r/bayarea • u/bloobityblurp • 1d ago

Work & Housing Downtown Berkeley housing construction has stalled, creating empty, blighted lots

https://www.berkeleyside.org/2025/04/04/berkeley-housing-downtown-vacancies
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17

u/Bubbly-Two-3449 East bay 1d ago

But while developers have been hoping for better economic conditions for nearly three years, long-term interest rates have stayed stubbornly high and the tariffs imposed and threatened by the Trump Administration would further increase construction costs by making building materials that come from Canada, Mexico and China more expensive. Just the potential for tariffs was enough for some suppliers to start raising their prices.

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u/mezentius42 1d ago

Hang on, I thought the free market was supposed to save us by making developers build until rents drop by half! It was simple supply and demand, and anyone who didn't think so was stupid! Rents have grown by 5% since 2018, so why aren't they building? /s

1

u/FBoondoggle 10h ago

That's quite a bit less than inflation over the same period. In real terms rents over the same period have fallen. Rents on the new apartments can't fall as easily because of terms in the loan contracts, which is why you get "3 months free" or whatever instead.