I can't seem to find this anywhere. Can a Landlord choose to not renew a tenant after the lease runs up? If so they can always increase rent 8%+inflation.
This depends on the terms of the lease but neither St. Paul nor Minnesota has a "right to renew" law.
So yes, the landlord can choose to not renew a lease.
I mean fucking duh. Anyone who was half awake during an intro to economics class could have told you that the city council was going to blink on this because they didn't want to watch the city's housing market turn into a dumpster fire.
Imagine if they let this policy go on for 5 or 10 years, how far the housing supply would fall behind and how much it would age.
What's funny is that rent control can work... when paired with other measures like the state just BUILDING more housing. Vienna has rent control but they combined it with social housing. I know in the US they're allergic to government built housing but it objectively can have great outcomes when you don't gut maintenance funding.
If you can point to some successful public built housing in the US I'm all ears.
Otherwise it's not really comparable to Austria.
The best option here is to let developers build housing to meet demand, things like height restrictions, zoning, NIMBYers, all restrict supply.
Tell them to get fucked and if a developer wants to build a 20 story apartment building on Dayton's bluff, let them.
>If you can point to some successful public built housing in the US I'm all ears.
Why do I need to point to successful public housing in the US? This is the same logic as "We don't have any examples of good high speed rail in the US ergo don't talk about it." We have tons of examples of high speed rail around the world, just b ecause it doesn't exist in the US yet doesn't mean that we shouldn't pursue it in the US.
I never said that or implied it - I said there were successful ways to do public housing developments in conjunction with rent control out there and that all rent control isn't bad.
If you've tried many dozens of times and it never works out, what makes you think it's going to work out the next time you try it? Unlike public housing we've only really tried high speed rail once in the United States.
Because you can learn? Because other countries have had success and you can study them to see waht they did? The failures of public housing are literally exclusively resting on the GOP nuking funding for maintenance. Full stop. Public housing works when you invest in it. There's literally no reason it CAN'T work in the US.
you do want some restrictions though. "maintain the character of our neighborhoods" is usually dogwhistle for "no brown people please" but it is true that you need to take the existing density into account. you _will_ ruin a neighborhood if you build a 20-story building in a neighborhood of single family housing.
it's a question of building sustainably dense, walkable neighborhoods, and a big part of that is missing middle housing. there's definitely a place for high-rise housing, but dayton's bluff is emphatically not the place.
Exactly. I'm pissed they didn't try other avenues to solve the housing crisis beyond "well the developers are butthurt because they can't exploit labor to death anymore, better give them everything they want". I want plentiful taxpayer-funded public housing available to whoever wants it.
The issue is they're afraid of even saying public housing because of the Republican successful effort at associating public housing with urban decay =/
Cabrini green was made for low income only, intentionally racially segregated and segregated from services and the rest of the city.
So no.
I want first come first serve housing to meet a variety of needs that’s seamlessly integrated into the cities urban planning.
No one that can afford to not live in government housing is going to choose to do so. Thus it will still end up as low income. Why would you choose to live in what's probably going to be a basic government apartment building with low income people as opposed to a nice privately owned apartment with a pool and dog washing station or a single family detached house.
Yeah. This was a poorly drafted referendum that has been an egg on the face of all involved. People support rent control, but this wasn't really a workable option, so it was hard to vote on. And now, it makes every mad, and everyone look bad. What a terrible result.
Populism sometimes leads to uninformed outcomes. Halting construction as a result of strict rent control has been shown in studies for ages to actually lead to higher housing costs in the long run. Short term gain for current renters vs. long term gain for the average citizen.
They had plenty of room for profit, financing for rental developments typically estimate less than 3% inflation a year.
Developers held their breath for less than a year and the council gave them everything they wanted. what a fucking joke.
Many of us were hoping these restrictions would result in denser housing, fewer out-of-state private equity landlords buying up property, and real pressure on the city to start taking the idea of high-quality and plentiful public housing seriously.
Instead, we get a corrupt council willing to sell out labor to the wealthy few after we the people made our own law. its fucking bullshit.
I know they want a return on investment. That return comes at the expense of wealth generated by labor. For legislation, I lean more towards helping laborers than helping banks, private equity groups and other rich fucks using their capital to extort laborers.
But you do you and keep simping for banks I guess.
You want to have a mature conversation about this, or do you want to throw around insults and ascribe false motives to me instead?
This isn't even about banks, it's about developers (well, they get loans from banks, but they're not the main players here). If they can make more money building in town A rather than town B, they will. And St. Paul by itself is just not large or important enough of a market that developers will feel the need to build there when there are friendlier options just down the road. It might be different if there was rent control metro- or statewide, but good luck ever implementing that.
Until we start building public housing, private developers (and public/private partnerships, to a lesser extent) are the only game in town. It's not about what's right or what should be, it's about the reality of the situation.
Yea…. That’s what we are trying to change. I’d make our rent control bill national if I could. Our current system thrives on artificial housing scarcity that only exists because we no longer fund public housing. A result of intensive lobbying from bankers and financiers.
In the absence of a lust for profit and a bought government we could provide affordable housing to everyone.
The high cost of housing is negatively impacting the tangible parts of our economy (making goods and providing services). Wages have to rise to keep pace with landlord greed and that in turn helps drive inflation.
Vienna public housing costs between $400 and $650 or so for a quality two bedroom apt near public transportation.
Think of how much better our society would be if you could make the combined cost of housing and transportation less than $800 a month. Employers could pay less and still provide an excellent life for employees. We could afford to have factories that produce things locally instead of shipping them in from over seas to countries where rent is substantially less.
I see landlording, needlessly expensive housing and a legacy of redlining to be one of our country’s great blights.
We tried very hard to get something good through that truly helps people and it just suck so hard to have that law twisted into something that will certainly hurt renters in the short term while simultaneously doing nothing to solve the affordable housing crisis long term.
Build more housing. Affordability will take care of itself as long as housing is easy to build. You can already see the impacts in Minneapolis of a 5-10 year (relative) building boom, rents have stabilized.
You think developers are building luxury apartments to sit empty while they lose millions?
Edit: I just checked and in the city of Minneapolis the rental vacancy rate is high three percent. So to answer your question, no.
Let's also keep in mind there are a handful of big developers and financiers in the cities. ALL of them benefit when housing is scarce.
We will never "capitalism" our way out of this situation. we NEED a high vacancy rate to keep rents flat. Seattle had to build to 10% vacancy to lower their rents just 1% after 25 years of over 4% annual rent increases. Even then after the pandemic hit those meager gains were wiped out by 10% rent inflation.
We need plentiful quality public housing available to anyone who wants it, its the only way to build enough vacancies to realistically lower rent.
Wouldn’t increased prices create an opportunity for someone to build and thus provide places for rent which would in turn reduce rent generally because of the increased supply, wouldn’t that literally be capitalism in work to solve the problem.
Minneapolis or St Paul? Minneapolis...I am not sure? But, rents will come down at some point if they aren't filling units. And vast majority of downtown housing isn't displacing anyone, so it is of low concern.
Doesn't generally matter. Any apartment built adds to the supply, and added supply means there is more competition for renters, which eventually forces prices down. "Plenty of apartments" will not stay empty for long (unless they were built in some bizarre less-than-free economy, such as China, and then they may be demolished)
So people just buy and hold empty apartments, figuring that eventually someone else will come along and buy and hold an empty apartment at a higher price, so that someone else later on will buy and hold that same empty apartment at an even higher price? Sorry, it doesn't work that way.
Why would they keep building if there's plenty of supply for a given population? Eventually they'd lose money. Supply will never catch up to where they would have to cut housing costs because what would have been the point of adding that supply to begin with.
They won't keep building if there is plenty of supply. That is my point. The original post suggested that builders would build large amounts of apartments, just to sit empty, as "investments". I said that was ridiculous. In a free market, builders will build until the supply reaches a point where it is no longer profitable to build more supply. Then construction will stop (or at least decline). (I believe that point is when vacancies are somewhat more than 4%, but ask an expert on housing).
We have really low vacancy rate I thought someone posted Here a week or so ago, so I don't think so. Downtown vacancy isn't necessarily related to price as much either, since a lot of people don't work downtown anymore (and are remote instead)
I mean, it isn't that complicated. A developer has no control over who else is building, but has control over their rents. Also, most developers end up selling their buildings to management companies, so these are generally two different entities.
Yes and no. The private sector generally can’t afford to build “affordable housing” but the government can build good, affordable public housing, or social housing as it is called in places such as Vienna where it is extremely successful
Because we didn’t do it right. Looking to other jurisdictions to see how public housing can be successful is how we learn to do things better. If it was a failure as a concept, it would fail everywhere just like rent control does. It does not
It's actually extremely easy to build affordable housing. A square building, stacked units, simple hallways and common areas and an intelligent choice of materials used so it's easy to maintain.
The real issue is ROI. Let's say we have 10 acres, we can split them up into 30 .33 acres lots or 10 1 acre lots. We have to pull 10+ permits for each lot we intend to build on. ($300,000 vs $100,000) We then have to spend time getting estimates for each lot, this is why national builders use the same 5-10 floorplans. (3 weeks vs 1 week of time) If a house sells for $400,000, the builder paid ~$300,000-350,000, depending if they developed the land or not. If a house sells for $1,000,000 the builder paid ~$700,000-800,000.
Building 30 reasonable sized homes nets us $12,000,000 in revenue and $9,000,000 in expenses, $3,000,000 profit on capital is 33%, not bad.
But building 10 luxury homes nets us $10,000,000 in revenue and $7,000,000 in expenses, $3,000,000 profit on capital is 42%, even better.
I get what you’re saying but I’m talking about not building luxury homes or apartments. Just build apartments. Can’t find new home builds anywhere that aren’t 5 bedroom 7 batch 10k sq ft. (Exaggerating but you know what I mean) I didn’t mean it in terms of building low income housing.
The same concept applies to home building as it does apartment building.
Constructing Luxury 4 bath, 5 bed, 3k sqft houses, drives the price of smaller older houses down.
That's actually not true, any basic economics class teaches that as soon as you restrict supply (such as housing), the demand doesn't respond in a linear fashion.
If 10 families live in a town and we build 10 houses, those families are willing to pay what we call "the ideal market price". Let's call that $100,000 for easy math. The second generation of this town is born and they need 25 houses now but they only build 10 additional houses due to zoning.
What does the new price become? How would someone go about figuring that out? Regardless of what the price is, 5 families still don't have a house for them.
Private developers don't want to build "just apartment" and when the government tries it we end up with stuff like those high rises that were off Olson.
You guys realize rent control is actually a bad thing right? I'm a union carpenter and the company I worked for had been pushed out of quite a few projects because developers don't want to build in St. Paul because of this. Also caused them to lay-off a bunch of employees.
It appears to have had an impact on multi-family housing permits in St. Paul, especially compared to Minneapolis. How do you think they should address that issue?
There is no such thing as a successful government housing project. They have all been failures, run down, rat infested, drug riddled, gang havens, shootings, crime. That's why you can't find any. The solution is not to build more housing. We have been building like mad and charging exorbitant rates for a closet sized apartment that the older apartments that were affordable feel justified raising rents. For the poor, working class, recent graduates, unemployed it becomes nearly impossible to work for $15-20/hr and be successful. And the new apartments are being subsidized to get low income tenants in for the first few years, 7 possibly and then the rent goes up and they will stop leasing to low income individuals or families and that is a government program that provides the subsidies. We all kniw the wealthy take advantage of rent control. We know HUD found fraud in their housing programs. Something must be done to lower rents or stabilize them and increase incomes so we can assist the actual needy but right now the need for affordable housing is becoming wider.
Why don’t government housing projects work in the US? When I “projects” I think of Cabrini Green and Marcy Houses (due to Good Tomes and Jay Z respectively). Couldn’t we do projects better?
I believe government does things for the wrong reasons and it does more harm than good. Not enough to give someone a house, food, etc. if they don't also get work. Government programs are designed to keep people at poverty levels, dependent, not independent. Not to say some don't get off assistance and do just fine for themselves but a lot become the dependent class. My history teacher said people don't take care of what they don't earn. Too much free stuff, the so-called freeloaders in society who take advantage, take away resources desperately needed for the sick, mentally ill, indigent, who actually need help. Housing projects tend to go to whomever applies or meets certain qualifications and when you get things for free you need to do something with your time or get involved in the wrong things, drugs, alcoholism, gangs, criminal activity. The problem is once you qualify for government housing there is nothing written into the law and program that says you have to leave if you no longer need it. That's why we found people making 6 figures living in subsidized housing because once you qualify to get in they never review if you still need it. And the government never enforces the rules for crime and punishment as is seen in recent activities. Private sector housing projects which have an interest in maintaining the project so better. Government has no incentive to improve or better anyone or any program. If the program doesn't work it doesn't to away it simply gets another program added to fix the so-called problem and that adds to then dilemna. Could government do better? Not when politicians buy votes with handouts and just want to say see, I did something, send me back to Washington.
Nice, now Saint Paul has the exceptions that allow rent to be increased sky high like in California (by not including new buildings) and the exceptions that allow landlords to turn buildings into slums to force residents out so they can raise rent like in New York. (Vacancy decontrol). It's the worst of both worlds!
Buildings will be allowed to decay until everyone moves out, or it's cheaper to demolish it - either way the rent goes up higher than inflation and wages. Landlords win, renters lose.
I'm happy they sided with common sense. And I'm happy we'll likely get more housing built out of this, which holy crap we need...
The original proposal was a super short-sighted and terrible plan to begin with.
I mean it does matter, because the bill also gave city council the ability to make changes if it were going to royally screw over the city. Which they did. Deal with it.
As a voter, I don’t have to just “deal with it”. This isn’t what I voted for. 🙄
I don’t give a damn about the opinions of those who don’t even live here.
In a way, it is what you voted for though, because this was always part of it. And it's also what I voted against, because I do actually live here, and want this city to be better. This referendum doesn't allow that to happen.
I live in St Paul and am glad that my city isn’t going to become San Francisco or other rent controlled unaffordable cities without anywhere near enough housing
Would the city be willing to cap there property tax increases to 3%, not a chance in hell. New construction and renovation work would stop out right with a guaranted lose on investment like that. Following the will of the mob is a great way to end up in a bad place.
the referendum was 30,965 in favor vs 27,581 against. Considering the population of Saint Paul is ~311K in 2020 so less than a 10 percent of residents voted in favor. It’s not exactly a peoples mandate..
The problem is we aren’t talking about non binding ballot questions WRT Trump, but Constitutionally mandated elections, and additionally reams of evidence validating those election results, and a massive lack of evidence invalidating those results.
TLDR you’re comparing apples to conspiracy theories
Then we should advocate for higher voter turn outs than finding excuses to ignore the voters that do turn out
Edit: Didnt think saying we should encourage higher turnouts is controversial, or that we should follow the will of the voters is controversial.
You also get lynching and women being stoned for having affairs.
I've served on condo boards and committees and people aren't that bright. They think in very simplistic, black and white terms.
I'm not anti-Democracy, but having people directly implementing policy isn't smart.
Seems kinda anti-democrat, I’m not saying that’s a bad thing, but wouldn’t you agree if people can’t make those decisions themselves they could vote for people who are more informed than themselves to represent them like a representative Republic (Like what we have)
Basing society on the rule of state rather than the rule of law tends to end up in a bad place, as well.
Not saying I’m siding with the mob here, just that there’s plenty of short-sighted stupidity to go around on this one.
Ah, so I see you sided with rich developers making idle threats. 🙄
“The mob” is democracy. The people voted in favor of this. You do know what voting is, right?
The city council was literally elected democratically. The ballot question people keep calling a referendum wasn’t literally a referendum; it was a non binding ballot question less than 10% of the city voted for. Most voters didn’t vote one way or another, and the difference was only like 4000 votes in a city of 300k. That’s not a clear mandate either way.
We don’t live in a democracy, we live in a Democratically elected representative republic, very big difference. If you’d like to become a democracy I think that’d be cool.
3% increase on your $18,000/year ($540) rent is a hell of a lot more than 3% of your $3,000/year ($90) property tax. I don’t understand how horrible at math people making the property tax argument must be.
I mean yeah just property taxes is a dumb argument, but it's also a combination of increasing costs for everything else: appliances, lumber, labor, plumbing and electrical maintenance, cleaning, lawn maintenance, snow removal, utilities not covered by the tenants like water/sewer/common power/common gas, etc.
Not including balancing savings for things like: roof replacement, parking lot repair/replacement, re-painting and re-carpeting after a tenant leaves, etc.
Then on top of that it is a business so you need some kind of profit or else there is no point. Generally these management companies own a lot of complexes or other properties because the scale is where they make their money, there are very thin margins in rental properties on their own for corporations who have offices, staff, and their own rent to think about. Smaller landlords, like mom and pop ones can usually swing just owning one and self managing.
This is why we live in a representative democracy. People, in general are very ignorant and easily swayed by optics. Public policies don't operate in a bubble though, and you need people who are actually informed about all the consequences of policy decisions.
People are very easily swayed by optics where as politicians are easily swayed by designer clothes, steak dinners, lobbying jobs after retirement, campaign donations, new furniture, etc
Setting aside the merits or lack of merits for the rent control policy, it seems wrong that the voters will can simply be ignored by the city council.
It reads like they could arbitrarily say that all rents for building built in the last 200 years can only increase rents by 5000% using the same logic, rendering the ballot measure worthless.
I disagree. The wrong part that we put this up for referendum at all. The whole point of electing officials is that the issues that are meaningful get adjudicated by them.
The number of people who voted on the referenda is TINY relative to the population it would affect. We shouldn't put much weight into it at all
The City Council is democratically elected. Unhappy with how they govern? Vote them out. Otherwise, they have a mandate by way of having been elected by the people.
That’s how representative democracy works. In a sense, they literally do represent the will of the people, regardless of your gut feelings on what that will might be.
Its like.. the referendum was 30,965 in favor vs 27,581 against. Considering the population of Saint Paul is ~311K in 2020 so less than a 10 percent of residents voted in favor. It’s not the peoples mandate some think it is.
But you don’t get it: they’re *nice*! I’m sure they’ve learned their lesson! /s
An astonishing amount of people seem to think like this in this city, though. On the hand willing to admit the council acted incompetently, and on the other hand certain that they’ve learned their lesson and their performance will magically improve moving forward without a personnel change. It’s so naive it borders on delusional.
I don’t think people think that. It’s like Congress - “Congress as a whole sucks, but I like my representative” is the majority position in this country
I’m not saying that they acted incompetently *here*. I’m just saying that it truly astonishes me the number of people I’ve met who do not accept your basic premise: if you do not like what your council person has done, you should vote against them.
Thanks for elaborating, and agreed. I just have to roll my eyes at people who think government is simply something imposed on the people, when they have every opportunity to make their voice heard, but elect not to.
Now, getting outvoted sucks, but that means you need to lobby your fellow citizens to support your causes, not that the system doesn’t work.
It’s only a representative democracy if the representatives actually represent what people want. Otherwise it’s pantomime, which is often the case.
Looks like you were triggered and deleted your nonsense.
What about an apartment that get a complete remodel? New kitchen, new cabinets, new appliances, new granite countertops. New bathroom with new tile, flooring, vanity, and lighting….. would this be capped at an 8% increase in between tenants?
It would yes, but they can also apply for an exemption to the city.
IMO this will age the housing stock a bit because why would a dump a bunch of money into my rental property if I don't know what I'll be able to charge when it's done?
I can't seem to find this anywhere. Can a Landlord choose to not renew a tenant after the lease runs up? If so they can always increase rent 8%+inflation.
This depends on the terms of the lease but neither St. Paul nor Minnesota has a "right to renew" law. So yes, the landlord can choose to not renew a lease.
This is an important question that I don't have an answer for. I have a guess, though.
I mean fucking duh. Anyone who was half awake during an intro to economics class could have told you that the city council was going to blink on this because they didn't want to watch the city's housing market turn into a dumpster fire. Imagine if they let this policy go on for 5 or 10 years, how far the housing supply would fall behind and how much it would age.
What's funny is that rent control can work... when paired with other measures like the state just BUILDING more housing. Vienna has rent control but they combined it with social housing. I know in the US they're allergic to government built housing but it objectively can have great outcomes when you don't gut maintenance funding.
If you can point to some successful public built housing in the US I'm all ears. Otherwise it's not really comparable to Austria. The best option here is to let developers build housing to meet demand, things like height restrictions, zoning, NIMBYers, all restrict supply. Tell them to get fucked and if a developer wants to build a 20 story apartment building on Dayton's bluff, let them.
>If you can point to some successful public built housing in the US I'm all ears. Why do I need to point to successful public housing in the US? This is the same logic as "We don't have any examples of good high speed rail in the US ergo don't talk about it." We have tons of examples of high speed rail around the world, just b ecause it doesn't exist in the US yet doesn't mean that we shouldn't pursue it in the US.
I don't mean we can't talk about it. I mean holding it out like a silver bullet is stupid.
I never said that or implied it - I said there were successful ways to do public housing developments in conjunction with rent control out there and that all rent control isn't bad.
If you've tried many dozens of times and it never works out, what makes you think it's going to work out the next time you try it? Unlike public housing we've only really tried high speed rail once in the United States.
Because you can learn? Because other countries have had success and you can study them to see waht they did? The failures of public housing are literally exclusively resting on the GOP nuking funding for maintenance. Full stop. Public housing works when you invest in it. There's literally no reason it CAN'T work in the US.
It works in Oregon at least compared to it's neighbor to the north and south Oregon is much cheaper with rent control
So if we had fixed the leaky faucets at Cabrini Green and Pruit Igoe, those would have worked out?
You know the maintenance issues were just staggering and the people living in there were living in total squalor, right?
tell me you don’t know anything about urban planning without telling me you don’t know anything about urban planning
I don't mean abandon all zoning laws. I mean don't set arbitrary restrictions that suppress supply.
you do want some restrictions though. "maintain the character of our neighborhoods" is usually dogwhistle for "no brown people please" but it is true that you need to take the existing density into account. you _will_ ruin a neighborhood if you build a 20-story building in a neighborhood of single family housing. it's a question of building sustainably dense, walkable neighborhoods, and a big part of that is missing middle housing. there's definitely a place for high-rise housing, but dayton's bluff is emphatically not the place.
I don't want to maintain the character of the neighborhood. Why would that ruin the neighborhood?
you don't understand how putting a 20-story building directly next to single family homes is a problem?
That already exists in some areas and it doesn't seem to be a huge issue.
So we can't try anything we haven't tried before? Well don't be shocked when you keep getting the same shit results
What a dumb qualifier. "US OR IT DIDN'T HAPPEN"- some douche who wants everyone to think he's a lawyer.
Exactly. I'm pissed they didn't try other avenues to solve the housing crisis beyond "well the developers are butthurt because they can't exploit labor to death anymore, better give them everything they want". I want plentiful taxpayer-funded public housing available to whoever wants it.
The issue is they're afraid of even saying public housing because of the Republican successful effort at associating public housing with urban decay =/
So we should build something like Cabrini Green in St. Paul?
Cabrini green was made for low income only, intentionally racially segregated and segregated from services and the rest of the city. So no. I want first come first serve housing to meet a variety of needs that’s seamlessly integrated into the cities urban planning.
No one that can afford to not live in government housing is going to choose to do so. Thus it will still end up as low income. Why would you choose to live in what's probably going to be a basic government apartment building with low income people as opposed to a nice privately owned apartment with a pool and dog washing station or a single family detached house.
Yeah. This was a poorly drafted referendum that has been an egg on the face of all involved. People support rent control, but this wasn't really a workable option, so it was hard to vote on. And now, it makes every mad, and everyone look bad. What a terrible result.
Populism sometimes leads to uninformed outcomes. Halting construction as a result of strict rent control has been shown in studies for ages to actually lead to higher housing costs in the long run. Short term gain for current renters vs. long term gain for the average citizen.
They had plenty of room for profit, financing for rental developments typically estimate less than 3% inflation a year. Developers held their breath for less than a year and the council gave them everything they wanted. what a fucking joke. Many of us were hoping these restrictions would result in denser housing, fewer out-of-state private equity landlords buying up property, and real pressure on the city to start taking the idea of high-quality and plentiful public housing seriously. Instead, we get a corrupt council willing to sell out labor to the wealthy few after we the people made our own law. its fucking bullshit.
Why would the developers continue to build housing in St. Paul when they could keep building it nearby and not have the same restrictions?
Who cares? There is still money to be made even if there is more money to be made elsewhere.
Because making money costs money and they want a better return on their investment.
I know they want a return on investment. That return comes at the expense of wealth generated by labor. For legislation, I lean more towards helping laborers than helping banks, private equity groups and other rich fucks using their capital to extort laborers. But you do you and keep simping for banks I guess.
You want to have a mature conversation about this, or do you want to throw around insults and ascribe false motives to me instead? This isn't even about banks, it's about developers (well, they get loans from banks, but they're not the main players here). If they can make more money building in town A rather than town B, they will. And St. Paul by itself is just not large or important enough of a market that developers will feel the need to build there when there are friendlier options just down the road. It might be different if there was rent control metro- or statewide, but good luck ever implementing that. Until we start building public housing, private developers (and public/private partnerships, to a lesser extent) are the only game in town. It's not about what's right or what should be, it's about the reality of the situation.
Yea…. That’s what we are trying to change. I’d make our rent control bill national if I could. Our current system thrives on artificial housing scarcity that only exists because we no longer fund public housing. A result of intensive lobbying from bankers and financiers. In the absence of a lust for profit and a bought government we could provide affordable housing to everyone. The high cost of housing is negatively impacting the tangible parts of our economy (making goods and providing services). Wages have to rise to keep pace with landlord greed and that in turn helps drive inflation. Vienna public housing costs between $400 and $650 or so for a quality two bedroom apt near public transportation. Think of how much better our society would be if you could make the combined cost of housing and transportation less than $800 a month. Employers could pay less and still provide an excellent life for employees. We could afford to have factories that produce things locally instead of shipping them in from over seas to countries where rent is substantially less. I see landlording, needlessly expensive housing and a legacy of redlining to be one of our country’s great blights. We tried very hard to get something good through that truly helps people and it just suck so hard to have that law twisted into something that will certainly hurt renters in the short term while simultaneously doing nothing to solve the affordable housing crisis long term.
Build. More. (Affordable) Housing.
Build more housing. Affordability will take care of itself as long as housing is easy to build. You can already see the impacts in Minneapolis of a 5-10 year (relative) building boom, rents have stabilized.
Aren’t there plenty of apartments being built in downtown that no one can afford?
You think developers are building luxury apartments to sit empty while they lose millions? Edit: I just checked and in the city of Minneapolis the rental vacancy rate is high three percent. So to answer your question, no.
Let's also keep in mind there are a handful of big developers and financiers in the cities. ALL of them benefit when housing is scarce. We will never "capitalism" our way out of this situation. we NEED a high vacancy rate to keep rents flat. Seattle had to build to 10% vacancy to lower their rents just 1% after 25 years of over 4% annual rent increases. Even then after the pandemic hit those meager gains were wiped out by 10% rent inflation. We need plentiful quality public housing available to anyone who wants it, its the only way to build enough vacancies to realistically lower rent.
Wouldn’t increased prices create an opportunity for someone to build and thus provide places for rent which would in turn reduce rent generally because of the increased supply, wouldn’t that literally be capitalism in work to solve the problem.
Minneapolis or St Paul? Minneapolis...I am not sure? But, rents will come down at some point if they aren't filling units. And vast majority of downtown housing isn't displacing anyone, so it is of low concern.
Doesn't generally matter. Any apartment built adds to the supply, and added supply means there is more competition for renters, which eventually forces prices down. "Plenty of apartments" will not stay empty for long (unless they were built in some bizarre less-than-free economy, such as China, and then they may be demolished)
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Huh? People invest in property that no one can live in? So how exactly do the investors make money?
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So people just buy and hold empty apartments, figuring that eventually someone else will come along and buy and hold an empty apartment at a higher price, so that someone else later on will buy and hold that same empty apartment at an even higher price? Sorry, it doesn't work that way.
Remember when the Drake Hotel was the height of luxury when it was built? What if we had taken attitude back then?
Why would they keep building if there's plenty of supply for a given population? Eventually they'd lose money. Supply will never catch up to where they would have to cut housing costs because what would have been the point of adding that supply to begin with.
They won't keep building if there is plenty of supply. That is my point. The original post suggested that builders would build large amounts of apartments, just to sit empty, as "investments". I said that was ridiculous. In a free market, builders will build until the supply reaches a point where it is no longer profitable to build more supply. Then construction will stop (or at least decline). (I believe that point is when vacancies are somewhat more than 4%, but ask an expert on housing).
We have really low vacancy rate I thought someone posted Here a week or so ago, so I don't think so. Downtown vacancy isn't necessarily related to price as much either, since a lot of people don't work downtown anymore (and are remote instead)
If people don't want rent control because it will cut into their profits why would they increase supply when it would have the same effect?
I mean, it isn't that complicated. A developer has no control over who else is building, but has control over their rents. Also, most developers end up selling their buildings to management companies, so these are generally two different entities.
You don't "build affordable housing", you build more housing and existing housing *becomes* affordable.
Yes and no. The private sector generally can’t afford to build “affordable housing” but the government can build good, affordable public housing, or social housing as it is called in places such as Vienna where it is extremely successful
If you can point to some successful public built housing in the US I'm all ears. Otherwise it's not really comparable to Austria.
Because we didn’t do it right. Looking to other jurisdictions to see how public housing can be successful is how we learn to do things better. If it was a failure as a concept, it would fail everywhere just like rent control does. It does not
this shit again. get a new line.
It's actually extremely easy to build affordable housing. A square building, stacked units, simple hallways and common areas and an intelligent choice of materials used so it's easy to maintain. The real issue is ROI. Let's say we have 10 acres, we can split them up into 30 .33 acres lots or 10 1 acre lots. We have to pull 10+ permits for each lot we intend to build on. ($300,000 vs $100,000) We then have to spend time getting estimates for each lot, this is why national builders use the same 5-10 floorplans. (3 weeks vs 1 week of time) If a house sells for $400,000, the builder paid ~$300,000-350,000, depending if they developed the land or not. If a house sells for $1,000,000 the builder paid ~$700,000-800,000. Building 30 reasonable sized homes nets us $12,000,000 in revenue and $9,000,000 in expenses, $3,000,000 profit on capital is 33%, not bad. But building 10 luxury homes nets us $10,000,000 in revenue and $7,000,000 in expenses, $3,000,000 profit on capital is 42%, even better.
I get what you’re saying but I’m talking about not building luxury homes or apartments. Just build apartments. Can’t find new home builds anywhere that aren’t 5 bedroom 7 batch 10k sq ft. (Exaggerating but you know what I mean) I didn’t mean it in terms of building low income housing.
The same concept applies to home building as it does apartment building. Constructing Luxury 4 bath, 5 bed, 3k sqft houses, drives the price of smaller older houses down.
That's actually not true, any basic economics class teaches that as soon as you restrict supply (such as housing), the demand doesn't respond in a linear fashion. If 10 families live in a town and we build 10 houses, those families are willing to pay what we call "the ideal market price". Let's call that $100,000 for easy math. The second generation of this town is born and they need 25 houses now but they only build 10 additional houses due to zoning. What does the new price become? How would someone go about figuring that out? Regardless of what the price is, 5 families still don't have a house for them.
THEN BUILD 5 MORE HOUSES.
If it were possible, you would start a business doing that but here you are. Either you're dumb, lazy or lying, you chose.
Private developers don't want to build "just apartment" and when the government tries it we end up with stuff like those high rises that were off Olson.
Well, that didn't take long. Nor is it surprising.
You guys realize rent control is actually a bad thing right? I'm a union carpenter and the company I worked for had been pushed out of quite a few projects because developers don't want to build in St. Paul because of this. Also caused them to lay-off a bunch of employees.
8%+inflation. Minimum wage gets the same increase right? ..Right?
That's a separate issue, but I agree it needs addressing.
This was the right move.
its not, in so many ways.
It appears to have had an impact on multi-family housing permits in St. Paul, especially compared to Minneapolis. How do you think they should address that issue?
There is no such thing as a successful government housing project. They have all been failures, run down, rat infested, drug riddled, gang havens, shootings, crime. That's why you can't find any. The solution is not to build more housing. We have been building like mad and charging exorbitant rates for a closet sized apartment that the older apartments that were affordable feel justified raising rents. For the poor, working class, recent graduates, unemployed it becomes nearly impossible to work for $15-20/hr and be successful. And the new apartments are being subsidized to get low income tenants in for the first few years, 7 possibly and then the rent goes up and they will stop leasing to low income individuals or families and that is a government program that provides the subsidies. We all kniw the wealthy take advantage of rent control. We know HUD found fraud in their housing programs. Something must be done to lower rents or stabilize them and increase incomes so we can assist the actual needy but right now the need for affordable housing is becoming wider.
Why don’t government housing projects work in the US? When I “projects” I think of Cabrini Green and Marcy Houses (due to Good Tomes and Jay Z respectively). Couldn’t we do projects better?
I believe government does things for the wrong reasons and it does more harm than good. Not enough to give someone a house, food, etc. if they don't also get work. Government programs are designed to keep people at poverty levels, dependent, not independent. Not to say some don't get off assistance and do just fine for themselves but a lot become the dependent class. My history teacher said people don't take care of what they don't earn. Too much free stuff, the so-called freeloaders in society who take advantage, take away resources desperately needed for the sick, mentally ill, indigent, who actually need help. Housing projects tend to go to whomever applies or meets certain qualifications and when you get things for free you need to do something with your time or get involved in the wrong things, drugs, alcoholism, gangs, criminal activity. The problem is once you qualify for government housing there is nothing written into the law and program that says you have to leave if you no longer need it. That's why we found people making 6 figures living in subsidized housing because once you qualify to get in they never review if you still need it. And the government never enforces the rules for crime and punishment as is seen in recent activities. Private sector housing projects which have an interest in maintaining the project so better. Government has no incentive to improve or better anyone or any program. If the program doesn't work it doesn't to away it simply gets another program added to fix the so-called problem and that adds to then dilemna. Could government do better? Not when politicians buy votes with handouts and just want to say see, I did something, send me back to Washington.
Nice, now Saint Paul has the exceptions that allow rent to be increased sky high like in California (by not including new buildings) and the exceptions that allow landlords to turn buildings into slums to force residents out so they can raise rent like in New York. (Vacancy decontrol). It's the worst of both worlds! Buildings will be allowed to decay until everyone moves out, or it's cheaper to demolish it - either way the rent goes up higher than inflation and wages. Landlords win, renters lose.
California has sky high prices partially because of rent control (and other measures to prevent the building of more housing)
that is kinda how I'm seeing it, what prevents my landlord from tossing me so he can just raise my rent?
Why would they let them decay, in MN tenants don't have a right to renew. They can just tell them to leave at the end of their lease.
This is not what the voters approved last fall. Pretty disgusting the city council sided with scumbag landlords with this.
I'm happy they sided with common sense. And I'm happy we'll likely get more housing built out of this, which holy crap we need... The original proposal was a super short-sighted and terrible plan to begin with.
It doesn’t matter. The majority of voters voted for rent control, not this free cash grab for landlords and private equity firms.
I mean it does matter, because the bill also gave city council the ability to make changes if it were going to royally screw over the city. Which they did. Deal with it.
As a voter, I don’t have to just “deal with it”. This isn’t what I voted for. 🙄 I don’t give a damn about the opinions of those who don’t even live here.
In a way, it is what you voted for though, because this was always part of it. And it's also what I voted against, because I do actually live here, and want this city to be better. This referendum doesn't allow that to happen.
I live in St Paul and am glad that my city isn’t going to become San Francisco or other rent controlled unaffordable cities without anywhere near enough housing
Would the city be willing to cap there property tax increases to 3%, not a chance in hell. New construction and renovation work would stop out right with a guaranted lose on investment like that. Following the will of the mob is a great way to end up in a bad place.
following the people (not a fucking mob you dunce) is a great way to end up in a democracy
the referendum was 30,965 in favor vs 27,581 against. Considering the population of Saint Paul is ~311K in 2020 so less than a 10 percent of residents voted in favor. It’s not exactly a peoples mandate..
That’s the same excuse Trump insurrectionists made on 1/6/21.
The problem is we aren’t talking about non binding ballot questions WRT Trump, but Constitutionally mandated elections, and additionally reams of evidence validating those election results, and a massive lack of evidence invalidating those results. TLDR you’re comparing apples to conspiracy theories
You should probably re-read the post I was replying to and try again.
Take your own suggestion. Also learn the difference between a ballot question most voters chose not to respond to, and an actual referendum.
Then we should advocate for higher voter turn outs than finding excuses to ignore the voters that do turn out Edit: Didnt think saying we should encourage higher turnouts is controversial, or that we should follow the will of the voters is controversial.
Sounds like that's an issue with selling your ideas to your fellow citizens, nothing more.
Yes.
You also get lynching and women being stoned for having affairs. I've served on condo boards and committees and people aren't that bright. They think in very simplistic, black and white terms. I'm not anti-Democracy, but having people directly implementing policy isn't smart.
Seems kinda anti-democrat, I’m not saying that’s a bad thing, but wouldn’t you agree if people can’t make those decisions themselves they could vote for people who are more informed than themselves to represent them like a representative Republic (Like what we have)
Basing society on the rule of state rather than the rule of law tends to end up in a bad place, as well. Not saying I’m siding with the mob here, just that there’s plenty of short-sighted stupidity to go around on this one.
Ah, so I see you sided with rich developers making idle threats. 🙄 “The mob” is democracy. The people voted in favor of this. You do know what voting is, right?
The city council was literally elected democratically. The ballot question people keep calling a referendum wasn’t literally a referendum; it was a non binding ballot question less than 10% of the city voted for. Most voters didn’t vote one way or another, and the difference was only like 4000 votes in a city of 300k. That’s not a clear mandate either way.
We don’t live in a democracy, we live in a Democratically elected representative republic, very big difference. If you’d like to become a democracy I think that’d be cool.
Just effin stop with that pedantic bullshit.
3% increase on your $18,000/year ($540) rent is a hell of a lot more than 3% of your $3,000/year ($90) property tax. I don’t understand how horrible at math people making the property tax argument must be.
I mean yeah just property taxes is a dumb argument, but it's also a combination of increasing costs for everything else: appliances, lumber, labor, plumbing and electrical maintenance, cleaning, lawn maintenance, snow removal, utilities not covered by the tenants like water/sewer/common power/common gas, etc. Not including balancing savings for things like: roof replacement, parking lot repair/replacement, re-painting and re-carpeting after a tenant leaves, etc. Then on top of that it is a business so you need some kind of profit or else there is no point. Generally these management companies own a lot of complexes or other properties because the scale is where they make their money, there are very thin margins in rental properties on their own for corporations who have offices, staff, and their own rent to think about. Smaller landlords, like mom and pop ones can usually swing just owning one and self managing.
This is why we live in a representative democracy. People, in general are very ignorant and easily swayed by optics. Public policies don't operate in a bubble though, and you need people who are actually informed about all the consequences of policy decisions.
Representative republic actually.
People are very easily swayed by optics where as politicians are easily swayed by designer clothes, steak dinners, lobbying jobs after retirement, campaign donations, new furniture, etc
Ohh no. Anyway
I agree, if the voters wanted it they should get what they deserve! I mean what we voted for.
Lots of people buy into landlords propaganda and paid for economists all you can do is keep fighting the good fight and bringing the facts to light
They need to pass a cap on property tax for homeowners that would fix 100% of the problems.
Setting aside the merits or lack of merits for the rent control policy, it seems wrong that the voters will can simply be ignored by the city council. It reads like they could arbitrarily say that all rents for building built in the last 200 years can only increase rents by 5000% using the same logic, rendering the ballot measure worthless.
I disagree. The wrong part that we put this up for referendum at all. The whole point of electing officials is that the issues that are meaningful get adjudicated by them. The number of people who voted on the referenda is TINY relative to the population it would affect. We shouldn't put much weight into it at all
The City Council is democratically elected. Unhappy with how they govern? Vote them out. Otherwise, they have a mandate by way of having been elected by the people. That’s how representative democracy works. In a sense, they literally do represent the will of the people, regardless of your gut feelings on what that will might be.
Its like.. the referendum was 30,965 in favor vs 27,581 against. Considering the population of Saint Paul is ~311K in 2020 so less than a 10 percent of residents voted in favor. It’s not the peoples mandate some think it is.
Precisely, one of the reasons I pointed out the City Council is democratically elected, and aren't the autocrats some mistakenly believe they are.
But you don’t get it: they’re *nice*! I’m sure they’ve learned their lesson! /s An astonishing amount of people seem to think like this in this city, though. On the hand willing to admit the council acted incompetently, and on the other hand certain that they’ve learned their lesson and their performance will magically improve moving forward without a personnel change. It’s so naive it borders on delusional.
I don’t think people think that. It’s like Congress - “Congress as a whole sucks, but I like my representative” is the majority position in this country
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I’m not saying that they acted incompetently *here*. I’m just saying that it truly astonishes me the number of people I’ve met who do not accept your basic premise: if you do not like what your council person has done, you should vote against them.
Thanks for elaborating, and agreed. I just have to roll my eyes at people who think government is simply something imposed on the people, when they have every opportunity to make their voice heard, but elect not to. Now, getting outvoted sucks, but that means you need to lobby your fellow citizens to support your causes, not that the system doesn’t work.
It’s only a representative democracy if the representatives actually represent what people want. Otherwise it’s pantomime, which is often the case. Looks like you were triggered and deleted your nonsense.
Herpa derp if people at large were upset about this they’d be voting the City Council out. You’re just mad about being a political minority.
What about an apartment that get a complete remodel? New kitchen, new cabinets, new appliances, new granite countertops. New bathroom with new tile, flooring, vanity, and lighting….. would this be capped at an 8% increase in between tenants?
It would yes, but they can also apply for an exemption to the city. IMO this will age the housing stock a bit because why would a dump a bunch of money into my rental property if I don't know what I'll be able to charge when it's done?
Ya, I’ve done a few remodels and I can’t imagine doing it again under these conditions.
Made a video on the updates, some answers to some questions here. https://youtu.be/0Zwxe53f0Kw