I live in Oakland and am a member of a few groups that give me a look outside my usual wealthy tech bubble to the sentiments of the lower income folks here. There is HUGE resistance to new development in Oakland among the very people who are being priced out. But unlike property owners who tend to resist new development because they worry about supply pushing prices down, many of these people seem to see an opposite correlation: that new development means higher rents, which displace them and their communities.
I think this is simply a misunderstanding of how development works. They see rents going up, and new buildings going up, and assume that the new buildings are the cause of the increase, not a response to the increase. They think we need to build more below-market rate units, because the luxury ones raise average rental prices.
But really, the shortages which create high prices are what create the business case for building expensive luxury condos. If rents weren't already high, these buildings wouldn't be built. If the demand is there but not the supply, everyone at the wealthy end of the spectrum will take all of the supply, leaving the poorer ends out of a home. So the more market rate units we have, the more lower end units that are available. Seems simple to me, but a lot of people seem to get this wrong.
They have this idea that there are a bunch of wealthy and greedy developers out to get them and their precious neighborhoods. The buildings these developers start have a shockingly high rate of spontaneous combustion in Oakland, right when framing is complete.
I wonder if the property owner interests only encourage these mis-perceptions since they serve their interests.
I think this is simply a misunderstanding of how development works. They see rents going up, and new buildings going up, and assume that the new buildings are the cause of the increase, not a response to the increase. They think we need to build more below-market rate units, because the luxury ones raise average rental prices.
But really, the shortages which create high prices are what create the business case for building expensive luxury condos. If rents weren't already high, these buildings wouldn't be built. If the demand is there but not the supply, everyone at the wealthy end of the spectrum will take all of the supply, leaving the poorer ends out of a home. So the more market rate units we have, the more lower end units that are available. Seems simple to me, but a lot of people seem to get this wrong.
They have this idea that there are a bunch of wealthy and greedy developers out to get them and their precious neighborhoods. The buildings these developers start have a shockingly high rate of spontaneous combustion in Oakland, right when framing is complete.
I wonder if the property owner interests only encourage these mis-perceptions since they serve their interests.