If there's a scenario where increasing supply DOESN'T lower rents, then not increasing supply will raise them even faster
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Replying to @AustenAllred
If that's true though, and rents are directly tied to supply, why would there be opposition to rent control on new developments? The increase in supply was going to drive the rent down naturally anyway, right?
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Replying to @ScubaForDogs @AustenAllred
Rents are not "directly tied to supply", they are "generally tied to supply". It's not a direct 1:1 relationship, it's a trend. Marketplaces always have pockets of irrational behavior. You are taking "pockets of irrational" and extending it to "markets don't work".
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I am in San Mateo county. No rent control. Pop: 750k If we add 200 units next year rents don't change. 2000 units? No change. 20000 units? Probable change. 200000 units? Complete and utter change.
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There is a point somewhere between 20k units and 200k units where rents will change. The point is imprecise, and it will face some natural human resistance. But the points does exist.
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Replying to @gatesvp @AustenAllred
Why rely on it to occur 'naturally' though? That's the part I don't trust. Why not calculate what the rents SHOULD drop with that increase in supply, and fix the rents at that rate? So there's no bait-and-switch.
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Replying to @ScubaForDogs @AustenAllred
Because it is very hard to predict that number. It's not a 1:1 relationship. Rent drops could result in: - roommate breakups - increased population influx - change in financing for next year's housing builds
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Replying to @ScubaForDogs @gatesvp
“Supply doesn’t affect housing prices” seems like a cop out
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Replying to @AustenAllred @gatesvp
we can keep going in circles if you want; if housing supply definitely and always drives rents down, then there should be no resistance to rent controls that would be within a reasonable range of the drop in prices that would supposedly occur naturally
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Except that rent control makes it prohibitively expensive to build housing, but yes
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Replying to @AustenAllred @gatesvp
No it doesn't, it just makes the resulting development less profitable. The cost to build the physical housing is the same either way.
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