The big lie about California’s housing crisis

By Deepa Varma : sfexaminer – excerpt

SF-skyline

New SF skyline shot from the bay by zrants

It’s official: The rent in California, not just San Francisco, is too damn high.

California now has the highest poverty rate in the nation when the cost of housing is taken into account. Since 2005, more than 2.5 million Californians have been forced to leave the state in search of an affordable home.

Unfortunately, the prevailing supply and demand — “just build” — mantra put forward by opinion leaders is diverting state government from the hard truth that the market has not responded to the demand of California families for affordable homes — not luxury and market-rate homes.

We are told a big lie, that the solution to our housing crisis is to get government out of the way and leave it to the free market to let affordable housing magically “trickle down” to lower-income households. The truth, though, is developers build to make a profit, not to provide a social need. Luxury housing doesn’t trickle down, at least not at a scale to bring down rents in a meaningful way…(more)

Other countries take a different approach to values…

In World’s Best-Run Economy, House Prices Keep Falling — Because That’s What House Prices Are Supposed To Do

Eamonn Fingleton : forbes – excerpt

When Americans travel abroad, the culture shocks tend to be unpleasant. Robert Locke’s experience was different. In buying a charming if rundown house in the picturesque German town of Goerlitz, he was surprised – very pleasantly – to find city officials second-guessing the deal. The price he had agreed was too high, they said, and in short order they forced the seller to reduce it by nearly one-third. The officials had the seller’s number because he had previously promised to renovate the property and had failed to follow through…(more)