mindstalk: (Default)
[personal profile] mindstalk
In which I argue that the lack of affordable housing indicates something horribly wrong, and not with capitalism as such.

Have you heard of Walmart? Of course you have. What are they known for? Providing lots and lots of cheap shit. Also for bullying local governments and squeezing suppliers, but that's not the point here, which is: cheap shit. They have nicer competitors: Target, Kmart, Dollar Stores.

Plane seats are jammed and humiliating but also cheaper than they ever have been, modulo gas prices.

You can spend thousands of dollars on a fancy bicycle, or less than $100 on a cheap one.

Stores are full of cheap, if sometimes unhealthy, food.

You can spend under $13,000, or maybe $12,000 on a new car, or over $100,000 on a luxury sports car.

Many of us wear cheap clothes, "from Third World sweatshops"; others spend $thousands on elite designer clothing.

You can get a watch for $15, or $1500. They'll tell time about the same.

Our economy is full of selling cheap stuff to the masses and expensive stuff to the rich, and various things in between, (sometimes including selling cheap stuff for higher prices, if you can pull off price discrimination.) Because that's how you make the most profit, not by only making luxury stuff.

But in housing, particularly in some markets, it's said that developers are only building luxury housing. If true, why would that be? Why would housing be unlike every other part of the economy?

"Everyone needs housing, so they can extort you." Nope, that won't fly. Everyone needs food and clothing, and in the US lots of people need cars.

"They're just chasing profit." But the point of my examples is that there's tons of profit in non-luxury goods and services. Walmart is *huge*, with its founder's children inheriting $20 billion each of accumulated profit.

And in fact, if you look around the world, you do see cheap(er) housing options. Mobile and manufactured homes for the individual, pre-fab housing for soulless but cheap developer tracts, microapartments that cut living space to 100 square feet, SRO hotels that go further by making you share bathroom and kitchen (if any), granny apartments. In cheap land markets (prefab housing in surbuban developments) and expensive ones (microapartments in Tokyo and Hong Kong.)

But not in Boston, or San Francisco. Why not? Is there something about those places that makes developers spontaneously ignore non-luxury demand? Or is something, like zoning laws and permitting processes, preventing them from doing so?

If you know me, you probably know my answer: the latter. But if you don't like that answer, what's your alternative? Why don't we see Walmarts, Spirit Airlines, $15 watches, and $13,000 cars of modern urban housing?

Date: 2017-Jul-16, Sunday 19:24 (UTC)
heron61: (Default)
From: [personal profile] heron61
Part of the situation is fixable with reasonable changes to laws and regulations, but some of it isn't. Consider cars, where you also have a high minimum cost for new cars (and sadly, while used cars go rapidly down in price, used houses often go up).

Cars uses lots of material, houses use far more, watches and clothes use very little. Also, cars and houses both have extensive safety regulations, which are pretty clearly an excellent idea.

In addition to changing zoning laws, and improving rentals (like in Germany), one change that is obvious in conception and likely very difficult in execution would be to find a way to ban housing speculation. Changing the dynamic of renting vs buying houses might help enough to fix this problem.

Date: 2017-Jul-16, Sunday 22:19 (UTC)
mtbc: photograph of me (Default)
From: [personal profile] mtbc
The people in the fancy studios maybe don't want to live anywhere near poor people squashed into tiny apartments and, e.g., vote for zoning that largely prevents the latter in their area?

Date: 2017-Jul-17, Monday 03:11 (UTC)
heron61: (Default)
From: [personal profile] heron61
I'm fairly certain a moderate proportion of the costs are safety and health related, since windowless apartments with no exterior walls would be notably cheaper, but also deathtraps.

Clearly land represents much of the cost, but even in the sorts of towns and very small cities that few people wish to live, there's still a floor on housing prices that isn't about land cost, and when median local income is factored in, this floor isn't all that low. Some of this floor is clearly due to the lack of 120 square foot studios, but health and safety regulations keep that from happening, and I'm all in favor of this, because actual homelessness can clearly be solved via other means and I don't see any other problem sufficiently bad to relax laws to allow for the existence of what would likely amount to a Victorian penny hang with a few amenities.

Also, the biggest problems with housing costs are clearly in urban areas that many people wish to live in, like many large to mid-sized West coast cities. Here, I know that a fair portion of the high cost is due to speculation and resale for profit, and that's clearly caused by capitalism.

Your link in late May to an article comparing and contrasting German vs UK housing clearly showed that governments can do a lot to increase affordable housing, but outside of the highest real-estate markets in the US, the housing situation here is far better than in the UK (looking at that article and then doing some comparison research on US vs UK housing showed me just how incredibly terrible housing problems are in the UK compared to almost all of the US), so we clearly aren't doing nearly as bad as we could be, except in a handful of few highly popular regions like the Bay Area.

Also, two of the more important differences between UK and German housing were less available mortgage credit and greater tenants rights in Germany, both of which are the result of the government strictly regulating capitalism. Now add in rampant real estate speculation in pretty much all US cities that are popular places to move to, and you have many reasons for more expensive housing that has little to do with zoning laws. Sure, zoning laws could be improved, but I'm not sure that would be nearly sufficient, and in the absence of other reforms might not change the problem at all.

Date: 2017-Jul-17, Monday 04:18 (UTC)
heron61: (Default)
From: [personal profile] heron61
All of which is almost irrelevant when 330 square feet of parking space are required for every unit.

I absolutely agree that this should go, and it would help a lot. In lots of cities in the US, studios are often 500 square feet, and they go down to 300, which means that a parking space might more than triple the land needed per apartment (assuming either ground-level parking only, or only a low parking structure that has fewer stories than the apartment building).

In any case, it's fascinating to consider what new construction will look like if the suggestions that self-driving cars will produce a rapid and massive shift to transportation as a service prove true.

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