Rent control is one of those ideas, like "term limits," that tells you how much someone has thought about the problem. Not much, it turns out. I wrestled with rent control until I read Progress & Poverty and learned how land value, not shelter rent, is the driver.

We already have term limits: they're called "elections." And anyone who can win, in a fair and equally-funded race, can stay in office as long as their constituents say. But "fair and equally-funded" are where we need to put in some work. The power of incumbency is real. 2/
So with rent control. It looks like an easy fix…limit what landlords can charge for rent. Boom: done. But this completely misses the rising value of land, rising tax assessments, and how that means properties decline or become vacant, as the capped rent doesn't pencil out.
It puts landlords where tenants are now: squeezed between a higher cost to hold the land (the real play) and the lower payments from tenants. Think of rising rents and static wages for workers…same squeeze. So capping rent means slums and idled land: what no city needs.

But if cities were to assess property taxes or rents based on the value of land, as our friends at @StrongTowns argue, land will be put to better use, year on year. Take the value from the land, not the improvements, since that value was created by everyone but the "owner."
Capping rents discourages investment, creates urban blight, and is the opposite of what a city needs.

“Rent control has in certain Western countries constituted, maybe, the worst example of poor planning by governments lacking courage and vision.” — Gunnar Myrdal

“In many cases rent control appears to be the most efficient technique presently known to destroy a city—except for bombing.” — Assar Lindbeck

If cities want to ensure housing for all, they need to build it, by forcing land into productive use, instead of as a wealth store. 6/
And the way to do that is to tax or assess a rent on land to a. recapture the asset value and b. reduce the speculative value so idled land gets put to work. A deadweight tax — rent control — like income tax will never achieve what proponents claim. 7/F

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More from @paulbeard

17 Oct
Anyone among my followers who knows scams, specifically money laundering through craigslist (or something like that)? Someone offered to buy something I listed and sent what appears to be a stolen check for 10X the amount…obvs not cashing it.
Bkgd: I offered a bike for sale on CL for $200 and someone replied with a full price offer + $50 to hold it. Said he would send a cashiers check (I should have stopped there but people are weird: why not PayPal/venmo?). Got email from Fedex to expect a package from Florida (!).
Package arrives with a business check — not a cashiers check — for $2,250 from a business in central Michigan. Immediately a text comes in to say the pkg has arrived, followed by an email. Thing is, I sold the bike locally for full price, as I told the scammer I would.
Read 12 tweets
15 Oct
Thought experiment for the urbanists, housing advocates, etc.

If you could buy a house in NE Seattle (98115) for $216k with a $5,000 land rent, forgoing the value of the land or you could pay $500k for both, which would you choose?
If you buy the house and rent the land, you would pay $1,226.42/month vs $1,975.60/month…$750/month that you would spend on any number of other things. Sure, you get more mortgage interest to deduct but is it worth it?
I realize this may not get any traction at all, what with my 800 followers, but maybe some more connecter person can amplify it.
Read 4 tweets
28 Apr
I hear a lot about "affordable housing" in Seattle and other cities that are showing both strong economic growth and a tight housing market. My interrogation of this tells me that without affordable land, affordable housing is a dead letter… 1/ #LVT
Here is the property tax assessment for a modest 4 BR house in NE Seattle…note the price of the land relative to the house. Note how the land gets more expensive, eventually passing the value of the house. But isn't the house all that you want? 2/ #LVT
I mean, what can you do with the land? You can't farm it or mine it. It's zoned residential so you need special permission to run a business out of it. So why buy it? Why take on a much larger mortgage just to own something you can't use except as a place to keep a house? 3/ #LVT
Read 14 tweets
29 Feb
BBC News - The boss who put everyone on 70K.

Has it really 4.5 years since @DanPriceSeattle put his money where his beliefs are?

I have been thinking of how Seattle's income/wealth inequality affects the business community as well as the workers. 1/…
Think of the things that people like me won't buy as renters…

We're not remodeling kitchens or bathrooms so plumbers and contractors are missing out. We know landlords aren't doing that either… 2/
We're not landscaping or planting trees or gardening, if we are able to rent a house rather than an apartment. The landlord will cut the grass but no more than that. 3/
Read 8 tweets
23 Feb
‘Why should I bother to come downtown?’ | What if there was more to downtown than shopping? 1/…
What if operating rents were managed, not at the retail (customer) level but at the wholesale (rentier) level? What if we could make downtown about experiences vs purchases? It would be interesting to see how many people go d/t just to be where something might happen. 2/
Outside of Capitol Hill and a few blocks around Benaroya/SAM what is there downtown after hours? Driving to a function a few months back and all 5 of us, all of us longtime Seattle residents, couldn't remember the last time we had been to the downtown core. 3/
Read 9 tweets
5 Oct 19
This is interesting. A couple of things that came to mind…
1. Costco stores are (almost?) always located in outlying areas/suburbs/exurbs, making car travel a necessity. To make that easier, they sell cheap gas.
2. Part of the big box store model is land — owning that scarce resource and extracting rents from it. Some of these chains hold the land in a separate business unit and rent it back to the retail business (which would seem to prove the value of land rents).
3. Costco stores — as well as other similar chains — are measured in acres, not sq ft. That's a lot of land that could be making money for the people who made it valuable by putting in utilities and building the roads that connect it to its customers.
Read 7 tweets

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