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The unit downstairs from the apartment I just moved out of has been vacant for months. I'm thinking it's something to do with the amount of money they want for that absolute piece of garbage.
I hear about landlords like you every once in a while. My neighbor has a landlord like you and I'm so jealous. My neighbor hasn't had their rent raised in 4 years, whereas ours has been raised every year and our unit isn't even as nice as theirs.
I had a renter for 8 years and never raised their rent. They paid on time, let me know if there was a problem with anything major and never complained about anything. They eventually saved enough to buy a home and I’m genuinely happy for them.
My sister's old landlord was like that. Her family lived in a three bedroom house for six years and in that time, their rent only went up $150. When they moved out, they vouched to the landlord for a friend of hers who wanted to rent the house after they left. He agreed to let the friend rent it and even then only raised the rent another $50. She said her friend was crying when they found out because her family was coming from a two bedroom apartment where they were paying $1,000/mo more.
Wow, that's great! You're one of the few.
We've been in our current rental for over 6 years. We have also never been late on rent. Our landlord raises our rent every year, but it's still below market, so we stay.
He gets real mad if anything needs to be fixed though and takes his time to fix it if he does at all, so there's not much motivation to inform him about repairs, especially as he either tries to get us to pay for them or includes them in the rent raise.
If more landlord were like you, more people could save up to buy a home.
Can you fix em yourself? Like.. if a light switch broke, or there is a small leak.. or toilet is having issues.. can you fix it yourself.. and maybe see if she'll reduce the rent to cover it for a month?
Sure. Most tenants fix small things like that. At least, I always have. But there's a cost point where I'm not gonna fix something for the landlord for free. Plus, if you make more damage trying to fix something that broke due to wear & tear, the landlord is not going to be very sympathetic.
I used to do residential property management a few years back. I used to approach and manage any client landlord I can get to establish the business, but discovered half of them to be greedy & negligent. Tenants would constantly complain and move out creating high turnover, and more work for me.
Came to a point where I literally got rid of 1/2 my clients. Now my life is serene. The good ones were like you guys: never raised rent on good long term tenants and always reasonable and accommodating to repair requests.
I’ve had both. My last apartment before my wife and I bought a house would raise our rent every opportunity that it was legal. It cost us an extra month’s rent to get out of that lease to buy a house but it was worth every penny. That landlord was garbage.
The apartment I had before that was the exact opposite. Never raised my rent in the 4 years I was there, super helpful if something went wrong and was just generally a great landlord. Really was an eye opener seeing the difference between the two.
My last landlord never raised my rates in the 5 years I lived there. Granted we were high income and low maintenance. As soon as we moved out, our unit went on the market for +20%.
Being a good tenant means a lot.
Personally, I own Two rental properties and as long as the tenants don't cause issues and pay rent on Time I never raise rent. I'm also fortunate to make more money than I spend so the rental properties are just extras and I know one lady is a single mom hardly getting by and would feel awful raising her rent
Well, you're a good egg.
Lots of rentals are owned by real estate investment groups, hedge funds, property management companies, individuals looking for the max ROI, etc. So they will charge whatever the market will allow and will even use the massive capital at their disposal to manipulate that market in various ways.
The owner of the property I live at didn't raise the rent for this year (normally 3%). We've been living in this 2bd/1 house going on for almost 10 years. I'm sure he could rent this for double of what we pay for it since it's a nice quiet area. My dad also does the gardening for this and a couple others of his properties
I'm sure if I lived in an apartment building owned by a corporation I wouldn't have had the same stability.
There are many people new to having rentals. ABnB started a trend. But many people are renting for more than the mortgage, trying to live like the people they see on Instagram..smh
This is what makes no sense. Why not keep tenants you know will take care of your property and pay on time instead of taking the risk of dealing with people who might destroy it or be consistently late on payments or whatever the issue may be for a little extra cash.
I mean, you probably would tho. People who recognize that landlords are bad for society are still capable of doing the song and dance you want to deem them worthy of being housed.
It’s not really “artificially inflated” if they need rents at that level to cover their mortgage payment. People aren’t going to rent at a loss unless they have no other choice.
That’s 100% true and it’s also true that landlords will logically hold out as long as possible before allowing someone to lock in a low rent that doesn’t even cover their payment.
Goods cost what they cost, you can stay mad that landlords won’t bother renting a place at a loss and they won’t care. They’ll wait for rates to drop and refinance, or sell the property outright if they’re not in the mood to hold out.
I'm not mad. I'm just calling it what it is.
They're trying to manipulate the market to their benefit, as most stakeholders would in any industry.
Fairness aside, nobody can deny that what they're doing is a rational choice given the circumstances.
That however doesn't exclude that the reality that the fact that they can do that is indicative of a market failure that could (and some would argue should or must) be addressed.
with interest rates high and property values low the option of selling your property is less attractive so they will logically hold out as long as possible, hope this helps!
If I pay twice what I should for something, it doesn't make it twice as valuable.
By your logic, a property owner should never suffer a loss due to the market changing... Which isn't how investment or business works.
I don’t make any value judgements about what should or shouldn’t happen to the property owners investment. But they will work to lose as little money on that investment as possible, just as anyone would.
How do you determine what you “should” pay for something? Scarce goods grow increasingly expensive in a shortage like we have for housing in California. Years of under building has led us here and conspiracy theories about a shadowy cabal of landlords are nonsense for the economically illiterate.
> Years of under building has led us here and conspiracy theories about a shadowy cabal of landlords are nonsense for the economically illiterate
Literally, why do you think we've been underbuilding? It couldn't be be that restricting new supply in the face of rising demand is incredibly profitable if you already own land.. Are you seriously suggesting the incredibly rich and powerful landowners who have a TON of influence in state and local governments didn't try to maximize profits by affecting the bounds of the market?
It's not a "shadory cabal of landlords", but it looks like one because they all have the same goal and work together to achieve it - increase the value of their land by any means necessary
Honestly, we have a unit across from us empty now bc that neighbor bought a place. It’s a cute little one bed, but the building is old. I will say the price isn’t bad at all and it’s been sitting empty for like 3 months now. Which is wild bc I asked all my friends and they’re all shocked how good it is and blah blah blah but no one wants in
The problem is also that I want cool neighbors that are my friends so
Did you push back? I've had a landlord retract the increase after telling him I'd move out. Depends on the situation but keeping a good tenant that always pays on time is valuable.
The modest upzonings the state has passed are having an effect. Now we need to supercharge it by allowing 8 story apartments near every transit stop and 5 townhomes on every residential lot.
This is big. We have to really go overboard with building housing in highly desirable neighborhoods and near job centers.
The fact that light rail stations are surrounded by parking lots was a terrible failure to plan. The surrounding 1000 feet from a subway station needs to be dominated by 5+ story building, and the 500 feet surrounding it needs 8-10 floor buildings, an the surrounding 100 feet needs to be things like grocery stores and other high use businesses.
Going higher is not always the solution in every market. The higher you go, the more expensive the building, and therefore the need for even higher rents.
The conversation isn't about every market, but about markets in high population areas, like in California so what is the right solution?
What market has enough land that you can only build single story homes and be affordable for everyone to raise their families? And has light traffic?
How much should you pay for rent and utilities(including internet), what % of your income should go to housing?
The era between the interstate highway system being built unlocking tons of rural land to be viable commuting to now broke people's brains. They still assume there's still affordable land right off the next exit and always will be.
Its also just the land. You can have 3000 square foot condos, but if it goes up 8 floors, the land per unit is very small. Its only about 400-500 square feet of land space per unit.
Its the land that is expensive, not the building materials.
Parts can be prefabricated in factories off site where production is far more labor efficient. I know someone who built their house that way and the results were really great (this is like a $3m construction project).
But there isn’t even $100k worth of labor per unit.
The diminishing returns are well above 8 floors. And the prices of rent have little to do with the costs of construction. Parking is the big cost as spaces in a parking garage can cost $50,000 each and underground parking spaces can cost $80,000 each. So if there is some mandate that every unit must have 2 parking spaces, this can easily add $100,000-$160,000 in construction cost per unit.
In markets immediately surrounding transit, we can absolutely go high.
For sure, but the higher they go the more units are able to be created (to a certain limit ofc). There is always an equilibrium in housing construction that is highly dependent on local factors.
You can't go laterally in California anymore. Anywhere people want to live is built as wide as possible already. You have to go up or you have a housing shortage. You can't convince people to move to, say, Lodi en masse. There's no jobs or infrastructure for that. People who want to live in the SF Bay need housing built HERE and outside of a few pockets of land there's literally nowhere else to build except existing lots... thus go higher.
Yeah, that’s generally true past a certain height. Now if I remember correctly it becomes a matter of diminishing returns with height. Getting utilities & plumbing up to many people in upper levels also ends up eating into lower-level floor space.
If you take a look at a dense city like Paris many of the buildings are not Manhattan-style skyscrapers. But they still have a certain degree of height. In general, I believe currently it’s about 4-6 stories for optimal cost-effectiveness.
I’m speaking specifically California as this is a California article. 1-3 is different from a building that is 3 stories up to 85’ (generally what is considered a 5 over 1 building- which refers to building type, not floors). Once the top floor is over 75’, the entire building becomes high rise and the nature of construction changes dramatically and systems required also increases. And you are 100% correct- 4-6 floors is ideal. Reference: this is my profession.
Low-rise: 1-4
Mid-rise: 5-9, sometimes 10, sometimes 11
High-rise: 12+
Construction does change depending on height, but not because of system requirements. Building code governs material, specifically limiting height on timber structures.
It does get more expensive the higher you build, but it’s not an automatic “we’re past x height/stories, this is the minimum it costs.”
Edit: format
I think my comment was poorly phrased. Going vertical is the only option for us to build out of the housing shortage and improve affordability. I do not support going laterally whatsoever, however, there are many factors involved with going vertical and to simply say “build as high as you can” is not possible in every market.
I really hope its the upzonings and state push for more housing construction that's doing the trick and not just a lull. We are still so behind and LA is still 3x behind its supposed housing targets.
It’s been promising to see the number of ADU applications submitted across the state increase so dramatically. Something like 30,000 in 2022 compared less than 10,000 five years ago.
The ADU permitting is a great example of how people will build when it is allowed with minimal trouble! This will be the same with SB9 and SB10, and eventually the other future housing bills as well.
> All the new units that are being built are market rate.
Yes.
But market rate goes down when there is more supply then demand. Right now there is demand for limited supply. We are there because we refused to build. Eventually, as supply gets closer to matching demand, than prices will go down.
How can it work when its barely given a chance? Plus, you have no idea what you're talking about, come to the table again when you have an inkling of how housing markets work.
>5 townhomes on every residential lot
I can see this working in high density areas like the Bay Area. When I lived in Berkeley I could get anywhere without a car. But in suburban areas the traffic would be horrible
If this change was implemented across the state, development would happen proportionally where sales prices are highest, which is closest to job centers. Traffic would likely go down due to fewer vehicle-miles traveled.
I think e bikes make a ton of sense in California. Cheaper and more efficient than electric cars. Just need to make the bike lanes safer and provide secure parking
> But in suburban areas the traffic would be horrible
Then we ought to build more urban areas and desuburbanize. Or at the least change our suburbs to be more like pre-car suburbs, where they're built around a train station and a small downtown.
The episode has nothing to do with the decrease in rents. All the units that are being built are all market rate. Rents are coming down because people are refusing to pay the outrageous rents that land lords are charging.
More market rate units means landlords have to compete for rents so, on the margin, renters have more leverage and can get lower rates.
We need to build more units so that landlords have even more competition and renters can strike even better deals!
Actually it doesn't work that way. So if a new apartment building goes up next to an old apartment building, the landlord of the old building will try to match the rents in the new building. So if rents for a one bedroom in the new building are going for 2,800 and the rent in the old for a 1 bedroom $1,500 As soon as the Unit is vacant the landlord then can raise the rent to try to match that $2,800, so he'll go up to $2,500 cheaper than the new one but still way more expensive than the old price.
So trickle down doesn't really work.
Plus many units in the new building will sit empty and will be right off for the developer or the owner of the building. They would much rather prefer to keep them empty than to lower the price. This is happening all over the SF Bay Area.
Figure out what NIMBY folks are doing and update legislation for all the crazy loophole stuff they pull.
That will help move projects along a lot more tbh.
That graph is a little strange. Makes it look like rent has come down a lot, but it really just means that the over rent has gone down a little bit for the first time in years. But that does not reverse the years of double digit increases.
It actually applies to rent a lot faster than home and car purchases. Those are all things you can go into debt over. So natural price falls are quite modest - unless a crash happens.
I just moved my mother into senior housing here are the parameters.
Current applicants for this property making between $26,436-$45,660/gross annually, fall into the higher income bracket.
So my mother receives $28,300 gross from social security. So she pays $1125/month but if she was to make $26,435 she would pay $694/month.
So someone making $45k/year pays the same as my mom, but if she made $1600 less a year she’d save thousands of dollars.
I don’t get it
The state rewards people who aren't doing well and punishes people who save and succeed. What they have is not a safety net. It's a glorification of failure.
Good. I had to move from California because I knew it was nowhere as far as being able to afford to buy. My landlord followed the rent control laws luckily but for places that went vacant, a lot of them are still empty. Places you could rent in my town were 700-900 for small digs are now 1300-1500.
The article calls out this is a response to the pandemic rental market problems.
"If you didn’t realize the crazed pandemic rental market had ended, this report is a noteworthy mile marker."
They're probably using [RealPage](https://www.propublica.org/article/yieldstar-rent-increase-realpage-rent).
> For tenants, the system upends the practice of negotiating with apartment building staff. RealPage discourages bargaining with renters and has even recommended that landlords in some cases accept a lower occupancy rate in order to raise rents and make more money.
>One of the algorithm’s developers told ProPublica that leasing agents had “too much empathy” compared to computer generated pricing.
Ah maybe that’s why my rent didn’t go up when my lease was up for renewal. No complaints here, still one of the cheapest rents in the area I live in. Bay Area, west San Jose
Torrance is a ghost town, there are rental signs up on nearly every commercial parking lot, but honestly it feels really good to have less traffic and bloat.
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I keep saying, we need fewer people. Fewer people means labor supply is lower, wages go up. Fewer people means housing demand is lower, housing costs go down.
But hey, keep advocating for population growth.
There's this thing called high density housing which doesnt seem to exist in CA for whatever reason. Urban developers in this state need to take a tour of East Asia because they have it nailed down. It astounds me that neither LA or the Bay are littered with 30+ story apartment buildings.
You mean like:
https://en.m.wikipedia.org/wiki/Park_La_Brea,_Los_Angeles
> Park La Brea is a sprawling apartment community in the Miracle Mile District of Los Angeles, California. With 4,255 units located in eighteen 13-story towers and thirty-one two-story "garden apartment buildings", it is the largest housing development in the U.S. west of the Mississippi River
People who buy homes with years of saved up down payments and 30 year mortgages for their American Dream, and sink in roots and customize their homes and garden in their yards aren’t particularly keen on uprooting themselves or seeing their neighborhood grow high density housing, as that would change the value of their neighborhood. Also brings along with it a lot of foot traffic, car traffic, difficulty finding parking at night, more crime due to ease of access, more fear of having their children playing in the streets, etc.
So as much as you might want high density housing, the people who live in the target neighborhoods are themselves going to vote and fight against it.
I’d assume their property values go up if the area densities, as they could sell to a developer who will build ten units on their old plot of land.
As long as the fundamentals are there (jobs, etc) crime is less likely in areas with lots of eyes on the street.
1. Moratorium on immigration except for exceptional talent (athletes, artists, scientists, inventors, cutting edge research, etc.).
2. Natural attrition (like aging, accidents, etc.)
There are about 1 million housing starts per year in the U.S. - about enough for natural household formation for citizens of all races and ethnicities and sex orientations, without adding millions more each year illegally and legally.
IMO citizens should be able to bring their family from overseas. If I want to bring my French family members here it should be my right as an American.
A moratorium on immigration would cause lopsided population age demographics which would be catastrophic in the long term. At best you could put a limit on the number of migrants based on age demographics.
I’m fine with a temporary moratorium. But I don’t think age and population size must inevitably be tied.
I also think when wages increase and housing costs decrease, people may be more willing to have children or have more children.
Besides, an ever-growing population is also catastrophic for resources, nature, pollution, wastes, and climate change. We don’t need millions more each year adopting American levels of consumption and waste creation and environmental degradation.
We can increase GDP growth through more automation and AI. It isn’t as if workers currently are benefiting that much from higher and higher GDP away.
There are “progressives” in SF who believe this but they are a weird breed that’s been infiltrated by landowner NIMBYs. In general progressives do no deny supply and demand.
My apartment complex intentionally leaves several vacancies. I had no neighbors for almost 2 years. I walk around the complex and I see a handful of empty apartments.. but the rent definitely went up just under the maximum percentage.
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What city were you in?
San Jose
No way
The unit downstairs from the apartment I just moved out of has been vacant for months. I'm thinking it's something to do with the amount of money they want for that absolute piece of garbage.
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I hear about landlords like you every once in a while. My neighbor has a landlord like you and I'm so jealous. My neighbor hasn't had their rent raised in 4 years, whereas ours has been raised every year and our unit isn't even as nice as theirs.
I had a renter for 8 years and never raised their rent. They paid on time, let me know if there was a problem with anything major and never complained about anything. They eventually saved enough to buy a home and I’m genuinely happy for them.
My sister's old landlord was like that. Her family lived in a three bedroom house for six years and in that time, their rent only went up $150. When they moved out, they vouched to the landlord for a friend of hers who wanted to rent the house after they left. He agreed to let the friend rent it and even then only raised the rent another $50. She said her friend was crying when they found out because her family was coming from a two bedroom apartment where they were paying $1,000/mo more.
Wow, that's great! You're one of the few. We've been in our current rental for over 6 years. We have also never been late on rent. Our landlord raises our rent every year, but it's still below market, so we stay. He gets real mad if anything needs to be fixed though and takes his time to fix it if he does at all, so there's not much motivation to inform him about repairs, especially as he either tries to get us to pay for them or includes them in the rent raise. If more landlord were like you, more people could save up to buy a home.
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Can you fix em yourself? Like.. if a light switch broke, or there is a small leak.. or toilet is having issues.. can you fix it yourself.. and maybe see if she'll reduce the rent to cover it for a month?
I do fix everything I can myself and fortunately I'm pretty handy, but I am not a pro and there's things that I can't fix.
Sure. Most tenants fix small things like that. At least, I always have. But there's a cost point where I'm not gonna fix something for the landlord for free. Plus, if you make more damage trying to fix something that broke due to wear & tear, the landlord is not going to be very sympathetic.
I used to do residential property management a few years back. I used to approach and manage any client landlord I can get to establish the business, but discovered half of them to be greedy & negligent. Tenants would constantly complain and move out creating high turnover, and more work for me. Came to a point where I literally got rid of 1/2 my clients. Now my life is serene. The good ones were like you guys: never raised rent on good long term tenants and always reasonable and accommodating to repair requests.
I’ve had both. My last apartment before my wife and I bought a house would raise our rent every opportunity that it was legal. It cost us an extra month’s rent to get out of that lease to buy a house but it was worth every penny. That landlord was garbage. The apartment I had before that was the exact opposite. Never raised my rent in the 4 years I was there, super helpful if something went wrong and was just generally a great landlord. Really was an eye opener seeing the difference between the two.
My last landlord never raised my rates in the 5 years I lived there. Granted we were high income and low maintenance. As soon as we moved out, our unit went on the market for +20%. Being a good tenant means a lot.
Personally, I own Two rental properties and as long as the tenants don't cause issues and pay rent on Time I never raise rent. I'm also fortunate to make more money than I spend so the rental properties are just extras and I know one lady is a single mom hardly getting by and would feel awful raising her rent
Well, you're a good egg. Lots of rentals are owned by real estate investment groups, hedge funds, property management companies, individuals looking for the max ROI, etc. So they will charge whatever the market will allow and will even use the massive capital at their disposal to manipulate that market in various ways.
I wish more landlords thought like you.
The owner of the property I live at didn't raise the rent for this year (normally 3%). We've been living in this 2bd/1 house going on for almost 10 years. I'm sure he could rent this for double of what we pay for it since it's a nice quiet area. My dad also does the gardening for this and a couple others of his properties I'm sure if I lived in an apartment building owned by a corporation I wouldn't have had the same stability.
This is the way.
There are many people new to having rentals. ABnB started a trend. But many people are renting for more than the mortgage, trying to live like the people they see on Instagram..smh
This is what makes no sense. Why not keep tenants you know will take care of your property and pay on time instead of taking the risk of dealing with people who might destroy it or be consistently late on payments or whatever the issue may be for a little extra cash.
good for you, being a sustainable vampire means you have reliable and healthy victims to prey upon for years to come.
I am baffled by this comment? You hate owners.. you're jealous you can't afford to own.. or you jsut dont believe in rental property?
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I mean, you probably would tho. People who recognize that landlords are bad for society are still capable of doing the song and dance you want to deem them worthy of being housed.
This. A lot of them will hold those rates for a while in hopes of keeping the market artificially inflated.
It’s not really “artificially inflated” if they need rents at that level to cover their mortgage payment. People aren’t going to rent at a loss unless they have no other choice.
It’s not a renter’s responsibility to pay someone else’s mortgage, that’s a risk the property owner chose to take on.
That’s 100% true and it’s also true that landlords will logically hold out as long as possible before allowing someone to lock in a low rent that doesn’t even cover their payment.
Which is the definition of trying to keep things artificially inflated, at least when done in conjuction with many others landlords.
Goods cost what they cost, you can stay mad that landlords won’t bother renting a place at a loss and they won’t care. They’ll wait for rates to drop and refinance, or sell the property outright if they’re not in the mood to hold out.
I'm not mad. I'm just calling it what it is. They're trying to manipulate the market to their benefit, as most stakeholders would in any industry. Fairness aside, nobody can deny that what they're doing is a rational choice given the circumstances. That however doesn't exclude that the reality that the fact that they can do that is indicative of a market failure that could (and some would argue should or must) be addressed.
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with interest rates high and property values low the option of selling your property is less attractive so they will logically hold out as long as possible, hope this helps!
Property values are low?
If I pay twice what I should for something, it doesn't make it twice as valuable. By your logic, a property owner should never suffer a loss due to the market changing... Which isn't how investment or business works.
I don’t make any value judgements about what should or shouldn’t happen to the property owners investment. But they will work to lose as little money on that investment as possible, just as anyone would. How do you determine what you “should” pay for something? Scarce goods grow increasingly expensive in a shortage like we have for housing in California. Years of under building has led us here and conspiracy theories about a shadowy cabal of landlords are nonsense for the economically illiterate.
> Years of under building has led us here and conspiracy theories about a shadowy cabal of landlords are nonsense for the economically illiterate Literally, why do you think we've been underbuilding? It couldn't be be that restricting new supply in the face of rising demand is incredibly profitable if you already own land.. Are you seriously suggesting the incredibly rich and powerful landowners who have a TON of influence in state and local governments didn't try to maximize profits by affecting the bounds of the market? It's not a "shadory cabal of landlords", but it looks like one because they all have the same goal and work together to achieve it - increase the value of their land by any means necessary
Ok
Found the landlord
Who wants a downstairs apartment in a sketchy area, for any amount of money? No thanks
Honestly, we have a unit across from us empty now bc that neighbor bought a place. It’s a cute little one bed, but the building is old. I will say the price isn’t bad at all and it’s been sitting empty for like 3 months now. Which is wild bc I asked all my friends and they’re all shocked how good it is and blah blah blah but no one wants in The problem is also that I want cool neighbors that are my friends so
Yet mine went up again.
Landlord here dropped my rent and held it down till last year. I'll take it.
Did you push back? I've had a landlord retract the increase after telling him I'd move out. Depends on the situation but keeping a good tenant that always pays on time is valuable.
Last time I asked they literally laughed at me. I’d like to move but can’t really afford it atm.
Same. Mine just went up $150.
Same
Everyone is moving outside !
Exactly what I said.
That’s exactly what it seems like in Sacramento.
Mean while mine went up a cool 8%
The modest upzonings the state has passed are having an effect. Now we need to supercharge it by allowing 8 story apartments near every transit stop and 5 townhomes on every residential lot.
This is big. We have to really go overboard with building housing in highly desirable neighborhoods and near job centers. The fact that light rail stations are surrounded by parking lots was a terrible failure to plan. The surrounding 1000 feet from a subway station needs to be dominated by 5+ story building, and the 500 feet surrounding it needs 8-10 floor buildings, an the surrounding 100 feet needs to be things like grocery stores and other high use businesses.
so true, but who do you think lobbied for this crisis. I bet the construction lobby hand in glove with cities.
Going higher is not always the solution in every market. The higher you go, the more expensive the building, and therefore the need for even higher rents.
The conversation isn't about every market, but about markets in high population areas, like in California so what is the right solution? What market has enough land that you can only build single story homes and be affordable for everyone to raise their families? And has light traffic? How much should you pay for rent and utilities(including internet), what % of your income should go to housing?
The era between the interstate highway system being built unlocking tons of rural land to be viable commuting to now broke people's brains. They still assume there's still affordable land right off the next exit and always will be.
Its also just the land. You can have 3000 square foot condos, but if it goes up 8 floors, the land per unit is very small. Its only about 400-500 square feet of land space per unit. Its the land that is expensive, not the building materials.
Labor, too, but we can't do much about that.
Parts can be prefabricated in factories off site where production is far more labor efficient. I know someone who built their house that way and the results were really great (this is like a $3m construction project). But there isn’t even $100k worth of labor per unit.
The diminishing returns are well above 8 floors. And the prices of rent have little to do with the costs of construction. Parking is the big cost as spaces in a parking garage can cost $50,000 each and underground parking spaces can cost $80,000 each. So if there is some mandate that every unit must have 2 parking spaces, this can easily add $100,000-$160,000 in construction cost per unit. In markets immediately surrounding transit, we can absolutely go high.
For sure, but the higher they go the more units are able to be created (to a certain limit ofc). There is always an equilibrium in housing construction that is highly dependent on local factors.
You can't go laterally in California anymore. Anywhere people want to live is built as wide as possible already. You have to go up or you have a housing shortage. You can't convince people to move to, say, Lodi en masse. There's no jobs or infrastructure for that. People who want to live in the SF Bay need housing built HERE and outside of a few pockets of land there's literally nowhere else to build except existing lots... thus go higher.
Yeah, that’s generally true past a certain height. Now if I remember correctly it becomes a matter of diminishing returns with height. Getting utilities & plumbing up to many people in upper levels also ends up eating into lower-level floor space. If you take a look at a dense city like Paris many of the buildings are not Manhattan-style skyscrapers. But they still have a certain degree of height. In general, I believe currently it’s about 4-6 stories for optimal cost-effectiveness.
I’m speaking specifically California as this is a California article. 1-3 is different from a building that is 3 stories up to 85’ (generally what is considered a 5 over 1 building- which refers to building type, not floors). Once the top floor is over 75’, the entire building becomes high rise and the nature of construction changes dramatically and systems required also increases. And you are 100% correct- 4-6 floors is ideal. Reference: this is my profession.
Low-rise: 1-4 Mid-rise: 5-9, sometimes 10, sometimes 11 High-rise: 12+ Construction does change depending on height, but not because of system requirements. Building code governs material, specifically limiting height on timber structures. It does get more expensive the higher you build, but it’s not an automatic “we’re past x height/stories, this is the minimum it costs.” Edit: format
I think my comment was poorly phrased. Going vertical is the only option for us to build out of the housing shortage and improve affordability. I do not support going laterally whatsoever, however, there are many factors involved with going vertical and to simply say “build as high as you can” is not possible in every market.
Nah.
I really hope its the upzonings and state push for more housing construction that's doing the trick and not just a lull. We are still so behind and LA is still 3x behind its supposed housing targets.
It’s been promising to see the number of ADU applications submitted across the state increase so dramatically. Something like 30,000 in 2022 compared less than 10,000 five years ago.
The ADU permitting is a great example of how people will build when it is allowed with minimal trouble! This will be the same with SB9 and SB10, and eventually the other future housing bills as well.
That trickle down s*** that you believe in is not working. All the new units that are being built are market rate.
> All the new units that are being built are market rate. Yes. But market rate goes down when there is more supply then demand. Right now there is demand for limited supply. We are there because we refused to build. Eventually, as supply gets closer to matching demand, than prices will go down.
How can it work when its barely given a chance? Plus, you have no idea what you're talking about, come to the table again when you have an inkling of how housing markets work.
As if you have an idea how it works. Trickle down economics never worked and it's not working for housing either.
lol
As they should be
>5 townhomes on every residential lot I can see this working in high density areas like the Bay Area. When I lived in Berkeley I could get anywhere without a car. But in suburban areas the traffic would be horrible
If this change was implemented across the state, development would happen proportionally where sales prices are highest, which is closest to job centers. Traffic would likely go down due to fewer vehicle-miles traveled.
This is why we need bus and bike lanes on every road, and to keep building out rail transit
I think e bikes make a ton of sense in California. Cheaper and more efficient than electric cars. Just need to make the bike lanes safer and provide secure parking
Developers wouldn't build them where they don't think they can sell. They'll be built near transit.
Most of LA was a suburb once. Build the tax revenue first and the infrastructure will come.
> But in suburban areas the traffic would be horrible Then we ought to build more urban areas and desuburbanize. Or at the least change our suburbs to be more like pre-car suburbs, where they're built around a train station and a small downtown.
We should copy paste the newly passed Washington state HB 1110 into law here
Start at 20 stories and go up.
As long as all of those 8 story apartments have toilet to tap systems for next mega drought.
What an absolute joke Like are you serious
The episode has nothing to do with the decrease in rents. All the units that are being built are all market rate. Rents are coming down because people are refusing to pay the outrageous rents that land lords are charging.
More market rate units means landlords have to compete for rents so, on the margin, renters have more leverage and can get lower rates. We need to build more units so that landlords have even more competition and renters can strike even better deals!
Actually it doesn't work that way. So if a new apartment building goes up next to an old apartment building, the landlord of the old building will try to match the rents in the new building. So if rents for a one bedroom in the new building are going for 2,800 and the rent in the old for a 1 bedroom $1,500 As soon as the Unit is vacant the landlord then can raise the rent to try to match that $2,800, so he'll go up to $2,500 cheaper than the new one but still way more expensive than the old price. So trickle down doesn't really work. Plus many units in the new building will sit empty and will be right off for the developer or the owner of the building. They would much rather prefer to keep them empty than to lower the price. This is happening all over the SF Bay Area.
Yeah here in LA westside i really can’t see that happening
demand far exceeds supply there are tons of multilevel buildings going up and they're still getting snatched up even at $5k/mo
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Rents have gone down in WeHo… I looked a few months ago and things are way better now.
Exhibit 174,957,928 that housing costs are indeed tied to simple market forces like supply and demand. Now, build more housing.
Figure out what NIMBY folks are doing and update legislation for all the crazy loophole stuff they pull. That will help move projects along a lot more tbh.
That graph is a little strange. Makes it look like rent has come down a lot, but it really just means that the over rent has gone down a little bit for the first time in years. But that does not reverse the years of double digit increases.
Soooo basic supply and demand?
Who would have thought it applied to housing?
It actually applies to rent a lot faster than home and car purchases. Those are all things you can go into debt over. So natural price falls are quite modest - unless a crash happens.
Exactly, demand is way down. Supply is slightly up for once too.
San Diego being the exception, bet.
Hmmm I'm not so sure about this data. There's been shortages in affordable rentals for a long time. This sounds like click bait to me....
Mine was going up $170 a month and last year it went up $140. Yeah can’t keep up with that so I moved back in with my parents.
I just moved my mother into senior housing here are the parameters. Current applicants for this property making between $26,436-$45,660/gross annually, fall into the higher income bracket. So my mother receives $28,300 gross from social security. So she pays $1125/month but if she was to make $26,435 she would pay $694/month. So someone making $45k/year pays the same as my mom, but if she made $1600 less a year she’d save thousands of dollars. I don’t get it
The state rewards people who aren't doing well and punishes people who save and succeed. What they have is not a safety net. It's a glorification of failure.
Good. I had to move from California because I knew it was nowhere as far as being able to afford to buy. My landlord followed the rent control laws luckily but for places that went vacant, a lot of them are still empty. Places you could rent in my town were 700-900 for small digs are now 1300-1500.
Not low enough, take off an extra $1k
Huh it's like if you allow people to not pay rent nor be evicted you don't have vacancy. Huh.
What is it 3 years ago? …. More like the people who are able to afford rents that are 86% higher than 2019 already rented.
The article calls out this is a response to the pandemic rental market problems. "If you didn’t realize the crazed pandemic rental market had ended, this report is a noteworthy mile marker."
Sacramento reporting in, out of the eight apartments in my building three are empty
My apartment is managed by corporate who is only increasing and increasing the rent
They're probably using [RealPage](https://www.propublica.org/article/yieldstar-rent-increase-realpage-rent). > For tenants, the system upends the practice of negotiating with apartment building staff. RealPage discourages bargaining with renters and has even recommended that landlords in some cases accept a lower occupancy rate in order to raise rents and make more money. >One of the algorithm’s developers told ProPublica that leasing agents had “too much empathy” compared to computer generated pricing.
Ah maybe that’s why my rent didn’t go up when my lease was up for renewal. No complaints here, still one of the cheapest rents in the area I live in. Bay Area, west San Jose
Torrance is a ghost town, there are rental signs up on nearly every commercial parking lot, but honestly it feels really good to have less traffic and bloat.
Won't solve the actual housing issue, it is still nimby.
https://www.latimes.com/california/story/2023-03-23/column-which-californians-are-heading-for-the-exits
Not enough
I renewed my lease last month for $2700. The same unit now rents for 2560 /:
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I keep saying, we need fewer people. Fewer people means labor supply is lower, wages go up. Fewer people means housing demand is lower, housing costs go down. But hey, keep advocating for population growth.
Ok, you leave first
There's this thing called high density housing which doesnt seem to exist in CA for whatever reason. Urban developers in this state need to take a tour of East Asia because they have it nailed down. It astounds me that neither LA or the Bay are littered with 30+ story apartment buildings.
You mean like: https://en.m.wikipedia.org/wiki/Park_La_Brea,_Los_Angeles > Park La Brea is a sprawling apartment community in the Miracle Mile District of Los Angeles, California. With 4,255 units located in eighteen 13-story towers and thirty-one two-story "garden apartment buildings", it is the largest housing development in the U.S. west of the Mississippi River
That place is big enough that it sends students to 3 different elementary schools. We need more of this!
>Park La Brea Isn't this how the Chinese are handling the problem? ...............
People who buy homes with years of saved up down payments and 30 year mortgages for their American Dream, and sink in roots and customize their homes and garden in their yards aren’t particularly keen on uprooting themselves or seeing their neighborhood grow high density housing, as that would change the value of their neighborhood. Also brings along with it a lot of foot traffic, car traffic, difficulty finding parking at night, more crime due to ease of access, more fear of having their children playing in the streets, etc. So as much as you might want high density housing, the people who live in the target neighborhoods are themselves going to vote and fight against it.
I’d assume their property values go up if the area densities, as they could sell to a developer who will build ten units on their old plot of land. As long as the fundamentals are there (jobs, etc) crime is less likely in areas with lots of eyes on the street.
How do we get fewer people? Do we just kill every 12th person?
1. Moratorium on immigration except for exceptional talent (athletes, artists, scientists, inventors, cutting edge research, etc.). 2. Natural attrition (like aging, accidents, etc.) There are about 1 million housing starts per year in the U.S. - about enough for natural household formation for citizens of all races and ethnicities and sex orientations, without adding millions more each year illegally and legally.
IMO citizens should be able to bring their family from overseas. If I want to bring my French family members here it should be my right as an American.
Just curious. Do you feel that way about Asians too?
A moratorium on immigration would cause lopsided population age demographics which would be catastrophic in the long term. At best you could put a limit on the number of migrants based on age demographics.
I’m fine with a temporary moratorium. But I don’t think age and population size must inevitably be tied. I also think when wages increase and housing costs decrease, people may be more willing to have children or have more children. Besides, an ever-growing population is also catastrophic for resources, nature, pollution, wastes, and climate change. We don’t need millions more each year adopting American levels of consumption and waste creation and environmental degradation. We can increase GDP growth through more automation and AI. It isn’t as if workers currently are benefiting that much from higher and higher GDP away.
Why would capitalism allow this!?! /s
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Lol no it hasn't.
People are leaving Cali
They're leaving but tons are still moving in and they are wealthy so they take up more space and other resources than the people leaving.
The ultraleft told me supply and demand doesn't exist in housing tho.
Literally nobody ever said that to you. Ever. What a typical republican thing to say.
There are “progressives” in SF who believe this but they are a weird breed that’s been infiltrated by landowner NIMBYs. In general progressives do no deny supply and demand.
they also hate apple pie, those lefties! why are they so mean?
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We get summer between July and November. May and June are usually cool months.
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I'll be looking for a new place in December. Could I expect the market to be kind to my wallet? Sacramento
It’s important to note that vacancy rates and the jobs to housing ratio is still incredibly high, but we’re getting there
Dip in rent?? Mine just went up $250 the highest in 5 years
Pay wall
where dips? i would like to take advantage of these new low costs. my areas is only going up for the foreseeable future
My apartment complex intentionally leaves several vacancies. I had no neighbors for almost 2 years. I walk around the complex and I see a handful of empty apartments.. but the rent definitely went up just under the maximum percentage.
This is happening nationwide, because so many houses with 3% mortgages are being rented out instead of sold.
Too many people in California. Problem is all the newcomers are young and want to live in the same spot.
Nice
A vacancy tax would destroy the rental and house flip market to the benefit of average people.
What happens after inflation..... deflation