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Comment by tjic | Hacker News Reader

> The reason why rent is so high in these places is because there's a lot of demand to live there -

No. Mere demand alone does not raise costs. There is a lot of demand for water, but it is still super cheap.

Prices are high when demand is high and supply is low.

The reason that prices in Manhattan and SF are high is because (a) lots of people want to live there, and simultaneously (b) government policies severely limit the ability of developers to generate more housing units there.

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You've worded it better, so thank you, but I believe my main point stands.

I've heard stories about SF's housing problems, but not about Manhattan. I know Manhattan is expensive, but it's also full of some of the tallest buildings in the world, and more are built every day. Are there actually policies restricting housing in Manhattan?

Hugely. It's possible to build extremely tall buildings in certain specific areas of Manhattan (and New York in general, like in Downtown Brooklyn), but most of the city is "maxed out" to its zoning - that is, the tallest building that can be legally built is already there. Indeed, in many places, the existing buildings are taller than the zoning code allows - so if you demolished an old building, you'd have to build a shorter one in its place!

Actually, yes. If you look at an aerial view[1], you can see that there are only skyscrapers in two fairly small parts of the island. Much of the rest has zoning rules that don't allow taller buildings. Even when the taller buildings are allowed, there are things like setback requirements that lower the amount of floor space that the building can contain.

Frequently, the buildings that you can see aren't even representative of what the current restrictions allow. Many building in Manhattan were built long ago when zoning was less strict. Forty percent of the buildings in Manhattan could not be built today because they don't meet zoning requirements[2].

[1] https://s-media-cache-ak0.pinimg.com/originals/9e/13/54/9e13...

[2] http://www.nytimes.com/interactive/2016/05/19/upshot/forty-p...

Exactly, and since high density cities are more common in Europe it is also more affordable there.

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