USA: Housing affordability in California


#1

10 points to keep in mind about housing affordability in California - -> latimes.com/opinion/op-ed/la … story.html

California losing lure over costly housing - -> scmp.com/property/hong-kong- … ly-housing

Victor Davis idea is that most of the middle class that voted republican has moved over the years to other states and as a uni-party state with old out of touch rulers California no longer has much sway nationally except for fund raising activities. The laws made by the people on the coastal strip don’t have a direct impact on them due to having higher average incomes, but it’s hollowed out the middle class in the rest of the state who left leaving only a lower income economic class who are dependant on welfare - hence the two states of California.


#2

Housing Bubble Trouble in Silicon Valley & San Francisco
wolfstreet.com/2019/01/07/housing-bubble-trouble-silicon-valley-san-francisco/


#3

I would say infill somewhere like Los Angeles would be an utter disaster, it already has too many people. Whatever infrastructure issues they have now will be twice as hard to resolve with twice the density.


#4

Just LA county, not even the Metro or CMA, has a population density one tenth of SF. And SF county is about 1/2 low density housing / industrial. Even if you just upped the density of the urban cores in LA county to SF levels you could add many hundreds of K’s of residential units with most of the county staying low density.

The problem is not space or lack of land. The state is mostly empty. And is bloody enormous. The problem is regulation and zoning. California had reasonable priced housing until the current zoning regulation system was introduced in the mid 60’s to mid 70’s. High priced housing California is a recent phenomenon. Since the late 1970’s/ early 1980’s. And one that is easily reversed. Repeal Prop 13 and and revoke all local anti growth ordinances and just watch the cost of housing return to historical norms.

The price dynamic in the Southlands is different but the talk among natives / old timers in SF is the current bubble has run its course, its currently like 2007, 2000, 1991, 1979, the previous bubbles maxes, and its downhill from here. Probably no serious downward movement until a proper dot com crash and / or a proper earthquake. A good sized earthquake would clear out the hipsters/ dot comers pretty quickly. And the GoogleBus people. For a start no power, no cell phones and no Peninsula freeways for weeks / months. That would clean out the excess dross from the City for a few years leaving rents / house prices more reasonable.

Till the next bubble.

Saying that, the rent of a house in a non hipster / dot comer part of SF has gone up on average of just over 4% p.a over the last 30 years. Apartments / flats in nicer areas a bit higher but not by much. Everyone doing the complaining about rents are recent blowins who wont be living in the City very long anyway who want rents to be as cheap as in whatever podunk city / suburb they grew up in. My answer is always the same, want cheap rents move back to where you came from. You can have pretty or you can have cheap. You cannot have both.

We are way overdue for a good sized earthquake. It will be the 30’th anniversary of Loma Prieta in October. And that was only a mid sized one. Not even a proper one. Its going to fun watching the hipsters / dot comers learn the hard way what is printed in the Disaster Guide in the front of the phone book. For the first 72 hours you are on your own. You should have a full 5 day / 7 day emergency prep kit and expect no help from outside…

Then they will very quickly discover they are on a vertical learning curve. With no cell phone. No internet. No electricity. And no Amazon Prime.