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Old 05-08-2019, 04:22 PM
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How do you forsee Gavin Newsom's attempt to have 3.5 million new homes built in California by 2025


https://la.curbed.com/2018/11/8/1807...m-housing-plan

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In a 2017 post published on Medium, Newsom declared that as governor he would oversee construction of 3.5 million new units of housing in California by 2025, amounting to roughly 500,000 units per year, were the tally to start right away.

That would require some aggressive building strategies. Over the last 10 years, an average of less than 80,000 homes have been built in California annually, according to the state’s housing department.
It sounds like a good plan, and increasing the number of houses will make the big cities in CA more affordable.

However, there is going to be a lot of pushback from the big cities against this since homeowners will potentially lose trillions in property value if the housing market goes from 11.5 million dwellings up to 15 million.

Supposedly setting housing standards at the national level if why housing is more affordable in Tokyo despite it being a large city with a large population density. So CA state overruling local regulations could do quite a bit to make housing more affordable.

But how will this play out? Lots of people with homes worth 6-7 figures won't want the housing market filled with new homes since it'll drive down prices. Plus won't it cause local tax revenue to decrease if home prices decline deeply? So local governments would oppose it too.

But it'd be nice to see it happen.
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Last edited by Wesley Clark; 05-08-2019 at 04:24 PM.
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Old 05-08-2019, 04:35 PM
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Plus won't it cause local tax revenue to decrease if home prices decline deeply? So local governments would oppose it too.
This is California with its strange (by my standards) property tax rules. In other states if property values fall, the local government would simply raise the mill rate to maintain revenues. In California, it might even be easier, though IANAC. Aren't taxes locked in based on the purchase price now? This would mean that they'd not be lowered if the property values fell. In any case, the new property would certainly add to the tax base.
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Old 05-08-2019, 05:40 PM
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Aren't taxes locked in based on the purchase price now? This would mean that they'd not be lowered if the property values fell.
Nope, doesn't work that way. First of all they do rise, but only at a maximum rate of 2% a year, well below where CA homes generally appreciate. However if home values fall the counties are supposed to re-assess them down. If they don't or you don't agree with their assessment you can petition them to do so/do over and they are required to follow through. If and when the values rebound the tax rate can climb back to where it "should be".

All of the above happened with me during the Big Crash. County reacted, but only froze the 2% climb. I petitioned for a reduction. They did an actual assessment, agreed and dropped my property taxes by A LOT. When the housing prices rebounded, my property taxes shot back to the prorated +2%/year assessment.

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In any case, the new property would certainly add to the tax base.
But this is absolutely the case. Frankly home values have risen so sharply, particularly in the last 5 years, that I doubt more than a few people would see a real loss. Just less of a gain.

ETA: All that being said, I'll believe Newsom's proposal when I see it. A push above 80,00/year may well be doable. 500,000/year seems like an unlikely bit of an over-promise.

Last edited by Tamerlane; 05-08-2019 at 05:43 PM.
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Old 05-08-2019, 06:19 PM
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Based on what I've read, this is a very worthy goal -- the "housing crisis" is almost entirely manufactured by bad policies (NIMBYism and similar phenomena), and simply based on artificial restrictions placed on the housing market.
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Old 05-08-2019, 06:30 PM
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I think the proposal is simultaneously awful and unrealistic. It's unrealistic because the figure is so far outside what has historically been possible that at best I would characterize it as aspirational.

NIMBYism is party responsible, but right now I think a bigger factor in why units aren't being built is because they are too expensive to build. Even developments that are fully permitted and ready to go, builders may wait to get more favorable conditions. Building is really expensive, and any large project is required to allocate a certain % of units to low income. As a result, the other units in development need to be priced higher to compensate, stratifying the market even more. Combine that with the region having three major fires in the last two years, and builders are in high demand and can charge even more. The cost of capital is also quite high, and some builders are unable to get financing for projects that are approved.

Right now what is in the legislature is a bill pushed by San Francisco State Senator Scott Weiner, SB50. SB50 does a number of things, but one of them is virtually eliminate single family zoning in the state. Fourplexes would be allowable anywhere by right (no approval necessary), and this bill is a big part of Newsome achieving his goal. It's getting quite a bit of pushback, and there is a major committee hurdle to clear by the end of the month. In it's last iteration, through negotiation with another state senator, the bill was changed to relax some requirements for counties with less than 600K population. Surprise, the person he made the deal with was from Marin County, and they have less than 600K population. The NIMBYs are also in the legislature. Newsome himself was from the North Bay, and often those areas didn't meet their housing requirements.

There won't be pushback from the big cities - they seem to be in on it. There will be pushback from the hundreds of smaller cities who are going to be caught up in these one size fits all rules that are being pushed.

Last edited by Bone; 05-08-2019 at 06:31 PM.
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Old 05-08-2019, 06:54 PM
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There won't be pushback from the big cities - they seem to be in on it. There will be pushback from the hundreds of smaller cities who are going to be caught up in these one size fits all rules that are being pushed.
That part is confusing to me, I thought a big reason there was a housing shortage in California was residents in big cities (especially SF) wanted to keep the prices high by making it hard for new units to be built.

Also aren't the smaller cities more reasonably priced?
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Old 05-08-2019, 09:13 PM
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I think the proposal is simultaneously awful and unrealistic. It's unrealistic because the figure is so far outside what has historically been possible that at best I would characterize it as aspirational.

NIMBYism is party responsible, but right now I think a bigger factor in why units aren't being built is because they are too expensive to build. Even developments that are fully permitted and ready to go, builders may wait to get more favorable conditions. Building is really expensive, and any large project is required to allocate a certain % of units to low income. As a result, the other units in development need to be priced higher to compensate, stratifying the market even more. Combine that with the region having three major fires in the last two years, and builders are in high demand and can charge even more. The cost of capital is also quite high, and some builders are unable to get financing for projects that are approved.

Right now what is in the legislature is a bill pushed by San Francisco State Senator Scott Weiner, SB50. SB50 does a number of things, but one of them is virtually eliminate single family zoning in the state. Fourplexes would be allowable anywhere by right (no approval necessary), and this bill is a big part of Newsome achieving his goal. It's getting quite a bit of pushback, and there is a major committee hurdle to clear by the end of the month. In it's last iteration, through negotiation with another state senator, the bill was changed to relax some requirements for counties with less than 600K population. Surprise, the person he made the deal with was from Marin County, and they have less than 600K population. The NIMBYs are also in the legislature. Newsome himself was from the North Bay, and often those areas didn't meet their housing requirements.

There won't be pushback from the big cities - they seem to be in on it. There will be pushback from the hundreds of smaller cities who are going to be caught up in these one size fits all rules that are being pushed.
Ok, so I have to question your reasoning a bit. For the areas with severe shortages, where an 1100 square foot home is 800k to north of a million, you could generally fit about a fourplex in the same lot if you are allowed to make it 4 stories and are exempt from lot coverage limitations. (that is, you can build all the way to the back fence and all the way to the front sidewalk if necessary, similar to a NYC brownstone)

If the local zoning board can do nothing but say "here's your permit", what super high amazing costs are going to prevent mass conversions in the relevant areas? (and incidentally, meeting this politician's aspirations)

I think you are saying the building materials involved and labor, in converting a lot from a value of ~800k to one worth about 2.4 million, are too expensive. (4 times as much rentable space, but some loss in value since the space is denser and each potential tenant has less privacy and has to share)

Note that if it's really "must approve", builders could use a pre-approved design and also convert entire blocks in one go - if they are allowed to make the fourplexes cookie cutters, then the earthquake and solar and other special california requirements would already be engineered in. Only the materials and labor would be more expensive, and cookie cutter mass development saves substantially on the labor.

Just pencil arithmetic says that builders can probably demolish an 1100 square foot home and build a 4000 square foot 4 story unit for less than 1.6 million. They do it routinely for about 400k in cheaper states...

To be fair to your argument - eventually during this mad building rush, enough units would be added to the market that no longer would that 1100 square foot dwelling be worth $800k. As the gains drop, eventually an equilibrium would be reached. But if the numbers of tech jobs added to california are correct, that's a looong way away...

Last edited by SamuelA; 05-08-2019 at 09:16 PM.
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Old 05-08-2019, 10:28 PM
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It's worth asking: Who is going to build those houses? And out of what?

To achieve the stated goal, they must be built at a monthly rate around 7.5 times that of the past 10 years. If you make the (unreasonable to the point of absurd) assumption that you can quickly triple the number of people building houses in CA, each must immediately become 2.5 times as productive.

There will be a corresponding huge increase in the materials and supplies that are needed to build those houses, the trucks that are needed to haul them around, etc. This will cause the price of those things to spike massively, and the quality to decline.
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Old 05-08-2019, 10:59 PM
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That part is confusing to me, I thought a big reason there was a housing shortage in California was residents in big cities (especially SF) wanted to keep the prices high by making it hard for new units to be built.

Also aren't the smaller cities more reasonably priced?
There's an element of NIMBYism that exists everywhere, but it's not as prevalent in the bigger cities as it used to be. There are quite a few YIMBY groups that have gained momentum, and larger cities have gotten more progressive. The concerns of these cities include increased homelessness, lack of affordable housing, gentrification, etc. Rent stabilization (rent control), as well as densification, and increased affordable housing requirements is quite popular in the larger cities I'm familiar with like SF, Oakland, San Jose, etc.

NIMBYism isn't the only reason prices are high. There's a staggering amount of demand fueled by increased job growth. From 2010 to 2016, the Bay Area has produced something like 720K jobs, primarily in the large counties of San Francisco, Santa Clara, and San Mateo. But over that same time period, there have only bee like, 100K ish housing units added. That's a lot of increased demand. Many of those jobs are relatively high income - over 100K, and north of 200K.

But in those same locations that have produced those jobs, like at Apple, Facebook, Google, etc., they aren't producing the housing in the county. In San Mateo during that time period, the jobs to housing ratio created was 17:1. So those folks get pushed out further in the area, increasing commute times, congestion, and demand for services. If you live 40 miles away and commute 1.5 hours or so each way, your kids are going to go to school where you work. Many of those outter region cities are bedroom communities, and have trouble keeping up with the infrastructure demands that this brings. Demands for schools, police, roads, etc.

Smaller cities may be more reasonably priced, but not by that much. Because of the lack of housing created near these jobs, demand has picked up all across the bay area. But typically single family housing units are a net loser for a city. They don't provide enough property tax revenue to cover the increased demand on services. Cities try to mitigate this by charging impact fees to developers, fees to offset the increased infrastructure costs, however there are currently bills in the legislature that would cap or eliminate these fees, hamstringing smaller cities who would be unable to provide services. So it's not simply NIMBYism, but also there is elements of feasibility.

Larger cities that create these jobs, they are infavor of these statewide or region wide efforts that would force surrounding regions to essentially subsidize them by providing the housing that they have not. So no, the big cities are in favor, and the small cities get squeezed.
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Old 05-08-2019, 11:10 PM
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Ok, so I have to question your reasoning a bit. For the areas with severe shortages, where an 1100 square foot home is 800k to north of a million, you could generally fit about a fourplex in the same lot if you are allowed to make it 4 stories and are exempt from lot coverage limitations. (that is, you can build all the way to the back fence and all the way to the front sidewalk if necessary, similar to a NYC brownstone)
Possibly - It may fit, but that doesn't talk about traffic, parking, schools, police, etc. These cities and city budgets did not grow from massive overnight densification.

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If the local zoning board can do nothing but say "here's your permit", what super high amazing costs are going to prevent mass conversions in the relevant areas? (and incidentally, meeting this politician's aspirations)
None? I mean, that's the intent of making fourplexes by right statewide. To increase density and encourage infill build projects. I think it will negatively impact neighborhoods, but the state doesn't seem to care very much. I don't live in a big city. I purposely chose to live further out to get more space, to avoid density. The state is trying to change that top down.

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I think you are saying the building materials involved and labor, in converting a lot from a value of ~800k to one worth about 2.4 million, are too expensive. (4 times as much rentable space, but some loss in value since the space is denser and each potential tenant has less privacy and has to share)
The problem is multifold. First, your assumption about building a 4000 sqft fourplex for 400K assumes $100/sqft. For a single family home in the bay area, the cost is closer to $600/sqft. That changes the calculus on a lot of things - and a fourplex would be more expensive. But there is an even larger problem - the intent is not to build luxury condos. The state is interested in creating affordable housing. They do this by deed restricting the properties and cap the price. Builders have trouble recouping their costs if they are not allowed to sell for a market rate. The state isn't interested in building market rate units. In SF for example, their inclusionary housing requirement can go up to 35% of units built. So if you build 100 units, 35 of them need to be considered affordable. It's hard for a project to pencil out that way. The way it gets done is to make the other units super luxury that can charge a super high price, and instead of building the inclusionary units on site, they pay an in lieu fee and either build the affordable units somewhere else, or simply contribute money to the city so the city can use those in lieu fees to support affordable projects somewhere else.

NIMBYism is part of the issue, however lack of financing, builder shortage, and projects that dont turn a profit I think are at least as significant. Several laws recently have streamlined approval process for projects, but they still have trouble getting built because they don't pencil.
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Old 05-09-2019, 11:14 AM
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There's an element of NIMBYism that exists everywhere, but it's not as prevalent in the bigger cities as it used to be. There are quite a few YIMBY groups that have gained momentum, and larger cities have gotten more progressive. The concerns of these cities include increased homelessness, lack of affordable housing, gentrification, etc. Rent stabilization (rent control), as well as densification, and increased affordable housing requirements is quite popular in the larger cities I'm familiar with like SF, Oakland, San Jose, etc.

NIMBYism isn't the only reason prices are high. There's a staggering amount of demand fueled by increased job growth. From 2010 to 2016, the Bay Area has produced something like 720K jobs, primarily in the large counties of San Francisco, Santa Clara, and San Mateo. But over that same time period, there have only bee like, 100K ish housing units added. That's a lot of increased demand. Many of those jobs are relatively high income - over 100K, and north of 200K.

But in those same locations that have produced those jobs, like at Apple, Facebook, Google, etc., they aren't producing the housing in the county. In San Mateo during that time period, the jobs to housing ratio created was 17:1. So those folks get pushed out further in the area, increasing commute times, congestion, and demand for services. If you live 40 miles away and commute 1.5 hours or so each way, your kids are going to go to school where you work. Many of those outter region cities are bedroom communities, and have trouble keeping up with the infrastructure demands that this brings. Demands for schools, police, roads, etc.

Smaller cities may be more reasonably priced, but not by that much. Because of the lack of housing created near these jobs, demand has picked up all across the bay area. But typically single family housing units are a net loser for a city. They don't provide enough property tax revenue to cover the increased demand on services. Cities try to mitigate this by charging impact fees to developers, fees to offset the increased infrastructure costs, however there are currently bills in the legislature that would cap or eliminate these fees, hamstringing smaller cities who would be unable to provide services. So it's not simply NIMBYism, but also there is elements of feasibility.

Larger cities that create these jobs, they are infavor of these statewide or region wide efforts that would force surrounding regions to essentially subsidize them by providing the housing that they have not. So no, the big cities are in favor, and the small cities get squeezed.
I think we may have differing definitions of small towns in California. I'm talking about actual small towns a couple hours from the big cities like Taft or Buttonwillow (near Bakersfield and two hours from Los Angeles). Median Home prices there are about 120k.

How will they get short changed? My impression is the bottleneck was regulatory, would this proposal require tax hikes statewide?

Also I thought sf had regulations against high rises and things like that that contribute to the housing shortage.
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Old 05-09-2019, 11:22 AM
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Housing really seems like one of those issues that the market can and does solve, when it's relatively free to do so. I think some regulations and zoning are reasonable (environmental, safety, etc.), but "I like my neighborhood the way it is" doesn't seem like near enough justification to restrict the market from meeting the needs of American consumers.
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Old 05-09-2019, 11:22 AM
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Possibly - It may fit, but that doesn't talk about traffic, parking, schools, police, etc. These cities and city budgets did not grow from massive overnight densification.
This.
Schools, police, roads, utilities, hospitals, shopping etc.-is the plan to just piggyback on systems that are already overloaded?
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Old 05-09-2019, 12:26 PM
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I think we may have differing definitions of small towns in California. I'm talking about actual small towns a couple hours from the big cities like Taft or Buttonwillow (near Bakersfield and two hours from Los Angeles). Median Home prices there are about 120k.

How will they get short changed? My impression is the bottleneck was regulatory, would this proposal require tax hikes statewide?

Also I thought sf had regulations against high rises and things like that that contribute to the housing shortage.
Buttonwillow is about population 1500, so that's pretty small. I'm referring to cities around 10K - 50K. Taft is more in that vein, however it's pretty far from anything. It is in Kern County, which is over 600K people so would be subject to the rules under SB50.

But look at a place like Mountainhouse. People commute from there to all over the bay area. Can that small town support the rapid densification? It's not like if they fill the place with 8 story towers all the sudden they will have enough funding to cover the infrastructure like roads, schools, police. Nevermind the horrendous traffic. No, the places that cause the increased demand with rapidly increasing jobs, should provide the housing that is the downstream impact of those jobs. Those places should be funneling money to the outer regions to support the increased burden on infrastructure. But that's the opposite of what is happening - the larger cities are gathering together to push laws that would force small communities to bear the burden of the lack of local housing where jobs are being created.

Current proposals include siphoning money from these smaller cities, and diverting it to the larger cities.

As for SF - it's somewhat unique because there just isn't that much land. Combine that with the inclusionary requirements and the cost of building makes many projects infeasible. What does work is luxury condo towers like you see now all across the SOMA area. But those do nothing for affordable housing when they cost 1.5M and come with a $1,500 monthly HOA.
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Old 05-09-2019, 12:26 PM
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Housing really seems like one of those issues that the market can and does solve, when it's relatively free to do so. I think some regulations and zoning are reasonable (environmental, safety, etc.), but "I like my neighborhood the way it is" doesn't seem like near enough justification to restrict the market from meeting the needs of American consumers.
Let's say there is a single family zone that has something like 500 houses in a subdivision. There are a few local schools, and primarily collector roads with maybe one arterial. Should there be a restriction on demolishing one of the local bocks to put up an 85 ft high density rental complex? What would you consider sufficient environmental or safety reasons to limit that type of build?
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Old 05-09-2019, 12:31 PM
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Let's say there is a single family zone that has something like 500 houses in a subdivision. There are a few local schools, and primarily collector roads with maybe one arterial. Should there be a restriction on demolishing one of the local bocks to put up an 85 ft high density rental complex? What would you consider sufficient environmental or safety reasons to limit that type of build?
I think I'd need more info. If those protesting can make a good case that there aren't and cannot be enough community resources (schools, services, etc.) to support the development, then maybe that would be sufficient IMO. If it's about harming the skyline, and views, and the quality of the people that will be moving in, then it wouldn't, IMO.

In my experience, NIMBYism frequently is about affluent people not wanting less affluent people moving in, and not wanting their views/skyline changed, and similar concerns that strike me as bullshit (and often bigoted).
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Old 05-09-2019, 12:36 PM
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Outside of specific coastal designated zones, there are no inherent view rights so objections about skylines don't carry much weight.

But it's not only what is possible, but what is being proposed. Sure there could be more funding for schools, but that's from the county and building is approved at the city. And it's not like new roads get built overnight, but the demand will certainly be there once the build is complete.

So yeah, let's say a developer wants to put an 85 ft structure adjacent to your property, asks for zero lot lines and no parking requirements. Are you good with that?

I can't tell what you would consider sufficient to oppose and I'm trying to tease that out but you're being kinda vague.

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Old 05-09-2019, 12:48 PM
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Outside of specific coastal designated zones, there are no inherent view rights so objections about skylines don't carry much weight.

But it's not only what is possible, but what is being proposed. Sure there could be more funding for schools, but that's from the county and building is approved at the city. And it's not like new roads get built overnight, but the demand will certainly be there once the build is complete.

So yeah, let's say a developer wants to put an 85 ft structure adjacent to your property, asks for zero lot lines and no parking requirements. Are you good with that?

I can't tell what you would consider sufficient to oppose and I'm trying to tease that out but you're being kinda vague.
More density would greatly benefit my community, and provide a lot of things I love or find very positive -- ethnic restaurants, shopping, workers, etc. I think parking requirements ought to be cut down, especially in places like my community which has great public transportation. I see no reason to subsidize car ownership in metro areas in which cars aren't necessary for everyone (like the DC metro area).

I'm not sure how to answer except on a case by case basis, but based on what you describe for this hypothetical, it would be a boon.
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Old 05-09-2019, 12:50 PM
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Personally, I'm very pleased when I see a new big housing development under construction nearby my home (which is quite frequently). I know it means more restaurants and shopping, as well as more economic activity in general. In the long run, this will be extremely beneficial to my property values, as well as providing better quality of life.

And I'd support just about anything that would improve the likelihood of a Korean BBQ restaurant within walking distance of my home.

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Old 05-09-2019, 03:04 PM
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And that's fine. Do you live in a suburban single family type area? My town is primarily residential. Virtually no commercial. Walking to places is not a thing. I think for those more urbanized cities that kind of thing can work, but the proposals in the legislature don't differentiate and would apply to Oakland as well as Mountain House.
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Old 05-09-2019, 04:05 PM
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And that's fine. Do you live in a suburban single family type area? My town is primarily residential. Virtually no commercial. Walking to places is not a thing. I think for those more urbanized cities that kind of thing can work, but the proposals in the legislature don't differentiate and would apply to Oakland as well as Mountain House.
So I have a query. You know that building higher density costs more. A 1 story house is cheaper than a 2 story per square foot - this is with style in rural areas is to build broader and more sprawling for larger homes. And a 50 story building is more than a 10 story.

Why do you fear small towns in CA facing an epidemic of essentially brownstones (what you call fourplexes)? The economics don't support this unless the underlying land is very expensive...
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Old 05-09-2019, 04:28 PM
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Well, the underlying land is very expensive. But your calculus isn't quite accurate.

It is cheaper generally to go up because of land costs, but only to a certain extent. At some point the increased engineering required for higher structures increases the cost.

It's not a fear of epidemic. It's not all or nothing. But there is real concern about impact to neighborhood s in character, ability to support growth with infrastructure and services, and not displacing existing residents. Here's an article with some visualizations:

https://www.mercurynews.com/2019/03/...port-says/amp/


There's also the idea that many of these efforts don't address affordability. A sea of luxury condos costing 1.4M would not be considered success by folks like Newsome.

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Old 05-09-2019, 05:15 PM
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And that's fine. Do you live in a suburban single family type area? My town is primarily residential. Virtually no commercial. Walking to places is not a thing. I think for those more urbanized cities that kind of thing can work, but the proposals in the legislature don't differentiate and would apply to Oakland as well as Mountain House.
I live in an area that has single family homes and big apartment/condo buildings and most things in between (North Arlington VA, along the Metro line). I think there are reasonable zoning and regulations, but I think most NIMBYism doesn't qualify, as far as the reasoning I've heard from most NIMBYists.

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Old 05-09-2019, 05:29 PM
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Originally Posted by iiandyiiii View Post
I live in an area that has single family homes and big apartment/condo buildings and most things in between (North Arlington VA, along the Metro line). I think there are reasonable zoning and regulations, but I think most NIMBYism doesn't qualify, as far as the reasoning I've heard from most NIMBYists.
Ok. Arlington is quite a bit different than some small cities around the Bay Area. Arlington is more like a big city than small.

But more specifically, what types of restrictions do you think are acceptable?
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Old 05-09-2019, 05:39 PM
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Ok. Arlington is quite a bit different than some small cities around the Bay Area. Arlington is more like a big city than small.

But more specifically, what types of restrictions do you think are acceptable?
I'm far from an expert, but off the top of my head, environmental and safety regulations for certain. Very rarely, perhaps historical regulations (i.e. "this building has special historical significance"), but my standards for this would be high. Regulations maintaining some level of parks and green spaces. Parking requirements, but only in communities with no chance of public transit... and I'm in favor of vastly increasing public transit in both size and quality.

I see plenty of ways that banning multi-family homes hurts the wider community, and no significant ways it helps aside from the personal preference of the existing home-owners (but only some of them -- surely some others would prefer to sell their homes to developers... and the chance to build profitable fourplexes and condos would increase property values).

Last edited by iiandyiiii; 05-09-2019 at 05:40 PM.
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Old 05-09-2019, 08:47 PM
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Well, the underlying land is very expensive. But your calculus isn't quite accurate.

It is cheaper generally to go up because of land costs, but only to a certain extent. At some point the increased engineering required for higher structures increases the cost.
That is inherent. If increasing height (and thus density) increases cost faster than the amount of new usable area rises, obviously at any given value per lot there is an optimal height building.

As a side note, San Francisco has lot prices similar to NYC/Hong Kong and other extreme density cities - in a genuine free market that's what it would look like. Easily high enough lot prices to justify 50+ stories.

Why is the underlying land so expensive in the "small town" you live in that you don't want the State to apply it's policies to?

Is it that you actually don't live in a small city but really just an area that is arbitrarily divided into it's own city but it's really part of a greater metropolitan area? That's what most people would assume. If this is true, then of course the laws should apply to your area.

If you're some rural area in the middle of nowhere - honestly I am not sure why the policy shouldn't apply there as well. Obviously if it's a middle of nowhere small town, the only reason prices would be high is if, say, the town council refuses to allow development in the outskirts, artificially driving up prices. Well, looks like they are getting bypassed as they should be.

So far what I've gathered is the actual problem is this patch to California's issues is just incomplete. It sounds like the actual problem is that as areas grow, the increased funding from property taxes just isn't getting funneled into where it needs to go so that transit/healthcare/education/police/fire etc gets appropriately increased funding.

And they need to stop forcing developers to make 33% of the units below market rate. If the government wants to subsidize some housing should tax everyone and pay for the difference, not force individual developers to bear the burden. Developers are the ones acting to alleviate the problem of high housing prices...

Also I propose a "density surcharge". If you think about it, there's nonlinearities in government services as well. Above a certain level of density, and the price per resident for transit systems/healthcare/education/police and so on actually probably starts to increase. No longer can you just slap down streets and a few traffic lights, you start needing to install subways. You start having increased crime and need more police and better police equipment once there's large crowds of strangers everywhere and would be criminals feel safely anonymous.

So it makes sense to make property taxes assess according to some formula that factors in land square footage per residential bedroom or something. (so a 50 story apartment building has far more bedrooms per square foot of lot land than a 1 story bungalow on the same size lot next to it)

Last edited by SamuelA; 05-09-2019 at 08:50 PM.
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Old 05-09-2019, 11:16 PM
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Originally Posted by SamuelA View Post
Why is the underlying land so expensive in the "small town" you live in that you don't want the State to apply it's policies to?

Is it that you actually don't live in a small city but really just an area that is arbitrarily divided into it's own city but it's really part of a greater metropolitan area? That's what most people would assume. If this is true, then of course the laws should apply to your area.
Because it's in close enough proximity to be commutable to employers in the Bay Area.

Look at a city like Mill Valley. It's just shy of 5 square miles, and has a population less than 15K. But it is also commutable to SF, so prices reflect that with modest homes less than 2K sqft asking for over $1.3M. would you consider that just an area that is arbitrarily divided into its own city? I mean, the city incorporated in 1900, so it's not like it's the new kid on the block. Does it make sense to force this tiny city to adopt the same zoning laws that SF has just so SF can continue to create jobs but not enough housing for the jobs it creates?

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And they need to stop forcing developers to make 33% of the units below market rate. If the government wants to subsidize some housing should tax everyone and pay for the difference, not force individual developers to bear the burden. Developers are the ones acting to alleviate the problem of high housing prices...
The progressives in the CA legislature will never give up inclusionary housing. The intent of many of these housing related laws is to increase inclusionary housing, not decrease it. There are also widespread proposals for rent control as well. Because of these rules, one of the few types of development that actually pencils out are luxury high rises which do nothing for homelessness or affordable housing.

Your other ideas are...not realistic. Especially given what is on the table at the legislature right now. Nobody is proposing density surcharges, but they are proposing destroying single family zoning across the state.
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Old 05-09-2019, 11:41 PM
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Because it's in close enough proximity to be commutable to employers in the Bay Area.

Look at a city like Mill Valley. It's just shy of 5 square miles, and has a population less than 15K. But it is also commutable to SF, so prices reflect that with modest homes less than 2K sqft asking for over $1.3M. would you consider that just an area that is arbitrarily divided into its own city? I mean, the city incorporated in 1900, so it's not like it's the new kid on the block. Does it make sense to force this tiny city to adopt the same zoning laws that SF has just so SF can continue to create jobs but not enough housing for the jobs it creates?
.
Yes. It is irrelevant when the city was founded, in my state the larger city would be permitted to annex your town and this makes practical sense. Your towns residents are clearly using San Francisco services on a daily basis and should be paying the taxes to them. You don't have a small town, you live in San Fransisco in a fake city due to a technicality.

As for the rest of your argument, all I see is "well ok this idea is good but the progressives will never do the obvious next thing to make it work".

Which they might not. Single payer would drive down healthcare fees to true cost. But instead we have an incomplete solution we seem to be stuck with.

Last edited by SamuelA; 05-09-2019 at 11:43 PM.
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Old 05-10-2019, 12:43 AM
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Because of these rules, one of the few types of development that actually pencils out are luxury high rises which do nothing for homelessness or affordable housing.
They don't do nothing. There might be some amount of induced demand, but there are also people who could afford a "luxury"* home if they were being built in large numbers, but are currently living in non-luxury accommodations. The relief of that pressure would cascade, in some amount, all the way down the scale.

And today's luxury housing won't necessarily be luxury housing tomorrow.

*Whatever that means. At the end of the NIMBY spectrum where they pretend to be motivated by stopping gentrification, they love to call everything a luxury home, often based on nothing but the developer's own PR. I don't know what they want, are developers supposed to say "come get your moderately okay home, it's just fine but nothing special"?

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Old 05-10-2019, 05:11 AM
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If someone wants to control their local community building policy in a way that doesn’t infringe property rights, there are private communities that have found ways of doing that. Also, private smart cities are on the rise if that appeals to you. I suggest NIMBYs explore these options.

The NIMBY wants to live where he/she lives, where they use the force of government to prevent others from exercising property rights.

Now in a free market, if Dow Chemical or Trump Condos wants to set up shop next to your bucolic paradise, there are ways that you could address that, but unfortunately the US courts are so ill-equipped to deal with property rights issues. In addition, the body of law related to real deal property rights has been neglected and undeveloped because of the focus on legislation. Very little innovation in law has taken place while capitalism has transformed our way of life. This is because government has monopolized law to such a degree.

Last edited by WillFarnaby; 05-10-2019 at 05:13 AM.
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Old 05-10-2019, 01:31 PM
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And that's fine. Do you live in a suburban single family type area? My town is primarily residential. Virtually no commercial. Walking to places is not a thing. I think for those more urbanized cities that kind of thing can work, but the proposals in the legislature don't differentiate and would apply to Oakland as well as Mountain House.
In other words, it's a bedroom community that can rely on the nearby city for those commercial needs, without the residents having to contribute to the required infrastructure for the commercial districts.
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Old 05-10-2019, 02:31 PM
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Does it make sense to force this tiny city to adopt the same zoning laws that SF has just so SF can continue to create jobs
How is America going to become great again if we don't support the job creators?


On a slightly less tongue in cheek note, you asked how one might feel if an 85ft multi unit dwelling was built next to my property.

I'd hate it.

Public policy shouldn't be reflect what I would like or hate. What makes me happiest shouldn't be the driving force behind what can and can't get built across the state. It's an issue that's bigger than me, and it's bigger than you.
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Old 05-10-2019, 03:00 PM
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Public policy should reflect the will of the people, expressed through their elected officials. It's perfectly reasonable to attempt to convince them, and others, of the errors of their ways.
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Old 05-11-2019, 07:46 AM
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They don't do nothing. There might be some amount of induced demand, but there are also people who could afford a "luxury"* home if they were being built in large numbers, but are currently living in non-luxury accommodations. The relief of that pressure would cascade, in some amount, all the way down the scale.

And today's luxury housing won't necessarily be luxury housing tomorrow.

*Whatever that means. At the end of the NIMBY spectrum where they pretend to be motivated by stopping gentrification, they love to call everything a luxury home, often based on nothing but the developer's own PR. I don't know what they want, are developers supposed to say "come get your moderately okay home, it's just fine but nothing special"?
I tend to agree with this. I think that by increasing the availability of high-end homes, it creates more space, which takes some of the pressure off of real estate at the high end of the market, which may have some impact on the rungs below. I'm an advocate of building more housing targeted for all socioeconomic strata.

However, I don't dismiss out of hand what Bone is saying. There are market forces at play that simply building can't avoid. You can't stop tens of thousands of young software engineers, IT entrepreneurs, or venture capitalists from moving into and concentrating in a geographically tight space. The difference between the labor market value of these software engineers versus the labor market value of, say, school teachers or restaurant workers is what's driving this problem, and just building more luxury condos can't really address it.

Lack of affordable housing, therefore, is a symptom of a broader failure to regulate socioeconomic inequality, which goes back to why we need better federal and state taxation and socioeconomic policies that control the concentration of wealth more broadly. The housing crisis is a situation in which local governments are confronted with an economic crisis that is largely the making of decades of regressive economic policies at the national level.

Last edited by asahi; 05-11-2019 at 07:47 AM.
  #35  
Old 05-11-2019, 10:14 AM
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I tend to agree with this. I think that by increasing the availability of high-end homes, it creates more space, which takes some of the pressure off of real estate at the high end of the market, which may have some impact on the rungs below. I'm an advocate of building more housing targeted for all socioeconomic strata.

However, I don't dismiss out of hand what Bone is saying. There are market forces at play that simply building can't avoid. You can't stop tens of thousands of young software engineers, IT entrepreneurs, or venture capitalists from moving into and concentrating in a geographically tight space. The difference between the labor market value of these software engineers versus the labor market value of, say, school teachers or restaurant workers is what's driving this problem, and just building more luxury condos can't really address it.

Lack of affordable housing, therefore, is a symptom of a broader failure to regulate socioeconomic inequality, which goes back to why we need better federal and state taxation and socioeconomic policies that control the concentration of wealth more broadly. The housing crisis is a situation in which local governments are confronted with an economic crisis that is largely the making of decades of regressive economic policies at the national level.
I don't agree with the italicized regions. And part of it might be because I'm a software engineer. A software engineer's rate of pay primarily depends on their perceived talent, quality of their education, experience and skills, and age. It's something you can earn with hard work to an extent, though not everyone has the right opportunity when young enough and the really bad software engineers without much talent struggle. (though in today's market they all have jobs still)

This is an example of the market functioning correctly. In today's world, software engineers are on average producing more value for their corporate masters than a schoolteacher or restaurant worker - most of the wealthiest companies in the world are either pure software or heavily depend on software. Also, while anyone with a college degree and not difficult to obtain certificate can become a schoolteacher, CS and similar programs are more difficult, and CS jobs tend to have the entry level/experience trap.

So the supply is less and the demand is higher. As a result of these high salaries, tons of new people are studying CS and joining the field. Eventually either salaries will come back down due to a flood of supply, or the software field will keep expanding faster than new entrants join until there are tens or hundreds of millions of (robotics) software developers worldwide and most other jobs are automated...

I would say this is an example of "functioning correctly" economic inequality. I would argue that things like inherited wealth are an example of "diseased" economic inequality - vast sums of inherited wealth are essentially putting billions of dollars in the hands of individuals who contributed nothing to deserve it. I think parents should be able to leave money to their children, but maybe 10 million in inflation adjusted dollars per child (enough to live comfortably for a lifetime or obtain any education or healthcare...) should be the rough limit. 10 million, not 50 billion.
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Old 05-17-2019, 12:24 PM
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Yesterday one of the biggest housing related bills that would have gone towards more housing production, was shelved for this year's legislative session. SB50 was held in the Senate Appropriations Committee.

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Senate Bill 50 by Sen. Scott Wiener (D-San Francisco) would have required cities to allow four- to five-story apartment complexes near rail stations and four or more homes on land zoned only for single-family homes across Los Angeles, San Francisco, Silicon Valley and much of the rest of California.

...

Gov. Gavin Newsom also made addressing the state’s housing affordability crisis one of the centerpieces of his 2018 gubernatorial campaign, adding momentum to Wiener’s efforts. Newsom called for a building boom in the state, including the construction of 3.5 million new homes by 2025, a pace that would more than quadruple California’s current output.

Though Newsom did not take a position on SB 50, he said in a statement after the decision that he was “disappointed” the bill was blocked.

...

Los Angeles City Councilman Paul Koretz, who represents part of the Westside, applauded the bill’s demise.

“This bill is intended to destroy single-family home neighborhoods in the state,” he said in a statement. “I believe a majority of Californians do not share in that goal. We will be vigilant to fight SB 50 when it rears its ugly head again in 2020.”
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