The problem is, one, that those vacant homes are not necessarily in places people live or want to live (unless we’re shipping homeless people off to empty homes), and two, that homeless people aren’t the only ones in need of housing - there are far more people living in overcrowded housing, or who are unable to move out of their parents’ house, or can’t afford to live without roommates, than there are vacant homes. That’s to say nothing of the people who are overpaying for housing today, whether in rent or mortgage, reducing their overall standard of living.
There’s a massive housing shortage in the United States and it’s acting like a vacuum, sucking up wealth and diverting it to landowners.
> those vacant homes are not necessarily in places people live or want to live
Good point, although i would like data to back that claim. For example in France, 200k empty dwellings are in Paris alone: this does not account for vacant industrial/office space which could also be converted to housing. In all cases, *proposing* (without coercion) homeless people a house somewhere does not sound inhumane at all.
> there are far more people living in overcrowded housing
Good point, too. Although as i said i would like to see data suggesting that the current real estate market (accounting for all vacant units) can't house everyone decently.
> There’s a massive housing shortage in the United States and it’s acting like a vacuum, sucking up wealth and diverting it to landowners.
To be clear, i'm not saying we should stop building houses entirely. But as long as you allow housing to remain vacant, prices are driven by speculation not by actual supply. I believe we should both rehouse homeless people immediately and keep investing in eco-friendly collective, affordable housing.
Also, just because it's "vacant" doesn't mean it can actually be used to house homeless people. It could be undergoing renovations, or on the rental market.
10% doesn't seem entirely reasonable. Maybe bit high, but still if the vacancy is because renovation, waiting for new tenants either renters or owners. You want some slack in any market. And ofc, there is some number of second or third properties in cities like Paris. Maybe part of solution would be to ban these and AirBnB entirely. Only allow hotels and like to exist.
> Parkmerced is a neighborhood in San Francisco, California, designed by architects Leonard Schultze and Thomas Dolliver Church in the early 1940s. Parkmerced is the second-largest single-owner neighborhood of apartment blocks west of the Mississippi River after Park La Brea in Los Angeles. It was a planned neighborhood of high-rise apartment towers and low-rise garden apartments in southwestern San Francisco for middle-income tenants. It contains 3,221 residences (after sale of five blocks to San Francisco State University (SFSU)) and over 9,000 residents, and is one of four remaining privately owned large-scale garden apartment complexes in the United States.
On my block, just on my street, there are over a dozen empty garden apartments, 2- and 3-bedrooms, that have been empty since (more-or-less) the beginning of the pandemic lockdowns. Folks started leaving and no one has moved back in. Next to my house there are three empty apt.'s to the left, one to the right, and four across the street.
The owners haven't lowered rents though.
The theory is that they would rather keep the rents high and the apartments empty than lower the rents because if they do that it affects their ability to raise rents later on (rent control is the only way I afford to still live here. For better or worse my family pays less than half the market rate. However, as I am describing, the market rate is not "clearing the demand" or whatever the economic jargon would be. No one is renting at "market" rate right now.) The other problem is that rents going down affect the valuation of the property, something like that. IANAEconomist.
Anyway... There are literally hundreds of perfectly fine apartments ready to rent here in Park Merced, with the M line light rail going directly to downtown SF in about 20-30 minutes and a BART station in walking distance.
- - - -
Get this.
Some folks moved in to the place across the street on Monday, but then Wednesday the staff was here kicking them out: they were squatters. I spoke to one of the staff who told me that this was a group of people who were breaking in and squatting in units all over the property, that they had changed the locks on the house they tried to squat in, and that he had called the police, who asked if anyone was being violent (no) and then still hadn't shown up an hour later! They never did show up. The squatters moved all their stuff and their two dogs back into their vehicles and left.
This is one of the reasons rent-control is a bad idea. It is foolish to leave an unrented apartment empty, provided you can maximize your revenue when market conditions change. Only when locked into a low-rent does it make sense to keep it off the market. Not to mention it disincentives investment and improvements.
We need to make it easy to use the the housing we have, build more housing (of any kind) and subsidize those who need assistance.
Seems like rent controls are the issues. Causing markets to be inefficient. No surprises there. Get rid of them and maybe supply increases as it can better match demand and capability of renters to pay.
Markets are not a magical oracle of true value though, especially in our current, deeply distorted economy which has the rich gobbling up assets and increasing prices well beyond any livable standard, which is the point of TFA.
Isolating price controls as some kind of glaring inefficiency in an otherwise rational system sounds like ideology, not reason.
It should be manifestly clear that an unregulated market has not served us well for the issue of housing, not just for the indigent but for all non-wealthy individuals and families who spend well over 50% of their income now on rent or mortgage payments.
Attacking rent control in isolation is irrational. Yes it can create a bad situation for landlords in the absence of any other policies designed to mitigate the disaster we are in. But saying that "market efficiency" is the answer is just sticking your head in the sand.
In a world w/o rent control, how do you imagine things playing out here? If the landlord lowered rates now and got tenants (without rent control), then demand rebounds, does the landlord then increase the rent again? Wouldn't that put a lot of the new lower-rent renters back out on the street?
Anyway, the OP's point stands: there are perfectly good homes going empty. They aren't out in the woods. They are right here in SF.
Yes, terminate the contract according to local regulations. Rent again for higher price. Then those who can't afford would need to either move out to cheaper regions or find ways to pay the correct market rate.
That seems like it would make for a pretty precarious living situation for people who can't find ways to pay the correct market rate, eh?
The bottom line (no pun intended) is that the corporation that owns Park Merced has (presumably) done the math and they expect to make more money by keeping the apartments empty and eating the losses now (and paying the overhead of evicting gangs of squatters) so they can rent them later at the "correct" market rate (a pretty likely speculation, I'll grant them) than by renting them at a market rate that fills them up again now and getting locked in to rent control at the new, lower rates later on.
So, in other words, the poor people can't live there because someday soon the rich people will almost certainly want to live there again.
What you suggest would instead let the poor people stay in the apartments until the rich people wanted back in, so I guess that's an improvement?
But I don't follow how getting rid of rent control would incentivize supply increases?
> But I don't follow how getting rid of rent control would incentivize supply increases?
Leaving units empty, or locked into lower-than-market rates are going to reduce the average profitability of investments. Investment in new units is in part a function of how profitable they will be sell, or to rent out.
But honestly the incentive for bay area real-estate is there, what really is needed is the ability to build with fewer encumbrances.
> That seems like it would make for a pretty precarious living situation for people who can't find ways to pay the correct market rate, eh?
Yes, this is generally referred to as gentrification. But, renting, even to poorer people, nevertheless is still usually profitable, albeit with more risk requiring a larger portfolio.
There’s a massive housing shortage in the United States and it’s acting like a vacuum, sucking up wealth and diverting it to landowners.