Tag: porto

• Most people still want to raise kids in a house (not an apartment)

  

  Untitled by Lynne Meng on 500px

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  Yesterday I ran a quick 3-4 question survey on ATC called homes for families. The objective was to get a sense of people’s preferences for apartment vs. ground-related housing (house or townhouse) when it comes time to raise a family.

  The results are public so anybody can take a look at the data. At the time of writing this post there were already 70 responses. That’s not a huge data set, but the data is more or less what I expected to see. 

  Here’s what I found (if the data set was larger, I would have made charts):

  The vast majority of respondents were from Toronto. No surprise there. That reflects the readership of this blog, which itself can be quite Toronto-centric at times. (I’ve been trying to branch out more, I swear.) That said, I was thrilled to also see respondents from cities like Seattle, Denver, Chicago, Porto, and Sydney.

  Of the people who specified that they have kids, 11% live in an apartment. 17% live in a townhouse. And 72% live in a house. If you add houses and townhouses together, you get 89% of people with kids living in some kind of ground-related dwelling.

  Of the people who specified that they don’t have kids, 61% live in an apartment. 6% live in a townhouse. And 33% live in a house. This is the kind of split that I generally expected to see for Toronto.

  For the people who specified that they don’t have kids, they were then asked where they plan to move if/when they do have kids. 13% plan to move to another apartment. 8% plan to move to a townhouse. 33% plan to move to a house. 23% don’t plan to move (i.e. they are planning to stay put). And 23% don’t plan to have a family.

  Interestingly enough, 100% of the people who said that they were not planning to move, were already living in a ground-related housing unit (a house in almost all of the cases). So in reality – and if you exclude the people who don’t plan to have kids – about 83% of respondents expect to raise their kids in a house or townhouse.

  Again, this isn’t a big sample size, but the trend appears more or less flat. 89% of respondents who already have kids are already living in a ground-related unit. And when people were asked to project where they would like to be living once they have kids, 83% said they want a house or townhouse.

  Do you think these numbers accurately reflect consumer preferences in your city?

  2015.06.01

• When rent control goes too far

  

  I was catching up with a friend of mine over coffee this morning and he was telling me about his recent trip to Porto, Portugal. I’ve never been, but it’s fairly high up on my list of places to visit.

  He was telling me about how beautiful the center of the city is and how it’s a UNESCO World Heritage Site. But he was also telling me how eerie it was to see so many abandoned and decaying buildings.

  And part of the reason for this – I learned – is that up until fairly recently, Portugal had some incredibly onerous pro-tenant rent controls in place that dated back to the beginning of the 1900s.

  In fact, they were so onerous that, by some estimates, roughly 150,000 households in Portugal were paying less than €50 per month in rent before the laws were changed!

  Because of this, landlords in many cases could not, and cannot, actually afford to maintain their properties. Buildings were left to decay, and in some cases they were completely abandoned. That was their only option. And it led to a virtually non-existent rental housing market (according to the IMF).

  Clearly, this is a problem. If you have a market distortion as serious as this one – where there’s virtually no incentive to invest – you’re on a highly unsustainable economic trajectory.

  Which is why when Portugal received its bailout package from the International Monetary Fund and European Union following the 2008 financial crisis, it was asked to reform its rent control laws – which it agreed to do.

  The hope was that the reforms would allow Portuguese landlords to charge more reasonable and market-oriented rents, as well as do other crazy things like evict tenants that don’t actually pay their rent. Not surprisingly, many fought the changes.

  I don’t know precisely how these reforms have ultimately played out in the market over the past few years (if you do, I’d love to hear from you in the comments below), but I do believe that liberalization of the market was, and probably still is, needed.

  While paying €5 a month for a 4 bedroom apartment in a desirable central neighborhood might be great for that one individual family, it’s not so great for the economy as a whole. And ultimately that comes around to impact even that household.

  Image: Flickr

  2014.09.19