieldstar-rent-increase-r...

It's likely a troll account. Check the history

Dunno man he looks like just a conservative to me. I'm astonished at how easily people go for the "troll" conclusion when they encounter someone online with wildly different values/beliefs as them.

That's not mutually exclusive...? Is it possible that he just chose the bad takes to provoke reactions? You know there are many shades of political stances regardless whether you are left and right and bad takes can happen anywhere?

If you read my previous comment carefully, you'd see that I'm not claiming that he's a conservative and can't possibly be a troll. I'm only pointing out that it's possible that he's just a conservative, and people are hastily jumping to the "troll" conclusion with seemingly little evidence.

Then how do you know I am jumping `hastily jumping to the "troll" conclusion` instead of actually went through his comments and think he is trolling? By trolling I mean the original meaning instead of the malicious one. He might be an average guy who is not believing those extreme takes and just having fun provoking reactions. And I personally believe that that's the case for most of the people

Aren't you the one who is hastily jumping to the conclusion by just saying I am hastily jumping into the conclusion?

touche ;)

Your initial comment was 9 words long and asserted that he was a troll with no justification whatsoever ("Check the history" isn't a justification in the same vein that "do your own research" isn't). While it's possible that you went through his full comment history, pulled out all the stops to do a psychometric profile on him, and concluded that he was acting in bad faith, I find that unlikely given how brief your comment was.

So far as I can tell, his comment history might have "bad takes", but they're consistent with mainstream conservative ideology. Unless you want to write off the entire right wing as acting in bad faith for holding their beliefs, I don't think it's reasonable to assume someone expressing conservative beliefs are acting in bad faith. On the other hand, I think most liberals and conservatives would agree that accusing someone of acting in bad faith without the requisite justification, is bad faith behavior and should be called out. Even the bad faith accusation is actually correct, we as a society can't tolerate everyone flinging around unsubstantiated bad faith accusations indiscriminately.

...according to the complaint in a lawsuit against realpage.

As an ex-landlord my instinctive reaction is the same as yours - it would take a lot of increase to cover months of standing empty.

On the other hand I'm not in New York and I've no idea what regulations are in play there, so I'm happy to accept the statement at face value.

I'd also suggest that Airbnb has a role to play - sometimes short term rents can deliver more return than long term. Holding back stock for this can be significant (it is in Barcelona).

Now if the city invited residents to rat out their landlord for this reason, that might have less sympathy than framing it as "public health of other residents". This ostensibly puts the focus on "my health", and if some unpermitted short-term rentals get caught up by accident, well, happy days.

Personally I've nothing against Airbnb - provided that it's done within what local bylaws require. "Illegal hotels" though are not really in anyone's interest.

Of course all regulations reglate someone. Whether you like regulations or not depends on whether you are being regulated for or against. The sweetspot is a balance , which I agree can be hard to find.

There are many landlords leaving units empty precisely because they’re sane and rational. In some cases becauee of a lack of regulation whereas in others because of over regulation.

I personally know a landlord who will almost never rent out the commercial space in their property. Right now not renting it out saves then tax due to the “loss” they declare. But the price at which they’d have to rent the commercial unit to exceed that tax benefit would be high enough to cause a reappraisal of the entire building which would increase the property tax for all the residential units they pay as well, which would mean they’re losing money, or at least making less money, on each unit until they can increase the rent to level which may not be sustained by the market.

Another well known non government reason to leave units vacant is if the market value has dropped, leading it out at the lower market value can trigger all sorts of problems for the property owner with the banks who have lent money to them for the property, including the ability for them to recall the money early, change rates, etc since it may trigger clauses regd the appraised value dropping below a certain threshold. These are purely private contracts that provide a very strong incentive for landlords to keep spaces empty rather than lease them out at market value. This tends to be the most common reason for us city storefronts being empty.

A million times this. A sensible regulation in this field might involve mandatory re-assessments of the property values, so that these games are meaningless to play.

> There are many landlords leaving units empty precisely because they’re sane and rational. In some cases becauee of a lack of regulation whereas in others because of over regulation.

They're just not. It's silly to not offer your vacant unit for lease at record-high rents 'hoping' that one day rents may be even higher. Every month you're vacant you're losing on $3000+. You really think rent growth can outrun missing out on $3000/month, every month? Every month you wait relies on a rent growth rate of ~9% per month just to break even on a 1-year lease if you have no ability to raise rents. I don't know where this theory comes from, but I can't find any data to support it.

When the Berkeley city council passed their tax on vacant units their own analysis indicated that about 1128 units in Berkeley were potentially vacant. Of them only 40% are actually vacant, so about 451 units. Of them, a number are actually being renovated, a number are being rented out without informing the city and about 100 of them are in totally derelict buildings that aren't fit for living in. It's all in the council's assessment on page 2. [1] Berkeley has 46,875 units. So that's a worst case of 2.4% vacancy rate - but more realistically we're talking <1%.

The only thing to be done is build more homes.

[1] https://berkeleyca.gov/sites/default/files/documents/2022-07...

Thank you for adding some concrete numbers!

Even with the 2.4%, that means an apartment is empty less than a month every three years. It seems like you'd there just with tenant churn.

Oh, man. I lived across the street from an apartment complex in Oakland for about 5 years that had a beautiful ground floor corner commercial real estate unit that was empty the entire time.

Sure, Oakland and all that. But other spots in the neighborhood would see commercial places show up, last months (or years!) and then leave.

This place was perpetually empty. Talking to some shop owners in the area, they would say, “Oh yeah, that location is way too expensive”.

The ultimate reason was this. It was more beneficial for the landlord to have this vacant spot for 5 years than to, god forbid, lower the rent to something the market felt was reasonable.

Weirdly, in the last few months we lived in that area, the unit was converted to residential (?!). A contractor came in for a few weeks to build a better bathroom and kitchen.

It still had the huge glass picture windows and glass door you see in traditional storefronts but someone put up curtains and one of those cheesy “welcome!” mats out front.

I just can’t believe it was more financially advantageous to have 0 rent for 5 years and then renovate vs just having any tenant.

It could make sense if you can inflate its tax value. If you can say you're losing $5000 a month (not that crazy for commercial) by renting it, and your tax rate is 30%, and the actual rent you could get is $1500, you break even.

There is no tax benefit to leaving a unit vacant, despite people who don’t understand real estate constantly making this claim. You do not get to deduct the rents you failed to collect, and there is no tax benefit that is lost when you rent the property. It never makes sense to refuse a dollar because you’ll have to pay 30% tax on it, or whatever. There may be other factors leading your friend to keep his property vacant, but this isn’t one of them.

The last paragraph sounds like nonsense too, though I’m less sure about that. What mechanism do you think there is for the mortgage holder to see your leases? And how stupid do you think banks are, that they’d rather your property bring in zero than less than they were expecting?

> no sane landlord is leaving their place empty in hopes of market based rental increases

There's plentiful documented cases of this happening. Rent rates for a building influence the average local market rate rents which influence the perspective returns that corporate bonds for landlords / developers in the area. Large scale landlords that hold many units in an area have an interest in not making it seem like rents in an area are decreasing since it limits their credit worthiness. The problem cycles on itself and creates these kinds of perverse incentives on their own due to the financialization of real estate.

Meanwhile, units going empty means there's fewer people that can afford to live in an area and the city collects less taxes, limiting the services they're able to provide for the people and businesses that live/operate there.

You have a good point. Warehousing does not happen, despite what the landlords themselves report

You'd think that and yet when Vancouver brought in an empty homes tax they raised 115 million over 4 years.

In other words it had zero significant impact.

Ideally you'd want to raise 0 and have 0 vacant homes, but they raised a bunch of money and reduced empty homes by 36%.

The idea that zero is the optimal number of vacant dwellings is extremely wrong.

yeah that's true.

edit: But like being clear the tax only applied for things that were vacant long term, so like, it was quite possible for apartments to be vacant for "a while" between tenancies and of course there were a number of exemptions as well.

So even within the context of this vacancy tax there was a lot of leverage for there to exist vacant apartments.

The intent was effectively to kill off pied-a-terres and permanent vacant apartments.

The less authorities try to interfere with the free market, the better.

This is empirically untrue.

We already tested this in communist countries.

Will this ever die? None of the societies that people point and scream about were actually communist in any real sense. They were just random flavors of authoritarianism wrapped in incoherent bits of Marxist–Leninist and/or Maoist ideology, both of which are the furthest thing from any of the popular left-communist and anarcho-socialist movements that exist in the US.

To put it in perspective, the Soviets literally rolled tanks on striking union workers and students in Hungary and killed thousands of people because they were (to heavily summarize) the wrong kind of communists. This is where the phrase "tankie" comes from.

That's an obvious strawman. Regulation against market failures is not equivalent to central planning.

Why not just one-up it and seize the means of production, i mean seize unused private property? Of course they'd have to label it as market regulation.

(Coming from a country where options for private property and private means of production were once pretty limited)

Again, a straw man.

The motivation of the OP is nuscances driven by the vacancies such as pest infestations. That's an entirely reasonable concern to regulate.

If you want to talk with actual seriousness and intellectual honesty I will. If you just want to do this I'm not going to waste my time.

Post-communist countries have highest rates of home ownership. It seems like it worked.

We've also tested it in the capitalist societies.

There is a reason why regulations exist and you could probably read up on history to find some of them

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