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Old 09-30-2014, 10:08 PM
 
Location: Oakland, CA
27,171 posts, read 29,768,960 times
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Quote:
Originally Posted by Ultrarunner View Post
Displacement is not a big issue in cities like mine with rent control...

As a property manager it is a sad state when I care more about the safety of my tenants family than they do in regards to smoke detectors.

It is the exception to find a home where none of the smoke detectors have been tampered with and something I will never understand.

I have a separate form that is signed at move in and annually the all smoke detectors have been tested and demonstrated to be working before I leave...

Usually the battery will be missing, sometimes the entire smoke detector will be gone and I've even seen them smashed in place...
Disagree with this one. Displacement is happening in Oakland too. Market rate rents in neighborhoods with good transit have increased at least 50% over the past 3ish years. And rent cintrol only counts for buildings older than roughly 1980. Check out Fruitvale, East Lake and much of North Oakland above Macarthur from roughly Telegraph to West.
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Old 09-30-2014, 10:43 PM
 
26,595 posts, read 52,465,128 times
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The property I manage is in Fruitvale, Laurel, Dimond Havenscourt and Brookfield... most are very long term tenants under rent control... with the most senior from 1988

The only way to get market rents is to hope someone voluntarily moves or petition the rent board for improvement offset.

On the other hand the children of my Pleasanton, San Ramon and Danville colleagues have flocked to Oakland and most live in very nice newer or over 50% rehabbed buildings that are not under rent control or in East Oakland.

Oakland is definitely not a once size fits all city and I should not have been so general...
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Old 10-01-2014, 06:45 AM
 
15,741 posts, read 9,288,044 times
Reputation: 14244
Quote:
Originally Posted by freemkt View Post
You are correct, it's actually the other way around.

Low income pretty much guarantees a person will be renting rather than owning.

As I said previously, lenders are extremely good at making sure their mortgage payments are affordable.
That may be, but renting is not the CAUSE of the low income, it is the RESULT of low income.

And PLEASE, quit with the silly emoticons.
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Old 10-01-2014, 07:40 AM
 
Location: Foot of the Rockies
87,085 posts, read 102,844,640 times
Reputation: 33152
Quote:
Originally Posted by nei View Post
Hmm. I'm curious on how true that is. I suspect part of the difference is you're comparing an apartment with a detached house (usually larger sq ft and with land). If you compared owning a similar sized condo with a rental, the difference may be smaller or non-existant. In some cities with depressed housing prices (rust belt cities such as Pittsburgh), the rent-buy difference may be low or actually cheaper to own if more than a couple years. It's often not worth it to buy unless you're planning on staying long-term. Buying a house has upfront costs, and is also more of a time commitment. The opposite extreme is markets where by zoning or historical circumstance rentals aren't built large quanities but lots of detached houses are. For example, the median rent in Nassau County, Long Island* is higher than Manhattan. [The market rent is higher in Manhattan but that's a very different comparison]

*It's still cheaper to rent than own in Nassau County. Median monthly housing costs for those with mortgage is $3,157 while rent is $1,479. But the rentals are almost certainly smaller than the homes with mortgage. Equivalent Manhattan numbers are $3,145 for a mortgaged home and $1,384 for a rental but the housing stock is completely different.

Trulia claims it's cheaper to buy:

Rent vs. Buy: Which is Cheaper for You? - Trulia Trends
Well, Trulia has an agenda.

You're right about the size difference; it's hard to find a 2000 sf rental. But if you're just looking at dollars and cents, the average house payment is higher than the average rent in most markets. As you say, there are upfront costs; as I said, there's always the home improvement bug too, that goes beyond general maintenance which yes, you do pay for in rent. If your financial circumstances go south, you can usually find a cheaper rental at the end of your lease, whereas it's harder to get out of a house.
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Old 10-01-2014, 11:00 AM
 
33,046 posts, read 22,149,341 times
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Quote:
Originally Posted by ringwise View Post
So what - renters don't pay property taxes or insurance. Any more than grocery shoppers pay property tax or insurance when they buy groceries.

Who cares about income of homeowners versus renters? It's not caused by the fact that one rents and the other doesn't.

You think landlords just altruistically eat costs like taxes and insurance? It's all bundled into the rents they charge. Landlords who cannot recover their costs will sell their property and find a better-performing place to park their money.

Even Mircea disagrees with you on this, and she deserves far more credence than I.

To address an earlier question of yours, income is precisely why homeowners consume more than renters; otherwise, homeowners would have far greater net worth than statistics claim they do..
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Old 10-01-2014, 11:28 AM
 
33,046 posts, read 22,149,341 times
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Quote:
Originally Posted by boxus View Post
Yes, not really seeing how one consumes more than the other, other than home improvements.

Home improvements are a significant component of homeowner consumption; increased homeownership is regarded as very good for Lowe's and Home Depot and their stock prices.

There is a concept in economics called 'marginal propensity to consume' (MPC) and is considered to generally fall as income rises, but never reaches zero.

We know from compiled statistics that homeowner median income currently is roughly 2x median renter income, and also that median renter income has never exceeded median homeowner income.

Under MPC greater than zero - again, it does not fall to zero at any income level - homeowners of 2x income will consume more than renters of x income.
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Old 10-01-2014, 11:48 AM
 
15,741 posts, read 9,288,044 times
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Quote:
Originally Posted by freemkt View Post
Home improvements are a significant component of homeowner consumption; increased homeownership is regarded as very good for Lowe's and Home Depot and their stock prices.

There is a concept in economics called 'marginal propensity to consume' (MPC) and is considered to generally fall as income rises, but never reaches zero.

We know from compiled statistics that homeowner median income currently is roughly 2x median renter income, and also that median renter income has never exceeded median homeowner income.

Under MPC greater than zero - again, it does not fall to zero at any income level - homeowners of 2x income will consume more than renters of x income.
Why are you making assumptions? Why does that homeowner income have to mean consumption? Maybe they invest it? Or save it?

In any case, how is consumption relevant to anything?
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Old 10-01-2014, 12:37 PM
 
Location: Crooklyn, New York
28,316 posts, read 26,348,104 times
Reputation: 11780
Quote:
Originally Posted by Ultrarunner View Post
There are some models that are immune to displacement due to gentrification...

Last summer I was in Detroit and can say from personal observation there is little fear gentrification will raise it's ugly head.

Cities like Detroit actually pray for Urban Renewal and Gentrification...

All a matter of prospective I guess.
Detroit certainly seems that way. On a regional level, it doesn't seem like the fundamentals are in place to spark a major wave of gentrification anytime soon.

It's funny, though, that it wasn't all that long ago that people said neighborhoods like Harlem would be undesirable FOREVER. In 1990, you could buy a brownstone for $80,000. Even Spike Lee said that when he bought his father's brownstone in Fort Greene, the most he thought he'd ever get for it would be around $300-$400K. The bad thing is that you get some people who probably could have purchased, but think the neighborhood will never change, and then don't. Then the next thing you know their rent has skyrocketed and they have to move on the next nearby, still crappy neighborhood.

Again, New York is different because the money has always been in the surrounding areas to create the perfect gentrification storm. However, I'm simply talking about perception, and the perception was that certain neighborhoods would always be garbage. Few people were scrambling to get a Clinton Hill brownstone in 1993.
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Old 10-01-2014, 12:51 PM
 
Location: Crooklyn, New York
28,316 posts, read 26,348,104 times
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Quote:
Originally Posted by annie_himself View Post
In that case it's not fair. But gentrification doesn't stop, it's a natural process.
Is it?

Quote:
Within a month of starting “Vanishing New York,” I was interviewed in New York Metro, a little free paper handed out to commuters at subway entrances. Paul Berger, who later interviewed me again for The New York Times, asked my take on how the city was changing. I answered, “What’s happening now is unnatural change. It’s like the way people argue about climate change and say, ‘Well, the climate’s always changed throughout time.’ Yes, it has, but climate change is dramatic, it’s overpowering, it’s overwhelming, and it’s certainly sped up. I think in New York we are seeing change on an unnatural scale.” I didn’t have a word for it then, but soon started using “hyper-gentrification” to refer to this new phenomenon, which I thought of then as gentrification accelerated—bigger, faster, and much more destructive. Hyper-gentrification had not yet made it into the mainstream consciousness, but urban scholars had been observing its effects for some time.
Jeremiah's Vanishing New York: On Spike Lee & Hyper-Gentrification, the Monster That Ate New York

What's most amazing to me is not so much the physical and demographic changes in neighborhoods, but the cultural segregation that tends to come along with those changes. If you were of an upper middle class profession in 1980, I suppose you shopped at an Acme, Pathmark, Star Market, Safeway, Piggly Wiggly or any of the other chain grocers the rest of the masses shopped at. Sure, you have upper middle class people who still shop at those stores today, but now you've got the Whole Foods, Trader Joe's and other stores that cater specifically to that demographic. IMO, Manhattanites (and some Brooklynites) are culturally removed from the rest of the city in a way that Manhattanites of the past were not. And that's a big difference.
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Old 10-01-2014, 12:55 PM
 
26,595 posts, read 52,465,128 times
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I've seen similar in Oakland... people or at least their parents shunned Oakland and many of these areas are again popular... and a big factor in my opinion is proximity to San Francisco.

The new urban pioneers couldn't homestead if there were not people selling... to me, Gentrification is when one group wants out and another wants in...
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