7 ms·

Architect explains why large development in LA seems to be luxury development

123 points by intull 9y ago

panic 9y ago
This is an interesting point about college education: Traditionally, contracting was the best paying "blue collar" job out there, and to a certain extent it still is. If you were smart, hardworking, but didn't go to college, you started hauling bricks on a construction site and then worked your way up to general contractor over the course of years. Lots of the best GCs out there did this. But, as less and less of super capable kids DON'T go to college, there are less super capable 18 yearolds hauling bricks and 10 years later, less super capable GCs. As more and more kids are going to college, who will do these high-skill blue-collar jobs?
- Joe-Z 9y ago
  Probably the same super capable kids just starting 10 years later as - still super capable - adults, realizing that their college degree has brought them virtually zero advantage over everyone else in the labour market.
  - jaclaz 9y ago
    Well, it's not the same thing. When you are 20 and you are given an opportunity of growing fast through learning from experience, you are willing to do anything including brick laying and if you are actually super-capable by the time you are 30 or 35 you have no matches (and not in just brick laying). But this is because you moved by hand thousands of bricks, and tons of mortar, and lots of double shifts and working weekends, and you did that because it was an opportunity to grow AND you were a blank sheet to begin with. When you get 30 you have some 5 years of college, if in US a huge student debt, and 5 years of failures in getting an adequate job, possibly a family, you simply won't be able to put in the energy and the time that you already spent. In a nutshell if you start from the bootom at 30 in this field you need to be super-super-capable, and it is rare enough, because if you were really super-super-capable you would have alredy found another job, another field, etc. and be successful at it.
    - FLUX-YOU 9y ago
      >because if you were really super-super-capable you would have alredy found another job, another field, etc. and be successful at it. Job markets aren't efficient at matching supply to demand. Trying different opportunities takes a large amount of time. I can't hit up construction, IT, healthcare, physics, retail, banking, and academic industries in a week to find out if I'm cut out for at least one of them.
      - jaclaz 9y ago
        > I can't hit up construction, IT, healthcare, physics, retail, banking, and academic industries in a week to find out if I'm cut out for at least one of them. Sure, but the hypothetical 30ish super-super-capable would have had roughly 5 years (not just one week) to find something better before starting brick laying, and this is the typical CATCH 22, if you are super-super-capable it doesn't take you 5 years to fail to find something.
- TheAdamAndChe 9y ago
  This is what happens when the upper-middle and upper classes are the only groups seeing an increase in quality of life. People would still be going into these industries if they were seen as long-term careers. If wages don't increase above real inflation, people will move to different industries. This is the direct result of outsourcing and illegal immigration gutting the middle class.
  - panic 9y ago
    They're making plenty of money -- as the article says, "[The general contractors] have all the power and charge accordingly." I'd say it has more to do with people (including their parents and peers) seeing college as necessary and not considering a construction industry career at all.
    - TheAdamAndChe 9y ago
      Now that the labor pool has adjusted following the recession, of course they change what they charge. For decades, though, wages for those folks have been stagnant and quality of life limited, which is why their parents and peers pushed them to go into different fields. I guarantee that if wages had increased as much as the stock market had in that time, there wouldn't be such a limited pool of contractors at the moment.
- Retric 9y ago
  Still plenty of people doing those jobs, but they tend to be immigrants.
- bb611 9y ago
  To me it appears the same group of kids is doing it, but now with college degrees. I have a friend who was a GC at 25, the main obstacle to his success was access to capital, which he achieved through a friend's father who was already in the business and looking for investment opportunities. He spent a bunch of years working on his skills and doing his own work, but now just subcontracts all the labor (mostly to immigrants), deals with legal/zoning issues, and keeps the client happy. I suspect the old system (start at the bottom, amass skills & capital until you're on top) won't work anymore, because the capital arrangement strongly favors people with a money connection over skills. But time will tell.
- a3n 9y ago
  > As more and more kids are going to college, who will do these high-skill blue-collar jobs? The ones that can't get jobs in their college major.
tomjakubowski 9y ago
Here's the relevant regulation: http://netinfo.ladbs.org/ladbsec.nsf/d3450fd072c7344c882564e5005d0db4/72f24c5fab8bd39788256a160067e2e2/$FILE/Summary%20of%20Parking%20Regulations%20final.pdf http://netinfo.ladbs.org/ladbsec.nsf/d3450fd072c7344c882564e... Note that historic buildings converted into residential are exempt from any parking requirement. Downtown LA is teeming with historic buildings that are, if not actually then practically, vacant. Many of the commercial building conversions I'm aware of in downtown are becoming luxury lofts; a minority have been or will be converted into SRO or otherwise "non-luxury" housing. But that's all anecdotes. If anyone has data on historic building conversions since, say, 2000, in downtown LA, or knows how I could get data like that, it would scratch an itch I've had for a while now.
jeffdavis 9y ago
Short version: affordable housing is illegal to build. A bunch of people sit around thinking "Wouldn't rooftop gardens be nice? Hey, let's make it a law that you have to build them on all new towers!". And then they are surprised that the housing costs more and excludes lower-middle class.
jeffbax 9y ago
LA, and most US cities, need to be more like Tokyo -- which has much better zoning/building regulations (as in, less onerous). > Here is a startling fact: in 2014 there were 142,417 housing starts in the city of Tokyo (population 13.3m, no empty land), more than the 83,657 housing permits issued in the state of California (population 38.7m), or the 137,010 houses started in the entire country of England (population 54.3m). http://marginalrevolution.com/marginalrevolution/2016/08/laissez-faire-in-tokyo.html http://marginalrevolution.com/marginalrevolution/2016/08/lai... http://marginalrevolution.com/marginalrevolution/2016/08/the-japanese-zoning-system.html http://marginalrevolution.com/marginalrevolution/2016/08/the...
- wodenokoto 9y ago
  The thing is, in Tokyo most housing projects are just replacing already existing houses. In California they are adding houses.
thecopy 9y ago
Government policies and regulations working against what their benefactors originally planned for, where have i seen this before?
- mtanski 9y ago
  Yeah, it's a case of I got mine. Different side of the same I got mine RE coin (rent regulated units).
pbreit 9y ago
I'm confused. $165/sf is very inexpensive ($200k for the 800sf condo with parking). Even $200-300/sf is not bad.
- mcguire 9y ago
  Depends very strongly on where, exactly you are looking. http://www.visualcapitalist.com/interactive-map-price-per-square-foot-us-housing-markets/ http://www.visualcapitalist.com/interactive-map-price-per-sq...
- mtanski 9y ago
  He's talking about LA not SF. Building anything in SF is even whackier then in LA.
  - suhastech 9y ago
    I think he means square feet.
- mahyarm 9y ago
  He is saying in order to deal with cost overruns that can easily happen, you need to charge $300-$400/sqft
- jrockway 9y ago
  I mean, in NYC we're talking $1000/sq ft as being inexpensive. People are paying $2000/sq ft to live in flood zones.
dankohn1 9y ago
The parking minimums are destroying our cities. Nevertheless, even luxury developments lead to more affordable housing do to filtering: https://www.vox.com/cards/affordable-housing-explained/filtering-vs-gentrification-a-key-housing-concept https://www.vox.com/cards/affordable-housing-explained/filte...
- deleted 9y ago
  [deleted]
givemefive 9y ago
they only build luxury developments in dallas too.. it's not exactly rocket science as too why.. the land is expensive and they need a ROI. they take care of parking with prefabricated 5 story garages.
gxs 9y ago
My dad is in construction and I thought I'd chime in with another practical reason. Once you're building at larger scales, the cost of materials between a luxury condo and a subluxury condo are different, but not astronomically so. Developers will go to China, Mexico, etc. and source some really nice stuff very cheaply. Sure, there are exceptions, i.e., materials that are expensive no matter what, but once you figure out a way to use cheap labor, the actual building materials are cheap. It's similar to luxury cars - the "luxury" part doesn't necessarily cost a lot more (but yes does cost a bit more) but it can be marked up a lot, lot more.
- pfranz 9y ago
  Unrelated, but it drives me nuts to see high end or luxury property with commodity fixtures. It's surprisingly common.
- jaclaz 9y ago
  >It's similar to luxury cars - the "luxury" part doesn't necessarily cost a lot more (but yes does cost a bit more) but it can be marked up a lot, lot more. This is also correct, but there is an additional twist to it. Non-luxury may be not marketable (besides bringing less margin). It is a curious market, I have seen more than one case of building companies that were put on their knees by the lack of buyers because they built "too basic" houses, believing that the relatively low price would have procured lots of willing buyers and this simply didn't happen, and they had to apply rebates over rebates, thus losing money in real terms to be able to sell them (if/when this actually happened).
ThePadawan 9y ago
From my European point of view, I find the whole hangup about the parking space regulations very interesting. Here in Zurich, there are the same sort of complaints about parking for new buildings going up, however there is now a different trend: Because rent for the parking space is typically charged separately from the apartment's rent, some parking space simply can't be rented out because residents don't have cars. In case you speak German and are interested in this sort of stuff, the regulations are available at https://www.stadt-zuerich.ch/content/dam/stzh/portal/Deutsch/AmtlicheSammlung/Erlasse/741/500/741.500_Parkplatzverordnung_16_V4.pdf https://www.stadt-zuerich.ch/content/dam/stzh/portal/Deutsch... . It also shows a table on page 3 that explains how you actually are allowed and required to build less and less parking spaces the closer you get to the city center, so much so that if you look at the maps on pages 6 to 7, you can see that that grey area allows <= 10% of the parking of the white area.
- jaclaz 9y ago
  Just to confirm the European viewpoint, it is pretty much normal in Italy, France and Spain to have similar requirements. But they are "logical" and at least here in cities, beyond and besides the building codes, having more parking space can be a resource, i.e. unused/excess parking places are commonly rented as there is anyway great scarcity of them for the people leaving in historical buildings that of course at the time they were built had no such requirements. Of course it is a cost since, just like it is in the US, in the words of the architect: >But wait, there’s more! That parking space for each unit either has to be at ground level (which is the most valuable real estate on the whole project), or it has to be above or below ground. we cannot make them float in the air ;). And of course requirements are not the same in city centres as they are in the outskirts, where areas are larger and building density allowed is much lower. I don't fully agree with the added cost for parking to be the main reason for high costs of the building, I find the culprit to be more "the market" and also (within limits) the higher standards (and expectations of the customers). I heve seen dramatic increasings in the costs of plumbing (not only the plumbing in itself, but also the kind of stuff that is installed, "design" basins, taps, showers, etc.), and electricity (here it is BOTH pricey switches, plugs, etc, and greatly increased number of them), besides safety related items. As a side note, and it depends of course on specific zones, having an underground parking under the building may actually help with seismic compliance and with getting rid of radon, so some of it is not only "added cost", the real cost issues come when the size of the parking is big enough to "trigger" stricter fire safety provisions. The EXACT same thing happened/is happening here, all the part starting from: > All that was manageable to an extent before the crash of 2008. is entirely accurate on this side of the pond, and has been described perfectly. Before or around 2008 you couldn't find reliable people/contractors because they were 100% busy (while you could find a lot of only half-professionals), now you cannot find them simply because they became almost extincted.
RealityNow 9y ago
It blows my mind that virtually every major city in the developed world is facing this same problem, yet nobody is doing anything about it. It's a pretty simple problem with a pretty simple solution. The problem is that local city councils have restricted the freedom to build through excessive zoning laws and regulations in order to increase housing prices for their own private investment benefit. The solution is to relinquish them of this self-interested tyrant-like overbearing power and set these policies on the national level - basically how Japan does it. The more localized the power, the more self-interest is going to favor a minority of private individuals at the expense of society.
- crdoconnor 9y ago
  >It blows my mind that virtually every major city in the developed world is facing this same problem, yet nobody is doing anything about it. It's a pretty simple problem with a pretty simple solution. If it's a local problem with local solutions then why did it happen to more or less every major city in the developed world at the same time? Weird parking regulations are specific to Los Angeles. It could be that wealth inequality is the primary cause of all of this but what do I know? I'm not the kind of person who would make a ton of cash if Los Angeles building regulations were slashed. Ironically the architect actually indirectly points this proximate cause by pointing out that land prices have skyrocketed. He just didn't think to question why. If land prices keep going up investors' incentive to treat apartments like bars of investment gold will keep going up too. If wealth inequality gets worse, more of that money will be stashed in land (luxury apartments), causing prices to rise. All of this will happen whether or not Los Angeles parking regulations are cut. If California rolled back prop 13, on the other hand, that would help somewhat to de-goldify land and provide enough money to the state budget to build affordable housing the old fashioned way it has always been built: by the government.
  - seanmcdirmid 9y ago
    Prop 13 doesn't apply to rentals. Even if the incentives to build luxury apartments are gone, the codes still don't make other apartments all of a sudden economical. The parking garage beneath by west LA near UCLA rental is virtually empty because most people come here without cars. But they have to have it so... But speculation is a problem, especially with Chinese investors who have already tapped out their own property tax-free markets. Just I don't think that is what is going on here.

123 points by intull 9y ago

This is an interesting point about college education: Traditionally, contracting was the best paying "blue collar" job out there, and to a certain extent it still is. If you were smart, hardworking, but didn't go to college, you started hauling bricks on a construction site and then worked your way up to general contractor over the course of years. Lots of the best GCs out there did this. But, as less and less of super capable kids DON'T go to college, there are less super capable 18 yearolds hauling bricks and 10 years later, less super capable GCs. As more and more kids are going to college, who will do these high-skill blue-collar jobs?

Joe-Z 9y ago
Probably the same super capable kids just starting 10 years later as - still super capable - adults, realizing that their college degree has brought them virtually zero advantage over everyone else in the labour market.
- jaclaz 9y ago
  Well, it's not the same thing. When you are 20 and you are given an opportunity of growing fast through learning from experience, you are willing to do anything including brick laying and if you are actually super-capable by the time you are 30 or 35 you have no matches (and not in just brick laying). But this is because you moved by hand thousands of bricks, and tons of mortar, and lots of double shifts and working weekends, and you did that because it was an opportunity to grow AND you were a blank sheet to begin with. When you get 30 you have some 5 years of college, if in US a huge student debt, and 5 years of failures in getting an adequate job, possibly a family, you simply won't be able to put in the energy and the time that you already spent. In a nutshell if you start from the bootom at 30 in this field you need to be super-super-capable, and it is rare enough, because if you were really super-super-capable you would have alredy found another job, another field, etc. and be successful at it.
  - FLUX-YOU 9y ago
    >because if you were really super-super-capable you would have alredy found another job, another field, etc. and be successful at it. Job markets aren't efficient at matching supply to demand. Trying different opportunities takes a large amount of time. I can't hit up construction, IT, healthcare, physics, retail, banking, and academic industries in a week to find out if I'm cut out for at least one of them.
    - jaclaz 9y ago
      > I can't hit up construction, IT, healthcare, physics, retail, banking, and academic industries in a week to find out if I'm cut out for at least one of them. Sure, but the hypothetical 30ish super-super-capable would have had roughly 5 years (not just one week) to find something better before starting brick laying, and this is the typical CATCH 22, if you are super-super-capable it doesn't take you 5 years to fail to find something.
TheAdamAndChe 9y ago
This is what happens when the upper-middle and upper classes are the only groups seeing an increase in quality of life. People would still be going into these industries if they were seen as long-term careers. If wages don't increase above real inflation, people will move to different industries. This is the direct result of outsourcing and illegal immigration gutting the middle class.
- panic 9y ago
  They're making plenty of money -- as the article says, "[The general contractors] have all the power and charge accordingly." I'd say it has more to do with people (including their parents and peers) seeing college as necessary and not considering a construction industry career at all.
  - TheAdamAndChe 9y ago
    Now that the labor pool has adjusted following the recession, of course they change what they charge. For decades, though, wages for those folks have been stagnant and quality of life limited, which is why their parents and peers pushed them to go into different fields. I guarantee that if wages had increased as much as the stock market had in that time, there wouldn't be such a limited pool of contractors at the moment.
Retric 9y ago
Still plenty of people doing those jobs, but they tend to be immigrants.
bb611 9y ago
To me it appears the same group of kids is doing it, but now with college degrees. I have a friend who was a GC at 25, the main obstacle to his success was access to capital, which he achieved through a friend's father who was already in the business and looking for investment opportunities. He spent a bunch of years working on his skills and doing his own work, but now just subcontracts all the labor (mostly to immigrants), deals with legal/zoning issues, and keeps the client happy. I suspect the old system (start at the bottom, amass skills & capital until you're on top) won't work anymore, because the capital arrangement strongly favors people with a money connection over skills. But time will tell.
a3n 9y ago
> As more and more kids are going to college, who will do these high-skill blue-collar jobs? The ones that can't get jobs in their college major.

tomjakubowski 9y ago

Here's the relevant regulation: http://netinfo.ladbs.org/ladbsec.nsf/d3450fd072c7344c882564e5005d0db4/72f24c5fab8bd39788256a160067e2e2/$FILE/Summary%20of%20Parking%20Regulations%20final.pdf http://netinfo.ladbs.org/ladbsec.nsf/d3450fd072c7344c882564e... Note that historic buildings converted into residential are exempt from any parking requirement. Downtown LA is teeming with historic buildings that are, if not actually then practically, vacant. Many of the commercial building conversions I'm aware of in downtown are becoming luxury lofts; a minority have been or will be converted into SRO or otherwise "non-luxury" housing. But that's all anecdotes. If anyone has data on historic building conversions since, say, 2000, in downtown LA, or knows how I could get data like that, it would scratch an itch I've had for a while now.

jeffdavis 9y ago

Short version: affordable housing is illegal to build. A bunch of people sit around thinking "Wouldn't rooftop gardens be nice? Hey, let's make it a law that you have to build them on all new towers!". And then they are surprised that the housing costs more and excludes lower-middle class.

jeffbax 9y ago

LA, and most US cities, need to be more like Tokyo -- which has much better zoning/building regulations (as in, less onerous). > Here is a startling fact: in 2014 there were 142,417 housing starts in the city of Tokyo (population 13.3m, no empty land), more than the 83,657 housing permits issued in the state of California (population 38.7m), or the 137,010 houses started in the entire country of England (population 54.3m). http://marginalrevolution.com/marginalrevolution/2016/08/laissez-faire-in-tokyo.html http://marginalrevolution.com/marginalrevolution/2016/08/lai... http://marginalrevolution.com/marginalrevolution/2016/08/the-japanese-zoning-system.html http://marginalrevolution.com/marginalrevolution/2016/08/the...

wodenokoto 9y ago
The thing is, in Tokyo most housing projects are just replacing already existing houses. In California they are adding houses.

thecopy 9y ago

Government policies and regulations working against what their benefactors originally planned for, where have i seen this before?

mtanski 9y ago
Yeah, it's a case of I got mine. Different side of the same I got mine RE coin (rent regulated units).

pbreit 9y ago

I'm confused. $165/sf is very inexpensive ($200k for the 800sf condo with parking). Even $200-300/sf is not bad.

mcguire 9y ago
Depends very strongly on where, exactly you are looking. http://www.visualcapitalist.com/interactive-map-price-per-square-foot-us-housing-markets/ http://www.visualcapitalist.com/interactive-map-price-per-sq...
mtanski 9y ago
He's talking about LA not SF. Building anything in SF is even whackier then in LA.
- suhastech 9y ago
  I think he means square feet.
mahyarm 9y ago
He is saying in order to deal with cost overruns that can easily happen, you need to charge $300-$400/sqft
jrockway 9y ago
I mean, in NYC we're talking $1000/sq ft as being inexpensive. People are paying $2000/sq ft to live in flood zones.

dankohn1 9y ago

The parking minimums are destroying our cities. Nevertheless, even luxury developments lead to more affordable housing do to filtering: https://www.vox.com/cards/affordable-housing-explained/filtering-vs-gentrification-a-key-housing-concept https://www.vox.com/cards/affordable-housing-explained/filte...

deleted 9y ago
[deleted]

givemefive 9y ago

they only build luxury developments in dallas too.. it's not exactly rocket science as too why.. the land is expensive and they need a ROI. they take care of parking with prefabricated 5 story garages.

gxs 9y ago

My dad is in construction and I thought I'd chime in with another practical reason. Once you're building at larger scales, the cost of materials between a luxury condo and a subluxury condo are different, but not astronomically so. Developers will go to China, Mexico, etc. and source some really nice stuff very cheaply. Sure, there are exceptions, i.e., materials that are expensive no matter what, but once you figure out a way to use cheap labor, the actual building materials are cheap. It's similar to luxury cars - the "luxury" part doesn't necessarily cost a lot more (but yes does cost a bit more) but it can be marked up a lot, lot more.

pfranz 9y ago
Unrelated, but it drives me nuts to see high end or luxury property with commodity fixtures. It's surprisingly common.
jaclaz 9y ago
>It's similar to luxury cars - the "luxury" part doesn't necessarily cost a lot more (but yes does cost a bit more) but it can be marked up a lot, lot more. This is also correct, but there is an additional twist to it. Non-luxury may be not marketable (besides bringing less margin). It is a curious market, I have seen more than one case of building companies that were put on their knees by the lack of buyers because they built "too basic" houses, believing that the relatively low price would have procured lots of willing buyers and this simply didn't happen, and they had to apply rebates over rebates, thus losing money in real terms to be able to sell them (if/when this actually happened).

ThePadawan 9y ago

From my European point of view, I find the whole hangup about the parking space regulations very interesting. Here in Zurich, there are the same sort of complaints about parking for new buildings going up, however there is now a different trend: Because rent for the parking space is typically charged separately from the apartment's rent, some parking space simply can't be rented out because residents don't have cars. In case you speak German and are interested in this sort of stuff, the regulations are available at https://www.stadt-zuerich.ch/content/dam/stzh/portal/Deutsch/AmtlicheSammlung/Erlasse/741/500/741.500_Parkplatzverordnung_16_V4.pdf https://www.stadt-zuerich.ch/content/dam/stzh/portal/Deutsch... . It also shows a table on page 3 that explains how you actually are allowed and required to build less and less parking spaces the closer you get to the city center, so much so that if you look at the maps on pages 6 to 7, you can see that that grey area allows <= 10% of the parking of the white area.

jaclaz 9y ago
Just to confirm the European viewpoint, it is pretty much normal in Italy, France and Spain to have similar requirements. But they are "logical" and at least here in cities, beyond and besides the building codes, having more parking space can be a resource, i.e. unused/excess parking places are commonly rented as there is anyway great scarcity of them for the people leaving in historical buildings that of course at the time they were built had no such requirements. Of course it is a cost since, just like it is in the US, in the words of the architect: >But wait, there’s more! That parking space for each unit either has to be at ground level (which is the most valuable real estate on the whole project), or it has to be above or below ground. we cannot make them float in the air ;). And of course requirements are not the same in city centres as they are in the outskirts, where areas are larger and building density allowed is much lower. I don't fully agree with the added cost for parking to be the main reason for high costs of the building, I find the culprit to be more "the market" and also (within limits) the higher standards (and expectations of the customers). I heve seen dramatic increasings in the costs of plumbing (not only the plumbing in itself, but also the kind of stuff that is installed, "design" basins, taps, showers, etc.), and electricity (here it is BOTH pricey switches, plugs, etc, and greatly increased number of them), besides safety related items. As a side note, and it depends of course on specific zones, having an underground parking under the building may actually help with seismic compliance and with getting rid of radon, so some of it is not only "added cost", the real cost issues come when the size of the parking is big enough to "trigger" stricter fire safety provisions. The EXACT same thing happened/is happening here, all the part starting from: > All that was manageable to an extent before the crash of 2008. is entirely accurate on this side of the pond, and has been described perfectly. Before or around 2008 you couldn't find reliable people/contractors because they were 100% busy (while you could find a lot of only half-professionals), now you cannot find them simply because they became almost extincted.

RealityNow 9y ago

It blows my mind that virtually every major city in the developed world is facing this same problem, yet nobody is doing anything about it. It's a pretty simple problem with a pretty simple solution. The problem is that local city councils have restricted the freedom to build through excessive zoning laws and regulations in order to increase housing prices for their own private investment benefit. The solution is to relinquish them of this self-interested tyrant-like overbearing power and set these policies on the national level - basically how Japan does it. The more localized the power, the more self-interest is going to favor a minority of private individuals at the expense of society.

crdoconnor 9y ago
>It blows my mind that virtually every major city in the developed world is facing this same problem, yet nobody is doing anything about it. It's a pretty simple problem with a pretty simple solution. If it's a local problem with local solutions then why did it happen to more or less every major city in the developed world at the same time? Weird parking regulations are specific to Los Angeles. It could be that wealth inequality is the primary cause of all of this but what do I know? I'm not the kind of person who would make a ton of cash if Los Angeles building regulations were slashed. Ironically the architect actually indirectly points this proximate cause by pointing out that land prices have skyrocketed. He just didn't think to question why. If land prices keep going up investors' incentive to treat apartments like bars of investment gold will keep going up too. If wealth inequality gets worse, more of that money will be stashed in land (luxury apartments), causing prices to rise. All of this will happen whether or not Los Angeles parking regulations are cut. If California rolled back prop 13, on the other hand, that would help somewhat to de-goldify land and provide enough money to the state budget to build affordable housing the old fashioned way it has always been built: by the government.
- seanmcdirmid 9y ago
  Prop 13 doesn't apply to rentals. Even if the incentives to build luxury apartments are gone, the codes still don't make other apartments all of a sudden economical. The parking garage beneath by west LA near UCLA rental is virtually empty because most people come here without cars. But they have to have it so... But speculation is a problem, especially with Chinese investors who have already tapped out their own property tax-free markets. Just I don't think that is what is going on here.