Downtown Los Angeles hasn't seen this much construction since the 1920s
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While I'm happy DTLA is booming it's not enough to keep up with demand:
http://www.abundanthousingla.org/201...ousing-growth/ |
The situation is similar in a variety of cities. We're seeing several huge booms.
Downtown Seattle, defined as a slightly gerrymandered 2,500 acres, is one of them. The current boom is something north of 22,000 housing units, 10,000,000 sf of office, 3,200 hotel rooms, a two-mile freeway tunnel, light rail extensions in two directions, and a streetcar for starters. This includes 19 buildings of 398' or taller by my count. Upcoming work will jump all of these numbers significantly. |
Houston (Harris County) adds around 15,000-20,000 apartments units/year.
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New York City has 301 large multistory buildings under construction, per emporis. around 80,000 units were permitted last year. good times for US cities, hopefully trump won't spoil the party. |
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I think this can be said about a lot of cities.
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Yes, this is true that a lot of cities are experiencing massive booms, but this article literally means what the title implies. Here is a tidbit from a Curbed article re: this LA Times piece:
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That article was an interesting read and it looks like Asian investors have found LA to be a good place to invest (I gotta admit that if whats proposed is built in LA it could almost be a LA's version of Toronto's latest). Although it is true in other cities as well-NYC is-well off the charts, Seattle is really beginning to hum and Chicago's south loop is just catching fire!! Of course Miami is hot as Houston, Atlanta and San Fran boom right along...
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This is what 0% interest rates buys you.
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However, ZIRP/NIRP have fueled this boom, 100%. Just about every single city has experienced massive growth due to easy access to abundant, cheap money. Of course cities would've still experienced growth and development, but not at this level. |
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If the Fed were to announce tomorrow that they're jacking up rates tomorrow it would slow construction, yes, but only by reducing national income. |
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I mean, it would slow construction because it would slow all economic production via recession, so no I don't agree with the spirit of your comment.
Dropping a bomb on Los Angeles would also temporarily slow construction and depress prices, and yet you wouldn't advocate for the Federal government to discontinue it's policy of not dropping bombs on LA would you? |
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USA | Biggest Skyscraper Building Boom Ever!!! it's great to see downtown LA making it's next great leap forward! |
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Boston Fed chief warns of commercial real estate speculation Quote:
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Theres nothing wrong with that, that's perfectly normal, rational behavior. The problem is we've handicapped the supply side of the market with zoning and other pernicious land use regs that translates any increase in nominal demand for real estate into higher prices. The solution isn't to blow up demand, like the Fed did in it's 2008 sept meeting, but to loosen regulations preventing housing supply growth.
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I hope LA has learnt from Vancouver's experience of allowing Chinese developers to run amok in the downtown development. The Chinese bought thousands of houses and apts in the city but allowed them to remain vacant. They were bought only as investments to sit on and then flip at a later time. It has left Vancouver in a horrid place. With just 650,000 people the city has seen the destruction of 20,000 homes nearly all of which were perfectly good and destruction of thousands of heritage homes. Condos were bought and left empty so new downtown developments are dead. The city now has near zero rental vacancies, the highest real estate prices in NA and a staggering 10,000 empty homes. It's not a way to build a sustainable city nor a sense of community. Some entire blocks on the tony Westside have only 1 or 2 inhabited houses leaving the area dead with an abandoned feel and no sense of community. Seattle is currently studying Vancouver to make sure they DON'T follow Vancouver's lead.
To make a city truly liveable it must put it's citizens first and not development for the sake of development. A city is for people and not just a commodity and I hope LA keeps that in mind. |
Vancouvers rents aren't all that high though. Less than the bay area or LA.
Correct me if I'm wrong though, I don't know much about Vancouver. |
Also the problem that Vancouver's suffering from is similar to the one that just about every large American city is suffering: demand exceeding supply.
So why not deregulate and allow supply side to meet demand like Tokyo? In that case an increase in foreign demand --> more money for construction workers/firms/interior designers instead of higher prices for landlords. |
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