patrick.net

Different Sean Says:
March 5th, 2007 at 1:26 am

I agree. Unfortunately, it’s the ’system’, and this particular LL is too scheming and too big a player to negotiate too much. He already owns a ‘discount’ property by building it himself. We should all become property developers, obviously, and secure our futures. But I’m either 1) leaving, or 2) negotiating or 3) passing it on to my employer as a wage rise…

DS,

It sounds like (a) your LL is asking WAY above market rate for your place and (b) you are ready to exercise your right of refusal, and (c) you have some real options/alternatives to choose from. It doesn't sound to me like your LL can demand whatever arbitrary amount he wants and get it -- with or without your consent-- unless there is really some kind of cartel/Mafia/shadow government-like gang that controls rents in Oz.

That's precisely how well functioning, transparent markets (note I avoid the use of politically loaded term "free") are supposed to work. OTH, if rent control were introduced to Oz, you would find a very different situation within a generation. Over time, rent control would mainly act to discourage new rental construction (limiting new supply and further driving up rents), and of course people would learn to game the system from both ends --just as is happening today in rent-controlled areas of SF (re-read FAB's many examples of illegally sub-let RC apartments, people who take over leases from dead relatives, etc.).

If your LL tries to stick you with a rent hike far above market-rate, then move. When s/he is unable to fill the unit for the sky-high "wishing rent' and must carry the costs of a vacant unit, s/he will quickly learn that "owners" cannot unilaterally dictate market prices.

I don't think good or evil are objective measurements. They're subjective matters that do not require further proof. If Peter P thinks rent control is evil, he's stating his feelings about rent control.

Or

Peter P is evil? AWESOME!

People here are complaining about problems with the rent control system as implemented, not the notion of rent control itself. And there is some fairly controrted logic even there as well. Apparently there are a few dysfunctions with the implementation of schemes. Similarly, public housing here used to be granted almost for life, when in fact it should be granted on an assessed needs and means basis. They are attempting to change that now. However, rent control systems in Oz are almost non-existent.

The question is, do people receiving rent control benefit from it in terms of quality of life, without disadvantaging others? I would say yes.

I don't have any problem with the notion of rent control, in fact I think of it as the very first step in a band-aid solution to providing affordable housing.

SP Says:
That’s interesting. When I went to university, reasoned arguments had to be backed up with observable, independently verified data gathered through a rigorous, repeatable scientific process.

Which course did you do? How do you do that in Sociology or Philosophy or Econ or English Lit 101? The very notion of logical positivism or empiricism as the answer to everything as you are proposing has been questioned at universities as unreflexive modernism, by the way. It works in physics and chem, up to a point, not in the humanities. However, are a series of newspaper articles and reports by RE managers enough to 'scientifically prove' rents are rising? Where does the hypothetico-deductive model come into play here? Come on, guys, get a grip, all sorts of para-autistic nerves are getting hit here for no reason...

People here are complaining about problems with the rent control system as implemented, not the notion of rent control itself.

No. The very idea of rent control itself --like price controls-- is an anathema to efficiently functioning open markets. Unless there is some sort of Mafia-esque cartel colluding together, eliminating competition and thus creating a genuine supply constraint, LLs cannot arbitrarily charge more than market rate forever.

If you implement rent control, then who gets to decide what constitutes a "fair market rent"? Is it LL carrying unit costs + 5%, +0%, -5%...? And what about inflation? Do LLs that only recently bought their property (at a much higher cost-basis) get to charge a lot more per SFT vs. long-time owners (that have far lower carrying costs)? Can a committee price rents more "fairly" or "accurately" than open markets?

Prop. 13 was voted in 30 years ago, supposedly to try to make property taxes here more "fair" and "protect" poor, old grandmas from the mean, nasty tax man. And look how well that's worked out for California...

Prop. 13 was voted in 30 years ago, supposedly to try to make property taxes here more “fair” and “protect” poor, old grandmas from the mean, nasty tax man. And look how well that’s worked out for California…

Actually, it's worked out great for established Californians.

For non-established Californians, like children, people who move here, etc - not so great.

When you are hungry, anything edible tastes good. The path to gourmet bliss is paved with starvation.

I saw a show on anorexia on HBO - apparently after a certain point, you don't get hungry anymore. So... that's not really true to a certain point.

From WSJ:
But Chief Executive Officer Michael Geoghegan defended his company's decision to offer subprime loans. "This is not trailer park lending," he said, claiming the typical HSBC Finance customer has average household income of $83,000 and a home worth $190,000.

Uh... where are HSBC's customers that they have incomes of $83k, and homes of $190k? A 2.3x ratio?

Can I move there?

efficiently functioning open markets.

Elevating 'markets' as the be-all and end-all is just a discourse in itself. Who says what is even 'efficiently functioning'? This whole frame of reference and meta-narrative can be critiqued to death, and often is, on a very many levels.

Were the conditions in Paris just prior to the French Revolution an efficient market? Probably they were. People were starving, however, bread was too expensive, and aristocrats ignored them to their detriment.

One argument put forward to the existence of the welfare state in the 20th C. was that if govts didn't address poverty at least a little, communist solutions would look more and more attractive to the population, and more revolutions would inevitably ensue. With the demise of Russia and China, and the threat gone, there will be more calls to wind back welfare such as family benefits and health care.

Unless there is some sort of Mafia-esque cartel colluding together, eliminating competition and thus creating a genuine supply constraint, LLs cannot arbitrarily charge more than market rate forever.

Effectively there *is* a Mafia-esque cartel colluding together, using asymetrical power arrangements and arbitrary ownership to oppress others. These arguments are operating too much inside the square for my liking, there is just too much self-referentiality and failure to see what's going on, in terms of exploitation and conflict theory. Just who is benefitting from this system exactly, that is the question you need to ask...

Prop. 13 was voted in 30 years ago, supposedly to try to make property taxes here more “fair” and “protect” poor, old grandmas from the mean, nasty tax man. And look how well that’s worked out for California…

As I said, implementation has to be thought out carefully...

Effectively there *is* a Mafia-esque cartel colluding together, using asymetrical power arrangements and arbitrary ownership to oppress others.

If this is true, then good luck with imposing rent control. Anyone who proposes or even vocally supports such controls will probably wind up dead in a ditch.

I saw a show on anorexia on HBO - apparently after a certain point, you don’t get hungry anymore.

I'm trying to reach that point, to shed a few pounds... nachos always look too good tho, and I start hallucinating about food...

HARM Says:
If this is true, then good luck with imposing rent control. Anyone who proposes or even vocally supports such controls will probably wind up dead in a ditch.

But you've got them. There's loads of rent control in NYC... What's wrong with a decent social settlement with reduced uncertainty?

What’s wrong with a decent social settlement with reduced uncertainty?

Utopia! Wait, don't utopias usually have at least one fatal flaw?

don’t utopias usually have at least one fatal flaw?

no, then they're not utopias... our current system, tho, is highly unequal and inequitable, is ravaging the environment and consuming non-renewable resources apace, and causing a lot of unnecessary suffering...

You can make alot of money by listening to David Lereah; just do the exact opposite of what he says and you will prosper.

as i mentioned above Rent Control was deemed necessary. If you have a entire city of renters, you have high crime, low respect for the environment, wacky voting patterns, essentially you have NYC circa 1978.

Huh? Who "deemed" it necessary? Has it successfully worked its "affordability magic" and turned NYC from one of the least affordable places to the most affordable?

As far as "renter = polluting criminal" or "wacky voting patterns" goes, I'll leave that for the locals to deconstruct.

Has it successfully worked its “affordability magic” and turned NYC from one of the least affordable places to the most affordable?

well, it must be more affordable than it otherwise would be, surely...

That is an EXCELLENT reasoned argument in response to my earlier comment.

yes, it is. it's the content of modern social science studies. sorry if you're out of the loop...

Oh, I see that you ARE talking mostly about intellectual wanking, (with the possible exception of economics). In which case, I retract my earlier comment about data and scientific observation.

I've done both a science degree and an arts degree, and excelled at both. I value the content of the arts degree far more highly in terms of 'enlightenment'. Your background is unknown, and your comments are purely subjective now, and not worth disputing further, as you clearly know nothing about questioning the logicial positivist project, and critiques of modernist thought (in fact, you are unwittingly presenting such thought). Being a technologist only is extremely limiting in attempting to form a balanced world view. Technology gives you the ability to blow the crap out of Iraq for resources. Post-modernist theory allows you to critique the discourses and lies of patriotism and fear-mongering that took you there on a pretext.

it was a contingency of broader interests at the metro and state level. They had “determined” “that” RE “value” would be in decline should the situation continue, because it was actually detracting from the general job market. These interests were involved in the construction of the WTC. and yes it did work its magic, NYC was very prosperous during the 80s and 90s.

Shmend,

What is your control group here? Are you certain NYC in the 80s and 90s would not have been as "prosperous" w/out rent control? NYC has long been the financial banking hub of the U.S. (if not the world). How would this have been changed significantly (if at all) by the absence of rent control?

Aside from the ex-post facto guesstimations, who's to say the NYC rental market would not have eventually self-corrected due to the general lack of affordability (as we are now seeing happening in the CA, FL, AZ housing markets)?

Of course - that is one of the premier fields for intellectual hand-pulled noodles, so to speak.

that's a very informed and scientifically rational series of arguments you are making. i can see the benefit of all your training now...

People who want an absence of regulation usually have specific economic motives.

exactly. i just can't be bothered writing a critique outlining how it is always the vested interests who want 'free markets' and subsidised american farmers who want 'level playing fields' and so on and so forth. and the other million criticisms of free market ideology that have been made out there, all easily obtained...

The goal of players in a free market, as many economists have shown, is to put an end to the free market by eliminating all competition.

Right, cartels and monopolies are inherently anti-free-market. Which is why competition must be preserved with anti-trust, pro-market regulation. Since when does being anti-price/rent control automatically make one an anarchist and/or plutocrat apologist?

Efficient, transparent "free" markets are neither "naturally occurring" nor good for plutocrats and monopolies.

Hmm... why am arguing with a guy who just accused me of being retarded?

OpinionsPlease/MarinaPrime/ConfusedRealtor asked a thread or two ago about buying a condo at Resort at Squaw Creek. Well, that's a topic near and dear to my heart (the skiing, that is). If anyone think's it's a good time to buy in Tahoe, here's a relevant article from the usually rosy DQNews:

http://dqnews.com/RRCA2Home0207.shtm

"Steep Drop in Sales of California Vacation Homes"

We rented a lux condo at the new Squaw Village last Spring - top of the line finishes, right at the base in the Village, decent price. After staying, the owner offered to sell it to us below what he paid. No thank you, at least for now!

On some Bay Area Chinese immigrant blog sites, buying a house for occupation or investment is still a hot topic. I am not sure if they received the memo of the recent stock market crash, but as skibum said, they've never seen a serious crash in their entire life, so the current state of housing is perceived as the bottom. The most senior "Bay Area residents" came here in 1989 or 1990 as FOB students, so they had little memory of what happened back then. When they started shopping for a home, the market hit the bottom and it was all glamor story from that point onwards.

The working class (I think of anyone who needs a wage as working class, including myself) Chinese typically buy in MSJ and Sunnyvale (with Cupertino school district), more established immigrants from Hong Kong or Taiwan buy in Los Altos, Cupertino and Saratoga. You can find quite a few elected municipal leaders born in Hong Kong, Taiwan and India in Los Altos, Palo Alto, Cupertino and Saratoga, so that gives you an idea of where these ethnic groups are buying.

There is also substantial money laundering going on from corrupted funds in China, but these people typically park their dough in SoCal, San Marino, Palos Verdes, and to a lesser extent SF City.

Again, I don't think the support from immigrants alone are going to carry the south bay housing through rough times, but there will be lots of knife-catching initially because they are either aggressive compulsive savers, or are able to give up a lot for home ownership, or the combination of two. In the initial phase of a housing downturn, I expect to see a divergence in pricing, houses in good school districts keeping its level and houses in so-so or bad school districts going into a free fall.

Although I think the houses in good school districts will also fall in the end, the net net result will be a bigger divergence in housing price between the desirable and undesirable areas (or school districts), just a miniature reflection of what the US was going through after each housing bubble. If you look back in history, it seems that after series of economic recessions, the inland falls further and further behind with the coasts soaring higher and higher, the pricing differential between the Rich America and the Poor America is further amplified after each recession. Bay Area will follow exactly that pattern.

@SQT: ;-)

Different Sean Says:

i just can’t be bothered writing a critique outlining how it is always the vested interests who want ‘free markets’ and subsidised american farmers who want ‘level playing fields’ and so on and so forth.

DS,

Vested interests want anything BUT a "free market" or level playing field, which is preceisely why everyone ELSE should want one. Monopolies and cartels do NOT like competition or price/wage tranparency. Is the NAR lobbying in favor of Open-MLS or for fee-based commissions?

It looks like there is now a dinner bubble underway.

Is Kanye West saying something about the quality of New York Indian restaurants?

The housing market's crashing!

The stock market's crashing!

Gold's crashing!

...and I'm dancing in the streets singing, "la, la, laaaa..."

There is also substantial money laundering going on from corrupted funds in China, but these people typically park their dough in SoCal, San Marino, Palos Verdes, and to a lesser extent SF City.

I keep hearing a lot of scuttlebut about that... definitely more in SoCal, but here as well.

OO
On some Bay Area Chinese immigrant blog sites, buying a house for occupation or investment is still a hot topic.

Can you post a link?

go to www.mitbbs.com, and go search the SF local forum. mitbbs is the largest forum for mainland Chinese immigrants and students in the US. HK and Taiwan immigrants are much more disperse and well assimilated, so you probably can only find us on English speaking sites.

Does it stand for MIT the school?

eburbed,

I doubt it. The site is registered to someone in BA and the discussions are all over the place.

You're not missing too much contentwise.

OO,

I didn't dig too deeply but my short glimpse in suggests a site is crawling with FOBs who think entirely too well of themselves.

OP, you think YOU are frustrated? Talk to my realtor who saw my wife and I walk away from making an offer last month.

I doubt it. The site is registered to someone in BA and the discussions are all over the place. I didn’t dig too deeply but my short glimpse in suggests a site is crawling with FOBs who think entirely too well of themselves.

That's kind of why I thought that maybe MIT stands for the school. Just to make it "look better".

Here's a REAL question for people on the board...

If you had a chance to do a 'lease' option on a place you really liked in a neighborhood you really loved, where you had to put down 2.5% 'earnest' money, and had 1/5th of the rent for the time you would be there be added to the earnest money as part of the downpayment for when you bought the place.

Here's the 'hypothetical' :

A well kept up original owner selling his place for 950k, wants 25k earnest and charges 2500 a month rent of which 500 goes to the eventual downpayment, with a hard deadline of 'buying' in 2 years.

Your 'downside' is about 2.5%, in theory, but if you walk, you really are walking from 25k. The rent is comparable, so you're not losing money on 'overpaying' for the rental. If the market crashes, in 2 years you offer the fair market value, but he gets the 25k + 6k credit, plus all the rent you paid over the years.