New York City

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FISHMANPET
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Re: New York City

Postby FISHMANPET » November 7th, 2014, 10:49 am

NYC really likes to encourage and subsidize office development, even though the demand isn't there, at least not in comparison to demand for housing.

mamundsen
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Re: New York City

Postby mamundsen » November 17th, 2014, 5:38 pm

Yay super talls... Oh wait. Nope. This doesn't look right.

http://gizmodo.com/this-is-how-new-york ... 1659685761

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Nathan
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Re: New York City

Postby Nathan » November 18th, 2014, 9:22 am

mamundsen wrote:Yay super talls... Oh wait. Nope. This doesn't look right.

http://gizmodo.com/this-is-how-new-york ... 1659685761

Doesn't look right? That is basically how everyone has imagined new York in the future isn't it? Super tall buildings, they've always been on the front lines of tall buildings. flying cars, basically the 5th element.

mattaudio
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Re: New York City

Postby mattaudio » November 18th, 2014, 9:28 am

What exactly could be wrong with the housing market responding to surges in demand by building these luxury buildings? Just think how much affordability (if you can call it that in NYC) is preserved downmarket by these new buildings.

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Re: New York City

Postby EOst » November 18th, 2014, 9:54 am

Many of those apartments are essentially just stashing wealth in a secure and desirable place, so I doubt they actually have much if any effect on downmarket housing affordability.

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Re: New York City

Postby mattaudio » November 18th, 2014, 9:59 am

But if those new units weren't being built, the same people would be stashing their wealth by buying top tier properties that already existed and may have been actually housing people. It's hard to quantify exactly how much this helps downmarket affordability, but it certainly helps.

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Re: New York City

Postby mamundsen » November 18th, 2014, 11:26 am

Nathan wrote:
mamundsen wrote:Yay super talls... Oh wait. Nope. This doesn't look right.

http://gizmodo.com/this-is-how-new-york ... 1659685761

Doesn't look right? That is basically how everyone has imagined new York in the future isn't it? Super tall buildings, they've always been on the front lines of tall buildings. flying cars, basically the 5th element.
I think what looks strange to me is the skinny-ness of them. They look like they would sway in the wind.

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Re: New York City

Postby EOst » November 18th, 2014, 12:29 pm

mattaudio wrote:But if those new units weren't being built, the same people would be stashing their wealth by buying top tier properties that already existed and may have been actually housing people. It's hard to quantify exactly how much this helps downmarket affordability, but it certainly helps.
Well, that's true to a point, but not necessarily; in many cases, these new towers might create demand too, insofar as they help to inflate a bubble which makes other owners more tempted to make their properties available for the purpose. I doubt it's a significant driver of price increases, but it probably isn't black and white either.

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Re: New York City

Postby mattaudio » November 18th, 2014, 12:33 pm

But a bubble isn't necessarily bad for affordability either, once it pops. Look how many people have been able to afford to purchase dwellings over the past five years because the former bubble popped. And any excess supply is just gravy - it lowers prices even further down the road.

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Re: New York City

Postby EOst » November 18th, 2014, 12:35 pm

Not every bubble pops, especially bubbles driven by massive concentrations of wealth, as here.

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Re: New York City

Postby mattaudio » November 18th, 2014, 12:56 pm

So, let's say that this bubble won't pop and it's theoretically harmful to NYC housing affordability. What alternative do you propose? There's not a simple policy way to make NYC real estate less appealing to multimillionaires looking to stash their wealth in a hard asset (or actually have a luxury Manhattan residence). Since we probably can't curb that demand, it seems like the least harmful response is to allow the market to accommodate it with new units.

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Re: New York City

Postby xandrex » November 18th, 2014, 2:21 pm

mattaudio wrote:But a bubble isn't necessarily bad for affordability either, once it pops. Look how many people have been able to afford to purchase dwellings over the past five years because the former bubble popped. And any excess supply is just gravy - it lowers prices even further down the road.
That's great for the people who are in a position to buy homes once it pops. Kinda sucks for everyone else that has to deal with years of high prices and may not be in a position to buy (for instance, a lot of people my age).

We should really be avoiding bubbles. It may have created some affordability (which, unless this is new construction, is someone else's loss, let's remember), but the benefits tend to be vastly overshadowed by the drawbacks. See: the recession.

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Re: New York City

Postby EOst » November 18th, 2014, 2:29 pm

mattaudio wrote:So, let's say that this bubble won't pop and it's theoretically harmful to NYC housing affordability. What alternative do you propose? There's not a simple policy way to make NYC real estate less appealing to multimillionaires looking to stash their wealth in a hard asset (or actually have a luxury Manhattan residence). Since we probably can't curb that demand, it seems like the least harmful response is to allow the market to accommodate it with new units.
I mean, personally, I'm just waiting for the workers' revolution.

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Re: New York City

Postby mattaudio » November 18th, 2014, 2:47 pm

But how exactly do you prevent them? That's what I'm asking... what policy change would actually improve things here? It's difficult to impossible to change people's preferences through policy.

And I realize that the recession was unfortunate for a lot of people, but it allowed myself and tons of other folks in their early 20s to buy homes. Granted, it would have been better for the bubble to never exist in the first place. And there were policies that built up that bubble at a macro level. But when we're talking about demand for housing units in a particular place, there's not much that can be done to quell demand. The same problem is felt with the downsides of gentrification.

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Re: New York City

Postby EOst » November 18th, 2014, 3:28 pm

Well, I mean, if you want to get into it...

The first thing, and arguably the most important, would simply be to adjust the tax structure to make those empty buildings of parked wealth generate income for the city. A tax on uninhabited units (perhaps with a floor somewhere in the millions), even if it didn't bring in massive amounts of money, could at least provide some benefits for the city. In that vein I would also raise the required ratio of affordable housing.

More generally, the government needs to return to its role of being a developer in its own right. Just because Pruitt-Igoe and its kin gave "public housing" a bad name doesn't mean a public authority can't make well-designed, urban structures, and I'd much rather the profits from these going to the public good than enriching some guy in Dubai.

The basic problem is that developers have very few incentives in an age of hyperinequality to build affordable housing. If the root cause won't be fixed any time soon, then we should be working to tip the scale.

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Re: New York City

Postby fehler » November 19th, 2014, 11:25 am

What are the laws on subletting in NYC? Are these billionaire apartments being subletted to millionaires, or are they sitting empty?

Elliot Altbaum
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Re: New York City

Postby Elliot Altbaum » November 19th, 2014, 2:29 pm

mattaudio wrote: And I realize that the recession was unfortunate for a lot of people, but it allowed myself and tons of other folks in their early 20s to buy homes. Granted, it would have been better for the bubble to never exist in the first place. And there were policies that built up that bubble at a macro level. But when we're talking about demand for housing units in a particular place, there's not much that can be done to quell demand. The same problem is felt with the downsides of gentrification.
I am floored that you defend the housing collapse/ recession as allowing a bunch of folks to buy homes. That housing collapse was an enormous loss in wealth for people of color; the median net worth of blacks dropped 53%! http://allianceforajustsociety.org/wp-c ... TIONAL.pdf

You are right that the bubble should never have existed, but to claim its outcomes have been generally beneficial is crazy.

I agre with EOst that restructuring taxes is the first approach. First tax the income of the billionaires so they don't have the same amount of money to induce demand. If the buildings are going to be built, heavily tax empty units. Limit foreign real estate investment in these projects; many are being built for oil princes to park wealth.

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Re: New York City

Postby mattaudio » November 19th, 2014, 2:43 pm

Yet the reality is that if there were not billionaires and oil princes looking to park wealth in supertalls on 53rd Street, those supertalls wouldn't be built. So what's the real harm in terms of affordability? We tolerate makework stimulation of demand to provide jobs and economic activity when government is doing the buying, but we won't tolerate essentially the same thing when it's billionaires parking wealth?

Elliot Altbaum
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Re: New York City

Postby Elliot Altbaum » November 19th, 2014, 3:06 pm

I think the frustration by many is the overall trend towards viewing real estate as just investment portfolios and not as homes. Overall the affordability of housing in NYC is going down, for the majority of people. Second, my guess is that nearby properties will be assessed with higher values which would thus demand higher rents. As EOst said, in the age of hyperinequality there is no incentive to build affordable housing.

I think there are pretty clear differences between how demand is induced by billionaires and the government. First, it has been well document at this point that trickle down economics through demand created by billionaires does not generate a growing economy on the whole. It might create growth in small sectors of the economy that service the billionaires (construction, yachts, etc.) it doesn't provide for the whole economy. Lastly, the demand is decided by the billionaires and not the rest of the population.
For government, it is very different. For a starters, the money can be directed in a way chosen in a democracy. That makes a huge difference. The CCC hired people to build trails in the national parks that can be used by anyone 100 years later. The WPA hired writers to write guidebooks. We, as a people, can direct the economic stimulus in a way that serves a greater portion of the people.

To bring it back to NYC, billionaires build supertalls that no one will live in. The city of New York could build supertalls that could provide affordable homes for the writers, sanitation workers, and teachers of the city.

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Re: New York City

Postby mattaudio » November 19th, 2014, 4:00 pm

There's no way a supertall on 53rd Street is going to be "affordable housing." We might as well spend the money making it easier for writers, sanitation workers, and teachers to commute from the outer boroughs.


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