HJCinLA (@Real__State) header
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Economics, Housing & Steel Modular Guy. 30% faster to market, 25% cheaper. Let’s build better 🏗️

Los Angeles, CA
Joined March 2013
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Finally finished the whole thing, and I wrote down a few notes while listening: - Solid performance for Raman, in a mildly hostile environment - It's an interesting path for Raman to be a 'centrist-progressive' because it might be enough to be elected mayor but she will have no chance on a state or national level. Then again, LA mayor has never been a springboard for anything. - @OppenheimJason, like many other RE people are going with Raman. We'll check how this plays out in 2 years More specific notes: - If LA is expensive, what prices would she consider affordable? What should a house cost? What should rent be? This question is never asked, ever - Homelessness is just assumed to be linked to housing costs, as if it's a given (not true) - Rent control on new homes - she keeps saying that but it's not true. There's rent control on brand new homes. LAHD is issuing rent control restrictions on brand new structures all the time. Many of the new apartment buildings in LA are deed restricted, which is similar to rent control. Plus she passed the JCO on all properties in LA - She supports ULA reform but not explanation why did she support ULA to begin with. Why should be trust her judgment when she could not see what we all saw when it was time to vote on it? - She talks about imbalance in eviction courts and giving tenants free lawyers evens the balance, which is hysterical. All the laws are tenant favored, the courts, the administration, new laws, the procedure, city hall, self help centers... And I don't mind the free lawyers, whatever. Saying there was imbalance in LA eviction courts is laughable. - She talks about a small number of bad tenants taking advantage of the laws - which is true as a whole, but it's the majority of tenants taking advantage of tenant protection laws in bad faith. Again, if I was facing eviction I would do the same thing, I don't blame the tenants or their lawyers, it's the system and the lawmakers - Interesting discussion when Graham asks Raman "why does a person deserves to live in Santa Monica" and Raman basically answers that it's her job to engineer some kind of society mix of poor and rich through legislation. As a concept I don't have an issue with that, the problem is - the costs to get there are severe. Many of the woes in the city can be traced to this baseline desire to engineer this kind of "diverse" community of income of all kinds. You can give a person free housing, but you then also have to give them free/discounted everything else because everything is 10-30% more expensive than say, Palmdale where land is cheaper. - This is basically the same argument advanced for unfettered mass immigration. "We need the cheap labor". People like Nithya say we need more workforce housing, we need blue collar labor force close by. The flip side of that is just higher wages, just sayin' - Graham mentions the 4th street project, at a cost of $1m+/unit. Raman supports the high costs and union labor. Does not say what premium she is OK on her end, just a generic statement she can bring the costs down with cutting red tape - Unlike other local races, Bass/Raman race is strictly local, no discussion over things non-LA related. There's barely any personal attacks, style arguments, affiliations, connections to people... It's basically as close to a policy differences as you can get.
Nithya Raman sits down with Jason Oppenheim, Graham, and Jack to debate rent control, homelessness, and where LA’s money actually goes Full Episode Here👇
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HJCinLA retweeted
Probably the best video ever created.
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Celebrities like Angelina Jolie are selling their Los Angeles homes for millions below asking price. Others like Aaron Paul are even choosing to live in faraway countries rather than spend another minute in the city. It’s not just a Hollywood trend, either: LA County as a whole lost roughly 54,000 residents last year, the most of any county in the US. Why? Government regulations and ineffective socialist property taxes, of course. LA’s “mansion tax,” which puts a 4% tax on property sales above $5 million to fund “affordable housing,” has inadvertently suppressed the sale of 9,100 homes, cost the equivalent of 16,650 construction jobs, and a class of small-time developers are getting crushed. Meanwhile, the city has spent only about 10% of its collections from the tax, and on deeply questionable projects: one is an $800,000 per unit development that still hasn’t broken ground after 4 years. In addition, condo construction, historically a stepping stone to homeownership for middle-class families, has collapsed by roughly 90% thanks to other burdensome regulations. All of this, of course, comes as the Palisades remains largely unreconstructed. @nicolewizman1 breaks down how LA destroyed its housing market, triggering a massive exodus 👇
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HJCinLA retweeted
A small infill developer shared their pro-forma with me. Fees amount to *20%* of total project costs. Mortgages for homebuyers will be be at least $1,212 / month more expensive. If CA Democrats want to advance an affordability agenda, start by cutting housing fees.
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Now instead of homes being overbid by 500k, they will be overbid by 550k over asking.
JUST IN: First-time homebuyers could get as much as $50,000 for a down payment on a house, under a draft bill to be introduced by Senator Jeff Merkley and cosponsored by Senator Ron Wyden, per Axios
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HJCinLA retweeted
Show me the incentives ... and I'll show you the outcome
Curious how the city spends so much money on construction? Here’s a union scaffold shop, working at 9:30 pm, using brand-new lumber to erect…a sidewalk shed. Every possible decision here has been designed to maximize cost.
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HJCinLA retweeted
In addition to market rate developers, affordable housing developers are also frozen out of AB179 if our projects do not take state money. (We're penalized for being better lol.) California should be promoting and incentivizing less costly affordable housing projects that get developed without the use of state money vs more costly affordable projects that do require (scarce and finite) state money. But AB179 gets it completely backwards. AB179 provides impact fee relief for the less desirable set of affordable projects that require state funding, but not for the more desirable and cost effective set of affordable projects that don't require state funding. Why? Because construction unions have had a vice grip on our Sacramento legislators and our Governor. Unions run the show in CA. How does it work? Projects that require/take state money must utilize prevailing wage i.e. union construction, and AB179 provides impact fee relief to help these projects get built. These fall into the category of the $1 million/unit projects that we all bemoan. They cost $1 million/unit mostly because the cost of construction is 30% higher than non union construction. AB179 perversely incentivizes these expensive affordable projects. Those of us who build affordable housing without needing/using state money build at a fraction of that cost because we build with non-union construction. Ours are the more financially efficient affordable housing projects that should receive AB179 relief to further incentivize development. But they don't. Because we don't build using union labor we are therefore shut out of AB179 relief. We need to move to housing production policies in CA that values and incentivizes projects that create (a) the most amount of housing units for (b) the lowest cost per unit (on an equal basis) that (c) allows the most housing to be built for a given dollar of public subsidy. Right now we do the opposite. We allocate the most amount of money and incentives to projects that cost the highest amount of money per unit. We have to decide to put the interests of Californians in need of affordable housing above the interests of union construction trades. Right now CA's housing production laws are too frequently union jobs programs rather than cost efficient housing programs.
Newsom's AB 179 cuts per-home affordable housing costs by $60,000–$70,000 via lower impact fees, which already cost affordable developers $300 million a year statewide. Market-rate developers, who build most new housing, still pay these fees in full. kqed.org/news/12090688/newso…
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America won't get electric cars, high speed rail, safe streets, ubiquitous delivery robots, or a housing construction boom, but we WILL get a hukou system for state-owned grocery stores
New York City will require IDs to prove you live in the city in order to shop in the city owned grocery stores. So you need an ID to shop in the city’s stores, but it would be racist to require an ID to vote. Perfection.
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HJCinLA retweeted
The majority of you are stupid.
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This is so frustrating. Rent control is such a terrible policy from every possible angle you might want to look at it. We can disagree on things like the proper amount of redistribution in society. But this is simply a harmful policy with no upsides that anyone can argue for.
Truth nuke in the FT comment section on Berlin rent control
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HJCinLA retweeted
if you read the nytimes under the guise that every article is pretty much written by a (former) theater kid who often lacks a basic understanding of economics & what actually drives a functioning thriving society/economy then all of the pieces become insanely fun to read.
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California is one of the most dynamic places on the planet. But it is a case study in how a rich society can spend more and more while producing less and less of what its ordinary citizens need. My take:
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We live in a C world. Half the people can’t even show up on time or keep promises. My guess is that operating at a B- level puts you at the top 10% of earners and operating at a B+ puts you in the top 1%.
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Watching footage from WW2 makes me realize how brave this generation was and how pathetic the current one is.
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The reason Japan can have great trains is not high trust. It's LACK OF VIOLENT CRIME. If you have even moderately high levels of violent crime, people will want to drive instead of taking the train. You can't have trains without suppressing violent crime.
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The progressive idea of "Let's make everyone equal at math by just not making anyone learn math" is going just about as well as you'd expect
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I forget who said it but a post said "buying my 30 year old daughter with 3 kids a mini van has a bigger impact in her life than $300,000 when I am dead" (something like that) I have never stopped thinking about it and will use that as a compass as my kids get married, have kids, buy houses etc.
If you're a boomer in your 60s and 70s and you own property and are well off but your children are struggling and can't even buy a home, what the hell are you doin? Your time is over. It's their time. Help them. Be a good parent, do whatever it is you need to do... sell the house if you need to, give them some kickbacks to help buy their first home, etc. Life is short. Be a good parent and don't squat on stuff that doesn't matter. Give them their time.
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It's not very complicated. Let the market build. Performative moral masturbatory policies are not as important as actual outcomes, but celebrating a policy proposal and never tracking outcomes is what wins elections here.
legalize more by-right housing!
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HJCinLA retweeted
San Marcos has permitted 90% of its state-mandated homes, while neighboring Escondido has reached just 25%. San Marcos claims it built a development-friendly environment rather than waiting for housing to happen on its own.
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