Wednesday, May 5, 2021
Uncategorized Sup. Mar takes on Zombie Neighborhoods and Housing Hoarding

Sup. Mar takes on Zombie Neighborhoods and Housing Hoarding

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Sup. Eric Mar is looking for ways to limit housing from being sucked up by corporate pieds a terre
Sup. Eric Mar is looking for ways to limit housing from being sucked up by corporate pieds a terre

By Tim Redmond

DECEMBER 16, 2014 — A measure by Sup. Eric Mar to tax unoccupied or largely unoccupied housing units could be one of the most significant pieces of tenant legislation coming before the board in 2015, and it’s received almost no news media attention.

The bill seeks to address a growing problem in the city: Speculators, corporations, and people who want a pied a terre in San Francisco are snapping up valuable residential housing stock – and not using it for housing.

We’ve reported on this. SPUR has done a study. There’s a pretty clear problem, and it could be responsible for keeping thousands of units off the market – and making a mockery of the mayor’s attempts to supply new housing for the workforce by building 30,000 new units.

At Question Time today, Mar will ask Mayor Lee to support the idea:

Mr. Mayor, A recent story on 48 Hills found that 39 percent of condos built since 2000 have absentee owners, and for newer buildings like One Rincon Hill, that number is 50 percent or above. Luxury developments like the Four Seasons residences have more than a 60 percent rate of absentee ownership.

When wealthy people who don’t actually live here buy up San Francisco residential properties, housing prices skyrocket beyond the reach of residents, making the cost of living unaffordable for even middle income people. Not only are these wealthy absentee buyers bidding up housing prices that effectively precludes everyday residents from being able to “keep up” with the exorbitant prices, but these unoccupied units also constrict the supply of housing available to meet the high demand for our City’s growing workforce.

And as we know, one factor in high housing prices is the limited amount of new supply available for residents. The San Francisco Business Times reported last year, “With a median home price of $706,300 in San Francisco, someone earning the median income of $74,922 makes 48 percent less money than they need to afford a median-priced home.”

This sort of home owner absenteeism is also bad for neighborhoods and leads to the phenomenon of “zombie neighborhoods” that contain beautiful new luxury units but no esidents.

New York State Senator Brad Hoylman who represents part of Manhattan, has announced his intention to introduce a bill that would place a property tax surcharge on luxury homes in New York City owned by nonresidents. This kind of “pied-à-terre tax” would address a very real problem that arises when a significant number of homes are bought by wealthy out-of-towners for the simple purpose of a place to stay on occasion, as an investment, or as a hedge against market swings.

I am beginning to research legislation to address this critical problem of newly built housing that is unoccupied, can I count on your support in helping to address the issue of residential real estate hoarding by out of town buyers?

The Mar bill will need careful drafting and legal discussion, because it’s a relatively new area. But no matter what, it will force the city to acknowledge that market-rate housing isn’t solving the city’s crisis.

It will also require the city to develop something that’s badly needed: A way to check who is actually living in high-end housing.

Nobody knows for sure how extensive the problem is: Some of the apartments we identified as owned by people who don’t live there may have in fact been rented and may be occupied. Some may be used primarily for Airbnb-style short-term rentals.

The tax, if it’s high enough might encourage owners to rent out (ort actyually occupy) the places they buy, or may put a damper on the mad rush to buy high-end San Francisco residential real estate.

Some very wealthy owners may not care; they’ll just write the tax off as a cost of doing business.

But if it’s high enough, the money could be used to build or acquire affordable housing – and given the city’s needs, any new revenue source is critical.

I’m not sure how the city would enforce it – but any enforcement mechanism will provide valuable information. In the old days in Berkeley, landlords were required to register all rental units with the city’s Rent Board and list the monthly rent; that would be a fairly significant undertaking in San Francisco, but would yield reams of important data that could help guide housing policy.

Since it’s a tax, it would have to go on the ballot, although there might be a way to do it as a fee: For example, the city could require registration for every rental unit, charge of fee of $1 a year, and raise that fee substantially for units that are available for rent but not occupied.

Again, the details are going to be tricky, but this is potentially a very big deal.

Tim Redmond
Tim Redmond has been a political and investigative reporter in San Francisco for more than 30 years. He spent much of that time as executive editor of the Bay Guardian. He is the founder of 48hills.

242 COMMENTS

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  31. I didn’t see an answer to the matter of how to tell if a unit is occupied or not.

    It shouldn’t be too very difficult to ascertain which units do not have anyone living in them; answers to the following questions should be able to prove it:
    – Does the owner-of-record claim the owner-occupied tax deduction at this address?
    – Is the owner-of-record registered to vote from this address?

    – Does the unit have reasonable-for-occupancy monthly electricity usage?
    – Does the unit have a reasonable-for-occupancy monthly water usage?
    – Does the unit have garbage pick up (mandated by SF Health Code 291.1)?

    A response of “Yes” to the first two items, and/or the last three of these should be enough to indicate that the unit is indeed occupied.

  32. “If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered…I believe that banking institutions are more dangerous to our liberties than standing armies… The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” — Thomas Jefferson

  33. Well, this story displays another angle to this question.

    10-40K? The SPUR article suggests that, at most, RC units held off number <10,000. Its a difficult sector to quantify. And of course, Mar's legis is supposedly meant to deal with 'foreign nations' & "luxury units" but will probably encompass those who withhold for their own peace-of-mind (due to regulations).

    As the study indicates, those PaTs (pied-a-terres) don't seem to add up to much in terms of numbers – 2-3% max. Sorta like Prop G – which was would have affected 60-70 blgs/units, according to the ballot summary.

    Makes ya wish these overpaid Supes would focus more sharply on what happens to $8,200,000,000 spend under their supervision on a yearly basis, eh? Bet they could find a few mill in savings to build "affordable" housing.

  34. Yes, oe serious downside of adding or keeping an in-law unit to a single family house is that both units may then be deemed rent-controlled, whereas SFH’s are otherwise exempt.

    It isn’t too serious if the in-laws are illegal, as many are, because you can get BI to condemn it and then evict the tenant. But keeping a tenant in your other unit makes the building near unsaleable,

    I’ve seen estimates that the number of RC units kept off the market is anywhere between 10,000 and 40,000. That issue dwarfs the odd new condo that a foreigner buys for a pied-a-terre here which, in any event, would never be an affordable home for a local anywhere.

    Mar needs to relax the rules for buildings where the owner lives, rather than seeking to punish people who dont want to risk being stuck with a lifer tenant

  35. I’m a small 40 year SF landlord keeping rental units empty and off the market because of the SF Rent Control Ordinance. These are houses with in-laws and have one rent controlled tenant in each. When I need to sell them to fund my retirement, the only potential buyers will be people who want to live in the properties and take full possession. Because of the restrictions then supervisor Amiano passed to the owner move-in eviction, In all practicality I would not be able to sell these properties if there were two tenants in possession. I therefore have left one unit in each vacant now for years as tenants voluntarily vacated. This is not a case of rich Chinese looking for a safe place to put money for a vacation home or eventual apartment for the son who will study at UCB. It’s the unintended consequence of the continuing byzantine rental policies pursued to pander to particular supervisor’s constituencies.

  36. I would regard that as an unreasonable invasion of privacy. Rules about contributions are fine, but not infringements of free speech or privacy.

  37. Eleen, you misunderstood. While there are rules what a city cannot do is force me to live in a home that I own, any more than it can force me to rent it out

  38. If they can find time to log the odd paid lobbyist, they can find the time to take a few notes when one of the race or union organizations show.

    Besides the city was nice enough to make it a full time job, as well as give them another paid helper a few years ago. Plenty of hands to go around for good government.

  39. You’re never free to do as you see fit with a home or any property that’s utter hyperbole and pish.

    Your sense of entitlement around private ownership is remarkably naive… a chronic anachronism under the current rule of law & market.

  40. how about just disclosing those that give you money to influence you in your professional life?

    not that hard, not that difficult. doctors, dentists & politicians the world over do it.

  41. Uber boober…you’re off your fucking rocker pal. Complete politburo-nutter-control-freak. Get a life, you old goat.

  42. It is an interesting idea, but would be hard to enforce, and would “catch” others who aren’t part of the problem in the net.

    How about we just don’t build any more market rate / luxury housing? If all our housing was BMR or something similar, then we wouldn’t have to worry.

  43. So according to SPUR this vacancy business is really not a problem. SF is in line with much of the bay area in terms of vacancies, and is below several ‘hot markets’ (Miami, Manhattan, Honolulu).

    So sounds like Mar has a solution in search of a problem.

    IF you taxed all the pied-a-terres’ $1000 each, then you might be able to afford to build ONE apt – less admin expenses or course. So, we haven’t even raised a million dollars yet.

    “Zombie neighborhoods”? Yeah, like Sea Cliff, the Marina, Western Addition, SOMA, Twin Peaks & Cole Valley. And N Beach/Russian Hill. Looking at the numbers, there really isn’t much of an issue. You could talk about NB and the Ellised blogs there, but soon enuf they’ll have residents, so … ?

    Sounds to me like more “Hammery the Landlords”. A perennial favorite in SF.

  44. Unlike in the recently defeated Prop G, 1.21’s spelling out of exactly how to define residency is loosy goofy. It almost takes a confession of non-residence for the ALJ to use 1.21.

    Now, maybe if the Progs were a bit more evenhanded in their legislation, then 1.21 would be more fairly & likely used.

  45. jch, strings of meaningless blatherings would be a good description of 99% of what is written here including (especially, in fact) the articles.

    Isn’t that why we all come here? For the meaninglessness of it all?

  46. I did consider it, and it looks like a taking.

    That said, I think it would be very easy to pretend to live in a place if I was financially motivated to make it appear that way

  47. Yes, RB, there was a survey in the Economist about a year ago that plotting housing prices against the strictness o land use regulations. The correlations were almost perfect – the more controlling the laws, the higher the cost of housing.

    The theory we are invited to buy into here is that even more strict controls will somehow miraculously make housing cheap. Experience tells us otherwise.

    To your other point, the purpose of market-rate housing is not to make housing more affordable. I have no idea why Tim makes that claim. It exists simply to satisfy and evidence demand.

  48. Sam, I wish you would learn the difference between refute and rebut. Very little of what you write can be refuted because it’s almost all opinion and little fact. Facts, when presented, can be refuted based on legitimate authority. Opinions, which run wild around here, can easily be rebuted and usually lead to strings of meaningless blathering.

  49. My mistake, it was 12.4%, not 17%. Which makes Greg’s point even more invalid (if we are to believe SPUR’s numbers and methodology…)

  50. “The Mar bill will . . . force the city to acknowledge that market-rate housing isn’t solving the city’s crisis.”

    No, it won’t. Whether or not you think more regulation is the solution — which is a position one can reasonably take, just as one can reasonably argue the opposite — we should all acknowledge that SF has not actually tried a pro-development, free market solution.

    Please take note: I’m not saying SF *should* have done that. I’m saying this: if we’re going to have a discussion about whether SF’s housing policy should move one way or the other on the continuum between more regulation and less regulation, we should acknowledge where SF currently is on that continuum. And the fact is, SF’s housing market is currently, and has for the past several decades been, far more regulated and less “free market” than almost any other housing market in the country.

    Put another way: if you made a list of every major housing market in the country, and put them in order from least regulated to most regulated, SF would be at or very close to the end of the list. If you’re tempted to disagree, I challenge you to name three markets that are more regulated. (I can think of one, maybe: Berkeley.)

    And again, I’m not judging whether that’s a good or bad thing. If you want to argue that the reason we’re in this mess is that SF wasn’t regulated enough, that we compromised and left loopholes in our regulation, that we need new policies further restricting market-rate housing, etc., you can make that argument in a principled way. You can say, “Sure, SF is at the end of the list, but that’s a good thing, and we should keep pushing the envelope.” You can say, “SF is the most regulated housing market in the country, but we should actually model our regulation based on X, Y, and Z markets in other countries, which are more regulated, and that’s good for the following reasons…” That can be your position.

    But don’t pretend that SF has been some Ayn Rand playground of free-market capitalism and as a RESULT, we have this housing crisis. That’s just dishonest. Arguing that “market-rate housing isn’t solving the city’s crisis,” is only true in the sense that we have not in fact tried to solve the city’s crisis with market-rate housing. We just haven’t.

  51. And why shouldn’t an elected official have to disclose *everyone* they meet with? Of maybe you think campaign donations should be private too.

  52. I understand your OPINION. You appear to be someone who lives a life of no. That doesn’t mean it’s not an idea worth considering..

  53. Thanks, Tim, for reporting on this. I usually disagree with Supervisor Mar’s proposals, but this one looks like it might provide a means for funding more housing getting built for lower and middle income working people. And that would make the abundance of low occupancy luxury condos a lot more beneficial to SF residents. Clearly, we have to start funding govt sponsored housing in San Francisco, and taxing low occupancy luxury places could provide one piece of that funding.

  54. Their motivation is not ultimately to help the less fortunate, but rather to punish the successful. If only they can make successful people a little less prosperous and happy, they will pursue that even if it cannot be shown that a single person benefits.

    35 years of micro-managing rentals and land use have given us the highest housing costs in the land. And yet their only solution to that problem is more of the very same policies that have created the crisis in affordability in the first place.

    It is the triumph of envy over everything else. And the desire for power and control at the expense of freedom and choice.

  55. Dan,

    As Dave pointed out, the SPUR study does not reference the number of foreign nationals owning SF real estate. Please clarify your source for the 17% you reference.

  56. “luxury”- anyone who appears to have and easier life then I do
    “wealthy”- anyone who has more money then I do

    This same philosophy worked great in Hitler’s Germany. for Hitler.
    Progressives look more and more like fascists everyday

  57. Ok I actually READ the entire thing, and I actually agree with Mar in that the wealthy that don’t occupy the housing here should pay a luxury tax for being non-occupiers of the space in this small dense place.

  58. George Orwell once noted that a great flaw of the left is that they oppose fascism but then seek to replace it with another system that is totalitarian.

    He also talked of the false pieties of the left. You see both those trends at work in this ill-fated and deeply-flawed idea.

  59. Oakland’s gross receipts tax is levied at a very low percentage. I think what Mar is planning here is much more punitive.

    Moreover Oakland’s system does not tax a home that is left empty and not rented out. That’s the exact opposite of Mar’s weird idea.

  60. 1.21 is often not effective because a tenant will be crafty and maintain his SF rental as his primary residence even though he might own a house in Tahoe.

    It’s fairly simple to cheat the system by keeping your DL, voting register etc at your SF address even if you spend hardly any time there, and even if you are Airbnb’ing the place while you are away

  61. Mar will never get five other votes on the BofS for this, let alone the eight he needs or the inevitable mayoral veto.

    So his only hope is to put it on the ballot, where it will either lose in the same way as G did, or squeak through and get thrown out by the courts.

    Mar isn’t as mindlessly left-wing as Campos or Avalos (didn’t Mar support the Twitter tax break and 8-Wash?) . But he is fairly mindless at times. Thank god is he is termed out next time

  62. Oakland is a perfect place for lower-income folks who cannot afford SF. RE prices per square foot are about 50% of SF levels. And it’s only 10 minutes away

  63. You would not necessarily know if the DBI inspected your building because they are usually interested in the outside parts of the building, fire escapes and the like.

    The rent board knows which units are rented out because only rented out units are assessed a rent board fee. The information is already there – you just need to go and look for it.

  64. And even if say 10% of buyers were foreign, so what? Many buy so that their kids can come to college here and they have a place to live. That brings in revenues and fees.

    While an absentee foreign owner is an almost perfect resident – he pays property taxes and service charges but does not consume any city services.

    We need more people like that and less people who demand to be subsidized left and right.

  65. I covered that point. Either a landlord will pass on the extra cost or he will be less likely to continue to be a landlord. So the effect of such a tax is either higher rents. Or it is less units available for rent, which means higher rents.

    We’ve had 35 years of policies like this and all that happens is that rents go up and up. Some people never learn.

  66. Mr. Uber,
    you seem to have no experience with the business tax system regarding rental property in SF, I suppose it’s because you have been a tenant for 25 years (15 yrs in one unit alone) Since you have made that statement, I see where you are coming from, the selfish position of the very privileged few who benefit greatly from Rent Control at the expense of your artist brothers and sisters. You have no interest in solving anything you simply want to keep your cheap apartment. You dont represent SF ideology, you represent yourself
    incidentally, youre right about one thing, sort of, if a landlord doesnt want to pay business tax anymore then they should sell or go out of business…..i.e. the Ellis Act.
    How can you be so contradictory and so proud of yourself at the same time?

  67. Yeah, because what San Franciscan’s have always been clamoring for has been the Gestapo checking in on them every month to report on how they live their lives.

  68. just good policy to check the facts yourself. It’s part of forming a personal decision rather then going along with the herd. Give it a shot

  69. I just read your link about Oakland. Some of it is true, mostly over simplified. What baffles me is, they are relying on tech jobs to fix the unemployment, and to increase the tax base in Oakland. Tech will bring in more folks from the outside, and taxing tech will prevent them from coming. That aside, the plan seems to be to build build build, new condos and high rise luxury apartments, therefore leaving the dilapidated inventory for a ghetto. Perhaps for workers in SF? well, thats what we have now, at least SF’s neighbor is keeping a ghetto for low income workers

  70. Mr Uber, your assumptions couldnt be more wrong. I live AND own several (rent controlled) units in SF. Do you? In fact, I plan on Ellis Acting and selling TIC simply because of these silly ideas and the general climate against property owners in SF. Believe when I say, I would much rather continue being a landlord here, I have wonderful tenants, but this climate is running mom and pop landlords out of town. So when you complain that only speculators or trusts are buying property, or that the housing stock is being reduced because of condo’s and TIC’s. Think about cause and effect. really think!

  71. That’s why a registration system is urgently needed, so the city FINALLY gets a handle on what units are being withheld from the rental market and why. As far as city inspections go, I never had even one city inspection of any property during 25 years of tenancy, including 15 years in one unit.

  72. the city of Oakland calculates their business tax on the gross income of rental properties. If a landlord rents an apt for $1,000 a month, then he pays $13.95 per thousand of GROSS collected income. so that one unit has an annual income of $12k and the tax would be $167.40. So, not only can it be done, but it is done. If you are interested in how rental income is taxed in SF, look up the details on Prop E passed Nov. 2012

  73. Morgan, that’s the federal and state tax system. Nothing prevents cities or counties similar to SF from imposing a separate tax on gross rental incomes. In fact, SF does it already under the business tax, but that law only applies to commercial rents, not residential rents. At least not yet.

    Taxes on landlords are completely voluntary since the law does not compel anyone to be a landlord. If a business owner or landlord doesn’t like the taxes they pay in connection with their business, they can always sell the business or rental property to someone else who doesn’t mind paying the tax in exchange for the profits they derive from the business or property investment.

  74. “But if it’s high enough, the money could be used to build or acquire affordable housing – and given the city’s needs, any new revenue source is critical.”
    Good luck with that. The city doesn’t suffer from a lack of revenue. It suffers from gross mismanagement.

  75. This is already covered in SF Rent Regulation 1.21. It helps to keep up with local, state and federal laws before spouting nonsense. By the way, the law has been in effect for over ten years. Maybe if you actually lived in SF or actually owned SF rental property you’d know the rules better.

  76. S(p)am and his spin. Always so uninformed, deceitful and unentertaining. It’s a good thing he’s had Brown, Newsom and Ed Lee to carry his landlord/gentrifying water, because otherwise he and his landlord buddies would never be able to do it on their own.

    Who *pays* taxes can be a complicated subject so I understand why S(p)am might struggle with the subject. A couple of examples might help.

    1) Japan recently increased its sales tax (VAT) from 5% to 8%. That means the customers must have paid more tax, right? Not quite, because the shopkeepers found out if they tried to raise prices to cover the new tax the customers wouldn’t buy nearly as much, so the Japanese shopkeepers are absorbing most of the VAT increase.

    2) If a landlord is offering a 1-bedroom apartment for $4,000, but a 50% tax on new rental contracts is passed, then the landlord would now rent the unit for $8,000 so they could collect the same rent amount, right? Uh, no, because if the landlord could get $8,000 for the unit, then that’s what the landlord would have offered it for in the first place. Landlords aren’t charities so they always charge as much rent as some tenant is willing to pay. If someone wouldn’t pay more than $4,000 before the tax, no one is going to pay more than $4,000 after the tax.

    Who pays any given tax is complicated and nuanced. Even experts and college professors often disagree on who actually pays certain taxes, so it’s not surprising S(p)am struggles with the issue as well. Perhaps Gary can point to another course at the local excellent City College to help S(p)am with his confusion.

  77. I have just left a message for Sup. Eric Mar to find out how true this insane idea is. Perhaps others should do the same??
    415-554-7410
    it doesnt sound like anything a thinking man would come up with, if it’s a false story, Tim loses credibility, if it’s true…the Eric Mar loses everything

  78. Energy would be better spent rooting out the long term renters, IN RENT CONTROLLED apartments that live elsewhere and keep an actual apartment as a pier d tier rather then someone who buys a luxury condo. Why are all the “solutions” in this forum about getting the evil landlords to bleed when it’s obvious there is good and bad on both sides of the fence

  79. I’m not clear what you mean “taxing rent incomes of landlords” — I already declare every penny of rental income I receive on my Schedule E and, less the allowable deductions, the balance is included in the income I pay tax on.

  80. Dan, what you wrote seems like a complete fabrication to me.

    I just looked at the report and the only time 17% ever comes up is the % of renter occupied units in the high level concierge building.

    SPUR didn’t claim to have a good handle on foreign investors at all, relying on Trulia traffic:

    “Another comment frequently heard in housing policy discussions is that many units are being purchased
    by international investors from China or Russia. We obtained search data from the real estate website
    Trulia showing the countries that most frequently viewed San Francisco homes on that website. Although
    China was in the top 10, it was not one of the top five countries. Only 12.4 percent of views of San
    Francisco homes are international. The remaining 87.6 percent are domestic”

    Is it a different SPUR study that you are referring to Dan? If so, my apologies, but there is just so much made up stuff written by Tim and others here…I just don’t see the point of it.

  81. Guess you didn’t read the SPUR report, huh? Where they estimate that a whopping 17% are foreign nationals? (That said, the SPUR report really reads like a best-guess, based on data that might not be the most reliable, so one should take it for what it is worth)

  82. “the city could require registration for every rental unit, charge of fee of $1 a year, and raise that fee substantially for units that are available for rent but not occupied”

    Sorry but you can’t force or penalize someone to be in business or go out of business. It’s simply unconstitutional. Besides isn’t this tax aimed at luxury home owners, and not rental units? They are going to have the same problem with the relocation payment legislation, they will need to prove that there is a nexus between vacant luxury vacation homes causing a shortage and increase cost of housing.

  83. Greg,

    Please point me to an unbiased study that shows that there are a large number of unoccupied units owned by foreign investors. I think this is a claim that is designed to appeal to xenophobic residents of SF.

    In addition, if you make the residency requirement too stiff you will find quite a few tenants who own other properties and will therefore run afoul of the rent control primary residence requirement.

  84. Any form of a tax on rents will be inflationary for rents. Either the LL will pass on the cost, if he can. Or he may simply decide to no longer rent out the property, and change its use.

    And the city cannot institute any form of income tax, so it is not clear how such a tax would be legal, even if it were a good idea, which it is not

  85. The city already inspects rental buildings. The DBI does routine inspection every five years.

    But the issue here is units that are not rented out, although Tim has no way of knowing how many there are despite his grand claim to the contrary.

  86. You’re wrong, Greg. If you have more than one home then you can elect which is your primary residence. This is important for certain tax purposes, for instance. And even for tenants if they wish to preserve their rent control.

    No particular difficulties with that.

    However, it is entirely possible to live in more than one home. So as long as someone spends some time in any given home, they will pass any stupid residency test.

    At the margin in may cause more allegedly empty units to be rented out, but these are mostly expensive condos that are exempt from rent control. So that really would not help the folks that Mar thinks he is trying to help here

  87. LOL, so you want to make housing cheaper by taxing it more?

    We just had a chance to vote on that idea – prop G – and it crashed and burned for obvious reasons.

    If you tax rents it will either increase rents or cause more landlords to quit the business and change the use of their building.

  88. You wrote: ” if they can’t build it their way they won’t build anything.” I was agreeing with you.

    And adding analogous points about other failed city attempts to force property owners to do what they dont want to do.

    Evidently youre the one struggling with comprehension.

  89. Except that you and Mar are the ones whining about the current housing rules. I’m happy with them and simply pointing out why Mar’s whinery is pointless.

    And yes, when protests and whining become excess, they do reduce the amount of sympathy that people might otherwise have.

  90. It must feel bad to not be able to refute my arguments and so make everything personal. Most people who are losing a debate would have the sense not to reveal that they know that so readily.

  91. It’ll never happen, because they’re established somewhere else. Besides, many of them are probably foreign nationals. You don’t support non-citizen voting, do you?

  92. It’s like Sam saying that the protests cause him to become less sympathetic to the victims of police violence. Oh, excuse me, “alleged ‘victims'”.

    Really though, you can tell how good an idea is by the amount of whining from the wingnuts. The meter is off the charts for this one. Must be something to it.

  93. Taxing rent incomes of landlords is a fair approximation of taxing “land values,” and it’s a lot easier to calculate and administer. For most buildings the same tax is collected whether there is a 4% “land-value tax” on the property or if there is a 10% tax on the gross rents, less costs of repair and maintenance. Underutilized and blighted property can be addressed by separate legislation.

    Henry George’s land value tax is an excellent idea, but administrative implementation is a challenge and homeowners would be terribly aroused if they thought the tax could apply to them. Taxing gross rents focuses the tax on landlords and nullifies any opposition from homeowners.

  94. The registration, inspection and disclosure of rent prices can be done with a perfectly legal city fee to cover all of the city’s costs. Any new tax policy that may come out of a better understanding of the city’s rental stock would have to be passed by the voters.

    I favor a graduated residential rental tax that would apply only to NEW rental agreements signed when the vacancy rate is below a certain threshold (say 5%). The tax proceeds could be devoted to building new housing, if passed in a separate voter-approved ordinance. Small mom and pop landlords (who receive less than $25,000 of rent per year) would be exempt, and tax rates as high as 10% would apply to all corporations that receive rents from any rental property and to any personal landlords who receive more than $100,000 in rent income per year, with graduated tax rates in between these levels. Deductions would be allowed for repairs and maintenance to the property.

    When there is a non-functioning “free market” and shortages are common, a high excise tax is the logical governmental response to prevent gouging and hording. Thus, the tax wouldn’t apply when the vacancy rate is above 5% since then supply and demand would be in relative balance.

  95. Why there isn’t a centralized system managed by the city to register and inspect every rental unit has been always baffling. Similar to the recent home-sharing registration process for Airbnb and similar companies, a certificate of fitness for rental (with required periodic health and safety inspections) and mandatory registration of every rental unit, along with disclosure of the rental price each year should be required, whether it be for a one-week rental or for the entire year. As Tim states above, with such a system in place the city would have meaningful data about which units are being rented and for what values so that the city can make more effective legislation regarding rental units in the city. How can the city ever hope to formulate effective policies to protect and inform legislation concerning over 60% of residents who are tenants without having access to this vital information?

    The transformation of cities across the US has been quick and dramatic. The billions of dollars of government transportation investment in US cities have caused rents to rapidly increase as the transportation improvements get capitalized into the land and rent values. Millennials’ preference to live in cities and the emergence of major employment regions, especially related to the technology industry (Boston, DC, west LA, Austin, Bay Area, Portland, Seattle), exacerbates the displacement and gentrification issues since the new job-seeking emigrants (domestic and foreign) force out existing residents and cause rent prices to sky-rocket for the remaining residents.

    Whether the gentrification and displacement is in SF, Oakland, Brooklyn or the Boston Back Bay, the housing, land use and demographic issues are exactly the same. The landlords and property speculators are favored by federal and state government policies, and current residents are forced out of their homes and communities. There is a recent excellent recent article in Next City that addresses many of these complex, inter-related issues that’s worth a read by anyone interested in the transformation of these major job centers, like the Bay Area, and the destruction caused to the families caught up in the cross fire. The article focuses on Oakland, but it’s the same story in all of the major employment regions.

    http://nextcity.org/features/view/oakland-gentrification-libby-schaaf-tech-industry-inequality-foreclosures

  96. What ARE you blathering about?

    I didn’t write that they should be forced to build what they don’t want to build. I wrote that they have options other than not building.

    I didn’t write that you should be forced to have a resident in your home.

    I didn’t write that the city should force you to be a landlord.

    You seem to be struggling with reading comprehension. Here’s a link to a class that can help:

    http://www.ccsf.edu/Schedule/CD/ESLF%203348.htm

  97. Lets see what Dennis H says about the legality of this absurd, unconstitutional idea. Remember, he has political aspirations too. Last go-around in court didn’t go so well. Don’t bit the hand………..

  98. Wouldn’t it be ironic if all of the second homeowners decided to claim that their unit was a primary residence. One way to establish residency is to vote. This could help accelerate the political moderation of SF.

  99. And why should they be forced to build what they dont want to build?

    Why should I be forced to have a resident in my home if I do not want one?

    Why should the city try and force me to be a landlord if I do not want to?

  100. Of course, it’s a blatant taking. You can limit what I can do with my property but you cannot force me to do something I don’t want to do with it. that is why we have Ellis for instance. Same logic – the city cannot force me to be a landlord if I do not want to be one. Nor can it force me to have a resident if I choose not to.

  101. The idea effectively roles back the concept of the private ownership of land. While the city can define some broad limits as to what you can do with a property, they have never before tried for force someone to do something with a property.

    Indeed, the Ellis Act was passed to enshrine the constitutional right to buy a home and leave it empty, if that is what I want to do with it. That is why I buy a home – to use it as I see fit.

    If you tell me that I am forced to have a person live there then you are basically trying to do what Santa Monica did, which led directly to Ellis.

    If you want to control what happens in my buildings, then buy them

  102. Yes, it’s obviously unconstitutional for a start, so even if it passed, it would get bounced by the courts, just like the relo expenses.

    It would also be very difficult to enforce, as there is no good way to determine if a home is being lived in

  103. Nobody said NOT to develop 8 Washington. It could be developed within the existing, voter-approved limits. There are developments all over the city built within the existing height limits that make a lot of money for the developers and other interests and enhance the city. Look at the Embarcadero in the South Beach area.

    Stop presenting this as an either/or scenario. The powers that be are behaving like spoiled children – if they can’t build it their way they won’t build anything.

  104. I don’t think this will work. Moneyed interests will turn to the courts or Sacramento to overturn what may be a very well intentioned but possibly illegal tax.

    I think somehow limiting these types of units using the permit process may be a better option.

  105. I think this is a good idea. In a dense city like SF, every square inch of ground is precious. And becoming increasingly so. When land reaches such a high degree of value, where it is splitting society in two, then it’s time to start thinking about invoking Henry Georgian-type revaluations, seeing the land as a “common inheritance.” Mar’s proposal doesn’t quite go that far, but by levying a tax on unused property, SF would provide disincentives toward land speculation while also incentivizing actual development of other projects in which the land will be used. SF simply does not have enough land to waste it on people — however wealthy — who are not using it. It’s pretty common sense, actually.

  106. When Tim writes:

    “We’ve reported on this. SPUR has done a study. There’s a pretty clear problem, and it could be responsible for keeping thousands of units off the market – and making a mockery of the mayor’s attempts to supply new housing for the workforce by building 30,000 new units.”

    It is worthwhile to look at what SPUR actually said:

    “Our analysis finds that the number of non-primary residences in San Francisco is relatively low, even for new construction in wealthier neighborhoods.”

    and:

    “Of the 1,954 condo units we surveyed, only 4 were not occupied in some form by an owner or renter.”

    What they did find is that 36% of the units in high luxury concierge buildings might be pied-à-terres and 13% of ordinary condos might be. But that just means that the owner has a second home; it doesn’t mean that they don’t stay in their San Francisco condo a significant amount of time (it is no surprise that people who own a condo in the Millennium have a second home, probably non urban).

    Is Eric Mar really going to quote data from 48 Hills???? Talk about making a mockery.

    One thing that is encouraging is Tim’s new admission that “given the city’s needs, any new revenue source is critical” because, back during 8 Washington, the $11 million that would have become $25-$30 million with matching funds wasn’t worth a thing. Same for 555 Washington wich would have kicked in another $30 million. Last I looked the 8 Washington site was still being used as a place to play tennis and the 555 Washington site was a burrito stand. Instead of $60 million for housing plus whatever RE taxes that would be generating.

  107. Here’s an idea, perhaps the bane of the Hustler club truck could create an incentive to rent, perhaps something around property tax rates around property holders who have rent controlled housing.

    Maybe he could consult his children on the subject, they seem to do a lot of his thinking for him.

  108. I was interested when the supervisors were required to report on what lobbyists they saw. As it turns out the supervisors don’t have to report on the majority of lobbyists they see.

  109. When do taxpayers get Question Time with Mar and all other Supervisors? Progressives might think of getting creative to make the BOS member more engaged with citizens outside their echo chambers. We could also use the prog members voluntarily posting their monthly work calenders on their City funded web pages.

  110. Thank You Tim for keeping me informed about this desperate and ridiculous idea that our elected official is thinking about…..I am a better informed voter now, and I guarantee Eric Mar will NEVER get my vote. Another waste of time and resources on illegal and illogical attempts, not to solve a problem, but to penalize success.

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