Average Rent in San Francisco Has Dropped $1k This Year

Re:Average Rent in San Francisco Has Dropped $1k This Year by throwaway0a5e on Monday December 28, 2020 @10:38AM (#25559984)

Even if land were historically taxed at say NYC rates in SF the supply and demand problem would still rear its head. The problem is artificial supply constraints created first and foremost by zoning and secondly by a myriad of other regulation that infringed upon property rights and adds friction (time, money, risk, all of the above) that prevents people from exercising their property rights. Prop 13 (a monetary incentive to not sell) falls into this latter category. LVT would just be the revers of Prop 13. It's not going to solve a fundamental supply and demand problem that's created at a lower level. You'd have everything built out as much as the zoning allows for but the net result would still be inadequate because the zoning is too restrictive and the regulatory friction is going to still works its magic at the margin.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by pydry on Monday December 28, 2020 @10:52AM (#25560110)

Zoning is a result of NIMBYism.

NIMBYism is a result of people who really want to protect the value of their land. Some of these people will be quite desperate to do this because they're highly leveraged. Negative equity is a good incentive to turn up to your local planning meetings and inhibit development.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by throwaway0a5e on Monday December 28, 2020 @11:21AM (#25560407)

I think NIMBYism only looks financially attractive because everyone who bought a square of land in a "city" since the 1970s or so and held for at least a decade has won big regardless of where. That doesn't mean that SF/SV isn't forgoing a lot of money in order to keep its NIMBY policy. Think about how much just the squares of land those single family homes and low rise buildings in SV are on would be worth if the SF was developed to NYC, Chicago or Boston levels.

I think the fundamental problem here is that the people of SV people do not believe in property rights (e.g. the right to develop property you own as you see fit) to such an extent that they are willing to put their money where their mouth is and codify it in the form of (restrictive zoning and other shenanigans that hinder development) even though this inhibits growth and limits their upside.

Edited for clarity

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Re:Average Rent in San Francisco Has Dropped $1k This Year by pydry on Monday December 28, 2020 @01:39PM (#25561813)

Seriously?

There are two types of people in SF:

* People who have watched their property appreciate in value by 4-10x for basically doing... nothing.

* People who have taken out an eye watering loan for well over a million dollars and are kept up at night by the idea that theyll owe a million dollar loan on a $750,000 home.

Of course they're going to be conservative! Of course they're going to try to avoid anybody rocking the boat! Of course they'll be NIMBYs!

Why on earth would you think that the one thing that keeps them ludicrously wealthy - property rights - is the thing that they'd stop believing in??

It makes zero sense.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by kelnos on Monday December 28, 2020 @08:22PM (#25565529)

I think you and your parent are not using "property rights" in the same way. You're talking about the right to own property in a sort of static sense, while the parent is talking about the right not only to own property, but build and develop on it as the owner sees fit.

SF homeowners of course believe in the kind of property rights you're talking about, but mostly do not believe in the latter. Most homeowners here want (and unfortunately mostly have) absolute veto right over any kind of construction or development that their neighbors want to engage in, whether it's as simple as reasonable cosmetic changes by a resident homeowner, or as complex as a denser rebuild by a housing developer.

(But I mostly agree with you in your characterization of the two types of SF homeowners. There also are some who are nominally in your second category but wouldn't be catastrophically financially impacted if their mortgages went under water, but they're definitely in the minority.)

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Re:Average Rent in San Francisco Has Dropped $1k This Year by throwaway0a5e on Monday December 28, 2020 @02:49PM (#25562528)

I guess they "care about property rights" in the same sense that everyone right of die hard communists cares about property rights but that's kind of like saying it's a warm day out because it's 200-something degrees above absolute zero.

If they care so much about property rights then why is it so hard for people there to do build on their own property that increase the value of that property?

Saying SF cares about property rights is like when the person who creates drama says they don't like drama.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by nitrogen on Monday December 28, 2020 @01:25PM (#25561627)

This is because fundamentally people aren't buying houses for "upside", they are buying them because they want somewhere to live.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by kelnos on Monday December 28, 2020 @08:27PM (#25565572)

Yes and no, and this is a big part of the problem: young adults in the US are taught that their primary residence is/will be their biggest investment. So you get this weird set of fears that encompasses the worst of both.

The house-as-residence aspect makes them fearful that you won't make your mortgage payments, or your mortgage will end up under water, and the bank will foreclose on you and you'll be homeless. The house-as-investment aspect makes them fearful that they'll take a loss or even break even come sale time, and then their retirement nest egg will be weak.

So I agree that fundamentally yes, people are buying a house to live in, but it's a lot more loaded than that.

If housing costs were more reasonable, perhaps we could turn the tide against this "primary-home-as-investment" attitude, which I believe to be counterproductive.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by throwaway201103 on Monday December 28, 2020 @01:37PM (#25561783)

> everyone who bought a square of land in a "city" since the 1970s or so and held for at least a decade has won big regardless of where

Not true at all, look at Detroit, Gary, or any midwest "rust belt" town. Abandonded properties everywhere, can't find buyers even at tax sale prices.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by throwaway0a5e on Monday December 28, 2020 @02:42PM (#25562471)

I live in one of those sorts of cities. Detroit is their own doing because of local tax code. There's a decent amount of "there was a falling down commercial building here so we bulldozed it and then just let it sit" type of lots kicking around in other cities but the lots have still increased in value (i.e. inflation has happened) enough that mostly nobody is underwater and anyone looking to get out can do so without losing money.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by thaumasiotes on Monday December 28, 2020 @10:47AM (#25560063)

> a myriad of other regulation that infringed upon property rights and adds friction (time, money, risk, all of the above) that prevents people from exercising their property rights. Prop 13 (a monetary incentive to not sell) falls into this latter category.

I think Prop 13's incentive not to redevelop is actually more significant here than its incentive not to sell.

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Re:Average Rent in San Francisco Has Dropped $1k This Year by kelnos on Monday December 28, 2020 @08:30PM (#25565598)

Right. At least when you're old enough to be in retirement there are a bunch of ways (expanded this year) to sell and keep your old tax assessment on your new place. AFAIK redevelopment will always trigger a reassessment no matter what.

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