Author: paul

No mention of why this property fetched such a high price…we see phrases like

the offering “garnered significant investor interest globally … due in part to the trophy quality of the asset in a submarket where the fundamentals are clearly improving.”

But no discussion of those fundamentals…that Seattle, like every city, has all the land it will ever have and the price to occupy and access it rises with demand, forcing the cost of living up. Forget all that stuff about money supply or the Wiemar republic and hyperinflation…the cost of land and its impact on the cost of living are constant and ubiquitous. The rising cost of land reflects the value of location and forces wages to rise for the businesses that value that location. Those who don’t command those wages are forced out, as shelter costs track the rising wages, like a buoy on the tide.

I guess I can’t expect the Business Journal to concern itself with these deeper issues but these articles are what we used to call “bead stringing” or “rip and read.” You just take the “news” releases from whatever industry you cover and print them, with a little light massaging or none at all.

A lot to unpack here — why do we continue to conflate housing with houses? — and the reluctance to accept that other people also want a place of their own, even if it means density.

“As a 30-something-year-old who is fully employed, my family and I have spent 18 of the last 24 months living in my in-laws’ basement. Not because we wanted to, but because we couldn’t find a house to buy.”

If a house is out of reach, is there no other option? People do raise families in multi-family buildings, some in very desirable locations. Not that his neighbors will accept a multi-family development:

Eskic went on to read a letter from a concerned citizen to a local Utah city council, in which the resident opposed a proposed townhome development and said they didn’t want to “live next to the kind of low-income people who typically reside in high-density housing.”

“I do not want their delinquent children attending the schools that my children attend. I do not want to deal with the increase in crime and drug use that inevitably accompanies such high-density housing units,” Eskic read from the letter. “I do not want my home values to decrease.”

We’ve already seen that density drives values up, as one would expect. But racism, xenophobia, whatever afflicts people like that isn’t amenable to reason.

The subject of the piece is a researcher but I wonder how many housing options they have seen, let alone researched. Are there no benefits to density and reduced car use, shorter distances between services? How would cities have grown without the car, in an alternate timeline? I get it, people want their private park and distance from their neighbors. They want a place to park a couple of extra cars or plant a garden or build a play structure for their kids or whatever. But doing that within a city comes with a cost. Not just to buy the land itself, but the opportunity cost of a city that allows more people to access it, to invest in it. It becomes a club, in other words.

This is all depressingly familiar, just another example of failure of imagination. “I want a house with a decent fraction of an acre and mature trees and good neighbors who look like me and drive nice cars and keep their lawns mowed and go to bed early” is not an urban planning strategy.

What if you lived in a building with people, some of whom look like you but many of whom are similarly educated, perhaps also work as researchers or knowledge workers, who have also decided they have better things to do with their time than commute to work by car or cut their grass for the approval of their neighbors? Is there nothing to gain from that set of choices? The 1950s are long gone. But they seem to linger in people’s minds, as some kind of dream world no one really wants to return to, if they had to.

Contrary to expectations, rates of homelessness tend to be lower where poverty rates are higher.

Contrary to whose expectations?

A quick comparison of income/GDP and homelessness suggests that higher incomes push up the rate of unhoused people…why, it’s almost as if housing (ie, land) prices chase wages, and those whose wages don’t rise so fast are forced out of whatever housing they could afford.

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Is it a perfect correlation? No, there are other factors but the assertion that homelessness is tied to poverty rates, rather than inequality or a widening gulf between rich and poor, makes me wonder how much the authors want to understand the problem. But then I am reminded of Upton Sinclair’s dictum that “[I]t is difficult to get a man to understand something, when his salary depends on his not understanding it.”

Housing as a market good rewards speculation. Recapturing the value of land to fund and build social housing, through outright public ownership of land or a tax that recoups the dividends of public productivity, can curb it.

Homelessnessness isn’t a housing problem: it’s a land problem. There is no affordable housing without affordable land. Seems like it wouldn’t take a PhD to get that. Maybe having one makes it harder to see the obvious.

Yet another well-argued and sourced explanation of why land rents are not just the “least bad tax” but good actually. The fact this never seems to be part of the debate, as tax rates in high earners (and investors) fall and working people find themselves under more stress makes a person wonder, why not?

A real Populist would make hay with this, if such a person existed. What’s the old saying? “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” Nor can you make someone understand something if their power depends on not understanding it…not that congressional salaries are unimportant (if the national minimum wage were $15, they would make about 12 times that, not counting staff and other expenses) but power is the real draw. Corporate boards and other sinecures await the obedient.

The Seattle Process is alive and well…just as a consortium to build social housing gets some traction, another then opposes it and who knows if anything will ever get built?

The land is there, the funding could be found, but as noted in this piece, the bust part of the cycle, where the fortunate few watch the rest of us struggle or leave, has cheerleaders. Seattle doesn’t want to be a fair and equitable city, One Seattle, or anything of the kind. I think the promise of that, as unveiled at the 1962 Century 21 Exposition, scared people. (What this writer seems to forget is that all the changes he and his mossback friend decry were all wrought by local people cashing out their local businesses or failing to keep up with the times.) The local voters were offered a future with transit and managed growth but opted out, cherry-picking pools and parks for themselves (and to keep other people in their own neighborhoods) and rejecting anything that connected people.

According to the City of Seattle, currently most surplus public land is sold to the highest bidder; however, a state level bill passed in 2018 (SB 2382) “grants authority to cities to sell surplus property for below fair-market value – all the way to $0 – as long as the land is used for permanently affordable housing.”

And as we already know, that just turns what could be productive land into a speculative investment.

No matter what the bloviators on right wing media claim, Seattle is far from “woke,” whatever they think that means. It’s still a propertarian city of private parks surrounding single family homes that are no longer housing but tradable commodities…Wall Street, not your street.

This encapsulates the current mood pretty well, reminding me that Seattle is a city that is willing to share, as long as it doesn’t have to give anything up.
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Rebecca Parson, a Democratic Socialist running in Washington’s 6th Congressional District, tweeted that “$15 minimum wage is an antiquated demand. It should be $30 per hour.” According to her reading of the present economy, which is mostly correct, “1 adult supporting 1 kid needs $30 an hour across the country. Rural, urban, suburban: $30 is the floor.” But increasing wages will only return us to regular Keynesian economics when what we really need to do is move toward an economy that makes life much cheaper. Raising wages without considerable structural changes can will only add more fire to the belly of the beast we call capitalism.

The increases in the cost of living and resulting inflation are caused by the increasing cost to access land for development. Inflation is caused by too many dollars chasing a scarce good…what is more scarce/finite than land? We have all the land we will ever have, and as much as all the kingdoms and empires ever had. What we have that they didn’t is a lot more people trying to make living, build a life, on that land. Putting a rent on land the returns that rising value to the people who created it is what we need to do.

Could housing crack before inflation does?

Singling out housing makes sense. As we’ve discussed, house prices and rents are very high. Roaring demand, driven partly by demographics, is paired with meagre supply. The inventory of existing homes for sale hit an all-time low in January and has hardly recovered. Homebuilders are rushing to get fresh inventory on the market, but are constrained by shortages of labour and building materials.

Does it make sense though? Labor and building materials are just as available in suburbs as in cities but land is not.

The existence of cheaper housing in suburbs or small towns, either as new construction or existing stock, shows us that land and location drive housing costs. Scarce commodities rise in price, as any economist or business person will tell you, but for some reason, land is always left out of the conversation.

So why compare inflation and housing costs without discussing land and the scarcity of it as the factor driving both upwards? Rising prices and inflation are always linked to scarcity of something…after the Black Death, as scarce labor supply raised wages.

But all we hear about is inflation without any attention paid to what causes it. The underlying inflation we hear about constantly as well as the pressure to raise wages, higher rents or home prices, all of this ties back to scarcity and the rising cost of living. And land is the one commodity we all need, whether for farming, manufacturing or just to live on. We should perhaps act like it’s valuable, maybe even essential.

Developers say they can’t build affordable apartments the Boise area needs. This is why

Blame high land and construction costs, along with property taxes, developers say.

Don’t listen to me, listen to developers who want to build the housing we need but can’t…because speculators are holding land for gain.

And by property taxes, they mean low taxes on vacant unproductive land vs the taxes on improvements that discourage development, along with zoning and other outdated laws. Raise the tax on undeveloped land and lower it on improvements and stand back…the increased in economic activity will more than make up for any shortfall in passive property tax revenue.

i like a piece of lawn like the next person but isn’t that what public parks and other spaces are for? you know, where community can actually gather and interact?

When I read this, I see the people of Seattle giving up public land in a park to make up for the enclosure of so much land in private parks (yards).

If you magically doubled the density of Seattle and freed up that much land currently under and around single family homes Wall Street’s new favorite commodity, imagine the amount of park land and public space we would have…and still only one-third the density of Paris. The City of Light houses 2.2 million people — three times as many — in one half the area…and there are public spaces, parks, railways, trams and bus lines, as well as ample and safe space to cycle.

I wonder if people are really as opposed to publicly visible encampments as they claim to be. Maybe people get a frisson of satisfaction as they glide past a tent encampment under a freeway bridge. After all, you can’t have winners if there are no losers.

I note this story on the declaration of a “homelessness emergency” with a pledge to end it in 10 years — in 2015. 6.5 years later, I’m not sure there is an emergent solution. But then I didn’t expect one. As was pointed out in the local paper two years later, Seattle had no idea how to manage its good fortune.

When the vacant land we already have is developed into much needing housing and commercial space (there are parts of Seattle that are close to being labeled “food deserts”), rather than carving up public parks, maybe we can take some of this seriously. Any parcel of land that has been idle for years — not even turned into pay parking — should just be reclaimed under eminent domain, taxed or fined as an eyesore, whatever it takes to get it developed, rather than sacrifice public spaces. But under the current city leadership, our glad-handing mayor and complacent council president, I don’t expect much to happen.