<story><title>Rents dropping significantly across the Seattle area after new construction</title><url>https://www.seattletimes.com/business/real-estate/seattle-area-rents-drop-significantly-for-first-time-this-decade-as-new-apartments-sit-empty/</url></story><parent_chain><item><author>smelendez</author><text>It is complicated, though.&lt;p&gt;Rich people moving in to a working class neighborhood makes the neighborhood more attractive to other rich people, both directly and by bringing in rich people amenities. So building high end housing can ultimately cause more demand and higher bids for the existing housing in the neighborhood.</text></item><item><author>weeksie</author><text>Holy shit, supply and demand is still a thing!&lt;p&gt;Last year I was in Seattle and all I heard was complaints about all of the highrises going up as if that was what was causing the high rents. &lt;i&gt;headdesk&lt;/i&gt;</text></item></parent_chain><comment><author>Lazare</author><text>Yes, but many of those people will be moving from other neighborhoods in the same city; when they move they vacate an older, less attractive, &lt;i&gt;lower rent&lt;/i&gt; dwelling.&lt;p&gt;The history of US housing is (with a few exceptions, notably the post WWII housing boom) a story of people building premium housing that, as it ages, becomes affordable housing.  Thing how many big old houses end up converted into duplexes or townhouses.&lt;p&gt;But lately we&amp;#x27;ve 1) used zoning to stop the conversion of premium housing into cheaper housing and 2) used zoning and planning permission to stop the construction of premium housing and then wondered why we don&amp;#x27;t have enough affordable housing.  What a mystery!&lt;p&gt;&amp;gt; It is complicated, though.&lt;p&gt;It&amp;#x27;s a complex system with many different forces in play, yeah, but it&amp;#x27;s not &lt;i&gt;that&lt;/i&gt; complicated.  If you build more housing, the price of housing drops.  Building expensive apartments in a neighbourhood doesn&amp;#x27;t magically create affordable apartments in the same neighbourhood, but it certainly doesn&amp;#x27;t hurt.&lt;p&gt;The exception would be if, somehow, building 100 units of housing somehow attracts more than 100 families into the city from outside the area, which...I dunno, it could happen, but is it?  Has it ever?  It sounds unlikely at first glance.</text></comment>
<story><title>Rents dropping significantly across the Seattle area after new construction</title><url>https://www.seattletimes.com/business/real-estate/seattle-area-rents-drop-significantly-for-first-time-this-decade-as-new-apartments-sit-empty/</url></story><parent_chain><item><author>smelendez</author><text>It is complicated, though.&lt;p&gt;Rich people moving in to a working class neighborhood makes the neighborhood more attractive to other rich people, both directly and by bringing in rich people amenities. So building high end housing can ultimately cause more demand and higher bids for the existing housing in the neighborhood.</text></item><item><author>weeksie</author><text>Holy shit, supply and demand is still a thing!&lt;p&gt;Last year I was in Seattle and all I heard was complaints about all of the highrises going up as if that was what was causing the high rents. &lt;i&gt;headdesk&lt;/i&gt;</text></item></parent_chain><comment><author>weeksie</author><text>While that&amp;#x27;s intuitive, that&amp;#x27;s not an argument against building high end housing.&lt;p&gt;I do agree that it&amp;#x27;s complicated, though!&lt;p&gt;As someone who lives in New York, I can attest that affluent people will just rent the apartments that already exist in the neighborhood and drive the prices up for everyone. The difference is that the shitty tenement one bedroom gets bumped to 3k&amp;#x2F;month because the affluent will displace the current occupants.&lt;p&gt;If you build luxury buildings, the affluent will move into those. Sure, that will have a second order effect on the desirability of the neighborhood (which is what I believe you are arguing), but I am of the belief that that is a separate issue. Gentrification is its own bag of worms.&lt;p&gt;A while back someone said &amp;quot;Luxury Housing is future middle class housing&amp;quot; and that rings pretty true. The economic incentives are to build nice properties and over time those properties get old. A good percentage of them get divided up into smaller places or simply rented for less as new inventory comes on line.</text></comment>