L.A.'s Housing Crisis Hits Hollywood: The Entertainment Workers Living in Their Cars
The housing 'crisis' in California is so bad, that now even the left-winger entertainers are living in cars, instead of apartments, because not even the Hollywood people can avoid the consequences of their bad policies.
At what point, do the people of the left admit their ideals in the world, are consistent failures?
Failure of high housing prices?
When housing prices are unnaturally high, yes. No other part of the country, that does not have the left-wing ideology dominating the market, has the current insanity going on in CA.
So, you’re in favor of affordable housing projects?
That's like looking at someone dying of poison, and asking if I'm in favor of adding some arsenic to their diet.
We need less government interference in the market, not more. More is what got us where we are. Adding more government, to a problem caused by government, doesn't result in solution. It results in more problems.
"Affordable housing projects" always result in less affordable housing. I have never once seen any system that did not have a negative result on affordable housing.
And the reason is really simple.
Affordable housing projects, result in destroying the low end of the market.
Why does GM spend more time making Chevy cars, over Cadillac? Why does Chevrolet spend more time making Malibus than Corvettes?
The profits from Cadillac and Corvettes, are way higher than Chevy Malibu. So why do they make low-profit cars? Because they make a hundreds of thousands of them. The market is bigger at the lower end, and thus there is far more money to be made there.
Same is true of housing. If the market is free of government regulation, producers of apartments and housing in general, will cater to the largest market.... which is the low end.
What affordable housing projects do, is it actually drives the prices too low, which results in the market dying.
Say a government project creates 100 apartments, at the cost of working people's tax money, to offer a rent of $700 a month.
This will do two things.
First it will kill new projects.
In Hilliard where I live, we just had an apartment complex open with 204 apartments, with a starting price of $900 a month.
The problem is, if people look online and see they can get the same basic apartment for a government subsidized price of $700, then they are not likely to bother paying $900 a month elsewhere.
Why would I buy a Chevy Malibu for $22,000, if I can buy a Toyota Camry for $17,000? No one would do that. Even if they ran out of stock, they would wait until more came in, before spending $5,000 more for a similar car.
Thus the developer would likely reconsider the plan. Perhaps they would make the rooms larger, and have fewer of them, so they could get customers to pay a higher price, for a larger apartment.
Thus the stock of available housing is reduced.
Similarly, the second result is that existing apartments become unprofitable. This happened famously in New York.
If you have an old apartment complex, and you have to lower the price to a similar level to the affordable housing projects, you end up having it become unprofitable. If you have an unprofitable building, what do you do with it? Typically you stop doing maintenance. Then you start having bug infestations, leaking roofs and basements. Eventually the building is abandoned, which has happened routinely during the affordable housing days of New York. There are completely abandoned apartment buildings in New York even to this day.
The other thing, is the owner will try to have it rezoned as office space, or the owners will renovate the apartments into luxury apartments, which will command a higher price.
Regardless the result is the same... less available low-cost housing.
So to answer your original question, no. Affordable housing projects are counter productive. The solution is deregulation of the housing market, and allowing the capitalist system to work.