July 29, 2006

Responses to the letter

The SunHerald printed my letter on the 22nd. The only change they made was to the title...they used Price gouging? Or basic supply and demand?

Only two responses thus far, both via E-mail.

Here's one:

Just a note on economics: As you correctly point out, the supply and demand
balance of Coast housing has changed, but that doesn't imply that raising
rents isn't "gouging." The lack of housing simply allows rising rents; it doesn't
require it.

An interesting thought on the rent raising, though I still think if you have a short supply and high demand, that's going to bump the price up in order to ensure a supply. Basic market forces there.

Here's the other E-mail reply:

Excellent letter... Thank God there are people like you who understand
basic supply and demand. It is going to be tough here for quite a
while... Things will get better, but rent may not ever go back down to
pre-Katrina levels.

I have faith that if we can get our housing unit levels back up to what they were (if not higher) pre-Katrina, that rents will eventually go back down.

Note I said "if". Because it will take the residents convincing their planning
commissions and city councils/county boards of supervisors that housing developments that encompass all income levels (and not just high-end condos or 5+ acre lots in the country) are what's needed around here.

And, of course, that will take some doing...

July 19, 2006

It's been a while. A few months while. Time for an update.

Below is a Letter to the Editor that I sent to the SunHerald today. It's regarding where housing costs have gone here on the Gulf Coast since Hurricane Katrina.

Title: One person's price gouging is another person's supply-and-demand.

Several times over the last few months, I've noticed complaints in Sound Off regarding how rent has shot up dramatically. The chief complaint I've read is that a given person's rent has gone up x dollars, or is now so high that they can no longer afford it. There have even some accusations of price gouging.

I understand where they're coming from, as my own rent will increase about $270 when my current lease expires. But while it's unfortunate what we've all gone through down here, and that some good hard-working people will be forced to move elsewhere because of high rent, it's just as unfortunate that some of these people haven't stopped to think about WHY rents have shot up through the roof around here.

Consider this: yes, we went through a major hurricane last year. That hurricane destroyed a lot of apartments and housing units. And while people did evacuate for the hurricane and did not return, that loss of population was made up for in the number of construction and other workers that flooded the area after Katrina. Furthermore, I've heard that there are several families that refuse to live in a FEMA trailer, and thus have looked for accommodations in other ways.

So in reality, the result is we have a similar (if not) higher level of demand for housing, contrasted against a big drop in the housing supply. Thus, housing costs and rents go up, often in big and surprising numbers.

If you truly think that price gouging is involved, contact your local supervisor or legislator. Contact the attorney general. Better yet, do the research yourself into how many apartment/housing units were lost, how many are available, and how many people there are trying to live in or find those remaining units.

Ultimately, the solution either way will require replacing the lost housing units or othewise increasing the housing supply. Contact your local officials and pressure them to support developments that will increase this supply, at prices that everyone can afford. Not every one, even middle-class, will be able to afford living in a condo.

Just don't sit and complain in an anonymous forum about the rents.