rent control basically traps people in a single apartment for the rest of their lives.
It doesn't "trap" anyone; that's just hyperbole.
The main effect is that it gives a significant number of people a chance to stay in the city in a profoundly deteriorating market for middle-class housing stock (driven, in NYC's case, to no small degree by external factors such foreign investment, and radical and -- in the view of many -- essentially undemocratic "pro-building" changes to the local zoning laws).
this is one of the ways that ghettos come in to existence.
Perhaps. But given the vastly greater forces at play (racism/classism; the collapse of inner-city manufacturing base; and deliberate wholesale razing of neighborhoods in NYC, Boston and elsewhere; mistaken notions about the wonderful community-building effects moving people out of quirky single-family housing and into massive high-rise development projects; and just the inevitable effect of multi-lane freeways in high-density urban areas, generally) it seems you'd have a hard time pinning it as one of the major factors.
It's not hyperbole in the least bit, I've seen it first hand.
A lot, maybe most by now, of my friends who live in SF cannot afford to move at all - they really are trapped in their current lease. It's often even worse because rent control encourages so many off-the-books subleases, so they can't directly deal with the landlord for fear of being caught. If the lease holder decides to give the lease up, they're screwed. This has happened to more than one of my friends who lived with someone else who had the lease and then moved out. The original leaseholder kept the lease as a courtesy, but it's actually a liability to them and they won't do it indefinitely. It's a shitty situation for all involved.
One argument against rent control is that it drastically drives up the price of the available units because there's such a reduced supply, exactly because the "trapped" can't move. This is a vicious cycle that causes even more renters to become trapped.
With subsidies instead of rent control, the available rental stock would be bigger, renters could choose from more options, and not be penalized for needing to move. Subsidies would still have an effect of increasing demand and ability to pay, thus pushing up prices a little, but the price inflation would be spread across the whole market, rather than concentrated on just the small portion of vacant units.
I'm one of those poor, suffering people, "trapped" by my rent control.
If this is confinement, then I'll admit that I much prefer confinement to the life of freedom I would experience when my landlord kicks me out in order to get a richer tenant.
Thanks for your concern, though. It's really touching.
You were (from your bio) one of the first engineers at Justin.tv (now Twitch.tv), a search and data mining engineer at Yelp.com, and a founder of Vayable, a YCombinator-funded startup.
You're comfortable with the idea that you get rent control? The market has been set up to essentially subsidize you, at the expense not only of the evil landlords but of all the potential SF tenants who do not get rent control, many of whom are (I can only assume, but it seems a pretty safe guess) far less economically secure than you are.
I'm sorry to personalize it like this (I'll forget your name soon after I write this comment). I really don't mean this as an attack. I'm just pointing out that you're a member of an undeniably elite class of worker, one that is essentially inheriting most of the economy (I believe "eating" it is the verb our industry prefers) and --- no moral judgement here --- displacing previous residents from the old outmoded economy. I'm a little startled to hear you suggest that you need a subsidy.
Wait...what is this "subsidy" you speak of? My landlord's costs are mostly fixed. I pay the same portion of the mortgage that I did when I moved in here -- and it's not like I'm paying a tiny amount of money, either. I'm subsidizing my landlord, not the other way around.
My landlord's inability to exploit me at optimal efficiency to pay for her income-generating asset is not a subsidy, it's just a policy decision in favor of tenant's rights.
Your landlord's costs are fixed --- modulo property taxes, which rise with the appraised value of the property --- but the value of the property fluctuates with the market. In San Francisco, that market is skyrocketing. Your rent should be too. It isn't: due to rent control, you capture the upside (below-market rent) instead of your landlord.
Respectfully: you are practically the poster example of the problem with rent control in a supply-constrained and rapidly gentrifying real estate market. Working class families get moved out of the city. That happens; it's part of economic growth. Meanwhile, a policy that should serve first and foremost to protect the interests of the least mobile workforce participants instead protects an elite startup founder at their expense.
Someone who wanted to make a case against SF rent control could literally just point at you. "We're distorting the housing market for the benefit of elite tech workers. We should stop doing that."
I don't blame you for accepting rent control. You're a rational actor, the option was available to you, and if you want to commit charity, there are probably more efficient vectors for that available to you than enriching a landlord. But I don't think your experience is a particularly good illustration of the public policy benefit of rent control.
Hey, I am too, though I recently moved so I got hit with the reset.
I guess you're just ignoring the part where no rent control and direct subsidies would lower the prices of the available rental stock. Do you like being penalized for moving? I don't.
Yes, I'm ignoring your completely unsupported hypothetical about subsidies.
You don't need to invent fancy theories to explain rents in SF: we're in a demand bubble, driven by the influx of venture-funded tech companies into the city. This is neither new, nor surprising.
I totally agree that we're in a demand bubble, but it's exacerbated by rent control and the historical difficulty of building new units.
This isn't a very fancy theory, it just effects supply and demand. I don't think you'll find many economists who would disagree with the assertion that rent control reduces supply, thus driving up prices. That reduction is caused by people incentivized to stay in a unit when they otherwise might have moved.
Well, at the very least, you should send your landlord a freshly baked pie and a letter of gratitude each month with your rent check as thanks for paying some substantial portion of your rent.
Well the landlord benefits from Prop 13 which is basically "rent control for property owners", so the landlord should really forward that pie and letter of gratitude to the California taxpayers who are subsidizing him.
Like most, my landlord's costs are largely fixed. So she should probably send me a pie for paying an unwavering percentage of her mortgage in exchange for zero equity.
But yeah, tell me more about how rent-seekers are getting a bad deal. We renters are such parasites, with our unreasonable need for stable living situations in exchange for the willingness to pay for other people's investments. We just take take take, don't we?
When I went to UC Berkeley, I never lived in Berkeley. I knew people that lived in ultra cheap apartments and houses, but every time I went to an open house, there were 50 other people waiting with me. I always lived in Oakland.
A guy I worked with had lived in his apartment for 20 years when he finally bought a house (because he got married). He had been paying a ridiculously low rent for decades, and he just couldn't move and spend 10x more for what he got.
It may be counter intuitive to you, but it is not hyperbole.
right, so the question is, was he "trapped" in his apartment, or was he given the chance to stay there when he would otherwise have been forced out long ago by rising rents.
It doesn't "trap" anyone; that's just hyperbole.
The main effect is that it gives a significant number of people a chance to stay in the city in a profoundly deteriorating market for middle-class housing stock (driven, in NYC's case, to no small degree by external factors such foreign investment, and radical and -- in the view of many -- essentially undemocratic "pro-building" changes to the local zoning laws).
this is one of the ways that ghettos come in to existence.
Perhaps. But given the vastly greater forces at play (racism/classism; the collapse of inner-city manufacturing base; and deliberate wholesale razing of neighborhoods in NYC, Boston and elsewhere; mistaken notions about the wonderful community-building effects moving people out of quirky single-family housing and into massive high-rise development projects; and just the inevitable effect of multi-lane freeways in high-density urban areas, generally) it seems you'd have a hard time pinning it as one of the major factors.