Housing (Supply Crisis & Public Policy)

Longfellow said:
Idk, is traffic even real? I grew up in Dover and I’m there all the time. It’s gotten significantly more denser with that typology you describe. People complain about the traffic but I’ve literally never had an issue. The population density or politics don’t support transit but you can technically build to the sky without building a single bus or train, it just sucks mentally and makes people who are more discerning eventually move to Boston. And yes if we were centrally planning we would build up city centers and let suburbs die on the vine, but we can’t do that, so fuck it, densify the suburbs for those who want them.
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I don't imagine the traffic within Dover or any other exurb would become unmanageable, but if you put an extra few hundred thousand commuters on the road, it would be hell for the highways. Park-and-rides could solve that for inner core commutes, but 128 commuting could be 24-hour gridlock.

In a perfect world, I agree with you in that increased traffic would just compel people to live in denser, transit-rich areas, but the reality is that those people vote and might be a large enough contingent to get state gov to spend billions on highway widening instead of transit. Hopefully not.

ritchiew said:
  • I'd really like to know if anyone has any ideas of a relatively straightforward zoning law that could 1) be applied statewide, 2) encourage new housing in the inner core, 3) encourage new housing in the suburbs and 4) pass a statewide referendum. I'm optimistic there's something, but I can't think of any.
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I think an overlooked benefit of the YIMBY bill revision that brought back parking minimums on lots far from transit is that it could actually create an effective incentive structure where it's cheaper to build near transit.

ritchiew said:
  • You mention how this could work in conjunction with other laws like the YIMBY bill, and I think that is really important. I don't know how that bill will turn out, but there are dozens and dozens of zoning changes that need to happen to encourage new housing construction. Some municipalities will try to subvert whatever progress is made, then we'll need to win dozens more political battles to make sure housing is actually built. This is a long fight, and fixing minimum lot sizes has to be one step. We'll never know the exact, optimal order of changing laws to fix the housing crisis. Even if there were an exact, optimal order, you'd never be able to convince and coordinate everyone to follow it. So when there is a politically viable opportunity to chip away at the problem, take it. This is one of those opportunities. Take it, then move on to the next.
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Agreed. I don't think I would ever actually vote against pro-housing policy. I'm mostly just bemoaning the lack of a grand vision for one true, bulletproof housing plan. C'est la vie.
 
Globe article:

Investor for pensions has invested billions in Boston, but now is hitting the brakes, says Wu's policies and possible rent control make other markets more appealing for investment.

"As chief executive of National Real Estate Advisors, which manages about $10 billion for roughly 120 institutional clients, Kanne is constantly weighing opportunities in some 20 markets across the country from Charlotte, N.C., to San Francisco. Sure, there’s incredible demand for new housing in Boston, but it’s too hard to get a return on his investment here."

"On top of uncertainty, Kanne weighs a city’s regulatory climate, from how long it takes to get projects through the approval process to the number of requirements, such as energy efficiency standards and affordable housing set-asides.

“I’m not suggesting that none of those things are good,” he said, “but what I can say is without a doubt, the fewer restrictions you have, the more likely it is that a project is going to pencil, and the more likely it is that capital providers like me will choose your city to put their money because there’s a lot less risk.”

But City Hall views these regulations differently. They exist for a reason — to build a Boston that’s better for the environment and more affordable for the people who live here. And the city’s notoriously drawn-out process ensures residents get a voice in development, too."

"... interest rates and materials costs are pretty much the same everywhere. And Kanne is investing elsewhere. Over the last year, [rather than Boston] he’s put capital in cities like Washington, D.C., and Atlanta..."

"Real estate investors are once again circling the Bay Area [San Francisco] looking for deals. Kanne said what’s helped is the attitude of the new mayor, philanthropist Daniel Lurie, who has “put out the welcoming mat to businesses and capital.”"

"“If you want to kill housing production, put rent control in place,” said Kanne, “and you’ll lose investors like me who will go somewhere else.”
Not that long ago, investing in office towers or luxury condo buildings in Boston felt like a sure thing. Not anymore. Some predict it could be another decade before we see another construction boom."

Full article:
www.bostonglobe.com

He’s invested billions in Boston. Now one big real estate investor is hitting the brakes. Here’s why. - The Boston Globe

If investors aren’t deploying capital into Boston, developers who rely on that capital can’t build their projects.
www.bostonglobe.com www.bostonglobe.com
 
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RandomWalk said:
At the federal level, the Faircloth Amendment hamstrings growth of public housing by limiting the unit count to the number in existence on October 1, 1999. Without the means to increase the number of publicly funded units, we are stuck with the private sector. Yanking IZ removes one of the few tools available to get the private sector to fill the gap.
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Damn, that’s crazy. Who in their right mind thought that was a good idea?
 
There is also a helping of “no one should have it any easier or better than I had”.
 

The package would cut some red tape around environmental reviews for new housing, which can be onerous and lead to months of delays if local opposition challenges a development with excessive reviews, studies and appeals. Such delays can drag out a building process for months or longer, driving up costs.

The legislation would allow communities to use existing federal development grants to build new housing; and reauthorize and update an existing housing program to spur the construction of more affordable housing.

[...]

Currently, the Department of Housing and Urban Development regulates manufactured housing, which must be built on a chassis, and states regulate modular housing. The legislation would expand the definition of manufactured housing to include structures without a chassis, which would make it cheaper to build and allow for more varied designs, making way for homes with multiple stories and larger footprints.

With more types of factory-built housing under the federal umbrella, builders would be able to standardize and expand their designs, delivering communities structures that are cheaper and faster to put up than stick-built housing. The bill also would update mortgage lending standards for manufactured housing and expand access to financing, and allow an existing federal program to provide grants to communities so they can maintain and protect existing manufactured housing.

[...]

The bill also adds a key demand from Mr. Trump: new limits on institional investors in the single-family housing market. A piece of the measure that was spearheaded by Senator Raphael Warnock, Democrat of Georgia, would bar investors who own 350 or more properties from purchasing a single-family home, though they would not have to sell properties they already own. While the bill includes a carve out for homes that are newly built explicitly as rentals, investors would only be allowed to hold onto their newly built rentals for seven years, after which they would be required to sell them.

The legislation would impose strict rules on institional investors when they sell homes, to ensure individual buyers have ample opportunity to purchase them.

While limits on investors have strong bipartisan support from voters, housing experts are doubtful that it will make a significant dent in the housing crisis, and some believe it could have a detrimental effect, potentially discouraging investors from building single-family homes. Most big firms are no longer buying foreclosed homes or homes listed by ordinary sellers. And, of the 72.6 million detached homes in the country, 85 percent are owner-occupied, according to 2023 census data.
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If the "ban corporations from buying SFHs" is the red meat needed to get congress to swallow the vegetables, sure, fine.
 
https://www.wgbh.org/news/local/202...control-will-only-worsen-state-housing-crisis

Pray that rent control does not get passed this fall.

As much pain as skyrocketing rents are generating for overly-burdened renters, I can't imagine a more efficient way to deter developers--already apprehensive about surging construction materials costs, the challenge of getting financing, projects generally just not penciling--from submitting proposals for desperately needed housing. Which of course will only deepening the crushing supply/demand imbalance...
 
Agreed but--existing owners have profited massively over the last 20 years and renters have paid for all of it. We should all be paying the price for it. Maybe it's time that we all go down together.
 
Longfellow said:
Agreed but--existing owners have profited massively over the last 20 years and renters have paid for all of it. We should all be paying the price for it. Maybe it's time that we all go down together.
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I'm with you, aside from the going down together. We 100000% need more housing and our approval/construction process is waaay to slow and brittle against minimal community pushback, but relying purely on incentivizing the private sector is also an issue.

Developers and landlords aren't suffering as a result of lack of affordability and rising rents, renters are. So of course renters are looking for an immediate solution to their problems. Yes, helping private developers build a ton will eventually slow rent increases in the long run (the many years it will take to build to demand), but why can't we also protect renters in the short term? Developers are incredibly reluctant to reduce rent unless they have no choice. Their loans are linked to the face value of rents and they desire to algorithmically price fix.

It's always a bit odd and ingenuine to me to see developers talk about how they want to help the housing crisis. As if it is a benevolent goal of theirs to intentionally create a system in which they eventually make less profit. If that were the case they would be on board with the rent control measure, it doesn't apply to units that are less than 10 years old and only caps annual rent increases at the lower of 5% or the Consumer Price Index. That's effectively what they say they want to do, just as long as they are not being held to that standard.

We should strive to both place protections for people today and try to build as much new housing as possible for a large range of wealth brackets tomorrow. Yes, we are bogged down by process and wealthy senior homeowners, but for-profit developers have no interest in letting these things happen either. The city tries to implement high standards for inclusionary zoning, the state votes for rent control, and developers hold the housing crisis over renter's heads.

DC has rent control very similar to what is being proposed AND they also built a lot of TOD. They are probably the best performing comparable city that managed to slow down rent growth post-covid (I don't think that we should be talking about Austin and Sun-Belt cities at all).

The problem is not rent control, it's acting like rent control is some silver bullet and then doing nothing else. Rent stabilization is an important tool for the immediate term, where an annual rent increase and the prospect of a very expensive move is what kicks someone out of their home or their city. It should be yes to rent control AND legalizing as-of-right dense zoning AND speeding up the approval/ permitting process AND single-staircase reform AND legalizing ADUs AND abolishing the Faircloth Amendment to allow social housing to compete with the private market. An abundist agenda that focuses solely on fixing the housing crisis by making developers more profitable while dismissing the immense wealth inequality and destruction that private forces have brought about is woefully missing the moment.
 
The economist they just interviewed in WGBH was saying that it would take two years of building like crazy to bring rents down. To me that seems like an impossible timeline. If your only goal was to fix affordability, find new mayors and legislators for Boston, Somerville Quincy, Chelsea, Everett, Brookline, and newton that want to build to the sky. I’m starting to think that will never happen and we should just take this wrecking ball to the market and be done with it.

Cause if you think about it, rent isn’t to cover maintenance, it’s to cover mortgage payments to the bank. My buddy was paying under market for his 2 bed with his girlfriend. Landlord was still making money renting under market and then made a lot of money selling the building. New landlord raised rent by 1k, still complains to my buddy he isn’t making money off the property. So now the only person happy and making money is the bank. The money is literally being evaporated, Why do we allow that? Thats the arg for rent control, is that that value speculation becomes pointless. But this policy as designed is too restrictive.
 
Longfellow said:
The economist they just interviewed in WGBH was saying that it would take two years of building like crazy to bring rents down. To me that seems like an impossible timeline. If your only goal was to fix affordability, find new mayors and legislators for Boston, Somerville Quincy, Chelsea, Everett, Brookline, and newton that want to build to the sky. I’m starting to think that will never happen and we should just take this wrecking ball to the market and be done with it.

Cause if you think about it, rent isn’t to cover maintenance, it’s to cover mortgage payments to the bank. My buddy was paying under market for his 2 bed with his girlfriend. Landlord was still making money renting under market and then made a lot of money selling the building. New landlord raised rent by 1k, still complains to my buddy he isn’t making money off the property. So now the only person happy and making money is the bank. The money is literally being evaporated, Why do we allow that? Thats the arg for rent control, is that that value speculation becomes pointless. But this policy as designed is too restrictive.
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I think a "burn it all down" approach is in the long run going to have the biggest impact on renters and low income people who can't/won't/shouldn't have to relocate when the regional economy sinks. I'll grant you, burning the regional economy will probably have the effect of long term rental price reduction, but this seems like the macro version of saying crime is good because it keeps local property values down.
 
I agree, tho it's interesting to hear how people on Reddit talk about the Somerville, Cambridge, etc. of 20-40 years ago. There are a ton of people who just flat out would trade everything for it to be 1996 again. They don't think the last 30 years have made us happier (even if we are much safer). I guess that's off topic tho.
 
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Longfellow said:
The economist they just interviewed in WGBH was saying that it would take two years of building like crazy to bring rents down. To me that seems like an impossible timeline. If your only goal was to fix affordability, find new mayors and legislators for Boston, Somerville Quincy, Chelsea, Everett, Brookline, and newton that want to build to the sky. I’m starting to think that will never happen and we should just take this wrecking ball to the market and be done with it.

Cause if you think about it, rent isn’t to cover maintenance, it’s to cover mortgage payments to the bank. My buddy was paying under market for his 2 bed with his girlfriend. Landlord was still making money renting under market and then made a lot of money selling the building. New landlord raised rent by 1k, still complains to my buddy he isn’t making money off the property. So now the only person happy and making money is the bank. The money is literally being evaporated, Why do we allow that? Thats the arg for rent control, is that that value speculation becomes pointless. But this policy as designed is too restrictive.
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I believe you're referencing the Jonathan Gruber article right? He's comparing the length of time from application to completion in LA (4 years) to Nashville (2 years in a not really comparable city) - "The timeline right now is four to five years. The timeline could be two years. If we want to address this in the near term, we can." I'm comparing the amount of time it would take to build enough housing to meet demand in the region (Healy's housing plan stated the goal of 222,000 new units in ten years). I have other critiques and apprehensions of Gruber's argument, but they may not be as relevant to your post. Additionally, many people have already mentioned the macroeconomic climate that have more of an effect on slowing private development than any one mayors policies.

I'm with you in that the market needs to drop and that we need to build more housing, home values can't be expected to rise forever and demand-supply is very unbalanced. But in anticipation of a crash we need to protect the people who are most vulnerable, not just incentivize profits for those who are already well off. There's a lot we can do to still incentivize the market in a number of other ways while instituting rent control. And we can even go further by funding guaranteed affordable social housing to build housing and increase supply. What do you feel like is too restrictive?
 
samsongam said:
I believe you're referencing the Jonathan Gruber article right? He's comparing the length of time from application to completion in LA (4 years) to Nashville (2 years in a not really comparable city) - "The timeline right now is four to five years. The timeline could be two years. If we want to address this in the near term, we can." I'm comparing the amount of time it would take to build enough housing to meet demand in the region (Healy's housing plan stated the goal of 222,000 new units in ten years). I have other critiques and apprehensions of Gruber's argument, but they may not be as relevant to your post. Additionally, many people have already mentioned the macroeconomic climate that have more of an effect on slowing private development than any one mayors policies.

I'm with you in that the market needs to drop and that we need to build more housing, home values can't be expected to rise forever and demand-supply is very unbalanced. But in anticipation of a crash we need to protect the people who are most vulnerable, not just incentivize profits for those who are already well off. There's a lot we can do to still incentivize the market in a number of other ways while instituting rent control. And we can even go further by funding guaranteed affordable social housing to build housing and increase supply. What do you feel like is too restrictive?
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In reference to the last paragraph in the article on the deal he’d make to help renters: “…in return for which we will support the kind of permitting reform that in two years allows us to get in place the housing stock that we need to bring rents under control.”

So as far as the govs plan goes, I don’t think Mass is going to or wants to build 220k units in ten years. Maybe that’s fatalism but it’s where I’m at
 
Yeah he's proposing income-based tax reductions to renters that will reduce government funding without affecting private landlords (sounds a lot like Section 8). Again, why must we continue to reduce public funding in order to protect private wealthy interests? The private market shouldn't be the only option and we can't keep propping up the wealthy. I don't think a small tax credit will fix anything, near or long term. It's the exact sort of slow government dismantling in favor of private interest that neoliberal centrists have been proposing for decades. Gruber spells it out plainly - "Usually you hear Democrats talking about regulatory barriers, but this is really something where the center left has really coalesced with the center right on this".

I get the nihilism around it all, but if you think the market should crash then shouldn't we try to make life easier for renters first before landlords and developers? We're in a crisis, but there are some positive soft signs from pols. We are exploring single staircase, we've passed some ADU laws, MBTA Community laws are being strength tested, and there are lots of rezoning initiatives happening. It's far from enough, but it's not nothing. There's lots of awareness and now it's everyone's job to push it further.
 
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