CPR: Debate over California’s housing situation ratcheted up amid conflicting data and a flurry of new legislation designed to mitigate high prices and low supply.
Analysts have separated into two camps around Golden State real estate, one more bullish than the other. “Two recent reports — from Fitch Rating, a Wall Street credit reviewer, and Arch MI, a seller of mortgage insurance — attempt to gauge the stability of regional housing markets by tracking changes in real estate metrics vs. other economic measurements,” the Orange County Register reported. “Using a California prism, the studies draw wildly different conclusions. Fitch concludes California housing is among the most overvalued housing markets in the nation. Yet California is not on Arch MI’s list of riskiest places to own.”
California doesn’t have a ‘housing problem’. California has an ‘idiots running the state, and they keep getting re-elected’ problem.
All they have to do is look at Seattle and Portland. They have it figured out. Just get a bunch of little tiny houses and put them in the backyards of other homes. Problem solved. It works great for homeless.
That’s the first I heard we had a housing problem. As fast as they are chasing jobs out of this state it should be getting a lot better soon.
Kali has a couple problems… Both directly related to their ability to amend their constitution by direct vote. One of the first changes they made while I was in grade school. Prop 13… Enacted because they libtards were taxing the WWII generation out of their houses. The proposition froze property taxes at the point the real estate transacted, or had major improvements. There are people in California paying property taxes last reassessed in the late 1970’s. This disincentivized housing development. Permits and planning fee’s for a single family house, which prop 13 did not touch, now cost upwards of $140k per unit in many cities. So that teardown shack with a valid occupancy permit is worth… You guessed it $140k…
The other monumental act of stupidity has been term limits. California house members get two terms. 4 years… That’s it. There are no seasoned hands. There is no patience. They get elected and have to make their mark immediately, so they can move up to the state senate. So every manner of bullshit back scratching happens in every house bill. They’re not going to be there when the piper has to be paid, so what the hell… They’ll pass what ever bit of pork gets put in front of them, as long as some of it goes to them.
Kali Refugee in Texas, Nothing like experiential lessons. Thanks for relating them.
I’ve wondered about term limits and can see how that can be like that.
I’ve been in the camp of voting them out IS the term limit, but haven’t seen it where limits have been tried.
Theoretically, rent control should work in California. Proposition 13 caps property tax increases, and in general inflation has been low. If the cost of utilities can be passed through to tenants, rent control should have little to no effect on housing stock.
Except that it does. It takes a long time to recoup the cost of rental housing, and it is likely that inflation will erode profitability. Furthermore, fair housing laws and regulations make owning and renting units much riskier, and legal/administrative claims can erode profitability quickly. Price controls on virtually anything have the nasty effect of making goods and services disappear – a fact that escapes most politicians.
The answer is to make housing stock more available. But California in particular makes that extremely difficult to do. The permitting process is long, arduous and expensive; there were developments planned in my area over 20 years ago that only recently finally received approvals. And in California, the NIMBY factor is significant – residents already residing in an area vigorously resist new development, and there are plenty of California laws which enable them to drag out the development approval process for years and which not infrequently result in developer bankruptcy and project blocking.
Progressives frequently justify rent control by claiming that it promotes economic diversity and prevents “gentrification.” This is a polite, if disingenuous way of saying that rent control ensures that poor folk can continue to live in developing neighborhoods – the very thing that most folk (including progressives) don’t want. People who live in neighborhoods with high crime, gang bangers, poor schools and poorly maintained buildings don’t want to move to areas with high crime, gang bangers, poor schools and poorly maintained buildings – they want to move to better areas. Rent control is likely to ensure that poorer neighborhoods will never improve, and that eventually the neighborhood you wanted to escape will come to you.
@Kali: I still prefer term limits. Legislators rarely get voted out, corrupt legislators are corrupt legislators regardless of how long they are in Sacramento, and professional politicians frequently lose sight of what it is like to be a private citizen and how difficult life can be with government interference. As far as legislative pork is concerned, I believe that this is actually a bigger problem with professional legislators who need reelection to continue their careers as professional legislators.
I understand your points, but despite the fact that we can indeed vote out bad legislators even before they are termed out, we rarely do. Even the old maxim that legislators are safe unless they get caught with a dead hooker or a live boy isn’t necessarily true anymore; they would still get elected again.
Wyatt I.P.J,
In general, I would agree, but there is no opposition party anymore. There are only Communis… Errr… Democrat’s. They’ve rigged the system to be a conveyor belt of inexperienced pol’s doing Lenin’s bidding. It’s a dog and pony show that serves to hide the real corruption.
While I’m pontificating about the collapse of my native state… Consider this: If you spend 4 hours a day in your car commuting, how much time do you have to serve in the role of “political opposition”? 24 – 8 hours sleep = 16. 1 hour to S.,S., & S… 8+ hours of work… You’re down to 5 hours. 2 hours commute in the morning and two at night… That leaves 1 hour of “free time” in your day. You’d have to be extremely dedicated to even make it to your kid’s Boy Scout troop meeting. You have to be extremely motivated cook dinner… Why would they fix the traffic problem? It keeps you out of the political process…
Jerry Brown leads the pack of low information govies, he “solves” every problem by spending into oblivion.
@Kali: The Republican party in urban areas of California is dead. The Repubican National Committee almost competely abandoned California, and while on one level that makes some sense, in the long term the Republicans have ceded a state of 30 million people to the Democrats without a fight.
My kids, and many of their classmates, left California for greener pastures – and that’s a shame. But particularly in our area (southern California), home ownership is a pipe dream and the cost of living is exorbitant and getting worse. We spend a lot of time commuting, and gasoline is almost a dollar a gallon more than anywhere else in the country. In newer developments, HOA dues, Mello-Roos taxes, property taxes and insurance may result in paying $1,000.00 a month before you even think about paying the mortgage.
I loved living in California, but as I slowed down we cashed out and left. There are things I miss, but there were a lot of things I used to do that I quit doing because of traffic and crowds. For example, we loved going to Laguna Beach and kicking back, but from May through September, and on nice weekends, the traffic was a mess and parking was unavailable.
I ended up in Orange County many years ago, and sometimes I miss it. But if I really think about it, I miss the Orange County of 20 years ago, and not the Orange County of today.
Wyatt,
“The Republican party in urban areas of California is dead. The Repubican National Committee almost competely abandoned California, and while on one level that makes some sense, in the long term the Republicans have ceded a state of 30 million people to the Democrats without a fight.”
In Southern California yes. Northern California not so much.
They need more big cardboard boxes.
Funny,
http://www.kcra.com/article/calexit-backers-withdraw-2018-california-independence-bid/9521079
Louis Marinelli is long winded for a guy headed to Russia. He must be hoping he made a strong case for his backers to pony up a bunch of money so he stays in Cali.
Even though Ca. legislators have the best of intentions, they’re the worst at learning from past mistakes. Every time the government interferes with competitive free market capitalism, the laws of unintended consequences prevail. It’s going to like they solved one problem but they always create more problems than they solved.
judgeroybean APRIL 18, 2017 AT 11:10 AM “Even though Ca. legislators have the best of intentions.”
What? Best of intentions for who? Not for honest hard working Americans who believe in the Constitution. Only for themselves, for illegals, for their crooked bureaucrat buddies, for gov’t unions, for perverts and hollywood snobs.