tag:blogger.com,1999:blog-28755195.post2887816240953024445..comments2023-09-25T04:26:51.568-06:00Comments on The Barefoot Bum: Thoughts on rent controlLarry Hamelinhttp://www.blogger.com/profile/08788697573946266404noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-28755195.post-28693269234156162552014-08-08T04:39:06.296-06:002014-08-08T04:39:06.296-06:00I'm even further removed from the SF political...I'm even further removed from the SF political scene than you. I don't think we can properly evaluate the role of rent control in SF without a more detailed analysis of the political-economic situation. <br /><br />On GP, I think SF is still gentrifying fast, and I don't see that anything (short of revolution) is going to stop it. Rent control at least slows the process down a bit, and gives some residents time to not have to make panic moves.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-5929424076693877612014-08-07T12:34:35.403-06:002014-08-07T12:34:35.403-06:00I don't exactly follow SF politics since I don...I don't exactly follow SF politics since I don't even live in the city, so I may have mischaracterized some of the details of the waterfront housing proposition. I believe that the one I'm talking about is proposition B.millerhttps://www.blogger.com/profile/05990852054891771988noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-72179841131319268842014-08-07T12:27:44.575-06:002014-08-07T12:27:44.575-06:00That's a good question, in what sense is the a...That's a good question, in what sense is the anti-gentrification sentiment in SF "bad"? Certainly, it seems that people have the power to limit the housing supply, and this power is legitimate. However, I think it represents a misunderstanding of the consequences of their own policies, and also represents a selfishness that decreases the overall good.<br /><br />For example, there was recently an attempt to build luxury housing along the bay, which voters shut down because they wanted more affordable housing instead. Affordable housing is explicitly what they want, but they are using the wrong means to get it.<br /><br />The policies also decrease the welfare of prospective tenants and people who move around a lot (most personally relevant, it affects students and the younger generation). Lastly, it represents defection in an inter-city prisoner's dilemma. For example, there were the "Google bus protests" which protested gentrification by Google employees, who commuted to Silicon Valley from SF. But the reason that those buses exist in the first place is because Silicon Valley has been even more effective than SF at limiting its own housing supply!<br /><br />Rent control is not the source of all these problems, and I would not even argue that rent control is, on balance, a bad thing. But there's something messed up about local housing politics, and rent control seems to be a key component.millerhttps://www.blogger.com/profile/05990852054891771988noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-71728390293786667622014-08-07T10:17:48.390-06:002014-08-07T10:17:48.390-06:00(I left a comment yesterday but it's presumed ...<i>(I left a comment yesterday but it's presumed lost.)</i><br /><br />There's nothing in the spam folder or on email. I don't know what happened.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-47052473041223408672014-08-07T10:15:31.188-06:002014-08-07T10:15:31.188-06:00"Nope. First come, first serve: a time-honore..."Nope. First come, first serve: a time-honored principle."<br /><br />I mean here I agree: No, prospective tenants do not have a say.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-5511502860080265872014-08-07T10:13:40.774-06:002014-08-07T10:13:40.774-06:00However, people here see rent control as a way of ...<i>However, people here see rent control as a way of mitigating gentrification, and gentrification is of course a long-term trend.</i><br /><br />It's been a while since I've lived in SF, so I will take your word for it here. But if so, so what? If people want something, and they are paying for it, then why is resistance to gentrification per se bad?<br /><br /><i>Ideally, the short run increase in rents should signal that more housing is needed, and since new housing developments are not rent-controlled, rent control does not interfere with this.</i><br /><br />Indeed. <br /><br /><i>The zoning restrictions are maintained by incumbent tenants, who talk about "preserving the character" of their neighborhoods</i><br /><br />Again, that's a political issue. If that's what they want, that's what they want.<br /><br /><i>Prospective tenants, of course, don't have the power to vote on city regulations.</i><br /><br />Nope. First come, first serve: a time-honored principle. I don't think there's a good way around it.<br /><br /><i>While a quota would increase the total surplus to landlords, creating that quota requires individual landlords to take their units off the market, thus sacrificing any share of the surplus they might get.</i><br /><br />They extract their surplus directly in the appreciation of vacant units. They can either hold that as a form of savings, or borrow using it as collateral if they need the cash flow, all without actually renting out the property.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-83073930868408057392014-08-06T11:20:16.674-06:002014-08-06T11:20:16.674-06:00(I left a comment yesterday but it's presumed ...(I left a comment yesterday but it's presumed lost.)<br /><br />I fully admit the value of rent control to stabilize short run fluctuations in prices. However, people here see rent control as a way of mitigating gentrification, and gentrification is of course a long-term trend. I believe in this case, the benefit of rent control is limiting transaction costs by preventing people from having to move, switch jobs, etc.<br /><br />I think, here in the SF bay area, the problem is not so much with the economics of rent control, but with the politics of it. Ideally, the short run increase in rents should signal that more housing is needed, and since new housing developments are not rent-controlled, rent control does not interfere with this. In practice, SF is simultaneously limiting new housing development through zoning restrictions. The zoning restrictions are maintained by incumbent tenants, who talk about "preserving the character" of their neighborhoods (ie against the spectre of gentrification). Prospective tenants, of course, don't have the power to vote on city regulations.<br /><br />I don't entirely understand the second argument. While a quota would increase the total surplus to landlords, creating that quota requires individual landlords to take their units off the market, thus sacrificing any share of the surplus they might get.millerhttps://www.blogger.com/profile/05990852054891771988noreply@blogger.com