Can't "Build Baby Build" Out of CA Housing Shortage

Timothy Birdnow

Recently Dana Mathewson posted a piece about California Governor Gavin Newsom's passing the buck on the California housing shortage. Bill H. left a great comment and I had something to add as well.

Bill H. responded:

Bill makes an excellent point!

BTW; remember when oil prices were spiking and these same people were telling us we couldn't "drill our way out of the problem"? Back then supply had nothing to do with demand. Now that they have to live with the results of their own policies supply is apparently everything.

I used to work in the Real Estate business, and I worked with a fellow who worked in the California market (twice, as it turns out). He said landlords were treated like the Joker from Batman by the authorities; they were considered robber barons. There were advocates who would take you to court if you tried to evict a bad tenant, and they would argue it was a "death sentence" before a judge, the logic being that the tenant would become homeless and die. The judges always bought it, too.

So you couldn't kick bad tenants out. They would tear the place up, chase away good tenants, and make your life miserable.

So, a part of the lack of "affordable housing" in California is a result of the soft hearted, soft headed approach taken by state officials.

While many people, and most especially liberals in places like California, think that landlords are these rich guys drinking champagne and eating c aviar for breakfast, the reality is owning rental property is usually a low profit, marginal business with high expenses. I was involved in it for twenty years. This was especially true after the housing market boom started around 2000; many working class people decided to buy cheap buildings and fix them up as investments (this was far more true here in St. Louis than in the pricier California). But still, you have so many costs involved in rental properties. You have a mortgage. You have maintenance (and renters don't care about your property so it's far worse than on a home), you have taxes. You have insurance. You have rent collection, and in a place like California that is difficult as you don't have an easy road to evict non-paying or bad tenants. You have to deal with lawbreaking or unruly behavior. You just have to put up with the tenants, many of whom think that because they pay rent they can yell and scream at you. How many landlords got earfulls when the power company shut off power? Knowing how it works there were more than a few angry calls.

Property management is a very challenging business.

But in California - and no doubt New York and other liberal meccas - the landlord is by definition a Dark Lord of the Sith.

Despite that there are still plenty of landlords, but not enough to provide the needs of the poorer people in CA. Yes, housing prices drive the workers at the tech companies into the cheaper properties, but one must ask why new housing isn't being built? Environmental laws, asthetic laws, all manner of regulatory octopodal strangulation drives the prices way up. You might get paid well at Google, but not well enough to build. Not in California.

So we have the perfect storm in the Golden State. High taxes, heavy regulations, a system that helps deadbeats stay in their homes, a large alien population, and a large tech sector that is drained of resources by the state government. But it is somehow only caused by not enough building. Never does an idiot like Newsom ask WHY there is not enough building going on.

Liberals used to sneer at Conservatives for saying "drill baby drill!" as a solution to high gasoline prices. Barack Obama said we can't "drill our way out of the problem". But now it seems we can do just that with the housing shortage.

Posted by: Timothy Birdnow at 08:11 AM | Comments (10) | Add Comment
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