[xg15]

What I don't quite get is how government of this city is being planned. Right now, it's basically Disney world, a huge privately owned development project. Will this eventually become a municipality of its own or are they planning to build a completely privately-owned city?

(Not from the US though, so I might be missing some details on how local government works in California)

Also yes, social housing, walkable neighborhoods and all that sound nice, but promises (and renderings) are cheap. It's not clear if this has any resemblance to what will actually be built.

[dimva]

Honestly, if you want a truly progressive city government in California, you probably need it to be 100% private. If it's public, the regressive California constitution comes into effect, and now you can't make property taxes be high enough to pay for city services, you can't increase the property taxes on long-term landowners, and those low tax rates get inherited by the property owners' heirs. You have to pay for city services with income/sales taxes. It's basically feudalism.

With a 100% private development, you can have a land value tax - it's legal if you just call it rent, and you can increase it however much you want (at most it's capped to 5% + inflation, a lot higher than the 2% (not inflation adjusted) cap for property tax increases).

And no, this won't be social housing. NIMBYs will say they want social housing, but they won't vote in taxes to pay for it (in CA, every tax increase must pass in a ballot referendum), nor do they actually want it built anywhere, either. Because only private money is being used for this development, it will mostly be market-rate housing, and that's fine. Or most likely, it will be nothing, since rural NIMBYs will block it.

[xg15]

Ok, but wasn't the whole point of this that market-rare housing is becoming unaffordable, hence so many homeless? So how will this project then help reduce the homeless population?

[dimva]

Any increase in the number of homes reduces the homeless population. There are so many homeless people in CA mostly because there just aren't enough homes for everyone there. It won't completely solve homelessness - many people living on the streets now need social services and therapeutic help before they can afford any rent again, but there's plenty of homeless people in California with fulltime jobs paying like $30k/year (around the median salary in France). If you build enough homes, these people would be able to find housing, and social services would be less strained for the people who really do need help.

[xg15]

That sounds a bit like "the reason for this traffic jam is clearly that there are no enough lanes".

Evidently, there are enough buyers/renters around who can afford the higher prices and are able to price out the $30k/year group. So what would prevent rent or prices from rising to the same unaffordable levels in the new development, if there is still demand from this higher-paying group?

I feel if the market rate becomes unaffordable for middle-class fulltime employees, then you have an inequality problem, not a supply problem.

[Anticlockwise]

Well, the Georgists argue that a LVT plus developer friendly laws would prevent prices from rising too high. LVT taxes the value of the land, not the property, so if you have expensive land (somewhere people want to be), you're incentivized to build densely to earn profit from it.

It's not clear to me that's sufficient. You may also need something like a property profit tax to reduce speculation on housing.