Submitted by Blecher_onthe_Hudson t3_11a2qwh in jerseycity
DirectorBeneficial48 t1_j9pitsv wrote
That's a lovely argument, but none of that holds up in practice. Boston had the 3rd highest rent growth among the 100 largest cities in the country last month. NYC was 84th. Of the other two cities mentioned, DC was 69 and SF was 91. Jersey City clocked in at 38th.
Median overall rent (not growth) has SF at 9, Boston at 13, NYC at 14, and DC at 22. Jersey City is 7.
There's no correlation between more permits issued and either higher rents, or rates of increase.
An interesting note as you scroll down the article here - https://www.apartmentlist.com/rent-report/ny/new-york -
> If we expand our view to the wider New York metro area, the median rent is $1,984 meaning that the median price in New York City ($2,024) is 2.0% greater than the price across the metro as a whole. Metro-wide annual rent growth stands at 4.2%, above the rate of rent growth within just the city.
>
>The table below shows the latest rent stats for 12 cities in the New York metro area that are included in our database. Among them, Hoboken is currently the most expensive, with a median rent of $3,598. Newark is the metro’s most affordable city, with a median rent of $1,372. The metro's fastest annual rent growth is occurring in Jersey City (9.4%) while the slowest is in New Rochelle (-1.3%).
New Rochelle is in the aforementioned Westchester County that you brought up as being a culprit behind rising rents due to low permits, while JC has seen massive growth and the worst annual rent growth.
Blecher_onthe_Hudson OP t1_j9pjne3 wrote
The comparisons to the other Metro areas does not state that they are succeeding in meeting housing demand, only that they are creating at a much higher rate than the NY suburbs. One assumes that Bergen & Essex Counties are similarly low to the other NYC suburbs.
JC is not an island, it's part of a interconnected Metro area and cannot lower rents no matter how much it builds if new construction attracts people from areas that are not building to meet demand.
JeromePowellAdmirer t1_j9pqvsl wrote
I stopped reading as soon as they said "monthly rent change." That's such a noisy data set as to have absolutely zero relevance to the topic at hand. It takes a good 3-5 years to construct multifamily housing and the effects should be measured over a similar time span! They should also be measured on a metro area level, not a city level. Plus furthermore the Covid/remote work shock throws all the data out of whack.
DirectorBeneficial48 t1_j9pxdpv wrote
Dipshit, I also included a median overall, which doesn't have the month-to-month variance.
JeromePowellAdmirer t1_j9qdyqk wrote
- The median overall rent says absolutely nothing about whether a very recent building spurt lowers rents relative to the status quo.
- The median Jersey City unit is much newer than in any of those big cities. Unless you account for this your number will be biased high. Compare the rent of an old Jersey City unit to an old Boston unit, Jersey City is not more expensive. A new centrally located luxury unit in Boston is more expensive than a new centrally located luxury unit in Jersey City. Except Jersey City has way more of them. You're only observing Simpson's Paradox.
oekel t1_j9u7euo wrote
Maybe??? I seem to remember that New Jersey suburban counties are quite far ahead of New York suburban counties in permitting housing.
Blecher_onthe_Hudson OP t1_j9u9xz7 wrote
Do you have a source? I was just assuming from observation and trends. In general suburbs have opposed 'transit oriented development' that increases density around commuter rail.
I grew up in a LI town 35 min from Penn with 2 LIRR stops, a cute little downtown, and zero multifamily development.
oekel t1_j9uae1k wrote
For one, New Jersey has Mount Laurel Doctrine which basically requires all municipalities to plan for growth
DirectorBeneficial48 t1_j9pke2e wrote
Everyone is meeting housing demands. There are thousands upon thousands of empty apartments, condos and homes in every one of those markets. The rest of what you stated makes no sense and has nothing to do with anything. Your original statement was a rhetorical why housing was so expensive in this area, and laid the blame on the areas that weren't building.
As has been shown ad nauseum in this and in other posts, more units doesn't mean higher or lower rent. There is zero connection between more or less development and higher or lower prices.
objectimpermanence t1_j9pplwu wrote
You are literally denying reality.
What you are saying goes against the evidence that is generally accepted among economists and other housing experts.
Housing vacancy rates are near historic lows nationwide (source).
The pace at which new housing is built has lagged behind the household formation rate for years (source). The problem is particularly acute in coastal cities like NYC, Boston, and SF.
A constrained housing supply and low vacancy rates are good for landlords and existing homeowners, but they are bad for renters and prospective homebuyers.
These are basic economic facts that everyone in the real estate industry is aware of. These conditions form the basis of the investment thesis that professional real estate investors use to justify their housing investments.
>There are thousands upon thousands of empty apartments, condos and homes in every one of those markets.
Of course there are thousands of vacancies in NYC. It's a city with 3.5 million housing units. At any given point in time, some of those units will be vacant for any number of reasons. E.g., they're being turned over between tenants, they're being renovated, etc.
Sure, some of those housing units are kept intentionally empty as non-primary residences for the wealthy, but that is a small fraction of the total number of vacant units.
What matters is not the absolute number of vacancies, but the number of vacancies relative to the total number of housing units in a particular city in relation to the number of housing units in demand.
Blecher_onthe_Hudson OP t1_j9ps4tj wrote
>You are literally denying reality.
>
>What you are saying goes against views that are widely held among economists and other housing experts.
Never stops the "socialists" who want to solve problems created by government market interference with more government interference.
xTheShrike t1_j9q3j75 wrote
Socialists do not understand economics whatsoever. Artificial government controls create artificial scarcity which leads to higher prices.
Blecher_onthe_Hudson OP t1_j9q82ea wrote
Precisely how rent control in response to a housing crisis during world War II has resulted in a continuous housing crisis for the past 80 years.
objectimpermanence t1_j9pup9f wrote
Yep, I wonder how many people realize that some of the greatest urban neighborhoods were built before contemporary zoning regulations were even a conceived.
Also, people love to rave about how European cities are designed and then they oppose changes to local zoning and building codes that would actually allow us to replicate that typology in new construction here.
DirectorBeneficial48 t1_j9pwv0t wrote
Your link is for homeowner vacancy throughout the nation, including rural areas. The discussion involves the inclusion of rentals, notably in cities, and I also included a response as to how there's not increased demand, merely an artificial scarcity and artificially raised rates. Way to gaslight, but you're just a shithead tossing out other stuff to obfuscate what the discussion is.
In fact, a huge percentage - over double that of the overall rate - of rent-stabilized units in NYC for example, remain empty, not for "renovation", but because landlords would rather wait until they can change the laws to remove rent controls. https://www.thecity.nyc/housing/2022/10/20/23413894/vacant-rent-stabilized-apartments-nyc
Getting back to the original discussion that you tried to derail, you can repeat the same line about MORE UNITS = LOWER RENTS all you like and go THIS IS SOME BASIC SHIT, but there's literally zero connection between the two. There's no housing market trend in that direction. None. Your theory does not match with reality.
Every example the OP pointed out, shows zero correlation between those two factors. I could go on and on and have in other threads. There's no correlation.
I'm sorry you're so fucking stupid that you keep repeating the same dumb shit over and over, but that's a you problem. What you want to be true and what is, simply aren't. The reality that we live in has demonstrably shown otherwise.
There's. No. Correlation.
objectimpermanence t1_j9qceep wrote
You are the one who is arguing that the basic rules of supply and demand somehow don't apply to the housing market.
I work in finance. My work touches the real estate industry pretty closely. I know for a fact that certain people and institutions have made a ton of money because they identified the supply-demand imbalance in the housing market and figured out how to exploit it to their benefit.
I have been in meetings with housing strategists and investment professionals at large institutional investment firms. If I told them that there is zero correlation between housing supply and housing prices, I would be laughed out of the room. These are people who spend their days analyzing a dizzying array of data about the housing market.
I am not saying that the conclusions of these people are 100% accurate 100% of the time, but there is an overwhelming body of evidence to support the theory that housing prices are a primarily a function of supply and demand and that that the primary reason for escalating housing prices in this area is due to a shortage of housing units.
You are denying basic facts. You are just as bad as the anti-vaxxers who think they are better equipped than actual scientists to make evidence-based decisions.
I am done arguing with you.
DirectorBeneficial48 t1_j9qizni wrote
>You are the one who is arguing that the basic rules of supply and demand somehow don't apply to the housing market.
Cool, show me the evidence it does. I've looked it up a bunch of times. It isn't there. There's no correlation to the locales that have had the most development and the rent in said locales. It flat out is not there.
There's clearly another force behind simply "create more units" that all y'all don't want to bring up, which is greed.
I've shown the very basic steps elsewhere, so I'll copy/paste for you.
>I'll help you. Google up "US cities with the most development" (substitute some other synonym for development, such as "new buildings/homes" if you like). Now do the same for "Average/median rent by city in US". Hell, if you really want to get spicy, toss in a third factor and add in "US cities with the highest rent growth".
And the fact that you work with the exploiters of us is not a mark in your favor. You are stuck in your bubble that believes this whole cloth without actually looking at the very basics of the argument.
> I have been in meetings with housing strategists and investment professionals at large institutional investment firms. If I told them that there is zero correlation between housing supply and housing prices, I would be laughed out of the room.
Yea, no shit, they aren't around to want to hear the very underpinnings against their raison d'etre.
pixel_of_moral_decay t1_j9pnke8 wrote
Pretty much.
Most of this argument is to distract from stagnant wages. Building/maintaining buildings is crazy expensive.
Lots of new construction does drive up prices as shown by parts of Florida, Las Vegas among others. Induced demand in housing is is a long known concept.
But the intent to distract from wage suppression is not an accidental thing either.
objectimpermanence t1_j9py529 wrote
Yes, wages have not kept up with productivity gains.
But there is more to the story than induced housing demand.
You can build all the new housing you want in Camden or Detroit or Gary, Indiana. But the presence of new housing by itself isn't enough to make people flock to live in those places. People want to live where there are jobs and economic opportunity.
The problem in the NYC metro area is pretty simple. There are tons of good jobs and lots of economic opportunity here. It's one of the most economically productive regions in the country. But we aren't building enough new housing to accommodate the people who want to live here.
All of that means that the NYC metro area ultimately isn't living up to its full potential. Opening a new business like a restaurant or a retail store is that much harder when you have to pay your workers enough to afford exorbitant rents that are propped up by exclusionary zoning rules.
Silicon Valley is an interesting example of that. There has been a massive transfer of wealth going on there from young tech workers to landlords and incumbent property owners due to rampant NIMBYism that has restricted the housing supply there. People who happened to buy a house there 40 years ago and then did nothing to it are walking away with millions of dollars today. It makes no sense.
PixelSquish t1_j9q7v5a wrote
THe people that downvoted you are morons.
As a progressive I fight for higher wages, universal healthcare, affordable daycare and mandatory paid vacations and sick days for all. I also realize that we need to build a ton of housing, and as you say, not just anywhere, but where people need and want to live. That is the only way we can solve our housing price crisis.
objectimpermanence t1_j9qz0b3 wrote
Agreed. As a registered Democrat, I have to say that Democrats' inability to take serious actions to deal the housing crisis in major cities is a major embarrassment.
I roll my eyes anytime anytime things like expanded rent control get floated as potential solutions. SF, which probably has the strongest tenant "protections" in the country has already tried that along with a bunch of other band aid hippy-dippy solutions and they have all failed horribly.
Every time someone gets priced out of an expensive Blue state and moves to a suburb in a Sunbelt state is a win for Republicans.
It is one of THE defining social issues of our time. Inability to access affordable housing is at the root so many problems in our country. It is very disappointing that our most "progressive" cities have let this problem get so out of hand.
People need to stop making emotional arguments about the big evil landlords and developers and listen to the experts. Our major cities need more housing plain and simple.
PixelSquish t1_j9r1ij3 wrote
Perfectly said. It's an area where Democrats and Republicans are an agreement, by being nimby's. Republicans are all for small small government, but when it comes to strictly dictating What you can do on most of the land rather drastically, They are all of a sudden big government lovers.
Then you have liberals who are all about a more equitable society with wages and health care and housing but when it comes to the one solution that will actually help housing prices, building more were people actually need and want to live, they quickly change their minds about everybody's problems.
pixel_of_moral_decay t1_j9pnd0c wrote
It actually does hold up.
Boston is an example of induced demand for housing. It’s a growing city because of its newer housing especially among younger people.
People wouldn’t build if they didn’t think they’d get a ROI. Nobody builds expecting to lose money with dropping rents.
DirectorBeneficial48 t1_j9px9j3 wrote
So more buildings don't lower rents. Glad we agree.
PixelSquish t1_j9q7lc3 wrote
Incorrect. You have to build enough units to equalize supply and demand.
This isn't rocket science. But it is to dictators that want to rule land like fiefdoms and keep oppressing the middle and lower classes with these insane housing prices due to a huge supply gap.
DirectorBeneficial48 t1_j9qhdld wrote
You're welcome to show me the correlation between more development and lower rents here in the US. Spoiler alert: there is none. I know because I've looked it up.
I'll help you. Google up "US cities with the most development" (substitute some other synonym for development, such as "new buildings/homes" if you like). Now do the same for "Average/median rent by city in US". Hell, if you really want to get spicy, toss in a third factor and add in "US cities with the highest rent growth".
There's no correlation. Look at my first response in this thread.
>Boston had the 3rd highest rent growth among the 100 largest cities in the country last month. NYC was 84th. Of the other two cities mentioned, DC was 69 and SF was 91. Jersey City clocked in at 38th.
>
>Median overall rent (not growth) has SF at 9, Boston at 13, NYC at 14, and DC at 22. Jersey City is 7.
The particular link had rent growth from last month. If you're completely unaware and clueless and don't know what rents have grown like over time, feel free to look those up, too.
PixelSquish t1_j9qhm7y wrote
Let me know if you ever understand the concept of supply and demand and please show me a point in recent history where we haven't been millions of units short of demand in housing. It doesn't matter if you're building housing if you're so far behind demand. It's not going to do much until you get closer and closer and we're not even remotely close.
If you can grasp those simple concepts please let me know and then we can discuss further.
DirectorBeneficial48 t1_j9qibdl wrote
You dummies keep arguing SUPPLY AND DEMAND like it's some miracle thing that solves it all. It isn't.
I'm showing my work.
I'm showing you how to view said work.
"Just build some more high rises, rents won't keep going up like this, I swear, just build more. Supply and demand, bro. One more building, we'll get there." You're like a drug addict who can't get off their high.
If it did, the numbers would not be what they are. Once you slow people get past the fact that this basic concept isn't the reason behind rent prices, then we can discuss further.
PixelSquish t1_j9qiq0f wrote
I mean you are really stupid at this point. There can't be a reduction of prices of an essential product that is so far behind in supply it's insane.
I'm surprised you can walk and chew gum at the same time.
As a progressive things like universal healthcare, higher wages, mandatory pay leave, reducing work hours, strict overtime pay, and other things, another huge goal of mine is to help solve the housing crisis we have that is destroying the middle and lower classes.
The only way to do that is to get towards an equilibrium of supply and demand. In the context of this issue it is so fucking basic that if people don't grasp this they are simply part of the problem.
DirectorBeneficial48 t1_j9rpbvn wrote
We're not behind in supply. There are more empty homes than there are unhoused people even. There are hundreds of thousands of units unrented in NYC alone. The argument that building more and with more density will reduce rents has literally not held up anywhere. I'm just going to respond to this by calling you a fucking idiot who isn't showing their work because that's literally all you're doing.
You don't have a fucking clue because your argument is not holding water. There are other solutions. BUILD MOAR is not the answer. You're a fucking idiot who isn't showing their work
PixelSquish t1_j9rpub6 wrote
You are posting numbers with no context, because you want to ignore reality.
https://www.nar.realtor/magazine/real-estate-news/16-million-homes-vacant-in-us
Small town America is dying, as you see from this list, the highest ratio of empty homes are in places where nobody wants to live or can't be productive enough to live. Housing in those places is pointless and not solving anything. This is basic data and knowledge. Empty houses in those places is a pointless statistic.
Sure there are empty units sitting in populated areas where the wealthy park their money, and that should be addressed, I am all for that too, but it is nowhere near the big part of the problem.
You haven't posted an iota of work. Want me to link one of the many supported articles that shows we are over 4 million housing units short where people need and want to live? I suspect you'll gloss over that and repeat your nonsense that completely ignores reality and common sense.
DirectorBeneficial48 t1_j9rqxip wrote
https://www.thecity.nyc/2022/5/17/23108792/nyc-apartment-vacancy-rate-housing-emergency
>New York City has more vacant apartments overall than it did five years ago even as units with monthly rents under $1,500 have dried up, according to a new report that also shows maintenance issues are surging across the board.
>
>...
>
> The report found that 4.54% of all New York apartments are vacant as of 2021. That’s up from 3.63% in 2017, the last time the survey was completed.
Simply building more does not equate with lower rents. You're a fucking idiot who isn't showing their work
PixelSquish t1_j9rrn3d wrote
Those numbers are still drops in the bucket of what we need. And it would NOT be profitable to only charge higher rents, as that article states about most vacant spots, if there was enough supply where it would be a lot harder for landlords to hold out for higher rents. Now they can do it, and people like you make it possible. Renters and buyers would just have more supply to choose from if you let housing be built, and the prices would stabilize. That is the problem.
Tell me, why do you want to continue to fuck over the middle and lower classes by keeping housing prices so high.
Wall Street is buying up real estate like mad. And they'll gladly tell you why. Housing prices are artificially inflated because there are way too many obstacles to building new housing, so they can make bank due to lack of supply.
Do you work for unethical exploitative Wall Street corps? Because then this would make sense.
DirectorBeneficial48 t1_j9rsnaf wrote
>Tell me, why do you want to continue to fuck over the middle and lower classes by keeping housing prices so high.
You're even dumber than I think you are, and I think you're incredibly fucking dumb, because my own personal solutions to this problem are way more helpful to the poor and middle classes than BUILD MOAR. Think Mao.
You're a fucking idiot who isn't showing their work
badquarter t1_j9qodgb wrote
You're forgetting more people are still being born. You're forgetting that our market isn't isolated.
If Manhattan, Brooklyn, and Queens aren't building and we are, we start to make sense for people to move here which drives up prices. We are a secondary market to Manhattan and would need to see a ton of housing built in Manhattan for our rents to be affected. A ton.
With that said, the velocity at which these new buildings fill is further evidence of the shortage of supply.
DirectorBeneficial48 t1_j9rq69v wrote
Christ, you can't even follow your own logic here. If BK and QN aren't building, but JC is, would it not then logically follow that (non rent-controlled) rents in BK and QN would be skyrocketing far past the point of JC, which is building at a very fast rate?
Spoiler for ya, that's not the case.
That's not happening, and I repeat myself for the umpteenth time now, because greater supply has zero correlation with lower price.
badquarter t1_j9rtqno wrote
> would it not then logically follow that (non rent-controlled) rents in BK and QN would be skyrocketing far past the point of JC, which is building at a very fast rate?
No, bro, lol. The opposite. I'm explaining why rents are going up here despite building.
Reinforcing what I said about our market not being isolated - there is a point of price resistance in NY where the consumer will then consider other options. And when BK and Queens get to a certain point, they consider JC. Then we fill up our new supply and prices still climb.
I'm saying we would need more development in Manhattan so demand wanes in BK, Queens, and JC.
DirectorBeneficial48 t1_j9rytpg wrote
Nearly all of BK and QN are currently cheaper than most of JC. Again, your logic is faulty - it's more expensive (JC) where there's more development.
Once again, there's no correlation between greater development and lower rents.
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