Housing Market/Economics - General Topics

[MNdible]

Not really covered in the article, but I'll toss in that SFH rentals are just much harder to manage well than a multi-unit building. They're often owned by inexperienced, one-off landlords; even when an experienced landlord owns multiple properties, it's just harder to keep an eye on a bunch of scattered site properties. You can't have a care-taker on site.

[Anondson]

That was something I said in my comment to the article. The decline in the neighborhood has little to do with the renters and nearly everything to do with the quality of landlord. A multi family building are often well regulated, and more likely to be well run than a SFH rental. They have resources to bear when a bad tenant happens.

[FISHMANPET]

I think there's definitely room for property management companies in this, as they can provide a lot of useful services (payment services, good quality leases, a 24 hour maintenance hotline to serve as a buffer between tenants calling in the middle of the night and waking up owners for minor things that aren't emergencies). But ultimately someone still has to care about the home and maintain it well. I rent my house and and it's been the family home, the owner's grandparents owned it until the past, the owner's dad (also the one that fixed it up before we rented it, and would probably do any maintenance) grew up on the house so has a personal connection to it.

The house next door appears to have been bought in foreclosure in 2008 and I have a suspicion it's being rented illegally, and to be honest it looks like kind of a dump, maintenance wise.

I've often wondered if there would be a market for some kind of SFH landlord insurance. It wouldn't be useful for large companies owning a lot of homes, but if a bunch of landlords that owned a single house to rent out paid a small monthly amount, and then if a tenant trashes the place the insurance pays out rather than a single landlord being bankrupted. A nice way to spread the risk out.

[seanrichardryan]

http://renterswarehouse.com/

[MNdible]

Sure seems like a reputable outfit.

[FISHMANPET]

Hey, that's the management company for my house!

Sent from my Nexus 5X using Tapatalk

[Anondson]

How zoning exacerbate inequality.

http://www.theatlantic.com/business/arc ... ty/417360/

[Anondson]

A shortage of lots for SFHs in the Twin Cities.

http://finance-commerce.com/2016/04/hou ... in-cities/

[RailBaronYarr]

Maybe the Met Council should agree to extending the MUSA in exchange for all suburbs cutting minimum lot sizes in all SFH districts to 5,000 sqft and allowing duplexes, triplexes, and ADUs. There is simply not a shortage of land to build detached SFHs in this region. The places I'm talking about do not have parking or traffic issues, and could easily add more families to their neighborhoods.

[xandrex]

The great divide between "expensive" and "expansive" cities is growing: http://blogs.wsj.com/economics/2016/04/ ... -s-cities/

[twincitizen]

Maybe the Met Council should agree to extending the MUSA in exchange for all suburbs cutting minimum lot sizes in all SFH districts to 5,000 sqft....

I'll stop you there before even getting to ADUs & duplexes. Firstly, I of course agree that 5,000-6,000* sq ft should be the minimum lot size allowed in all communities within the transit capital levy area (7-county metro minus the rural/exurban areas with no transit service whatsoever). I'll even compromise further - say everything inside the 494/694 loop + all adjacent burbs >50k pop?

Problem is that all of these inner and 2nd ring suburbs are already built out. The MUSA line already extends far beyond these developed communities. Do we necessarily want 5,000 sq ft lots and/or multi-unit at the fringes of the MUSA line? Probably not! How does extending the MUSA line benefit older 1st and 2nd ring suburbs? It doesn't...quite the opposite, most would argue. So I'm not sure how you compel inner suburbs to make changes to their land use based on something (MUSA line expansions) they either don't want or are ambivalent about.

Putting aside the MUSA line talk, it would be very interesting to see some kind of regional effort to get existing suburbs to reduce their minimum lot sizes. The push would probably have to come from some coalition of builders, unions, etc. rather than top-down from the Met Council. Met Council could push local communities with its various carrots (brownfield cleanup grants, development grants/partnerships, local transit service funding, etc.) The time to push these minimum lot size changes on inner suburbs would be now-2017, as cities are just ramping up their decennial comprehensive plan update processes.

*Note: Minimum lot size is so unbelievably huge in most suburbs that I'd probably settle for 10k sq ft minimums for anything beyond the first ring. IMO the greatest opportunity for change is getting the entire first ring on board with 5,000 sq ft lots, and the sooner the better.

[RailBaronYarr]

If we're being honest, though, 5,000 sqft lot sizes as a minimum in most suburbs isn't going to spur anything. Most lots in first or even second ring burbs are somewhere between 8,000 and 15,000 sqft, (1/6 to 1/3 acre), with homes generally in the middle of the lot and/or driveways on the side to a detached garage and/or wide and shallow ranch styles taking up 2/3 the lot width and/or on difficult to build on lots from a terrain perspective. I know I'm sort of contradicting myself here, but the vast, vast majority of people in Bloomington or Edina or Minnetonka are simply not going to value a land sale of ? $100,000 ? in their pockets, if another home could even be added, in exchange for having a new neighboring house on half their lot for the remainder of their time living there. The reaction to Minnetonka's 75' width lots (15k sqft vs standard 22k square feet!) should give us insight into the reaction (though I will note that Lakeville started allowing more development on 8,400 sqft lots, different dimensions than Mpls but not much larger).

I guess the lot size is but one change. There are developers who might buy some SFHs as a tear-down to put up 2 or 3 in its place (or buy two contiguous lots to do so), which is good. Duplexes, triplexes, etc add flexibility to that conversation. But all of that will be a pretty slow pace of construction IMO. I say this as a person utterly dismayed by the gap between amortized construction costs for an ADU with $0 lot purchase and the rents I could get given I'm within walking distance of one of the hottest neighborhoods in the state.

I brought in the MUSA line because it's a compromise of sorts. From my perspective, it's a little disingenuous to be pro-market solutions but be mostly opposed to *any* fringe development. You're right, the built-up areas don't really benefit from new development in new sewer service areas. But we do know that restricting the MUSA line does make whatever development occurs outside it (which will continue to happen!) to be on larger lots than if the MC were involved, which manifests itself in worse outcomes re: regional transportation costs. And, I doubt if you asked an Edina resident if they'd rather have New MSP Resident John Doe live on smaller lot new construction on the fringe or a small apartment next door (or, horror, their neighbor's home converted to a duplex) they'd pick the former every day of the week. The compromise allows cheap fringe construction at densities that at least pay for their sewer line costs in exchange for regional leverage to do some upzoning in built-up areas.

Otherwise, what's the Met Council's bargaining chip when Edina or Plymouth come with their Comp Plans and basically propose a few pockets of super-high density parcels and no change to any existing SFH neighborhoods? I see what you're saying on getting other parties in on the push, but realistically anyone with that kind of sway probably 1) doesn't care where the development happens anyway and 2) is probably better at doing it on farmland tract subdivisions. That's why extending the MUSA line is important, to get those parties interested.

[David Greene]

I never fails to amaze me that we built better housing 100 years ago than we do today.

[FISHMANPET]

I too am shocked that the buildings that have lasted 100 years are, on average, better built than the average new building.

Wait, no, I'm not. Not everything that is being built now will last 100 years, and not everything that was built 100 years ago lasted 100 years. There's some serious survivor bias going on where all the buildings that are 100 years ago represent the best of the best to have survived this long, and somehow extrapolate that to say all buildings built 100 years ago were of a higher quality. What about the buildings built 100 years ago whose roofs leaked 5 years after they were built? What about those?

[relux]

I'd say a leaky roof is better than the building being torn down after year 40.


Sent from my iPhone using Tapatalk

[David Greene]

I too am shocked that the buildings that have lasted 100 years are, on average, better built than the average new building.

Wait, no, I'm not. Not everything that is being built now will last 100 years, and not everything that was built 100 years ago lasted 100 years.

Poor wording on my part. What I meant to say is that I'm amazed that with all of the scientific and engineering knowledge about buildings that we have today and didn't have 100 years ago, we still build buildings that fall apart, even though without all that knowledge we were able to build things that lasted a century ago.

[RailBaronYarr]

We're also building structures that don't fall apart today, which was FMP's point. We hear all the bad stories about buildings that need major (or even relatively minor) work, but never hear about the ones that just chug along. And, we don't really have a good grasp of the amount of rehab work in the first 30 years of old building lifespan. I think it's at least worth pointing out that newer buildings, both single- and multi- family, are far more complex - more and larger windows, crazy rooflines, elevators, complicated HVAC systems (relative to hot water), better insulation, deeper foundations for parking, could go on. They all bring in points of failure, intrusion, etc that simple buildings just didn't have, or they fail quicker because the old way of doing things was hazardous to our health (asbestos, lead paint, etc). There are plenty sectors of our consumer economy nowadays that have much shorter lifespans but are far, far better (in terms of efficiency, features, whatever) than their counterparts from 50+ years ago. TVs, lawn mowers, refrigerators, you name it. Maybe a majority buildings today really are built with a 50 year useful life in mind and they might require some extensive work in the meantime, while back in the day they were built to last 100-200 years. We can evaluate whether that's good or bad from an environmental or social perspective, but it doesn't by itself make the older building "better." I will admit, I'm mostly interested in what our building codes aren't addressing and/or how things are slipping past inspections.

Anyway, this situation is too bad because the narrative for anyone against new housing writes itself. Either newer housing is crappy quality and will fall down, or new housing impacts adjacent properties. So don't build new housing.

[David Greene]

Again, my point is not that old is better, it's that we apparently still build shitty stuff despite having 100 years of technological advantage. No one would accept the reliability of a1916 automobile today. It's a process problem.

Sent from my Z958 using Tapatalk

[RailBaronYarr]

Not sure if you deliberately ignored all the examples I gave of durable goods people accept nowadays with shorter lifespans and/or reliability in exchange for greater efficiency and/or more features than their equivalent from 50+ years ago or ??????

[David Greene]

Jesus.

Ok, fine, I made a terrible point that is not even correct.

Happy?