[Chirono]

I still find it strange that housing is expected to be an appreciating asset class, rather than a depreciating one that requires continual investment to counteract wear and tear etc. I understand that this is largely by design, but it seems odd to me how much this is accepted as fundamental to properties, rather than something that’s been constructed.

[baxtr]

It's mainly about the location and property value and not so much about the asset built on that property.

[cm2187]

Population growth. The city centre doesn't expand but the demand for it does.

And logically it should also be a hedge against inflation. I am not sure that our modern economies have the stomach for what it takes to rein in inflation (too leveraged).

[arcticbull]

Zoning. The city center is free to expand upward just about as much as we let it, but the problem is we don't let it so that we can enrich the existing landholders (they are the voting class after all).

The city of San Francisco is a prime example. The city makes is utterly impossible to build anything. From 2012 to 2016, SF metro added 373,000 jobs and only 58,000 new houses. The entire western half the city is hard-capped at 4 stories for no reason. There's a whole wikipedia page on it. [1]

If you let supply meet demand, the cost of housing converges around the cost of construction give or take, just like in Japan which has seen ~0% inflation-adjusted housing price growth since the mid-90s. [2]

This is a simple problem to solve. Allow construction, invest in transit.

SF is so obstinate that it's short 82,000 units in its submission of a conforming housing element to the state. [3] The fun part is if they fail to produce a conforming element, the builder's remedy kicks in and the city loses its ability to deny housing (and new builds don't have to go through CEQA). [4]

Really in my opinion the Builder's Remedy should the default state. We should do what Japan did and federalize zoning. The federal government does have precedent. At least according to the "trillion-dollar coin" guy, Carlos Mucha. [5]

[1] https://en.wikipedia.org/wiki/San_Francisco_housing_shortage

[2] https://fred.stlouisfed.org/series/JPNCPIHOUAINMEI

[3] https://www.sfchronicle.com/sf/article/housing-California-co...

[4] https://www.hklaw.com/en/insights/publications/2022/10/build...

[5] https://twitter.com/mucha_carlos/status/1420815462342959105?...

[cm2187]

Well, Japan hasn't seen population growth.

I have a lot of sympathy for deregulation and think it should be the primary tool, though many cities also have a character and you can't replace every construction with a high rise building without destroying the city. Think of Paris or London.

[arcticbull]

> Well, Japan hasn't seen population growth.

I don't know why this is everyone's immediate reaction. I'm saying housing is governed by supply and demand. If you want to drop prices you can either increase supply or decrease demand. They allowed supply to meet demand by increasing supply into flat... ish demand. ([edit] SF and Tokyo both grew ~10% from the mid 90s). So the system works :)

> I have a lot of sympathy for deregulation and think it should be the primary tool.

Great me too.

> ... though many cities also have a character and you can't replace every construction with a high rise building without destroying the city. Think of Paris or London.

Think of Hong Kong. A wonderful city. It's very different from the 50s when it was basically the same height as SF. I don't think anyone misses that. ([1] before, [2] after - I'd hardly call that ruined).

Yes, construction will change the character. But so what? Look at SOMA. Do you miss the old warehouses? I don't. And I certainly wouldn't miss the mishmash of almost identical 4 story buildings in the Sunset. They ain't no painted ladies is all I'm saying. Or much of the Mission. Honestly the entire SF affordability crisis would disappear if the Sunset was zoned 6 story instead of 4.

Embrace change!

[1] https://www.mardep.gov.hk/theme/port_hk/en/p1ch6_1.html#

[2] https://en.wikipedia.org/wiki/Victoria_Peak#/media/File:Hong...

[ericmay]

Hong Kong is a fragile anti pattern of artificially high density enabled by fossil fuels. We don’t want that (though it’s less bad than the suburbs, but just barely).

What we need to continue to strive for is medium density, where you have a mix of housing types and transit options, and also work options.

In this mode you have a good density level that is in harmony with the surrounding environment, but you can also do things like fix your own house or make changes or improvements. These types of neighborhoods also offer multi-generational living and better social interactions.

[arcticbull]

In terms of carbon footprint, Hong Kong is actually very good.

2021 is showing about 4.37 metric tons per capita, and if you assume the rough contribution of power remained constant after 2011 ([1]) the overwhelming majority of that continues to be simply their almost complete reliance on coal, natural gas and oil power. If you exclude power, the per-capita CO2 emissions are around 1.6T

For comparison the lowest CO2 footprint city in the USA is New York at 5.38 and second-highest is San Francisco at 7.12 [2].

The HK figure is from 2021 while the US figures are from 2019 so that's not entirely fair. In 2019, HK had roughly 6T per capita CO2 emissions, putting it directly between NYC and SF - the two lowest emitting cities in the US.

With respect, I do want that! I want that very much.

[1] https://www.worldometers.info/co2-emissions/china-hong-kong-...

[2] https://www.magnifymoney.com/news/cities-with-largest-co2-fo...

[dmitriid]

> you can't replace every construction with a high rise building without destroying the city. Think of Paris or London.

There's a living example of that: Stockholm. They destroyed the center of the city in the 50s-60s and replaced it with high-rise buildings and a highway [1] [2]

They botched it so badly that you can't even properly see the city hall the way its architect intended.

[1] https://goo.gl/maps/q8wxq3UWvSU5yDmD8

[2] https://goo.gl/maps/7uVYivYFQvmpWVGR6

[soulofmischief]

You had me until "federalize zoning". That's a huge step in the wrong direction. We need to fix local politics, not give the already overextended federal government even more control over states.

[arcticbull]

My argument is simply that the further you remove the decision makers from the decision impact the less involved they'll be. Normally this is a problem, but in cases where the issue is that decision makers are too close this becomes a solution.

So far the state of California has been the one to allow duplexes, California has been the one to require new construction in SF, California has been the one to allow density near transit etc, all while the local councils fight tooth and nail. Atherton even shut down their Caltrain station so they didn't have to comply!

I want less control so I want to pull that up to a higher level where all but the most egregious abuses will be completely ignored. The Feds couldn't care less about a shadow over a park. An "already overextended federal government" running this is a feature! :)

[soulofmischief]

No amount of justification can uphold such federal zoning legislation.

The traditional model is that parent governments offer benefits which embedded governments can access by adhering to certain mandates. This is the exact situation now where cities in California are already ignoring housing regulations.

Moving zoning responsibilities up the chain of command won't fix this, unless your plan is to send in the National Guard. We need to fix the broken relationship between state and city. I don't understand where federal government comes into this.

[arcticbull]

> No amount of justification can uphold such federal zoning legislation.

Housing is interstate commerce, and the federal government has overruled local zoning rules in the past (satellite dishes in Chicago of all things). It appears to be quite legal, constitutional and precedented.

> Moving zoning responsibilities up the chain of command won't fix this, unless your plan is to send in the National Guard. We need to fix the broken relationship between state and city. I don't understand where federal government comes into this.

The ideal law would be similar to Japan's model: the federal government says housing is permitted in all zones and sets some consistent rules about what you can build and where. This framework would remove the silly arbitrary rules set up by councils to preclude reasonable land use in lieu of clear, consistent federal rules. Federal government sets the framework, municipalities execute.

Worth a read if you're curious what I'd like to see. [1]

[1] http://urbankchoze.blogspot.com/2014/04/japanese-zoning.html

[cudgy]

Is SF obstinate or are the employers that insist on building their businesses there and attracting employees from other areas despite a lack of housing for them the obstinate ones?

[arcticbull]

Yes obviously it is the people who want to live there who are wrong. How dare they?

It's funny, especially considering all the 800K people who already live in San Francisco are the beneficiaries of previous liberal zoning rules - who are now pulling up the ladder behind them. The city was like 300K people in 1900. If they'd stopped building houses then, that would be the population now. I wouldn't be here, and assuming you live in SF, neither would you.

Folks just out here picking an arbitrary point in time and saying, whelp, I'm here, that's good enough for me. No new buildings! No up-zoning. No densification. No duplexes until the state forced it through with S.B. 9.

Without even stopping to consider the benefits of density: diversity, like actual diversity ala New York. Transit. Infrastructure. A tax base. Stuff we can use to have nice things.

But I guess my real question is, I own the land, who are you to stop me from developing it as I see fit?

[cudgy]

So, you are arguing that the existing population should want to have their lives upended, real estate taxes raised, schools over-crowded, family and friends priced out of their homes, quaint neighborhoods turned into skyscraper projects, and endless highway and infrastructure projects to accommodate the employees of new industry when they are happy with the status quo?

[pharmakom]

Who said anything about highways?

[wiseowise]

People are infinite resource (relatively speaking), land and houses are not.

Also, some places disproportionately attract more people. (Just like attractive people are disproportionately attracting more attention than “uglies”)