At the State of the City, Mayor Brett Lee announced that “there are very substantial changes on the horizon for vacancy rate rental housing.” For years, the city did not approve any new apartment complexes. “The city should have something around 3000 beds coming on line within the next couple of years.”
He said right now the vacancy rate is around one-half of one percent while the hope is to get it closer to three to four percent. “This low vacancy rate creates some issues,” he said. At the same time, he said the campus “will be providing 5000 beds in the next couple of years.”
While that is the good news – and the mayor and city manager took time to show a drone video of construction at West Village, none of that housing is available right now. And while on the surface it looks like the vacancy rate is up, drilling down into the report, that may be more an artifact of the report than anything else.
Bottom line: real change is going to have to wait for those West Village and Sterling units to come on line, and then more units to be built on campus and in the city.
In 2019, “a total of 122 apartment complexes and property management companies responded to the survey. These properties include a total of 9,007 rental units.” The report was performed by BAE 
Urban Economics on behalf of UC Davis Student Housing and Dining Services.
The survey looks separately at bed leases versus unit leases, although 7207 of the units were rented by the unit, accounting for 85 percent of all reported market-rate rental units.
Per the survey respondents, “there were 40 vacant apartments available for lease on a unit-lease basis during the survey period. This translates to a vacancy rate of 0.6 percent. This is 0.2 percentage points higher than was reported in the 2018 survey.”
Moreover, the survey noted, “Broken down by unit type, the 2019 survey results show that the vacancy rate was the highest among the one-bedroom and two-bedroom units, which had vacancy rates of 1.0 percent and 0.5 percent, respectively.”
However, “The comparatively high vacancy rate among one-bedroom units is driven by vacancies at a small number of properties that have recently undergone renovations, where units were not available until after the fall lease-up period.”
They found that 1266 of the units were rented under bed-lease arrangements.
The survey found that there were 141 vacant beds which equals a vacancy rate of 3.4 percent. BAE writes that this “represents a significant increase from 0.7 percent and 28 vacant beds in 2018.”
The seemingly good news comes with a considerable caveat: “The increase in the vacancy rate is largely due to vacancies at a small number of properties, where units were not available until after the typical fall lease-up period.”
With the diverging lease types, BAE now combines the unit and bed lease to generate a combined or “blended” vacancy estimate.
This year they estimate a blended vacancy rate of 1.0 percent for all units, up from 0.4 and 0.5 percent the previous two years.
There would seem to be two pretty important questions here to look at.
First, is the vacancy rate actually improving? The answer is that it is probably marginally improving, but the real answer is that at this point it doesn’t really matter. What will matter is what happens when the new units start hitting the market. If we can get to 3 to 5 percent vacancy, then it will make a difference.
A second point is whether bed leases produce higher vacancy. Here again, we cannot be that confident in the estimates. Although last year when the data seemed more complete, the difference between unit and bed release vacancy rates was 0.4 for units and 0.7 for bed leases. That is what we would expect – we would not expect a lot of vacant units, but having beds available to lease would be advantageous.
Given that for whatever reason lease by the bed has been controversial among town folk but popular among students, we can see a considerable advantage for bed leases in a tight rental market where you would not expect to find a lot of vacant units off cycle, but may well find available beds.
Taking a look at the rental rates, BAE reports: “Most respondents reported static or increasing rents, relative to 2018.”
They do note: “Five of the respondent complexes reported lowering rents in 2019 in order to fill vacancies. This is a slight increase from 2018, when only four complexes reported reducing rents. Generally, complexes lowered rents by only two percent or less. One complex indicated a reduction in the rent on only one unit, while another reduced rents but is now charging an additional offsetting ‘utility coverage’ fee.”
Overall, rents continue to rise. An average one bedroom is $1430 while an average two bedroom is $1893.
Meanwhile, bed leases are going up as well. They write that “the weighted average rental rate for a bed lease, in units of all sizes, was $1,003 per month. This represents an increase of 5.1 percent over 2018, when the average monthly bed lease rate was $954.”
They calculate the blended rental rate. For a one bedroom that is $1455 and for two it is $1929.
BAE notes, “Across all unit types, the average rental rate is $2,117. This represents a 5.5 percent increase over 2018.”
Basically the average one bedroom went up in rent by about $63 per month and the average two bedroom went up by about $108 – those are for unit leases. Overall it was a 4.7 increase over 2018 but 2018 had an 8.5 increase over 2017.
The good news is that number decreased. The bad news is that, even with an improved vacancy rate, we were still seeing a newly 5 percent increase and the worst news is over two years the rental rate went up over 13 percent.
Bottom line, relief is not coming until the units are coming on line. And those folks who are suing Nishi and who sued Lincoln40 did the student renters absolutely no favors and probably will end up costing them considerably over the next two rental cycles.
—David M. Greenwald reporting
A growing population with a stagnant supply and the price needle moves at a rate that is well above inflation. As Gomer would say “Su-prise! Su-prise! Su-prise!”
That tells the story going from 12 to 1900 over an eight year period
Do you happen to have the overall numbers as well for the region — say the SACOG covered area or similar? It would be interesting to compare the rent increase for Davis to the overall increase for the regiion.
Alan, I don’t vouch for the accuracy of the site’s data, but https://www.rentjungle.com/average-rent-in-sacramento-rent-trends/ has a snapshot of what you are looking for.
What we don’t know is the month of each year that the BAE data represents.
https://www.kcra.com/article/5-things-to-know-about-sacramentos-housing-rental-market/30771764#
The above sentence may be labeled as laying down the guilt.
Is it wrong?
Is it “wrong” to suggest that this is the reason for the lawsuit?
The reason is to drive up the costs? Is that what you’re saying?
That seems to be what you’re saying. Your comments are irresponsible and purposefully divisive.
What I am saying is that is the result of the action not necessarily the intent of the action
You’ve never actually explored the “intent” (which I believe challenges the Affordable housing program, for one thing). For example, can non-students live in the proposed “affordable” units? (I’m not sure, either way.)
Almost all of your focus is on villifying those who initiated the lawsuit.
If there is anything “wrong” with the program (or proposal), what’s to keep other developers from pursuing the same thing (unless challenged)?
But that didn’t stop you from inferring intent
The quote from you that Alan M. cited (and you “followed-up” on) shows your intent. Probably in a more “mild” manner than normal, for you.
You’ve essentially (and repeatedly) declared a one-sided “war” against those who initiated that lawsuit.
It’s irresponsible, and could even be dangerous. It might also be viewed as intimidation, or a “warning” regarding your crusade against anyone else pursuing such actions.
Until rents (& property values) actually start dropping we haven’t built enough. It’s NOT enough to stop the rents from rising — the desired outcome is that rents should substantially decline.
Median rent for a 1 bedroom in Ann Arbor is ~$900. There’s no reason that shouldn’t be the price here.
Tell that to the lords of land — and the laws of economics.
I highly recommend two courses at UCD: Econ 1A & 1B. Hopefully they are still being taught by economic theorists and not by socialists.
I’m pretty sure if 20,000 apartments were built on the edge of town rents would drop pretty quickly. That’s the Econ 101 supply and demand you refer to.
The problem is the lords of land are happy to block new housing to make sure that rents and property values go up.
True. You pass.
Ya mean NOT scraping along the bottom as statistically close to zero as mathematically possible isn’t good enough?
When the Vanguard published the UCD press release on Thursday, David Greenwald made the comment, “Better than it was and it comes in advance of the thousands of beds that will be coming on line perhaps by September.”
I pointed out that David’s comment was flawed as follows, “Actually David we really don’t know that it is better than it was. The report clearly identifies three major reasons:
(1) There were only 122 apartment complexes reporting this year compared to 138 apartment complexes in 2018, 142 apartment complexes in 2017, and 143apartment complexes in 2016. The 9,007 Beds reporting was down from 10,188 reporting in 2018, 9,969 reporting in 2017, and 9,905 reporting in 2018.
(2) “The comparatively high vacancy rate among one-bedroom units is driven by vacancies at a small number of properties that have recently undergone renovations, where units were not available until after the fall lease-up period.”
(3) In the Bed Leases section “The increase in the vacancy rate is largely due to vacancies at a small number of properties, where units were not available until after the typical fall lease-up period.”
The reason is mathematically quite simple. If an apartment unit is “not available” then it should be totally removed from the unit count rather than reported as “vacant.” “Not available” is a report of Supply. “Vacant” is a report of Demand.
The press release states, “According to the fall survey, 40 apartments, or 0.6 percent, of 7,207 leased by unit were vacant, compared with 0.4 percent vacant last year.” If 20 of those 40 apartments were actually “not available” rather than “vacant” the Vacancy Rate is cut in half to 0.3 percent.
The press release also states “Among the 1,266 units leased by the bed rather than the unit as a whole, 141, or 3.4 percent, of the 4,194 beds were vacant.” If 20 units out of the 1,266 units total are under renovation that represents approximately 66 beds (Table 2 in the actual survey shows 4,194 beds rented by the bed in 1,266, which is a ratio of 3.3 beds rented by the bed per unit). Reducing 141 by 66 to 75 reduces the leased by the bed vacancy rate from 3.4 percent to 1.8 percent.
When the “under renovations are removed from the Blended Vacancy Rate, it drops from 1.0 percent to approximately 0.5 percent.
With all the above said about Vacancy Rate, neither the smaller number of reporting Apartment Complexes, nor the number of Under Renovation units affects the Average Rental Rates in any meaningful way. There is nio reason not to consider those numbers as accurate.
The 4.7% annual rental rate increase clearly shows the tried and true law of Microeconomics that there is “too much demand chasing two little supply.”
Matt: Shouldn’t the first acknowledgement be that the survey itself only represents a portion of the Davis rental market? (Limited to large apartment complexes, and only those who responded.)
It seems like they have a sizable sample.
Again, leaves out a large percentage of other types of rentals (e.g., smaller complexes, single-family rentals, etc.).
It apparently doesn’t even include the vacancy rate for housing on campus, as you noted further down on this page.
The first step would be to determine what percentage of the total rental housing market is actually represented (or left out), by the survey.
It’s a survey it captures a sizable portion of the apartments and gives a snapshot That can be compared over time. It definitely does not include on campus housing and it doesn’t include single-family homes. But it gives us a sense of what the market looks like in terms of cost and in terms of vacancy.
It is a “survey”, no question about that.
But one cannot take the results from it, and declare that the vacancy rate (for all rental housing in the city, and/or on campus) is “XX percent”.
Given that the vacancy rate has pretty much been unchanged for the last 35 years or so (and there was nothing to prevent proposals from coming forward during this entire period), I’m skeptical that future results will change much. I certainly don’t think that rents are on their way “down”.
However, a bigger factor is probably the expected “dearth” in the number of new college students. That’s something that might actually impact “demand”.
UCD can still “create” more demand, or renege on the units that are not under construction. (It might be cheaper for UCD to simply pay the city/county the minimal amounts described in the settlement.)
That’s correct what you need to do is look at change over time
To be clear, I’m referring to the survey’s “vacancy rate”. We don’t actually know what the vacancy rate is throughout the city, and on campus. Nor do we know how that’s changed, over time.
I suspect it’s pretty low (at least in the city), though. Apparently, it’s pretty low throughout the region (although again, one would have to examine how that’s measured).
For sure, using that number (in any locale) as a “planning tool” is going to lead to some negative consequences.
Using the vacancy rate for planning would be akin to using the number of “for sale” houses to determine if more of those should be built.
(I’m not really referring to student housing, with this comment.)
No it hasn’t.
I guess you’re agreeing, Don. The line in that graph is misleading, as it shows vacancy rates remaining pretty low, overall. Nor does it explain some pretty significant “changes” during a short period of time.
By the way, did rents nevertheless “rise” during the period in which the rate was somewhat higher?
I recall another commenter noting a low vacancy rate even further back than that.
But again, it’s a focus on the symptom, rather than the cause. Nor is there any correlation presented with prices during those years.
Not misleading, but perhaps this will help with the exact numbers. For consistency I’ve not been using the “blended” rate as I’ve tracked this over the years.
You’ve included a broader number of years, now.
What do you suppose caused the rate to change (from less than 1 percent in 1990, to 8.7 percent in 1992)?
One other question I have (in general), is why aren’t landlords charging even more, when the vacancy rate is low? (In other words, increasing rents to the point that vacancies rise, again?) Isn’t that what’s expected, under “supply-and-demand”?
Given that there are alternative schools (and locations to live, outside of town) – it’s not a totally “captive” supply of customers.
Also – did you notice that the period between 2009 – 2013 had a relatively higher rate (which corresponds with the housing crash/recession)?
And yet, that’s the period in which many pursued college, rather than attempting to get a job. As such, you’d think that student housing might have been at its most impacted point, during those years.
In any case, there’s several “moving parts” – starting with enrollments during those periods. That’s your “driver” of this entire issue.
Ron, the answer to the 2009-2013 data anomaly is easy to explain. Because money was tight, more and more students chose to voluntarily “double up” and the average density of residents per unit rose by between 10% and 20% depending on the year you choose to compare to the baseline.
That’s fine as a “guess”, Matt – nothing more, nothing less.
And to expand upon your theory, some are now (apparently) doing well-enough to pay for their own apartments, thereby driving down the vacancy rate. (Again, according to your theory.)
No Ron, I don’t think that should be the first acknowledgement. Do you know it is limited to large complexes? I suspect there are plenty of smaller complexes included as well.
The fact that it is only those who responded is meaningful only if you are looking for an absolute answer. As surveys go, this one has an INCREDIBLY HIGH rate of participation. Comparing it to the world of surveys it is more likely to be accurate than most.
On the other hand when comparing it to itself (year to year) the high rate of return is consistent from year to year. So what you are looking for is not differences in the margin of error calculation when the participation rate goes down, but rather for the reason for the 15% drop in the number of apartment complexes responding in 2019. The 20 complexes that didn’t respond this year tell a very interesting, and unknown story.
And yet, there’s this, in regard to Sacramento’s rental rate increase (from an article posted 4 days ago):
https://www.kcra.com/article/5-things-to-know-about-sacramentos-housing-rental-market/30771764
I’m not sure what point you are making Ron. I believe the laws of Microeconomics are working in both Davis and Sacramento … and in Las Vegas and Phoenix as well … “too much demand chasing two little supply.”
Matt: Do you have some kind of side-by-side comparison of the vacancy rate in those communities, vs. increases in rental rates over the years?
Are you suggesting that other costs (including construction, maintenance, insurance, taxes) don’t rise – regardless of increased demand?
How do larger factors such as recessions and economic expansions impact prices?
In other words, do landlords sometimes “eat” rising costs, if a given market won’t support rising rents? (For example, during economic downturns?)
And when an economy does rebound, landlords then “make up” for years in which they couldn’t increase rents?
If a market is able to support rising rents, does that necessarily mean that more people are moving in, or might it mean that salaries are rising, for example? (Or maybe, “both”?)
No Ron I do not.
Please note, that in your final two sentences above (that end in a question mark) you are once again “wondering.”
Also, what causes towns like Detroit to consider tearing down tens of thousands of existing houses, at substantial cost?
I think I know the answer to this, and it’s the same factor that causes increases in “demand”.
Increases AND decreases in demand are BOTH related to “economic development”. There is no mystery about that.
“Vacancy rates” and rental/housing prices are a “side effect” of that.
Ron, in the case of Detroit the cause is not Economic Development, but rather Economic Decay.
Two sides of the same coin.
But again, vacancy rates and housing prices are only a side-effect. (And yet, the side-effect is consistently examined in “isolation”, on here.)
I’m not sure what you mean by two sides of the same coin … either that or I don’t think your metaphor works as well as you think it does.
Comparing Detroit to California, Arizona and/or Nevada is not a comparison of economic decay to economic development.
The primary (but not the only) reason that California, Arizona and Nevada have all experienced the substantial increases in housing demand has been due to the population growth that is a natural bi-product of the superb climate that all three states have. All those immigrants from Asia to the west, Mexico and Central America to the south and the majority of the other 40+ states to the east need housing. A substantial portion of those immigrants have no desire for one of the “new” jobs that result from economic development. Another substantial portion are simply filling jobs/positions that already exist in the California economy. That is particularly true in the Agricultural economic sector.
To be sure there are many people who come to California to fill the “new” jobs that result from economic development, but my wild ass guess is that that accounts for no more than one-third of the increase in housing demand … quite possibly much less than one-third.
Now, if we step down from California to Davis, how many “new” jobs do you think have been created in Davis as a result of Economic Development in Davis over the past 10 years? According to publicly available statistics the 65,000 to 70,000 residents of the City of Davis produce a labor force of approximately 36,000 workers. Given that baseline, how do your number of Economic Development-created jobs compare?
I’m going to guess (and it’s definitely a guess) that Economic Development has produced no more than 1,000 new jobs in 10 years. That is about 3% of the 36,000 total. Compare that 3% to the growth in Rental Rates and Housing values, and you will quickly see that Economic Development accounts for a small portion (dare I say very small portion) of the growth in housing costs.
Bottom-line, economic development is not the boogieman you try and label it as. On the other hand, in Detroit, economic decay is indeed the boogie man. That is a coin of a different color.
Yes it is. That’s exactly what it is.
Have you been to Phoenix and Las Vegas during the summer?
Preposterous, to suggest that they’re pursuing housing without jobs.
You’re referring to farmworkers? What does that have to do with the conversation?
You’re wrong, and you have no basis whatsoever to back up that claim.
I’ve posted articles regarding this phenomenon. Repeatedly. Overall, there’s a net outflow of Californians, to other states. However, inbound immigrants (from other states) are higher-wage workers, and are forcing out lower-wage workers.
Those being forced out of the Bay Area (or are simply reaping the “benefits” resulting from “economic development” by selling their houses) are moving to the Sacramento region.
Ultimately, folks move to locations where housing costs “match” the income that they’re able to bring in.
Are you kidding me? What do jobs in Davis have to do with anything? The jobs are on campus, and in the Sacramento area. (Some commute to the Bay Area, as well.)
Again, this is a preposterous comparison. Davis itself has never been a major employer, and never will be. It’s a “bedroom community” for UCD and Sacramento.
Two sides of the same coin. Detroit’s economy has collapsed, and so has its housing market. Davis enjoys two of the most stable employment bases that exist (UCD, and government jobs in Sacramento).
Add more economic development, and you’ll see more demand for housing. It’s not rocket science.
However, it is generally a “zero-sum” game, for cities.
And that, by the way, is the reason that San Francisco still experiences massive fiscal deficits, while some individuals become wealthy.
It’s also the reason that renters in San Francisco (unless they’ve stayed in their units long enough to enjoy the benefits of rent control) usually don’t experience a personal net benefit – even if they receive a higher salary than they might in other locales. Especially low-to-middle income renters. (These are the folks who are “leaving” San Francisco and the Bay Area, in addition to those who want to “cash out” their houses.)
Actually, there’s also some unfounded presumption that Davis (and the Sacramento region as a whole) is also some kind of shangri-la.
It isn’t. It’s a hot, flat, floodplain – with poor air quality during the summer. With increasingly miserable traffic, and jobs opportunities that are only slightly better than some other locations.
However, it’s just close enough to the Bay Area (and the Sierra) to be influenced by that. Most folks traveling from the Bay Area to the mountains would probably prefer it if they could “skip over” the entire, increasingly traffic-chocked mess. (And, most probably couldn’t care less if they “inconvenience” the locals via the Mace Mess, for example.)
California weather (and geography) is desirable if you’re near the coast. That’s also where the best jobs are. You don’t get to make that claim, in the valley. Even in “oh-so-special” Davis. 😉
Ron, you are viewing the situation through the lens of your own bias. The number of people who have moved to California and Arizona and Nevada to retire (and expect no job) far exceeds th number of people who have moved to those states as inbound immigrants to fill the higher-wage jobs created by economic development. You do realize that economic development does not first create “new” lower-wage worker jobs and then replace those lower-wage worker employees with higher-wage workers.
Yes, my brother moved to Tucson from Philadelphia. Trying to argue that the comparing bitter winter cold and then humid summer heat of the whole East Coast and the upper Midwest to the dry summer heat and incredibly comfortable fall, winter and spring of Phoenix and Las Vegas is a fool’s errand. Go to https://wallethub.com/edu/cities-with-the-best-worst-weather/5043/ and look at the rankings of cities by weather. Again you are viewing weather and comfort through the lens of your own bias.
Not the least bit preposterous if you are a retiree. You have a house. Do you have a job? Look at the population growth of Davis between 2000 and 2010. The Seniors population cohort (over the age of 55) grew 45% in a period whan the total Davis population only grew 9%.
It has everything to do with the conversation. The people who work on farms clearly need jobs, but those jobs are not the result of Economic Development.
Again, you are viewing the situation through the lens of your own bias. I don’t have the specific number but a substantial portion of the inbound immigrants to California, Arizona and Nevada are retirees. Another substantial component of the immigrants to those three states are from foreign countries, and are definitely not high-wage workers.
You are changing the subject away from Economic Development. Try and stay on topic.
You’re putting forth unsupported claims, although I’m sure that what you’re stating is a factor. However, I suspect that retirees don’t necessarily move to the same location as workers, within a given state. I’m not sure that many retirees move to Las Vegas and Phoenix, for example.
I have no idea what you’re trying to claim, here.
The “higher-wage” jobs I was referring to are the ones created in places like Silicon Valley.
Again, that wouldn’t explain how Detroit was (at one time) able to attract more residents than they can, now. The weather did not “change” there. Economic conditions did.
Economic conditions are starting to change in Pittsburgh again (pursuit of technology companies), resulting in a significant increase in housing prices.
The “seniors” in Davis are the same ones who used to be workers. They’re simply retiring in place. That’s the bulk of the “45%” number that you’re using. It is not as if Davis is attracting a large number of “new” resident retirees.
The number of student residents has likely increased.
Also, please cease from sharing what you think you know about me, other than what I share on here. (A really bad habit you have – and not just regarding me.)
You’re referring to farmworkers? What does that have to do with the conversation?
Again, I don’t know what this has to do with the conversation. As a side note, however, farming is (also) a form of “economic development”.
inbound immigrants (from other states) are higher-wage workers, and are forcing out lower-wage workers.
It’s not my “lens”. This has been the focus of repeated articles. Those moving to the Bay Area consistently have higher wages than those that they are replacing. The ones being “forced out” are moving to places like Sacramento, Phoenix, Las Vegas, Texas, etc.
To some degree, those being displaced from the Bay Area are (in turn) displacing some in the communities to which they’re migrating to. Including the Sacramento area.
You’re the one who brought up “Davis jobs” as if it was much of a factor.
Economic development is directly related to demand for housing. Are you denying this? Have you seen what’s happening in the Bay Area (especially Silicon Valley and San Francisco?)
Take away UCD and Sacramento, and Davis’ “demand for housing” would dry-up overnight. They’d be tearing down houses, like they’re doing in Detroit.
So, here’s one such article:
https://www.mercurynews.com/2018/04/04/bay-area-trend-low-earners-move-out-high-earners-move-in/
There’s the reason that rent is rising.
It’s not a mystery, regarding the reason that the cost of housing in the Bay Area has risen so much (within just the past few decades). It’s not due to “natural population growth”.
It’s also a reason that many in Davis originally came from the Bay Area. Many of whom might not even be able to afford their DAVIS homes today – let alone their former Bay Area homes.
Ultimately, lower-income folks (and/or, the ones who didn’t buy houses “back in the day”) are the ones who get pushed out
I’m not sure that some folks realize just how much, and how quickly Bay Area housing prices have risen over the past few decades.
There was a time (not so long ago), that middle-class people could easily afford it. Not anymore, thanks largely to the tech industry. Back in the day, it wasn’t even considered to be the apparent “Garden of Eden” that some think it is, today.
To some degree, the same type of phenomenon is happening in Davis, although (at this point), there’s still a lot of nearby communities willing to accommodate the sprawl resulting from the pursuit of economic development. And frankly, Davis seems somewhat willing to “contribute” to sprawl, as well.
Rather than San Francisco itself, places like Los Angeles and San Jose actually provide a more realistic “model” of what some are pursuing for the Sacramento region. And yet, even with their vast subdivisions and resulting traffic mess, those regions are not “bastions of affordability”.
It would be interesting to see what the region will look like, in decades/centuries into the future. (As well as any impacts from climate change.)
Not to mention what the “rent” will be.
Ron, have you heard of Sun City?
That is correct. And those higher-wage jobs do not displace existing lower-wage jobs. The whole purpose of Economic Development is to create net new jobs.
Again you are looking at the situation through the lens of your bias. Are those lower-wage jobs actually going away, or are the workers who are filling those jobs simply moving to, or being sourced from, nearby communities that have lower cost of living. We are seeing that phenomenon happen here, as lower-wage workers choosing not to rent in Davis, and move to Dixon, West Sac or Woodland. Despite the residence change of the workers who fill the jobs, the existing jobs don’t go away.
Go back and read what I said … Economic Decline is the reason for the housing supply shrinkage in Detroit. That has never been questioned. What was questioned was whether Economic Development was the reason for the massive housing demand (and population) growth in California, Phoenix and Las Vegas.As I said before, I believe Economic Development is responsible for no more than one-third of the growth in Housing Demand. I believe the population growth due to the immigration of retirees from other locations (both within the United States and from foreign countries)is larger than the population growth ue to the immigration of the high-wage associated with the “new” jobs created by Economic Development.Those retirees are not coming to California because of the economic conditions.
That is a ridiculous statement. The extent of the farming industry is constrained by the aggregate size of the acres being farmed. I’m pretty sure you will find that the aggregate In order to have Economic Development in farming you would need to be increasing the amount of land dedicated to farming. In reality the number of acres is shrinking not growing. Existing farms are increasing the productivity of the acres they do farm, but that rarely creates “new” jobs growth. In fact, those productivity gains are frequently the cause of jobs loss.
Please provide an example of an industry or company where lower-wage workers have been displaced from their jobs by higher-wage workers.
Again that lens thing. The jobs that the people you are referring to as “forced out” are not being eliminated by the creation of the tiger-wage jobs. Those jobs continue to exist (except perhaps in brick and mortar retail, and the disappearance of those brick and mortar retail jobs is not being caused by the creation (through Economic Development) of the new higher-wage jobs. If a lower-wage worker makes the personal decision to move to places like Sacramento, Phoenix, Las Vegas, Texas, the employer of the job they left places an advertisement in the media and hires another person to replace the departed worker.
Yes, I’ve heard of Sun City.
Apparently, opened in 1960 (and now a community of about 37,500 in an unincorporated part of Maricopa county):
https://en.wikipedia.org/wiki/Sun_City,_Arizona
I didn’t “deny” that retirees are moving to Arizona. Do you think they’re responsible for the highest rental rate increases in the nation, last year (in Phoenix)?
It’s not that high-wage “jobs” are replacing low wage “jobs”.
However, high-wage “earners” are replacing low-wage “earners”, in places like the Bay Area. They’re pushing those who don’t earn enough to other locations (including out-of-state). That’s what “economic development” can lead to (and perhaps more importantly, “sprawl”).
I’ve already posted an article regarding this, elsewhere on this page.
Yes – locally, lower-wage earners (or those who didn’t purchase long ago) will increasingly live in surrounding communities. (In fact, even some “higher-wage” workers will pursue those options, as well as others who just want more “bang-for-their-buck”.)
Strange, how (even when I quote an article regarding a factual phenomenon), I’m accused of looking at it through my own “lens”.
The “pushing out” of lower-wage workers is visible through any “lens”. With the possible exception of Mr. McGoo’s “monocle”.
Here’s a link to the article again. Maybe put on some reading glasses?
https://www.mercurynews.com/2018/04/04/bay-area-trend-low-earners-move-out-high-earners-move-in/
(Looks like the “replacements” are younger, as well!)
I’m going to give this one a comment all of its own.
Actually you were the one who injected your boogeyman subject of Economic Development with your Detroit example.
It was off to the races from there.
UCD is not City of Davis Economic Development. I’ll repeat the question I asked you before … How many “new” jobs do you think have been created in Davis as a result of Economic Development in Davis over the past 10 years?
Later I said, “I’m going to guess (and it’s definitely a guess) that Economic Development has produced no more than 1,000 new jobs in 10 years. That is about 3% of the 36,000 total.” The bottom-line is that Economic Development in Davis has been anemic at best, and not a significant contributor to housing growth in Davis. I would also point out that the vast majority of the jobs that Davis residents fill in Sacramento are also not Economic Development. They are government jobs and UCD Medical Center jobs. Jobs that are organically part of long-established existing businesses and government agencies.
Matt:
I’m not necessarily seeing a point of disagreement, here.
Demand for housing (especially rental housing) in Davis is primarily driven by UCD (and proximity to Sacramento).
If more economic activity is pursued, it will increase demand for housing (both rental, and for-sale housing).
The fact is that Davis has more than enough jobs available, on-campus or in Sacramento. Although the “activity” is not in Davis itself, residents and commuters are already experiencing the benefits of those activities. That’s why there’s already a net inflow of commuters, through Davis.
The point regarding Detroit was not intended as a “negative” example. It simply shows how demand for housing is directly related to economic activity. Unlike Davis, Detroit was dependent upon an “in-house” economic activity for jobs, which ended up “downsizing”.
There’s actually a more useful comment (and article) regarding UCD’s survey, on another blog.
So, to answer your question, my response would be “I don’t know” how many jobs have recently been created in Davis. The answer has nothing to do with any point I’ve tried to make, here.
I do know, however, that the addition of more jobs in Davis will further impact the availability of existing housing. And, will likely encourage more sprawl. There’s already more than enough jobs available nearby, to create more than enough demand for Davis housing.
I have yet to figure out why some (who claim to be concerned about “housing shortages”) advocate for making the situation more challenging. Seems like some just want “more of everything”, I guess. (Except land that’s preserved.)
ARC, for example, doesn’t even include sufficient housing to address the need it will create. (Even with its flaws, the EIR for ARC acknowledges this, as I recall.)
Ron, your original point, which you have repeated over and over and over again, was that Economic Development pushes lower-wage workers out of their JOBS, replaced by higher-wage workers. That article has nothing to do with the job market … nothing … nada … gornisht
In general, it’s not difficult to see how “planning via vacancy rate” (or rental price) has to be among the most ill-advised approaches there is. Same thing is true regarding “for-sale” housing.
However, if a university (or employer) creates additional demand, then it’s also not difficult to envision the result – especially if there’s an absence of effective rent control.
Other factors include “spillover” demand, from places such as the Bay Area (where they’re escaping from much higher prices).
And by the way, there was NOTHING to prevent the flood of proposals from coming forth, prior to this point.
Developers (not cities) are the ones who decide when to submit proposals. The multi-year “housing crash” is probably the biggest reason for a dearth of proposals for a period of time.
And now, they’re all racing to be approved before the next crash occurs. (Perhaps to be created by “too many” approvals at once.)
Wondering if the survey also includes the vacancy rate for housing on campus. If not, why wouldn’t UCD’s own survey examine that? Shouldn’t THAT rate be “front and center”, since they’re the ones creating the demand?
I recall that the vacancy rate was unexpectedly high there, about a year or two ago. Not sure if that was limited to one campus development, or all of them. (I don’t recall the source of that information.)
That’s not what the survey has looked at.
Ron, if you truly are “wondering” about that factual question, then you will take steps to contact UCD and get the answer to that question.
On the other hand, if you are simply injection “wondering” into the dialogue as a political weapon … trying to leverage uncertainty, then that is a horse of a different color.
I suspect, but do not know, that you regularly use both “wondering” and your own lack of specific knowledge as a political weapon.
For the record, I once “wondered” the same thing (for a different reason than yours) and I worked with UCD to obtain the factual information I needed to sate my personal “wonderment.” It is interesting to note that the result of that research on my part was that arguably the Apartment vacancy Rate in Davis is really not a very low positive percentage, but rather a negative percentage between minus 20% and minus 30%. The reason for that is the high level of pent-up, unmet demand for Davis rental housing. The “people” or “beds” that make up that unmet demand have been forced to rent their housing in other communities and commute each day to Davis.
“Wondering” includes questions that come to mind (including very significant questions, such as whether or not the survey includes vacancy rates on campus).
What you describe as a “weapon” is really just a form of common sense, when presented with repeated advocacy articles. I’m not the author of this article, so perhaps your suggestion would be better-placed there.
Your theory regarding a “negative” rate is conjecture, at best. For one thing, it assume that there’s a significant number of out-of-town students who would live in town, if more apartments were available. Perhaps some would, but others may be more price-sensitive, and would not be interested. That is not necessarily “pent-up” demand.
Matt: It also appears that you didn’t even bother looking at David’s response (DIRECTLY ABOVE YOURS), before responding.
I had already seen it. The answer is “no – the survey did not examine or include the vacancy rate regarding campus housing”.
Now, maybe you (somehow) think that this isn’t relevant.
By the way, it looks like this is back again (despite the state’s recent actions establishing a “cap” on rent increases, as of January 1st of this year). This proposal goes much farther than that – and would repeal Costa Hawkins. A similar effort was soundly defeated, last time – but who knows what might happen next time?
https://www.ebar.com/news/news/286120
Now this, my friends, would be a game-changer if it’s ever approved. And, would forever “put an end” to developer efforts to team-up with (or manipulate) the renters that they’re taking advantage of. Game over, at that point.
Most landlords were never developers… most developers sell their projects early on, after completion… some do not.
Yeah, right… new software engineer hired in Silicon Valley is going to “push out” someone who works in the ‘service sector’ in same area? Not bloody likely… different housing choices, different mobility…
Silly argument/proposition.
Just to clarify, you’re suggesting that rising rents have “nothing to do with” the tech industry in Silicon Valley? And, that these rising rents are not impacting lower-wage workers, first (causing them to leave)?
Is that actually what you’re claiming, or would you like to reconsider considering how such claim flies in the face of direct evidence (let alone, common sense)?
https://www.mercurynews.com/2018/04/04/bay-area-trend-low-earners-move-out-high-earners-move-in/
Here’s another article, which flies directly in the face of what you’re claiming. Have you not been reading these, as I’ve posted similar articles, multiple times. Or, are you just “objecting” because I’m the one pointing it out?
https://www.timesheraldonline.com/2019/08/30/bay-area-exodus-thousands-more-fleeing-region-than-arriving/
Right – no one in Davis is being “priced out” by those who can afford the housing prices.
Ron Ron Ron Ron Donn David Matt Matt Ron Ron Ron Ron Ron Don Ron Ron Matt Matt Matt Ron Ron David Matt Ron David Matt Ron Ron Ron Ron Ron Ron Ron Ron Ron Ron Ron Ron David Donn Matt run run run run Ron Ron Ron Ron Ron Ron Ron David Matt and Ron Ron Ron Ron Ron Ron
Ron Ron Ron Ron Ron Ron Ron David Matt and Ron Ron Ron Ron Ron Ron
… Lather rinse repeat
… Lather rinse repeat
Ron Ron Ron Ron Ron
Ron Ron Ron Ron Ron
New article about housing the next day
Lather rinse repeat
Ron Ron Ron
Tomorrow, let’s try a maximum of seven (7) posts per person. This means that participants might wish to consolidate their points into longer, more organized comments. I suggest doing that off line and then pasting it in. I’m happy to go in and edit out the nonsensical coding that comes in from Word and other programs if necessary. It means that participants will need to avoid directly confronting each other, and stick to the principle topic of the thread. Rather than repeating older discussions, perhaps one can link to them instead.
I have literally never had anyone say to me “I really love to read the long, argumentative comment section of the Vanguard.” Generally the feedback I get is that there are very informative commenters who post here, but their points get lost in the squabbling. I actually know that all of you are smart people who can provide a lot of value in these conversations. So let’s try fewer, longer, better comments.
That sounds great, but is a decided departure for some who seem to revel in personal attacks.
With great effort, I’m sure we can all become better at this.
Agreed, and the limitation would encourage it. Thanks for bringing it up.
Actually, I had no intention of commenting again on here anyway, until I saw David’s “attack” against those who initiated the lawsuit. Stupidly, I probably made some other comment after that exchange, and ended up wasting another ENTIRE DAY on nonsense with Matt. (No doubt, a waste of time for him, as well.)
I’m always, always sorry whenever I end up participating on here. Unlike some (who seem to “get off” on INITIATING personal attacks), I actually hate that part of it.
One has to wonder whether it’s worth challenging the status quo on here, in the first place. (But, the comment limitation should help, if one chooses to do so.)
No Ron, I’ve actually enjoyed it quite a bit. I got to lay down some of my best sheepdog moves.
Don, the problem isn’t the content, it is the ideological crusade. Which is why I have pointed out over and over and over again to the crusader, “Again you are looking at the situation through the lens of your bias”
No better evidence exists than the 6:59pm post that says “I’m not necessarily seeing a point of disagreement, here” and then follows that statement up with seven additional posts.
I realize that this is how you’re repeatedly trying to “paint me”, but it isn’t going to work.
And, why would you keep “poking at me”, if we’re not even disagreeing?
Which “seven additional posts” are you referring to, and did you reply to any of them?
A “decided difference”, between the two of us. But, I suspect that your “sheepdog” moves exist primarily in your own head. I don’t think they’re coming-off as well as you seem to think.
Which “seven additional posts” are you referring to, and did you reply to any of them?
6:59pm
7:08pm
8:42pm
8:48pm
8:57pm
9:05pm
9:09pm
No, I did not reply to any of them
So, already I see that the 6:59 p.m. comment was in response to your comment to me.
I’m not even going to bother looking at the rest of them, based upon your misleading description of that one comment, alone.
We could go over each and every one (including those made in response to others, or to clarify a point that was cut-off by the premature expiration of the editing period), but do you think this is useful? Or, are you simply bringing this up in some kind of continuing, misguided attempt to attack me (and by extension – any point that I bring up)? I suspect that this is the ACTUAL reason for your interest.
I really think that you need to look in the mirror, regarding how you’re approaching this, in general. Not that I think you actually will, though.
You’re not coming-off as well as you might think. (In contrast, I don’t view my own comments and responses with the same level of hubris.)
I purposely set you up for this follow-up by including the 6:59 comment in the list. Six would have been plenty, but using the 6:59 as the seventh was too good a teaching opportunity to pass up. Your pattern of responses is so well defined and so consistent that it was clear what you would do. Look at your 6:59 pm comment again. You could have simply stopped typing after “I’m not necessarily seeing a point of disagreement, here” and hit the Send Comment button, but you couldn’t resist making the same ideological point again for the umpteenth time. It was remarkably illustrative.
So, I see one additional comment after that, which I believe was made to account for a premature editing period. (Note that I did so to specifically answer your question, which you apparently asked more than once.)
I have no idea what you’re referring to, regarding an “ideological point again for the umpteenth time”. That is a figment of your imagination.
You’re the one who seems to have an “ideology” (or something to “prove”), regarding the reason for Phoenix’s rental rate increase, last year. You seem to be claiming that it’s due to a vast increase in senior citizen “renters”, arriving from elsewhere. Which makes no logical sense.
Or, maybe you think it’s due to immigrants (as you stated elsewhere), who are coming to Phoenix because of the “weather”, rather than economic opportunity. Which also makes no sense.
Seems like you’re doing everything possible to avoid acknowledging the actual reason for Phoenix’ rent increase.
Honestly, Matt – I’m not sure if you realize how “foolish” you look, by repeatedly attempting to attribute all of my comments to “ideology”.
The more you attempt to dive into this, the stranger it makes you look. This is not a reflection upon “me”, despite what you think in your own mind. We are generally not the best arbitrators of our own comments.
You really should ask someone else, regarding how they view your comments. (Other than me, or one of your online allies.)
Honestly Ron, I follow the principle of reverse ad hominem in my life, working hard to be as dispassionate as possible in the information I share, and focusing on the message rather than the messenger. I leave the passion (“foolish” being an example of a passion) to others.
I certainly wouldn’t have chosen a 2016 campaign slogan of “We have to pay our bills!” if I was worried about what people thought of the messenger carrying that unpopular message. What I wanted them to do was focus on the message.
I will be with a group of others this afternoon, many of whom will have probably read my comments. I’ll ask them for feed-back.
One final fact from the US Census.
For the period from the 2000 Census in California, the fastest growing Age Cohort was Persons 65 years and older, which grew 18.1%. The next closest was the 18 to 64 cohort which grew 12.78%. 0-4 years was third, growing 1.78%, and 5-17 was last, growing 0.01%
For the period from the 2000 Census in Phoenix, the fastest growing Age Cohort was Persons 65 years and older, which grew 13.68%. The next closest was the 18 to 64 cohort which grew 9.89%. 5-17 years was third, growing 7.57%, and 1-4 was last, growing 4.65%
For the period from the 2000 Census in Las Vegas, the fastest growing Age Cohort was again Persons 65 years and older, which grew 26.53%. The next closest was the 5 to 17 cohort which grew 23.38%. 18-64 years was third, growing 21.61%, and 1-4 was last, growing 14.38%
So it is pretty clear that all three places are retiree destinations. And we all know that very few retirees move to a new location because of a job.
It’s truly amazing, how you consistently put a lot of work into presenting facts, as if they support your conclusion.
For one thing, “fast-growing cohorts” does not necessarily translate into the addition of “new people”. These might very-well be people who are “aging in place”.
More importantly, you’re jumping to a completely unsupported conclusion, regarding the reason that Phoenix had the highest rental rate increases in the nation, last year. For one thing, seniors moving to that area are probably (generally) not renters.
We could explore the reasons for the rent increases in Phoenix, but we haven’t done so yet. I suspect that most of it is due to an improving economy, there. (Cities like Phoenix and Las Vegas are always more susceptible to economic “swings” than other places.)
Matt…
Will be interesting to see the 2020 breakdown on cohorts… within the last year, on our cul-de-sac (yes, microcosm) out of 12 households, there are two young couples, with new babies. That type of thing may or may not play out in Davis, as a whole. But at least in our neighborhood, the median age has dropped.
Just a “data point”…
My guess, from the dozen comments following the above comment is: “not so much”.
What would solve the problem is:
• Don’t take everything so personal.
• Don’t feel the obsessive compulsion to have the last word (the person with the last word is not necessarily the “winner”.
• Don’t feel it is OK to demean people because you think you hold the ultimate truth and they don’t.
• Don’t feel it is OK to demean people because they demeaned you.
• Don’t rerun the same film over and over — the person who says the same thing more times than their opponent is not necessarily the “winner”.
Fair points.
Good advice.
Another option is to not comment on here in the first place, especially if you hold views that are decidedly in the minority. I find that the days that I refrain from doing so are far less-aggravating, and I hope to increase the frequency of that option.
Or, if you simply want to avoid experiencing personal attacks. (No – not referring to the lengthy nonsense, above.) Too bad that the main point got lost in all that noise: High-growth areas have experienced the fastest rental rate increases, lately.
Given that the Vanguard isn’t going to moderate comments before they’re posted, I like the 7-comment limit, as it helps me “implement” your suggestions. Even if it has other limitations, such as ensuring that minority views have “fewer total comments” at their disposal.
Well said Alan.
This is pretty good