The easy thing to do is just try to ignore the likes of SFBARF and hope they will go away. But they don’t, and in fact, a technology reporter at The New York Times, who like other tech writers has suddenly discovered that housing is an issue in San Francisco and decided to chime in, just did a major feature on the group.
And this week, our own C.W. Nevius added another story that essentially argues that if only we stopped all the rules and regulations and got rid of neighborhood opposition, middle-class people would be able to afford the rent.
I just wish people who wrote about the SF housing crisis would first understand the basic facts, which are not that complicated.
We have a crisis because more people are moving here than there is housing – and because that creates a climate for landlord and speculator greed. There are two elements to that situation that are typically left out of all of these stories.
The first is that this particular wave of immigration to San Francisco isn’t the same as the waves of the “hippies” and the “beats” that all the uninformed writers like to talk about. One of the main reasons that counterculture types flocked to places like North Beach and the Haight in the 1950s and 1960s? The rent was cheap. The city was welcoming to people with different attitudes from the mainstream, but face it – if the rents had been the way they are today, the Summer of Love and the Beat Movement and all the cool stuff this city celebrates today would never have happened.
Those people moved here for cultural reasons, not economic reasons. Same, for the most part, as the LGBT community in the 1970s.
I love phrases like “the Bay Area has always been expensive.” No: In the late 1960s, there were banners across Market Street offering “three months free rent.” When I arrived in 1981, a room in a flat in the Haight was $100 a month.
The reason that people are moving here today is, to a great extent, not cultural but economic. They’re coming for jobs. Nothing wrong with that, and it’s not the fault of the new arrivals. But it’s important to understand. And the reason there is so much more Demand is because city officials, starting with Mayor Ed Lee, decided that turning SF into a center for tech companies was a great idea. He just didn’t stop to think about where the new workers were going to live.
(Lee’s “jobs agenda” wasn’t aimed at unemployed people who already lived in SF; intentionally or not, the jobs that were created went overwhelmingly to people who moved here from someplace else to take them.)
There is Demand and there is Supply. Both, any Econ 101 student can tell you, are part of the equation that establishes Price. We talk all the time about the Supply side – SF isn’t building enough housing – but not about the Demand side. SF has given out tax breaks and rolled out the red carpet for companies that pay a lot of money to people who move here and want to live in a hip place like the Mission.
That wasn’t a random occurrence; it was public policy. Lee could have focused on creating jobs for people who already lived here and were unemployed, but that would have been harder – that population was less educated and an economic development policy would have required serious public investment. Letting the private sector just replace people was easier.
And while tech companies were already on the Peninsula, SF as a matter of policy made it easier for those companies and cities to outsource their housing impacts to San Francisco by encouraging a fleet of special private shuttles to take people from this city to their jobs. The areas served by shuttle stops have seen some of the highest price hikes and the most evictions of anywhere in the city.
And, of course, since the state of California won’t let San Francisco regulate housing properly, the result has been a huge boon for speculators and greedy property owners. The biggest beneficiary of the Twitter tax break wasn’t Twitter; it was the Shorenstein Company, Twitter’s landlord.
And let’s please not forget that Airbnb, a company the mayor has championed, has taken at least 6,000 housing units off the market.
There is zero talk in the NYT or the Nevius column about property owner greed. Instead, it’s all about building denser housing, which under the Invisible Hand of Adam Smith is supposed to bring down prices. Again, not noted: In many cities outside of the US, where there is massive density (Hong Kong) much of the housing is social housing, outside of the private market.
So: We ignore speculators. We ignore Demand. We ignore Airbnb. We just say the problem is Supply. So let’s look at that for a moment.
The solution to most of the city’s housing problems, according to the NYT, BARF, and Nevius, is to give developers a more free hand:
Ms. Trauss’s cause, more or less, is to make life easier for real estate developers by rolling back zoning regulations and environmental rules.
And there’s an utterly false dichotomy set up here, which is particularly annoying to those of us who are part of the stereotype:
In San Francisco, though, things get weird. Here the tech boom is clashing with tough development laws and resentment from established residents who want to choke off growth to prevent further change.
Ms. Trauss is the result: a new generation of activist whose pro-market bent is the opposite of the San Francisco stereotypes — the lefties, the aging hippies and tolerance all around.
Her opponents are a generally older group of progressives who worry that an influx of corporate techies is turning a city that nurtured the Beat Generation into a gilded resort for the rich.
Those groups oppose almost every new development except those reserved for subsidized affordable housing. But for many young professionals who are too rich to qualify for affordable housing, but not rich enough to afford $5,000-a-month rents, this is the problem.
Adding to the strangeness is that the typical San Francisco progressive and the typical mid-20s-to-early-30s member of Ms. Trauss’s group are likely to have identical positions on every liberal touchstone, like same-sex marriage and climate change, and yet they have become bitter enemies on one very big issue: housing.
I don’t even know where to start.
First, the opponents of SFBARF are NOT “a generally older group.” If the NYT tech reporter would bother to go to City Hall hearings, or loud and raucous rallies, he would have noticed that most of the people demanding a different housing policy are young. Many are non-white.
And the differences in policy? This concept that because we all agree on some social issues, like same-sex marriage, fundamentally ignores that fact that the left and the right (yes, the right) in San Francisco disagree profoundly on economic issues.
Many of the people known as “moderates” believe that the free market will ultimately solve our problems, that we need fewer regulations on land use, and that we should not impose higher taxes on speculators and the rich. Does that sound Conservative? Because on economic issues, it is.
When did “every liberal touchstone” stop including income redistribution, progressive taxation, and limits on the ravages of uncontrolled capitalism? Only in the current, bizarre, political narrative in San Francisco.
Ardent low-income housing activists, opposed to the building of anything but low-income housing, have formed an alliance with older, gray-haired NIMBYs to try to stop most construction.
I am a 35-year resident of this city, a homeowner, a parent, 58 years old (which I guess makes me “older”) and a person with gray hair. I do not oppose “most construction.” I agree there are people on the West side of town who don’t ever want any more density, which is a losing battle (although let’s remember: San Francisco is already by far the densest city West of the Mississippi, and third in the entire country).
What I ask, and so many of us ask, is for a little reality in the discussion.
And that starts with the idea that development of any kind should make the city better, not worse. Private development should pay for itself; the rest of us shouldn’t subsidize developers who are out to make a profit.
I have sat in hearings and heard developers say that if the city requires too much affordable housing, and Muni fees that actually reflect the cost of service, then the new buildings won’t pencil out. I haven’t seen the numbers, so I can’t vouch for that claim, but let’s assume it’s true.
In that case, the development shouldn’t happen.
Seriously: If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing (because new rich residents want people to serve them coffee and fine wines and clean their clothes and their toilets and provide security etc., and those new jobs mean new people who need places to live), then any high-end housing that isn’t 30 percent affordable is making the crisis worse. Got that? When you are in a hole, stop digging. If you’re in a crisis, don’t make it worse. And right now, building luxury housing is a net loser for the city.
The same goes for Muni. It costs the city far more to serve new housing than the new housing pays. Which means every time the rest of us pay higher fares for Muni, we are in effect subsidizing market-rate housing developers.
“Build, baby, build” sounds so fine and simple. But forget the ugliness factor (why do all these new projects have to be so hideous? A century or more ago, people could build amazing houses. And today, nothing but bland nastiness?) Forget views and traffic and density. Just look at the money: Are new projects costing us more in impacts than they bring in benefits? If so, why are we building them?
If the type of housing that the investors now will finance makes the crisis worse, why are we approving it?
If that new type of housing leads to more displacement and gentrification in vulnerable communities, what is its value?
Are we actually building housing for people who are going to live here, or just for speculative investors?
If building more private-sector housing “of all types” were the answer, why is the private market unable to build housing for the middle class? (One reason: We have created so much Demand that land values and the cost of construction have soared. There is no way the current private market will build anything but high-end housing without strict regulations. And guess what? The more market-rate housing you cram in, the more land values keep rising, and the more it costs to build more housing.)
These are not Nimby questions. They are basic urban planning, basic math. And so far, I haven’t heard the developers or their allies give a reasonable answer.
Please: Show me any evidence, any credible evidence at all, that allowing the private market to build, baby, build in San Francisco today (without demolishing hundreds of thousands of rent-controlled units and creating a city like Manhattan or Hong Kong without the social housing, that none of us want to live in) will actually bring down rents and allow the middle class to stay, and I will listen. But as far as I can tell, that evidence doesn’t exist.
You are a Bay Area homeowner and you benefit directly from the housing shortage, which artificially inflates the value of your house. Prop 13 has been good to you, no? You are the problem. Stop pretending you care about the poor or the young. You are the lord of the manor around here.
I predict that there’s a high probability you’re going to dismiss this out of hand but this blog post about Houston is “evidence … that allowing the private market to build, baby, build in San Francisco today (without demolishing hundreds of thousands of rent-controlled units and creating a city like Manhattan or Hong Kong without the social housing, that none of us want to live in) will actually bring down rents and allow the middle class to stay”.
I do agree with you insofar that I think San Fransisco, and NYC, can’t move towards more of a free housing market without pain. But I’m sure we disagree about the inevitable amount of pain to be caused. And possibly where a freerer housing market is even a good thing or not.
Most of the housing is Social housing in Hong Kong? I don’t think you really understand at all how Hong Kong works. All land in Hong Kong except for the Anglican cathedral is owned by the government and they sell long land leases to developers and others. The Hong Kong government also develops its own property and leases this to lower and middle income individuals. The majority (60%) of Hong Kong’s government income comes from land leases. In essence the Hong Kong government is also a big property developer – and a great one – for they turned a barron rock without much space in to a thriving city for 7 million people with millions more from mainland china clamoring to get in. Hong Kong is probably the most laissez faire place on earth – the US would do well to imitate its lack of regulation, simple tax system, professional and helpful attitude at the ground level of government.
What happened to all the comments that were posted in response to this opinion piece? Did Tim Redmond not like the way the conversation was going and just decide to delete them en masse??
And as to the assertion that it isn’t generational…
One thing is for certain: building housing affordable to low- and middle-income people will help low- and middle-income people.
No, that is not certain at all. High-income people can outbid low-income people for limited supply. If a high-income person and a low-income person must compete for the same crappy apartment, I guarentee you, the high-income person will win.
If you build enough market rate housing, prices will eventually come down and make housing more affordable. Every additional unit means that some tech professional moves from a older unit, to a newer nicer unit, which means the older unit is freed up for someone else to move into. Now, I agree that developers should not destroy existing, perfectly good, housing unless they are building a larger number of total units, but adding more housing is not going to create more need for housing that didn’t already exist. If tech professionals don’t have housing to live in they will just bid up the prices of the existing supply. And salaries will rise to match the cost of living, because the tech industry is always (at least for the foreseeable future) going to be able to afford to pay their employees whatever it takes to live in a nice place. Hence, that additional demand always existed and is always going to exist regardless of whether market rate housing gets built or not. The only difference is how high rents for the existing supply get bid. If you don’t build market rate housing, rents get bid up higher.
I don’t expect anything of quality from you and have no interest in your response thoughtful or otherwise.
So you have nothing other than ad hominems. I have many issues with SFBARF though less that Campos’ ‘thesis’. But you arent someone who I think deserves a thoughtful response.
Ok, a hostile poster who is full of himself–that doesn’t make what you say true. And it’s not. Here is a report from the SF Federal Reserve Bank that discusses this issue. In summary, the report says, “One factor underlying this pattern may be the growth of higher-wage jobs in California, which has contributed more to output than to employment growth. This creates relatively few opportunities for low-skilled workers, which may help explain why poverty increased more in California than in most states over the period”. You can call them at Main 415/ 974-2000415/ 974-2000 and see if you can win them over with your hostile tone and bad information.
Evidence suggests that the reason California has experienced faster economic growth than job growth is that employment has shifted to high-wage industries. Slower job growth, particularly in low-wage industries, is a potentially important problem if it implies fewer opportunities for less-skilled workers.
A related concern is the growth in the poverty rate over this same period. California’s poverty rate adjusted for housing costs grew over five percentage points from 1990 to 2011, the third largest increase among all states (see Neumark and Muz 2013). Even excluding the Great Recession, California’s growth in the poverty rate still ranked 13th highest among states. This rise in poverty is consistent with relative declines in job opportunities for less-skilled workers. California’s relatively high economic growth combined with its relatively low job growth may have disadvantaged less-skilled workers, highlighting a key challenge facing policymakers. That is, the greater economic efficiency that helps spur economic growth sometimes comes at the cost of social equity.”
I challenge you to critique SFBARF’s thesis.
Planning was writing about ‘housing deficiencies’ by the mid-1960s:
And yet, prices did stabilize, and then fall, at least in those markets where massive construction was undertaken, just as the theory of supply and demand predicted.
There’s lots of room for good-faith debate on how to interpret the the evidence. Economics is a “dismal science” precisely because it is impossible to perform perfectly controlled experiments, and yet we are still able to make useful and informative interpretations of data that hold water over the long term.
However, Tim Redmond’s assertion that there exists zero evidence contrary to his pre-judged conclusions is asinine.
Let’s crack down on no-fault evictions. Let’s run the evict-and-flip landlords out of SF. Let’s fully fund the SFFD’s arson investigation unit to examine the rash of structure fires in the Mission in the past 2 years. Hell, let’s gradually roll back Prop 13. But let’s also get the hell out of the way of building housing.
I’m equally as frustrated that I can’t support basic development in this city without it coming wrapped with talk drastically altering the entire city, resentment towards natives, and a whole host of cultural war type mumbo jumbo.
Sure, the city is changing and has been for decades. When did you enter the conversation? Do you think the changes have improved SF? Some have, but most has not. And that was before we had quasi political groups pushing for change…and when you point out it amounts to destruction of the city, they don’t care.
To clarify, I’m saying that building Mission Bay itself will lead to the Bayview residents getting displaced. And it’s backwards to say you want to preserve the Bayview, but not Telegraph Hill…which is a landmark, btw…the entirety of Telegraph Hill. What you’re talking about is making an area unrecognizable to ward off would be market rate buyers. Yeah, even the status quo sounds better than that, and the developments will take longer than most new transients will call themselves San Franciscans, so….
It’s so frustrating that I can’t even engage in an honest dialogue on this issue, without being accused of having the ulterior motive of wanting to “change the character of the city”.
The way I see it, the character of the city is changing, whether we like it or not. Demand for housing is not going away. So we have two options:
1. Do nothing, and watch displacement become even worse.
2. Try to house all these new people.
The point you bring up about the Bayview becoming “condo friendly” is actually interesting. I definitely understand the fear that building new market rate housing in working class areas will cause displacement of local jobs and businesses. That said, new market rate construction doesn’t need to go in working class neighborhoods. I’m more than happy to upzone Telegraph Hill, the Marina, and pretty much all of the West Side. But I’m fairly certain that if we don’t build *somewhere* displacement in the Bayview will only get worse.
Land can be rezoned to uses other than highrises, which will make it more affordable to purchase by the city. Not to mention the huge chunks of public land sold for a pittance to private developers, mostly for their own profit (Treasure Island, Candlestick, etc.)
“Everyone agrees that BMR housing is an essential part of the solution.” How much BMR? To keep things from getting worse, never mind to catch up with the housing deficit, the percentage of BMR should reflect the percentage of income erarners which can’t make market rents. 70%? 80% Anything under that means that more commuters, i.e. people who work in the city but don’t live in it.
“Of course all of the things you list are important, but so is housing.” You need balance, and that’s what planning is supposed to be doing. If a city is getting more residents than it can provide services to, then it’s doing something wrong.
“The study concludes that new wealthy *residents* create the need for lower-paying jobs.” New housing (except BMR) is for the wealthy, relatively speaking. So right now building more $4k 1BRs will automatically bring in, say, more restaurant-goers, without providing housing to restaurant workers.
“The cost of doing nothing” is not a cost. It’s better to do nothing than to further greater income inequality. It’s better to do nothing than to strain public resources which the city hasn’t figured out how to provide.
Your basic assumption is that rich people moving here are an unavoidable force of nature. If high-paying jobs are causing displacement, and displacement is bad, then we shouldn’t have so many high-paying jobs here, right? What do we do about it?
Prices falling is a bad measure. You should focus on inflation rates stabilizing to falling as a measure of success since price levels really dont fall outside of recessions.
“San Francisco, No. 2 in rent, is showing vacancies are now flat.”—I thought we weren’t building enough?
“In Washington, D.C., vacancies are falling, despite thousands of brand-new rental apartments coming onto the market. Rents, however, are seeing gains below the national average.”—I thought falling vacancies would make prices rise, because textbook economics?
Anyway, rents in DC are now up again:
I challenge you to point out a single statement that is factually incorrect.
Plain and simple. Lets see what you have.
There is difference between fatalism and realism, no?
You can keep fighting for it. Good for you but that doesnt change the reality. Maybe you succeed. Great if you do. But int he meanwhile what happens is the key.
“pure market-rate development”: No one, not even Sonja Trauss, queen of the YIMBYs herself, is advocating a pure-market rate solution. Everyone agrees that BMR housing is an essential part of the solution.
“land taken out of circulation, which could have public uses”: Most land is already “out of circulation”. Barring eminent domain, privately owned land is not going to be put to any of those purposes. Of course all of the things you list are important, but so is housing.
“creation of demand for lower-paying jobs” This is something Tim Redmond harps on a lot. His evidence is a single study, which I think he is drastically misinterpreting. The study concludes that new wealthy *residents* create the need for lower-paying jobs. It doesn’t prove that building high end *residences* attracts more of those wealthy newcomers. Those wealthy people are coming here whether or not we build. In the absence of building, that just means they’re going to be paying luxury prices for older, less-than-luxury homes, displacing the rest of us.
Most importantly, though, In listing all the horrible “what ifs” of what might happen if we actually build some homes, you’re totally neglecting the cost of doing nothing. As more rich people move here, the wave of displacement we’ve seen is directly related to a region-wide failure to build enough housing. It frightens me that so many people want to stay the course on this disastrous policy.
Lastly, many of the fears you raise about the ramifications of development have very simple solutions. Traffic? For 65,000 MUNI riders, the red carpet bus lanes on Mission St. have made traffic largely a thing of the past. Simple improvements like this can help us accommodate our growing population, while simultaneously making the city work better for everyone. We just have to be willing to work toward progress, rather than fearing change.
“Show me any credible evidence at all”. Okay.
Basically, what the construction boom in DC shows us is that increasing supply does in fact reduce prices. In particular, it also shows that increasing construction of “high end” housing had a depressing effect on rental prices at all price levels.
None of this is news. In fact, it’s textbook economics. It beggars belief that Tim Redmond has never been shown these stories before. Why can’t SF’s housing activists get behind a moratorium on evictions (like Oakland did) instead of standing in the way of building housing?
The grand total of tech jobs in SF is 69k. No one company is even over 10k I would imagine (maybe other than sales force? this is just a guess though).
A large chunk is 5/10-20 people start ups.
So I think this just not a practical concrete solution that has any chance of implementation in SF or really anywhere in the US in way to make demand for people to want to live and/or work in SF lower not withstanding your reducto ad absurdum. (I disagree with it is an entirely separate point).
I have positive exchanges with people I disagree with on here like hiker and Y and am happy to engage them even though we disagree. You are just disagreeable with your personal attacks and ad hominems. So good luck to you but I dont engage with that so I will be avoiding you. You are free to do as you please.
Again, even I give you all that, what does it mean today? or even a year from now? Thats the issue. Whats your bridge?
Anayways. I think we had a substantive discussion. I took something away away and learnt from what you had to say. Hope you feel the same.
Most people have good intentions. We just differ on the solutions.
Thank you. I feel similarly. If things keep up, more of us will just find ourselves motivated to defend what’s left of the SF we love. We’re the ones who will still be here when the fog settles.
Nope, I have posted 5-6 links..Just not to you.
Nothing close to the deception you are trying to perpetrate.
SF added a lot of units in the 80’s, and 90’s. SOMA was transformed into what it is today.
You can also look at Bed Stuy, Brooklyn and watch that play out in real time for the worse. The NY market has more similarities, including periods where the new development inventory outpaced the market, for a few years.
Hell no. Let’s be honest here, the reason Mission Bay was built, wasn’t to make the city affordable. Building more doesn’t address imbalance, by default. What are you building? Where are you building it? I’m not saying the city needs a moratorium against building, but nobody has a magic calculation predictive of market realities 3 years down the road, and anyone claiming they do is a con, or has an agenda to profit.
All part of the 100% money-back guarantee.
It’s not just the right diagnosis would feel good. It’s a necessary step. Even during the FF wars, it’s been a hell of a fight to convince people of the diagnosis, and to avoid industry-friendly ineffective approaches (clean coal, carbon storage, etc.) It took decades to get to the consensus of zero fossil fuels ASAP: now the fight is over the “AP” part of that.
Well, that basically is saying, we are weak, they are strong, let’s give them 90% of what they want, even if we don’t gain much from it. I’m not that fatalist.
There are ways of shaping demand. As one example, a government can refuse to issue a business license, if it thinks the business is harmful or unsupportable. If I wanted to operate a shipping company that discharged 1000 trucks a day onto the Embarcadero, the city would tell me it can’t support that much traffic. If I wanted to build a factory that used too much water in an area that relied on wells, I might be refused a license, because its operations would lower the water table for everyone. Why shouldn’t we refuse a license to a company that wants to bring in 50,000 people which are hard to accommodate?
I wad saying focus on inflation rate is generally a better idea to see if rents are stabilizing or not. John B is wrong IMO to look at rent levels. Inflation rates may still very well make your point.
Y – I am totally with you. That is a worthy long term multi generational project we all can get behind. But that is not a solution that will have any tangible impact on the lives of dandyhighways friends (as an example). The expectation that they wait around for that is what is unrealistic. We can walk and chew gum at the same time. Whats the solution until we achieve income inequality? What the path to bridge to it. Accepting the diagnosis may feel god but doesnt do any tangible good for people on the ground.
In the fossil fuel example, the best thing ultimately would be to have zero emmisions, right? But going cold turkey today on fossil fuels would be a disaster. We are trying to bridge to the end of FF.
Hope thats helpful.
O greater defender of the people of SF! The self aggrandizing sanctimoniousness is just staggering.
” But this banter you and others are laying on everyone that if only enough market rate housing was built then everyone would have housing is nonsense. ”
Can you show where do i say this?
I actually think there is little chance this is going to happen since the all the stuff that got us here has created an imbalance is too large – it will take a long time to do it from demand or supply.
I dont believe in the fantasy tales of how if only we could get developers to build 90% affordable housing (Campos) or get government to build it (with what money? in how long? where?).
I would like to say this is an excellent real discussion between Y and dandyhighwayman. Thank you both for it.
I personally agree mch more with dandy and his thoughtful articulation tough you make good points too..
Y – this is what I think dandy and I agree on a realistic workable solution.
If as you say (and I agree) developers wont even do 25%, how will you get them to do much more than 30%. While it may be desirable, its not a realistic practical expectation to hold out for.
You’re more optimistic than I am about people. I see lots of good people but I see lots of people lacking compassion too. Congrats on your optimism. 🙂 (I mean that sincerely)
I don’t think you’re venting. But I see a lot of activism that is nothing more than venting.
I just don’t see any legal way in the US to shape demand. Property rights and rights to create jobs in this country are strong. I’d love for that to change, but I can’t see how to do it.
And not building doesn’t shape demand. It just makes it easier for people with money to out-compete people without money.
Huh? I’m talking about rents dipping a few months ago, as John Broughton had pointed out, then climbing again. He was arguing that Seattle had fixed rising rents by vigorous building. I’m showing it hasn’t.
I’m not venting, and believe it or not, I don’t think that people suck. I’m just saying that the only thing that will work is the thing you’re saying is impossible, namely shaping demand to what the urban ecosystem can handle.
The solution is to fight income inequality, which locally would mean restricting high-paying jobs. Yes, it’s politically very very hard. But it’s the only thing that would work.
Remember when you mentioned climate action a while back? Restricting fossil fuels is politically very, very hard, but it’s the only thing that will work. Same deal here. For now, the main thing is to have people accept the diagnosis.
This is not right IMO. Tim has state this opinion in more detail before on the site. I recommend looking it up if possible (not sure if the site is searchable for words).
So no links then, right? Got it.
Do you agree that we still need 100k ish units to address the imbalance (this is not a static number) to stabilize prices weather it comes from less demand/more supply/some combo?
But to rkgwoods point, you have proficiently pointed out the problems with what you see. So lets assume (for argument sake) those are all true. But you still have not given any idea of what a concrete, actionable realistic plan would look like. I share his frustration in that regard in general.
I commend your efforts. You surely at least tried. I honestly have no complaint with you. We disagree. Thats fine.
see this is where I wish all the energy went, and it’s where I start to part ways with the YIMBY folks. Since the state doesn’t find affordable housing, and since hope isn’t a solution for that the money has to come from somewhere.
30% affordable housing requirement sounds just fine to me. With the high tech salaries that will work. the people who are lucky enough to buy houses/build condos/apartments should be able to afford to cover the costs.
Of course that should be bundled with something that helps more housing get actually built. Fix how much red tape there is.
This is how compromise works. Both sides get something.
You have think in inflation terms not rent levels. Outside of recessions, levels dont really go down in any sustained manner generally in growing metros.
The thing is, you can’t stop those people from coming. They don’t see the Google Bus protests and decide to not come. They don’t see the anti-Ellis act protests and decide not to rent from a landlord that Ellis-ed out their rent-controlled tenants.
You can’t stop the companies from growing and hiring people either.
They come anyway, and they pay $4000/mo.
Is it terrible that people come and don’t care? It sure is. But if you don’t build, they displace people. And all of the capital that would go into building instead goes into finding newer and cleverer ways of displacing existing residents.
I’m interested in actually solving the problems instead of just venting that people suck. People do suck, but venting about it doesn’t fix it.
As to what’s reasonable building—Redmond has been saying, at least 30% affordable housing. I think even that’s not enough to make up for the imbalance that already exists, though the developers will fight a 25% quota as if it’s going to kill them.
More likely, new people moving into the city. The big tech companies are projecting tens of thousands more employees in the Bay Area in the next few years. These people will nicely fill out any new development in the current pipeline.
We can’t say that speculators are paying $4000/mo rent for a 1 BR. No, they are not, but they are renting out these 1BRs, and counting on rents rising even more.
What would be a “concrete, actionable plan” other than building? To me it sounds like you’re saying, “Doctor, you’ve been saying for years you don’t know what’s wrong, so why don’t you just go and do some surgery? And if that doesn’t work, do some more?”
Among side-effects to the kind of pure market-rate development we are saying are: land taken out of circulation, which could have public uses (open spaces, scools, government services); creation of demand for lower-paying jobs, which increase housing demand, or create more burden on commuters from further away; and burdens on transportation, schooling, and other public amenities. These are not abtract things: they are things I see happening in SF: block-long stopped traffic; filled-up schools; and restaurants struggling to find employees.
First of all, these goal post numbers aren’t realistic.
150k units? Just, no. It’s not going to happen within city limits. The point of that demand is to justify challenging the character of the city, and forcing the issue so it becomes not about housing, but redesigning the entire city, every neighborhood.
If you insist on making that the discussion, then the actionable plan is stopping it and shutting down even the good development.
Building in the shipyards, or Candlestick Point is one option, providing they don’t attempt another Mission Bay.
New construction brings housing opportunities, and those opportunities create demand, and that demand filters into the nearby areas. It fertilizes the market. The worst thing that can happen for rents in the Bayview is for it’s neighboring areas to get all built up and developed. If you make the Bayview condo friendly, and bring new transplants to that area, in greater numbers, then you will cause displacement. That is the pattern which has played out.
You’re right that there are all kinds of techies. But right now, they can basically only move into those Victorians.
And as you said, those buildings are being built by business folks. We can’t say that speculators are paying $4000/mo rent for a 1 BR. The only people who are going into those are people who are living in them. Those business folks building the towers of $4000/mo 1 BR have pretty good business cases showing that a lot of folks in Victorians are going to be moving into them.
That’s right. Income inequality, global macroeconomic problems, and all sorts of other stuff are screwing over people who aren’t lucky enough to have been born rich or landed in a career that unfairly makes more money than other careers.
The problem is that we’ve been waiting years and years to figure out what kind of building is reasonable. I’ve seen literally decades of editorials in SF and Bay Area history saying that we just need to wait a little longer to figure out what’s reasonable.
After decades pass, one starts to wonder if the folks saying ‘just wait a little longer!’ can actually come up with a plan. Meanwhile they work so hard through the CEQA and zoning laws to stop other people from building. If I were cynical, I’d think saying the same thing for decades but not changing means they’re not sincere. But I do know that at least some of the people are sincere.
I’m willing to bet a donation to the charity of your choice that the folks who said that they’d have a plan after the 18-month prop I moratorium won’t actually have one. Not because I don’t like the prop I folks, but because I’ve never seen any viable, funded plan to build emerge from the folks who say we should wait to build.
I know that ‘build build build’ is not a perfect solution. But what we’ve been doing is not good either, and it’s time to try something new. We’ve been prioritizing ‘neighborhood character’ for years. Maybe it’s time to prioritize people.
You mention NYC. It’s actually cheaper to live there now than it is in SF. And rents and property prices are holding steady.
I’m genuinely curious what type of development is not “bad”, and how can we get 150k units of this “not bad” development ASAP? What frustrates me about many people on your side of the argument is that I hear a lot of opposition to “bad” development, but no concrete, actionable plans to build homes.
I’m of the opinion that most development is not “bad”. As long as no one is being directly displaced (i.e. tearing down rent controlled homes to build luxury condos). The fact is, anything that gets built, there’s a demand for. If it doesn’t get built, that demand doesn’t just vanish. Something like 97% of rich newcomers move into existing homes, thus bidding up the prices for those homes to “luxury” levels. If we built more actual “luxury” homes to absorb some of those rich newcomers, how much cheaper would those older buildings be?
The idea that techies will fill the new apartment buildings and leave the older neighborhoods to everyone else is not convincing to me. There are all kinds of techies. Some like new apartments, some like Victorians. Mr. Mark General Hospital himself could have bought the top few floors of Rincon Center, but he chose a Mission Victorian.
As to what to do, it’s a hard problem. We are seeing the same story of housing becoming unaffordable and people being pushed out, all over the world: Toronto, New York, London. It’s a global problem, which I suspect has to do with the global problem of rising income inequality, and occurs in cities which build a lot as well as ones that build a little.
Saying that we should build and build, because we don’t know what else to do, is not reasonable. There’s nothing wrong with wanting to be sure about a correct diagnosis before administering a treatment with serious side-effects.
Woah now. I’m not saying all development is bad. The problem is, the majority of the development in the city has been bad, and we’re seeing more of the same. What’s happening here is more than advocating for more home building, and I don’t think it’s the seed to affordability…rather the opposite.
So if you’re taking cues from people who weren’t in the city to know better but have decided they’re going to act as leadership, and their rhetoric includes pointing fingers at home owners as the roadblock to…people staying in their homes….well, something is wrong here.
Thanks. Yes, you should read the Housing Element. It contains a large data section so you can see many of the assumptions. But one thing the Housing Element doesn’t show too well are the RHNA (Regional Housing Needs Allocation) numbers that are determined by HCD and ABAG and then the city has to amend the Housing Element to accommodate those numbers. But legally, the Housing Element is the city’s constitution on housing so in some respects it is the focus of housing issues in the city Or is should be.
Build baby build. What a choice pep rally slogan. The fact is: nobody in SF city/county government can or will actually build any housing whatsoever. All they can do is tax, zone, beg, complain. Developers have freedom to do or not do their business as they see fit. All the comments about, “SF has failed to build enough units since 19XX, we need to build X type housing now” are somewhat moot. Businessmen have the final say as to how to invest their resources. All SF government can do is approve or deny certain projects. They remain at the mercy of the market, and the current environment in the city is so muddled, builders are appropriately skeptical and reluctant. The recent, sudden increase in % of “affordable” units up to 25% will likely serve to decrease # of projects being proposed. And with the wacko city supervisors in SF, I would think developers would be smart to just let SF stew in its juices for the foreseeable future. Dysfunctional state of affairs, and an obvious lack of intelligence at the helm.
The average homeowner? No. But there’s certainly a loud minority.
As for your question about organizations bent on “profiteering”, no, I don’t think those organizations should have free reign either. Like I said, regulations are important, as long as we make sure they’re not abused.
You seem to be starting from the assumption that any (or most) development is harmful to the city and it’s people. If I agreed with that assumption, then obviously I wouldn’t be advocating for more development. I don’t think building homes necessarily violates any “sense of ethics”.
It’s frustrating being accused of lacking a sense of ethics and not caring about the community, because I think most people on both sides of this issue share the same progressive values. We all care about living in an affordable, diverse city. We simply disagree on the best practical way to achieve those goals.
No, that is simply not correct. It is people losing their jobs that causes displacement. Jobs=housing demand. Someone who loses their job may not be poor (your physics class couldn’t make that distinction?). Are you saying that high wage earners are incompatible with middle income people in a city? I actually have degrees in planning, real estate development, and project management. And I have actually built multi-family units myself. So, your blind representation of me without knowing me is as wrong as your conclusions. We aren’t here to debate moratoriums-and I haven’t stated my position on moratoriums so you are premature in your judgment of me in that respect- we are really talking about the SFBARF position that says should the city allow unlimited market rate development in SF as a way of solving the affordable housing crisis? My answer is no. Below is a graph approved by the BOS that shows that even though the city obtained 97% of its market rate housing it only achieved 16% of its middle income housing. That fact is that cities or non-profits have to build the affordable housing because in order to be affordable there has to be write-downs or tax credits, etc. IF the city was producing enough affordable housing that when a person lost a job they would have somewhere to move to. That currently is not the case. Here is a basic article about affordable housing in Canada and the US and how it is built. http://prospect.org/article/affordable-housing-lessons-canada
Hobo Catsuit didn’t say that market rate construction “leads to the creation of affordable housing”. She simply said that building market rate housing does not somehow create more need for affordable housing.
As for this Housing Element, it would be interesting to see the assumptions that went into creating it. Specifically projections for job growth and population growth. It’s very possible that these trends were underestimated and that the goals were set too low for all affordability levels.
Its Trump like in its exclusivity!
Thanks for replying.
Developers are businessmen and investors. But those new $4000/mo 1 BRs mean that techies move into those units rather than the mission. (I like to think of those tall buildings as giant techie traps, designed to make sure they all end up in places other than displacing folks who currently live in the city.)
Redmond and folks have been yelling for low-income housing to be built. But rarely do they have a plan other than ‘hope’ and ‘don’t build anything until we figure out how to do it.’
Also let’s remember: current property owners are business folks, in a sense. Landlords obviously are. But even folks who own single-family residences go to neighborhood meetings and talk about how building anything new (like low-income housing, or centers for homeless folks) will reduce property values. Once single-family owners are thinking about property values, even after their houses are worth a million dollars, they’re business folks too.
All I’m looking for is a plan other than ‘do nothing until we think of something better.’ We’ve had years of thinking. We need to act now.
Prop I was supposed to give the city 18 months to figure out how to build affordable housing. The folks (like Tim) who pushed it said they could come up with a plan in 18 months. It didn’t pass, but that shouldn’t prevent them from coming up with a plan. (Keep in mind: a plan means having an actual source of money. Arguing for the abolition of capitalism, while great, is not going to happen any time soon.)
We’re almost 25% of the way through that 18 months, and yet I haven’t seen any planning happen other than ‘don’t build anything,’ ‘hope the tech bubble bursts,’ and ‘scare techies into moving out of SF.’ None of those things are actually building housing.
What I see is this. The people doing the building want higher, not lower housing prices. You are hoping that more building might make the city more available to the non-rich, and that’s not going to happen, by design. Developers are businessmen and investors. If there’s a danger of prices being lowered by oversupply, they’ll stop building until prices get back up (“recover” in real estate speak).
In other words, plenty more $4000/mo 1 br’s are being built, which will not help your friends, or mine, or Tim’s. No one wants to build $2000 1br’s.
As Redmond has been reminding us again and again, he and the Bay Guardian have been yelling and screaming for low-income housing to be built in the city for decades, long before this crisis, long before he’d become a homeowner.
Ugh, Its like debating a 9 year old on why sleep is important.
High wage earners generate jobs. You can take that to the bank of economics 101 and make a deposit.
What causes displacement is a lack of supply. Think back to high school physics and the displacement experiment you did. Your teacher dropped a rock into a beaker full of water and displaced some of that water…think of them as the poor people of San Francisco.
To stop this from happening you have two alternatives. 1, You stop the rock from dropping in the beaker…i.e.you stop people of means from moving to san Francisco. That’s not allowed because we have this thing called the constitution that guarantees certain freedoms, therefore you have to look at alternative number two. 2. Build a bigger beaker, add volume, so that when the rock drops no poor people are pushed out.
Its not a hard concept to grasp unless you are willfully blind to the obvious, which I’m becoming more convinced that you are.
What is causing poverty in California is our shortage of housing. the bottom 25% of income earners are spending 67% of their take home income on housing. They have no choices, no alternatives, the shortage is so dire that the market is commanding ever higher rents…..and people like you and Tim are calling for moratoria. NUTS!
I am under no obligation to you. I have posted many links on to this site to people who seem to have genuine questions. Why should I participate in your deception?
I have already responded to you when you posed the same question elsewhere on this board. There are many options but your option of building unlimited market rate housing is nonsense.
I am unsure of your question. Let me rephrase it. I think the west side should have more new housing as it has a lower number of units than other parts of the city (at least per acre).
I think all you’ve “got” is a sense of deception toward the citizens of SF. People in our city need help, they don’t need people creating false arguments so that one sector of the economy can cash in (the real estate business). Now, I say that and I should say that I like real estate people and developers a lot.I have known many and I like them as people. I have degrees in planning, real estate development and project management, and I have built several multi-family projects myself. I have worked on some of the largest projects in CA as a planner. But what almost everyone else seems to know is that affordable housing is built by the government or non-profits. They need to have lower costs and hence there has to be write-downs, tax credits, etc for it to work. Market rate developers won’t normally do that-but they often set up subsidiaries to do that. But this banter you and others are laying on everyone that if only enough market rate housing was built then everyone would have housing is nonsense. Here is a basic article that discusses the differences between Canadian and US affordable housing progress: http://prospect.org/article/affordable-housing-lessons-canada
ok: Clarity. Fair share of new housing? Or any new housing?
I don’t think you understand the obligations of posting on a public board. This is NOT your board as much as I know you want to try and control the conversation. I will comment appropriately as you continue to misrepresent what is happening to the people of SF. Thank you.
There is already such a law on the books in SF. Many cities “stop” them by tying new offices to housing supplies, etc . Look up what a home occupation means. It means one can’t have anyone visit, it means that only the resident can work there, it means that there can be no signs up. So, you think Google’s next adventure will be converting 20,000 homes?
Me too! I hold out hope that he’ll use this great platform he has and all the passion he has for SF to making the city be inclusive of newcomers.
Well, there is some housing there already. So, I would say “Fair”.
I really hope so. But I fear that this is pretty much all Tim focuses on: keeping people who are already here in place, to the exclusion of everyone else. In his zeal to exclude all the tech folks, he forgets that the great international hope of SF is that it has open arms for all the queer and other non-mainstream folks. I suspect Tim thinks that if tech would just leave the city, magically housing prices would just drop and magically things will go back to how they are.
But that’s not going to happen. The folks he dislikes the most are the least responsive to protests and the least responsive to his pleas. They’ve got the most money, and they’re going to keep spending money, and keep using all the disgusting tools they already use to evict folks. And it will be impossible to change the law to prevent it, because the same zoning laws he loves also protect those folks’ right to buy property and move in and treat it as a single-family residence.
The city is changing, and it’s not changing for the better. I’d rather he think about how to harness the forces that are changing it, rather than focusing so much on how to stop change. That’s a doomed endeavor. He had a nod to this in the article (“any high-end housing that isn’t 30 percent affordable is making the crisis worse.”) — he’s pretty much right here. But instead of coming up with other solutions, he just says his default ‘stop building’ thing.
Here’s the thing: every single family residence in SF is already luxury housing — including the one Tim lives in. Rents and purchases are both out of the price range of everyone but rich folks. My queer non-techie friends can’t rent unless they work hard to find the random bedrooms that are still rent controlled. And when they can’t find them, they’re sleeping on couches of friends until they can. And when they can’t, they’re forced out of the city. This is not a theoretical problem. This is something I get to sadly witness constantly (and do whatever I can to help out.)
We can’t wait a decade for Tim and his friends to figure out the perfect way to build perfect units that are up to their aesthetic and character standards. We need to build now, and we need to build with the money that’s already in the city. The state’s not going to help us (Jerry Brown refuses to build affordable housing), and the feds aren’t either (yay GOP.) That means solving the problem locally, with the local money we have. Why isn’t Tim trying to find ways to get all of the billions of dollars floating around the area into housing? I’d love to see new taxes, new fees, even a non-profit that all the super-rich tech companies (and employees!) could contribute to. But no one seems to want to organize that stuff. He’s great at organizing housing moratoriums. But actually getting housing built? I don’t see that.
Housing seniority and building no units does not help my broke friends have places to live.
The official poverty rates do NOT account for housing costs.
When people’s jobs are pushed out by high wage earners, that is how the poverty cycle begins. You are not going to solve the poverty problem by building market rate housing.
“Despite strong economic growth, the official poverty rate remains high.
According to official poverty statistics, 16.4% of Californians lacked enough resources—about $24,000 per year for a family of four—to meet basic needs in 2014. The rate has declined a little from 16.8% in 2013, but it is well above the recent low of 12.4% reached in 2007. Moreover, the official poverty line does not account for California’s housing costs—or other key family needs and resources.”
Seattle rents are now back up again, higher than ever:
The same website shows rents dipping for a month or two in SF and Portland about the same time, before heading up again. Perhaps the dip had to do with tech jitters.
Not to speak for Redmond, but as I read it, the poorly phrased “husing seniority” idea basically means not evicting people so that others can take their place. I, for one, wouldn’t want it to happen to him, to me or to you.
fair share? Or any?
Glad you are here. Dont hold your breath for Tim, he’s been spouting the same stuff for decades. It’s pretty sad that he is what represents the progressive vanguard in San Francisco! Someone who genuinely believes in a seniority system as part of who gets to live here.
Is this article, written by Tim, not a perfect example of “haha the hippies are the old fogey conservatives haha SF” – He is legitimately advocating for a seniority system on who gets to live here.
You have quoted the same sources, and sources who are quoting the same sources, over and over again. I spent time reading these papers, and summarizing them, and pointing out that they are incomplete, and don’t address issues other than regulations. And this is the thanks I get?
For those who want an example of whether build-baby-build can cause rents to fall, take a look at Seattle, which DOES have large employers, including Amazon, moving tens of thousands of jobs into the city, as well as an very large amount of new, market-rate housing:
Four times as many people commute into San Francisco every day to work than the other way round. Ever been on BART at 8am? the Golden Gate Bridge? the Bay Bridge?
Last year, after staying Monday night in a hotel in South San Francisco (my wife had an early flight out of SFO), I took 101 North, at 7:10 a.m., into SF, heading home (in Sonoma County). I was dreading the drive – but it wasn’t bad at all. What was bad was 101 South, jammed with cars of (I assume) the tech people who live in San Francisco and work in Silicon Valley. The point is that it’s not necessarily tech jobs IN SAN FRANCISCO that are attracting rich(er) renters and buyers – it’s also the desirability of LIVING in San Francisco, for those who work elsewhere and are willing to commute (and, of course, many have the option of taking buses at no cost, courtesy of their employers).
Dont waste your breadth. I have tried proviing poeple on here with charts, data and papers ranging from the White house, NY times, the fed, berkley, NBER and many other sources. Does. not. matter.
How do you stop an office building legally?
Even if you could how do you that since 2009 office density in SF has gone up and its only going to go up even more.
What if more and more people work from home? How will you stop that?
The last time housing in San Francisco was cheap compared to national benchmarks was in the 1960s. The last time we built a lot of housing compared to peer cities nationally? Yup. the 1960s. We stopped building in the 1970s when the preservationists took control of City Hall and we’ve been getting ever more expensive. The preservationist homeowners, people like Tim, saw a combined $131 billion in property value appreciation in 2015 alone. No wonder they don’t want any new home building!! its quite a racket.
great post. I wish Tim would respond to a real point that you make but dont hold out hope.
I dont think you understand the meaning of the word fact. Facts can be proven.Can you prove your assertion. If you cant stop replying to my comments that are not addressed to you. Thanks.
So no solutions? Zero solutions. Not a one. Got it.
Tim, do you live in a home built by a market rate developer? or by HUD?
You are one who cites the research. Its your responsibility to provide links.
In this thread alone I have provides over 10 links to research I have cited. Thats the meaning of citation.
It suggests you cant produce the ‘countless’ research that you claim to have seen. In the time you snipe at people asking for links you would simply have provided them and proven them to be wrong.
Sorry Phil you’re wrong. When we don’t build market rate housing, the programmers and coders who would ordinarily purchase/rent that product turn to existing housing stock and compete with lower income existing residents for the few homes available. That’s when you get evictions and displacement. Our persistent refusal to build market rate housing is at the root of this problem.
Phil, less than 1% of Californians currently live in a home built by an affordable developer with a government subsidy. Do you honestly believe that the affordable development community can solve this crisis? their ability to generate units is microscopic compared to the demand.
Yes they did in their previous report. The bottom 25% of income earners in California spend 67% of their take home pay on housing costs, this is because we are not building enough housing and demand is incredibly high.
99% of nexus studies are bunk. The quickest way for a consultant in the nexus study business to get kicked out of the nexus study business is to find no nexus. If a city wants to charge a fee and needs to prove a nexus as required by State law they will shop for an author until they find one that will guarantee a nexus, no matter what the facts say. The State Legislative Analyst has no financial skin in this game and has thoroughly and objectively analyzed the principal causes of our housing crisis and has reached some very concrete conclusions. Our crisis is a crisis of supply. We don’t build enough housing. Band aid solutions proposed by the affordable housing mafia do more harm than good…impact fees, inclusionary ordinances, rent control…all cause fewer overall units being produced, including fewer affordable units.
The Times wanted a “haha the hippies are the old fogey conservatives haha SF” article and the author did what it took to get that article. As always, outsiders sure do like to talk about SF’s problems without really doing any research, and take self styled activists at their word. Even the times!
I don’t want our beautiful Baghdad By the Bay to become Hong Kong, LA, Manhattan, or outer-Paris projects. That said, I don’t oppose all construction, but I do oppose the god-awful crap that has become the new Richmond Special.
The Victorians in the Haight are big, and they are beautiful, and they show what is possible. The new buildings are too big, and they are ugly as sin. I live out in the Avenues, and I cringe to think what our people-friendly neighborhoods will become in the hands of soulless developers. The least our city planners can do is insist on good architecture as well as a transit system that can support the load.
Helping low-n-middle income people is a noble effort. But tilting the playing field making ‘staying’ their only financial alternative (lose a job but can’t afford rent someplace else – even with a new job there) has ramificaitons beyond those mere individual households. Then we have a petrified housing situation which does damage to newcomers/movers and even those purportedly ‘helped’, as well as the community as a whole; which is forced to build $800,000 “affordable” units, while singles stay in 2-3 BR rent controlled units “cuz its too expensive to move”.
Additionally, the Twitter Tax break is a bogeyman. If Twitter had moved to Brisbane, would the SF housing market been substantially better off? Serious doubt.
Tim is correct that the additional jobs have had a vast impact. But he neglects to mention that rent control and Prop 13 have impacted the housing market, and kept many in place who may otherwise have ‘self-deported’ – many to a better life elsewhere. Instead, they have remained – in various stages of fear. And this does who good – other than the pols who play off this anxiety?
Almost 4 in 10 Californian’s are living near the poverty line. Did the LAO describe why this is happening>? No, they did not. http://www.ppic.org/main/publication_show.asp?i=261
16% of the moderate not low. And that should be SFBARF–of course.
The building of market rate housing does NOT lead the the creation of affordable housing. Anyone arguing the contrary is simply a mouthpiece for the development industry and is trying to open the gates for their private development activity (I have worked with developers for years and I actually like most of them it is simply that some of them are out of control in SF). Pick up any Housing Element in any city and you will see that the market rate component is almost always met but that the affordable portion is rarely met. That is because either non-profits or government have to step in and help finance affordable housing. Market rate developers won’t do that. This graph is from SF’s Housing Element adopted last year and approved by the BOS (except Farrell). Note that 97% of the market rate housing requirement was met but only 16% of the low income housing was met, etc. SFBART is trying to obfuscate the facts and say otherwise, but they are a theatrical group creating drama for their developer benefactors–they are not trying to help SF citizens.
You don’t get it? Jobs causes demand for housing. When jobs go away people are displaced-they have to move. That is what is happening in SF-as the Federal Reserve Bank of SF white papers show. I have no idea why someone would want to create a metric that shows some sort of gentrification movement based on housing type. It’s not relevant or descriptive of what is happening in SF or in the rest of CA for that matter. I think the city’s 24% poverty rate attest that in-place trend. High wage earners move in and their businesses displace the middle and low income businesses that provide employment to low and middle income people. Your market rate developers don’t care about this–just their per unit profits but the low and middle income people move away. Coming into their former rentals are high wage earners who can afford to bid the rental prices up. If we had a law that gave the city vacancy control and certified someone’s salary before they were allowed to move into rent controlled units, then all the new high wage earners would have to live in market rate housing. Then you would have an argument for creating much more market rate housing.
I have no such onus when the person doing the requesting is really trying to obfuscate the facts and is doing nothing but representing development interests by claiming only they can fix the affordable housing situation ( in the most pedantic way imaginable).
He’s literally arguing that he and his friends should be able to stay to the exclusion of everyone else. It’s obvious, direct self-interest.
I’m queer. I grew up poor and in a homophobic part of the country. I worked my ass off to make sure I could get here, and fortunately I managed to get here before things got expensive. If I didn’t make it here I’d probably be dead. This is the first place I’ve live where I’ve felt accepted for who I am.
I appreciate that I’m here, and try to do my part to respect the area and help other people stay. I’m very lucky, and don’t think I’m more deserving than anyone else.
Your ‘housing seniority’ idea is stupid. It means that my queer friends (who are broke and not in tech) wouldn’t get to stay. It means that the summer of love (whose whole point it was to welcome queer and other non-mainstream folks to the city) would be over–and you would be ending it.
The more I read you the more you sound like a bitter person who wants to literally keep *everyone* out of the city so you can keep tech folks out of the city. (I know because I work in tech you’d want to keep me out, literally anything else about me notwithstanding.)
I know you’re well-intentioned so I hope you use the platform you have to propose something a bit more interesting than ‘keep newcomers out.’
Do you really think the average homeowner is out there stopping projects out of self interest?
How many home owners do you know, and how many are down at Planning Commission meetings?
And how does this compare with organizations that want to build for profiteering, beyond any sense of ethics, or sensitivity to the existing community?
One thing is for certain: building housing affordable to low- and middle-income people will help low- and middle-income people. And protecting low- and middle-income people in their homes with legislation to protect low- and middle-income people in their homes will protect low- and middle-income people in their homes. There just isn’t getting around any of that.
Additionally, Tim is right to have argued in recent articles that the Twitter tax break never should have been approved without a plan to sustainably house all those new employees. Same in Silicon Valley — communities should not be greenlighting all the industry expansion without sustainable plans for housing new employees (in other words, not in SF and not in the Central Valley — the latest plans for HSR have the first leg connecting Silicon Valley with the Central Valley, which means sprawl).
Regarding that New York Times puff piece, who’s the NYT bureau chief in San Francisco? Why did that bureau chief let the author get away with including two websites, GrowSF and East Bay Forward, that pretend to be organizations but in reality appear to have no memberships or boards of directors?
I agree, but that isn’t my point. He was trying to alleviate high unemployment and, while, in retrospect, he didn’t do it how he should have, I don’t fault him for trying.
The author of this is so clearly biased and emotional that he can’t actually address real arguments. It’s a canard, a take down, repeat. And even his take downs are nonsense. It’s depressing drivel like this gets written and worrisome some might not see though it.
I am away from my main computer right now but here is an article from Canada that talks about US and Canadian affordable housing. It acknowledges that affordable housing is almost always met from govt or non-profit actions and not from the market rate developers. You could go to almost any CA city web site and pull down their Housing Element. That document will almost always show a meeting of the city’s market rate housing and almost never a meeting of their affordable requirements (per RHNA). http://prospect.org/article/affordable-housing-lessons-canada
here is one: http://www.frbsf.org/economic-research/publications/economic-letter/2013/april/job-economic-growth-california/
I wasn’t responding to your argument–just stating a fact. Nice patronizing remark of yours however.
Jobs housing balance, no new offices unless new housing is provided, etc.
Seems pretty relevant to local conditions to me.
I realize that you don’t understand–it is quit clear. Market rate housing has never provided sufficient affordable housing. It is axiomatic in the housing industry. But I know you and the other SFBARF members support unfettered projects for the largest developers in the city and are active in pretending that these developers will somehow save the city and its residents. I happen to like developers and have worked with them for years but they don’t produce market rate generated affordable housing. By taking the position you do and by doing the theatrical stints your group does you do nothing but polarize people on housing issues.
You made the claim, so the onus is on you to provide supporting evidence.
No, entrenched interests like obstructionist homeowners, I thought that was clear from my comment.
Yes, the west side is not absorbing its fair share of new housing in SF.
The usual NIMBYs (and the district 3 supervisor) are restricting Seawall Lot 322-1 from being turned into affordable housing.
Nice data, John
Too lazy to do the research yourself? You might start with the cities own housing documents.
“we’re just concerned that the regulatory system has been co-opted by entrenched interests.”
Entrenched interests like SFBARF and SPUR?
That sounds a bit…racist.
I guess SFBARF types are unaware of People of Color Flight?
And since you say countless just 5 should be super easy to link to.
why do your comments keep getting deleted?
Kok, Monkkonen and Quigley 2011 [PDF] cherry picked one factor?
This seems pretty reasonable. Where is the cherrypicking?
“Over the years there have been countless studies in the US that show that building market rate housing does NOT provide for more affordable housing.”
I would be interested in reading them. Do you have any links?
You have a very reasonable point. My guess would be that your bimodal assumption is accurate. Dallas MSA being much more suburban wiwth high size of family unit. Thats makes the cross sectional comparison tougher for a city like SF to a region like Dallas MSA. Better to a time series analysis IMO which shows much lower ratio prior to 1980. But your point is well taken. Thanks.
I understand your goal. The question is how do you get there? How do you limit a business without being discriminatory? You have to at least explain that.
And what are these amazing middle income sectors that you keep talking about that can employ hundreds of thousands of people from Detroit to San Francisco what will overcome and reverse all the issues with productivity, technology and globalization which have eroded those jobs in the 1st place?
I agree that if a lot of 150k job seeks come to SF they will push or the 60k job holders but your solution that there shouldnt be high paying or low paying jobs middle paying jobs its fantasy (tech executives =teachers). Fantasy defined as something of which there is no example of ever being true anywhere ever in human history.
All else aside, I don’t see how this gap is evidence of underbuilding on its own. Taking these numbers as given, that’s a ratio of 2.54 people per unit added. To give an extreme comparison (back of the envelope), since 1990 the four main counties of the Dallas MSA (Dallas-Tarrant-Denton-Collin), which nobody would ever claim were growth restricted, added 2.3M people and 760K housing units, for a ratio of just over 3 to 1. On its own, therefore, unless I’m misunderstanding your numbers, a gap of 186K to 73K doesn’t seem alarming unless the a bimodal wage structure gives you a lot of high-wage singles and DINKYs (“dual income no kids yet”), meaning a lower than average household size requiring a higher than average rate of unit construction to population growth (and households that are more competitive in the housing market). I think that’s what North Beach Phil below is driving at. If I’ve misunderstood you though let me know.
Yearning for manufacturing ‘middle income’ jobs of the is fantasy. SF is the tech hub of the world. That is the reality. Any amount of wishing isnt going to change that of the gentrification it brings.
“The question is how to handle a long-run demographic reversal in which
cities across the country have regained population following years of
“white flight” to the suburbs.”-from the BARF article.
Would whiteFolks living in SF who were raised in faraway suburbs consider themselves part of the housing problem here? Are you willing to return to upstate New York, Spud Idaho, etc, and cede your property to a worthy-working-class person (preferably of color)..
Since 2009 tech jobs have gone up 35k, non tech jobs have gone up 3x that at close to 100k. So while it may ‘feel’ like its all tech its clearly not the case. Does that clarify your query?
“Units and people are different things. As I said elsewhere, the population in 1945 was almost as high as it is now, with much less housing”
— Kids! Right now children are at an all-time low.
It seems the SFRA destroyed about 14,000 units in total across the redevelopment areas, and by 2000 only about 7,500 had been replaced. That would at least partially account for the flat net production. https://journals.law.stanford.edu/sites/default/files/stanford-law-policy-review/print/2014/01/rosen_sullivan_25_stan._l._poly_rev_121.pdf (note 13)
No worries with my beliefs, thanks for asking. Trauss is more in the category of pest, irritant, charlatan, and the curtain deserves to be pulled back. Things will reveal themselves in time, they always do. Since you’re into hypotheticals, she should become room mates with, perhaps, Dewsnup & Sarah Palin. Social Justice!
I think Chuck was right in his analysis that a coalition of gray-haired NIMBY leftovers from the 60s and advocates for the poor are stifling housing construction in San Francisco.
Does it make you feel more secure in your beliefs if you imagine that everyone who disagrees with you is being paid or manipulated by corporations?
Not 🙂 . I’ve not sniped at you, don’t snipe at me.
These 535K include people who have been living here for a while, and are not competing for housing. Among the people now moving into vacant housing, what percentage are earning high salaries (“tech” or whatever)? These are the people whose income is dictating housing prices.
It’s a question of limiting businesses, not limiting people. If you bring in jobs which are split between those paying very high wages and those paying low wages, you’re exacerbating income inequality, which ends up making housing unaffordable to people on the lower side of things.
It’s not about driving away people of one persuasion or the other. People follow jobs. If 100,000 people are following $150,000/yr jobs in a limited geographical area, they’ll make life unaffordable to people making $60,000/yr., whether they want to or not, even if they have the best intentions.
There are some really unfair characterizations of the SFBARF/YIMBY side here. You’ve painted us as a bunch of anti-regulation libertarian extremists. For the most part, we’re not anti-regulation, we’re just concerned that the regulatory system has been co-opted by entrenched interests. Low-density zoning constitutes a massive handout to landowners, at the expense of literally everyone else. Upzoning the West Side would be a good way to add a lot more housing to the city. But that is politically infeasible, because homeowners are concerned about loosing public benefits like ample free street parking and the nebulous notion of “neighborhood character”. People abuse our regulatory system to oppose any and all new development in their neighborhoods, even if that development would be a net gain for the city as a whole. There are even some egregious examples of neighbors opposing 100% affordable developments, causing the nonprofit developers to spend millions of dollars more than they otherwise would have.
Most of us on the YIMBY side are absolutely in favor of environmental protections, zoning, and tenant protections. It just seems like the regulatory framework that was put in place to serve these goals needs to be revamped, so that it’s not so easily abused by obstructionist millionaire homeowners.
You’re just being silly. Blight is not the only alternative to gentrification. You need jobs for the local population, as opposed to jobs to other people who would come and displace the local population. Detroit used to be a thriving town, because it had middle class jobs, not just high-paying and low-paying jobs.
The Bronx? The Bronx was ruined and created by Urban Renewal, and public housing so big you have to take a bus from one side to the other. The Bronx literally burned, and that’s your example of keeping it’s residents intact?
And no, it’s not just a few parts of Brooklyn, it’s all of Brooklyn that is experiencing the threat of rampant displacement of it’s residents. Housing and Tenant activists are not screaming for more new developments, because they regard it as the seed for their communities being torn apart. There is no “Build, baby build” movement in NYC, the problems there are clear.
A few small parts of Brooklyn, perhaps. Meanwhile you can find apartments in the Bronx cheaper than anything in Oakland, with reasonable transit access to Manhattan, better schools, and less property crime.
OK, the first corporate subsidized grassroots group. Puppet strings are being pulled. Dance.
Sorry, but I know better. I’m on the group’s email list and have met a good number of other supporters in person. There is a strong amount of grassroots energy and activism.
They pay taxes and salaries. Its not their job to house people.
Anyways you keep tacking on ‘what about this and what about that’ to each discussion. I dont think any amount of logic or evidence is going to change your mind.
I am not. Not that there is anything wrong with it! 🙂
Also really great engagement of the argument. What a well thought out response.
But how do you do it? It is personal. You will ask a person to not move to SF legal or morally? That question remains unanswered.
Restaurant capacity issues are due to fire codes etc. How can you think thats a realistic comparison to city.If you do you must then appose sanctuary city if you want to remain consistent with your restaurant anology. They dont turn away certain type of customers only.
I dont understand what your solutions are. Real solutions. Not pie in the sky utopian ones.
Reading this blog and its mind-numbingly stupid bleating against any and all new development literally makes me dizzy.
What are these middle income jobs specifically?
Greed isn’t a heuristic notion for those ensconsed for decades in rent-controlled units? Owners have an obligation to supply housing to the needy, but those who already have a place with low payments don’t?
That’s just lazy. It’s not like these studies included 100 factors and I’m nitpicking over one more. They cherrypicked one factor (rregulations) and ignored the most important others. It would be like a heart-attack study which didn’t factor in age and diet.
Nothing about you personally, but there are limits, and we’re seeing them. Restaurants and event spaces have their capacities too, and people are turned away when these capacities are reached.
Units and people are different things. As I said elsewhere, the population in 1945 was almost as high as it is now, with much less housing. It just meant that people were living in more cramped conditions. think at least some of the statistics you’re seeing meant that more people were living wth roommates later.
Anyway, the larger picture is, why did 113K people move to the city? An industry is hiring 100K people over a few years, and letting everyone else figure out how to house them, or whether they can house them. How is that different than a company using groundwater or any other limited resource? Why shouldn’t local government have any say on whether they can support that or not?
By this logic we should try and make things worse for Detroit to lower rents. Turning into a ghost town maybe best where ppl can live for free in abandoned homes.
Employment recovered mostly everywhere. Luring middle-income jobs to the city would have been better. Many of the people who’d been unemployed didn’t get these shiny new jobs, they were just forced to move away.
Clueless commentator doesn’t even know he’s talking to several of us, accusing us of being fake. I’m so tired of hearing these attacks.
Do you have a link to the SF Fed paper?
As I said, consider West Oakland. Houses got expensive, and people who could afford more moved in and are displacing the current residents, whose incomes did not rise to match rising housing costs. No reason why the same couldn’t happen in Detroit.
Suppose (I’ll make up numbers) that you’re renting a place in Detroit for $300/mo, which you’re paying for out of your $800/mo income. Tech companies move in, people need housing, and rather than move into an apartment many newcomers would rather rent a big house for $1000/mo, a ridiculous bargain by California standards, especially if the landlord would fix it up first. So landlords raise prices, before or after evicting the old tenants, and the people making $800 are getting priced out, even if their salaries go up by 50%. The neighborhoods are going to look better, but the people who’d lived in them all their lives are not going to benefit from these improvements. They’ll be forced to move further away, to even worse circumstances.
I called “Supply and demand” the principles which don’t apply. You’re making emotional arguments and looking for something to cling to.
So you’re making inflammatory statements and trying to evoke race for the sake of being divisive, is that it? I’m not telling you not to speak of race ever, but in this context, it’s inappropriate and not helpful. I get that you’re walking into a mind field predisposed to view many things under the lens of race issues, but Western Addition is especially delicate….and let’s not forget, you’re now siding with the Urban Renewal groups that did serious damage in the Fillmore. How about those lovely condos, and that “Historical Jazz district”, and all those promenades outside the fast food places. That’s some culture!
Cheap rent in SF, especially on Broadway, had nothing to do with racism. Nothing.
Were housing policies racist in some areas? Yes, but we’re not talking about those areas, and they were affluential areas, not areas where you could exploit cheap rent.
In fact, it was the opposite of what you think…the poor areas were desirable for countercultural types because they weren’t scared to live besides people of color, in what was perceived as rougher working class neighborhoods…and that working class, especially during war time was divided by class, more than race. Also lost on this conversation is the renewed interest in neglected under appreciated Victorians, and the space they afforded.
“Can you justify talking about race at all?” Do I need to justify it? We won’t get make progress if we tell people to just shut up and never speak of it again. I’m not afraid of sounding ignorant. That’s how we learn. That’s why we’re having this discourse now. I could shut my mouth and remain ignorant if you’d like.
My original point wasn’t that white flight was the only source of cheap rents. It’s that we can’t look back at the “all the cool stuff this city celebrates today” with rose colored glasses. It’s that cheap rent was, in part, a product of racism and its effects on policy just like sky-high rents are today.
Incorrect assumption. Not my “leader” in any way. My disgust is with Trauss and her faux facts, her divisive dialogue, her surrepulious, synthetic, sucker-baiting cesspool operation.
We can easily see that a high level correlation exists between high rents and venture capital funding. Condo prices are falling because the venture capital dried up. According to a recent Fitch ratings report, San Francisco home prices hit an all-time high in third quarter of 2015 and are now 62% above their post-recession low in early 2012.
In the report, Fitch Managing Director Grant Bailey said that San
Francisco home prices are up more than 10% in the past year alone,
making the San Francisco housing market now approximately 16% overvalued when compared to the area’s underlying supporting economic fundamentals. The Fitch report suggests that Bay Area home prices are have reached a “level unsupportable by area income” http://www.bizjournals.com/sanfrancisco/blog/real-estate/2016/02/san-francisco-home-price-bubble-report-fitch.html
Can you justify talking about race at all?
North Beach was full of Italian immigrants, many who barely assimilated, then you have the lingering effects of the Barbary Coast, which was more diverse than you probably think. By the 40’s, you have the opening of bars which attracted a largely Gay clientele including the Beats. The area happened to attract a lot of derelicts, and social deviants, and Broadway Corridor had a concentration of SRO’s that served military men, and various people down on their luck….or someone looking to live cheaply, like the Beats. This is a very surface explanation.
By the way, your concept of white flight in the 40’s is off too. A chunk of the city was only built and brought to market 5 to 20 years before, and it space provided the opportunity to start families. Post war San Francisco was very fertile.
Western Addition? Trust me, the whiteness of that area was never a factor to the Bohemians, beats, hippies, or any other counterculture. The demographics that had the effect on them were Blacks, Jews, and Asians.
are those not your words? Supply and demand is never an “emotional argument” no matter what the qualifier.
“Can the reporters who take on housing in San Francisco please take the time to understand some basic facts?”
Yes, Tim, can they?
“And the reason there is so much more Demand is because city officials, starting with Mayor Ed Lee, decided that turning SF into a center for tech companies was a great idea.”
Neither the housing crisis nor the tech boom started with Ed Lee.
“Lee’s “jobs agenda” wasn’t aimed at unemployed people who already lived in SF; intentionally or not, the jobs that were created went overwhelmingly to people who moved here from someplace else to take them.”
This contradicts the heart of your anti-market-rate housing stance. The nexus study you are so fond of citing is based on the premise that new high-income residents create many other jobs.
As Vox recently wrote, “It’s worth pointing out how backward the situation in the San Francisco Bay Area is. In most parts of the country, city leaders are desperately looking for ways to attract big companies to town — or, even better, foster the creation of new, homegrown businesses. Bringing a new business to town normally has broad benefits. Some people get jobs at the new company. Others get jobs providing services — restaurant meals, legal advice, medical care — to the new workers.”
“And let’s please not forget that Airbnb, a company the mayor has championed, has taken at least 6,000 housing units off the market.”
No, it hasn’t. Presumably you’re referencing the report from the City’s Budget and Legislative Analyst, which found ~6,000 *listings* on Airbnb, most of which are just rooms or occasional rentals. That same report estimates “between 925 and 1,960 units citywide have been removed from the housing market” due to Airbnb.
“Many of the people known as “moderates” believe that the free market will ultimately solve our problems, “
Many of the people known as “moderates” a) would not describe themselves as such, b) would prefer a well-regulated market to a free one, and c) reject the notion that our current housing market is well-regulated.
“that we need fewer regulations on land use, “
Putting us in agreement a large number of liberal economists.
“and that we should not impose higher taxes on speculators and the rich. “
You’ll find a lot of people clamoring to build more housing would love to see major changes to Prop 13 and the Mortgage Interest Deduction, which are two giant handouts to millionaire homeowners.
“When did “every liberal touchstone” stop including income redistribution, progressive taxation, and limits on the ravages of uncontrolled capitalism? Only in the current, bizarre, political narrative in San Francisco.”
When did “progressive” interests become aligned with preserving Single-Family Zoning, which was created to exclude non-white people from suburban communities? When did “progressives” embrace cherrypicking evidence and burying their heads in the sand instead of taking the word of academic experts? When did “progressives” decide that free parking and their aesthetic preferences of low-slung buildings trumped the environmental and socioeconomic benefits of denser urban living?
‘I do not oppose “most construction.” ‘
“Seriously: If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing “
You keep citing this one report and ignoring all the others. How strange.
“Please: Show me any evidence, any credible evidence at all”
Read your own comment threads. It’s all there.
First half truths, now half a quote.
Next you’ll talk about “old white guys”….oh wait….
Read my comment: the carpetbaggers I mentioned are your fearless leader Tim Redmond, Perennial nosayer Sue Hestor, Calvin welch….
Best laugh of the day: “supply and demand is an emotional argument”
“North Beach and Western Addition were integrated areas full of immigrants, and multi-racial communities not examples of white flight.” They didn’t start that way. The city was 95% white in the 40s. Forgive my ignorance. Help the discourse. Inform me.
Ok now Bob is supporting carpetbaggers. Easy to dismiss the rest of your position. They are interviewing her because of her support from corporate backers, i.e. Yelp and others remaining hidden. It’s a Trojan Horse method, adopting “counterculture” label & methodology to subvert their movement. If you can’t see through the thinly veiled facade of Trauss, she succeeded. What the F is she doing over in Lafayette? Grand stander. Meddlesome prima donna persona wanting money, attention and support. There was a time when tarring & feathering was a reaction, now it’s profitable to be a shill.
Wait, why wouldn’t it matter if an opportunistic carpetbagger creates some fake organizations (not even their name shows sincerity) and abuses the transient nature of this city?
The “Supply and Demand” talk is an emotional argument hiding behind principles which do no apply.
No, because those areas had rough streets which were the equivalent of the Tenderloin, with flophouses, and they weren’t desirable. North Beach and Western Addition were integrated areas full of immigrants, and multi-racial communities not examples of white flight.
We’re at a point in these discussions where people like yourself aren’t helping the discourse. You’re uninformed.
New York is a hotbed of displacement.
“There is Demand and there is Supply.”
Can both sides please stop with the rudimentary concept of how the local housing market works?
It’s leading to some fundamental misunderstandings of the situation we’re in, so that the majority of discourse is over false premises.
Speaking of which, SFBARF’s aren’t San Franciscans, and their opponents aren’t NIMBYS, they are San Franciscans. That’s why they have started calling everyday San Franciscans who don’t support their convoluted idiocy “NIMBY’s”. as a blanket term.
This is what happens when you have rent control and don’t build (example from Sweden). Rent controls promote conversion of existing rental buildings into condos, AirBnB etc, and planning controls kill off anything else that manages to escape.
It’s not rocket science – if you have more people than homes, prices will go up. Speculators can be sorted by putting a value tax on all land in the city. That means that homes have to be rented out rather than be left empty.
30-year waiting list for apartment in Södermalm
SVT news: http://www.svt.se/nyheter/lokalt/stockholm/30-ars-ko-till-lagenhet-pa-soder
What’s amazing is that, unlike most opponents of development, Tim clearly grasps the issue. There has been a boom in jobs, but there is not enough housing to house all these new workers. But he can’t just make that additional step to say, “…hence we need more housing”.
As for the reason why all developments are luxury. Well, if you only allow a measly 1k-2k units of housing to be built, of course the developers will make them luxury. Try to allow 10k-20k units and see what happens. There is not an infinite demand for housing.
Cities in Texas went through the recent oil boom with little to no increase in housing prices because they build 50k-70k units a year. And before you say, “Well yea, they do it through sprawl.”, they build more multi-family units than SF does.
Finally, a good example of what supply constraints does is when US opened itself up to foreign car imports. At first, when a small quota of cars imported was allowed, they were all luxury. Once the quotas went away, luxury and non-luxury cars were sold. I wonder whY??
right, because all of the NIMBY cast of characters that I named in my former comment are actually born and raised in San Francisco. When does it matter if you are a carpetbagger? When you are in favor of building more housing! They are interviewing her because she is effectively the counterculture in SF housing policy. They are interviewing her because of the San Francisco level absurdity of someone being the counterculture because they advocate for more housing. To quote the times: “This may not sound like a controversial idea. But this is San Francisco.”
Interviewing her due to the obvious astro-turf connections, that desire to further their agenda. SFBARF’s ‘leader’ remains somewhat a carpetbagging grandstander, running interference for developers.
What about the thousands of people who commute into San Francisco every work day? More people commute into San Francisco for work than commute down the peninsula to work in tech jobs.
SFBARF is “grassroots”?? You are very mistaken, it’s as astro-turf as they come.
She’s such a laughing stock that the NYtimes is interviewing her.
Lobbying against any significant housing development at all is “doing no harm”??
How is it possible that you can be so blinded by your own ideology? we ALREADY have a seniority based housing policy – implemented by people like yourself and Sue Hestor, Calvin Welch, Randy Shaw, Bruce Brugmann. How’s that working out for San Francisco??
Has Tim ever been to Hong Kong? Or New York in the last 20 years? They aren’t exactly the hellscapes he makes them out to be.
You couldn’t remove hundreds of thousands of units of rent controlled housing because there isn’t that much to begin with. Tim knows this. He’s just being hysterical. Besides, we aren’t largely going after the big apartment buildings in the NorthEast SF where the vast majority of those units are. If Tim knew anything about us beyond what he writes in his own blog, he’d realize we are MUCH more about allowing developers to buy 4 single family homes and put up a 10-story building with 80 units.
Just a few points:
It isn’t just landlords and developers that are the beneficiaries of the housing shortage: it’s pre-existing homeowners – http://www.sfweekly.com/sanfrancisco/welcome-home/Content?oid=2136819&showFullText=true
San Francisco in 1981, despite the author’s anecdotes, was not considered cheap at the time. They were already using the term “housing crisis” and there were many ballot initiatives aimed at curtailing it: http://foundsf.org/index.php?title=1980-1991:_RENT_CONTROL_WARS
It’s also worth noting that the author, who professes a “do no harm” philosophy, doesn’t consider the harm that not building housing causes. The city economist opined on that in regards to the Mission Moratorium: http://www.sfexaminer.com/city-report-finds-mission-moratorium-would-drive-up-housing-costs/
And the State’s LAO released a report consistent with that as well: http://www.lao.ca.gov/Publications/Report/3345
It’s true that our housing policy and our jobs policy have been at odds with each other, but putting the blame entirely on our jobs policies is very one-sided.
A land use “restriction” may actually create more housing so your argument doesn’t make sense. Such a restriction may be a maximum parking ratio (leaving more room on the land for more units. Developers often tend to over park). It may be a density bonus whereby the owner can built 6 units by right but 25 units if they do x, y and z (such as add affordable units).
Here’s another NYT article you could take down, while you are at it. http://mobile.nytimes.com/2016/04/24/nyregion/housing-bias-outlasts-ruling-in-a-long-island-village.html
I liked your article but maybe you phrased the “seniority” comment above in a bad way. High wage earners are moving in and middle and lower income people are moving out because the middle and lower income jobs are going away. Housing and housing prices are almost always about jobs. Had the Lee administration focused at least some of their time on keeping middle and lower income jobs then those people wouldn’t have to move. It is when these people move (and with no vacancy control) that the new high wage earners come in and bid up the price of housing. Finally, the city has under built affordable housing. If someone gets hit into a lower paying job there is nowhere for them to go and they can’t compete with the high wage earners for the new higher rents. So, they leave the city.
You’re a BARF member.
“overbuilding” isn’t subjective. If you know the demand for a certain housing segment then if more is produced than is required then it is overbuilt. Developers do marketing studies to determine this and bankers require it for loans.
Demand for what? Demand for market rate housing? Who is restricting affordable housing in your mind? That if the city had no restrictions on housing it would produce enough housing for all income segments is absurd.
Exactly right on point 1. In fact, the Federal Reserve Bank of SF has issued a white paper on that very subject. Normally, a local economy slows when new workers won’t come to that market due to high rents. There was no such effect in SF as the people moving here were high wage earners that bid up the rental prices and could afford to do so. So, in some respects the higher rents are not necessarily a demand issue but rather it has a lot to do with high wage earners moving in and middle income people having to move out (their businesses forced out of the city). We don’t have vacancy control so the second someone moves out the rent can increase. The 20 something high wager earners can live together and pay almost any price and they have. The result is a huge increase in rents.
I plotted the CPI and compared it to a 2 bedroom apartment in SF from 1979 to 2015. The results, no spikes in rents except in the 2000 tech boom and the one since 2011. The two lines followed each other nicely for decades. So, you simply can not say that it is a cumulative housing shortage. How would people know in earlier decades that in 2012 SF would have a 100 yr flood of new jobs?
Housing is all about jobs. SF is in the middle of a 100 year job flood. The city encouraged this flood and they did nothing to mitigate it or the impacts it was causing the city. I don’t buy your thesis that we are all lost at sea in a sinking ship and there is nothing we can do about it
What are you talking about? Even the LAO report focuses on “coastal California” as they see the dynamics there as being different from non-coastal areas.
Over the years there have been countless studies in the US that show that building market rate housing does NOT provide for more affordable housing. Even the NYT’s had a long article last year outlining that issue. But evidence in the city’s own Housing Element and almost every Housing Element I have seen in the state shows that market rate housing has been “over produced” and yet very little middle and lower income housing has been built. In fact, in SF, the city has not meet its RHNA housing (required by law) needs for low and middle income people even though we have a huge build in market rate housing going on. The Housing Element is a part of the city’s General Plan (the Supreme Court calls the General Plan the local governments constitution for land use) and it was approved last year by the BOS with everyone voting (and approving the data) except Farrell. The LAO was looking for statewide trends and they really didn’t focus on local conditions. As I just mentioned, the Housing Element is a long document and it has a huge data section and provides real evidence, not .anecdotal statewide “evidence”./
“When I arrived in 1981, a room in a flat in the Haight was $100 a month.”
In 1981, we were paying $450/ for a 4.5 rm apt @ 17th & Guerrero; not a great area at the time, but better than 15th & Guerrero (across from Valencia ‘Gardens'( or HP or some other areas I imagine. Parts of the Haight were pretty scary iirc; price vs safety.
Rent Control was established in 1979, due to the “housing crisis”. That was also the year when the population hit its lowest point in the previous 40 yrs. Changes in housing usage can be attributed to that ‘demand’, as families with kids were being replaced by adult roommates with geometrically higher ability to pay rents than single-earner families. Those who complain that SF is not hospitable to families any more need look no further than the elimination of restrictions on non-familiy members sharing a household.
Spoken like a true Potrero Hill NIMBY.
Let me guess. You also pushed to prevent the upzoning of Eastern Neighborhoods, blocking 50-100k new units there.
Oh, but what about the west side? I haven’t heard a peep out of 48 hills about maximizing affordable housing on Balboa Reservoir that NIMBYhood groups oppose. I haven’t heard a peep about abolishing single family home restrictive zoning.
Like it or not, we won’t go away, because we are the future. You better start thinking of a way to work with us instead of against us.
Also, the Twitter tax break in central Market didn’t add that many jobs compared to the overall tech employment picture in the city.
San Francisco imports more workers from all but one of the 9 ABAG counties than it imports. The idea that 10k riding tech busses are this huge issue for San Francisco when literally hundreds of thousands of people cross bridges, take BART, and drive up the peninsula highways every day to work in SF is laughable NIMBY “stop hitting yourself” nonsense. Where is the outrage about how SF is ruining the Oakland housing market by adding jobs but no housing?
Tim, I think you’d be surprised to find that many of us on the BARF/YIMBY side share your views on economic redistribution, need for public investment in housing, etc. But turning back the tide of Reaganism in the US is going to take years, maybe decades, and we can’t wait that long. I believe that increasing the housing supply, when combined with rent control (to prevent displacement of current residents) and inclusionary zoning (to maintain as much economic diversity as possible) is the best option we have, even though I would never claim that this is an ideal solution.
I would add to that list mortgage rates. I think they hit 10% in 1970. Consumer optimism is another factor to consider.
Is this sarcastic? Detroit is better off with less jobs than more? Tech or otherwise. I wonder what a poll would show in Detroit if asked about Apple moving there.
Putting aside your racism and ageism, SFBARF has zero credibility, and because Trauss’ is defending the actions of the nutcase Dewsnup, she is now a laughingstock.
As for the NYTimes, go back an read their dire prediction about California and the drought. If any of that nonsense was true, we’d all be drinking our own urine by now.
While I despise Ed Lee, unemployment was 9.8% in San Francisco after the 2008 global economic meltdown. Luring employers to SF was the right thing to do.
If the tech companies had never started offering shuttles Tim, leftists like yourself would probably be slamming them for contributing to traffic congestion and further overcrowding government transit at peak times, by failing to provide any kind of transportation of their own for their employees! You know it’s true.
Tim – Access to housing based on seniority and who’s been here longest? That’s not very progressive of you! Older people have more wealth than younger people in this society on average – that’s why this is in part a generational issue. You are essentially siding with the “haves” and against the “have nots”. This is essentially no different from the attitude of someone like Donald Trump, who wants to legally preference people who already live in the United States over those who are trying to come here.
Leftists who are willing to prioritize compassion and helping the poor over siding with wealthy NIMBY property owners who don’t want new construction in their neighborhoods can play a positive role here. Let’s talk about decriminalizing housing alternatives for lower income people who want to live here, like tiny houses, in-law units, people living in vehicles, tents, houseboats, etc., and cutting the bureaucracy, tape, permit fees, and so on that stifle creative housing solutions.
Are all of these living options ideal for everyone? Of course not. Will many people see them as better than being homeless, living in fear of the law, or not having the choice of being able to live in SF at all? Yes. And the more housing options that are allowed to exist or be created in the city, at all price levels, the more it will bring down prices. That’s just a basic economic reality, which growing numbers of younger people are recognizing despite the statist propaganda of the establishment and older groups that share its ideology, and this is reflected in the emergence of new grassroots groups like SFBARF.
Its not so simple but its not as complicated as you want to make it either. Unit type are sum of single and multi family. A 113k gap on a base of 865k us too big to explain away by changes in unit type or living patterns.
A 113K gap even in the most generous reading cant be considered as reasonable.
You seriously think that this population to unit gap is fine? Nothing to see there? We have build sufficiently? How much should the gap be for you say we under built?
I dont see the point you are tying make about single people and 3BR flats.
The vacancy rates werent high means that the market was not oversupplied and thus needed supply to keep pace with population.
So I dont get it – outside of waiting teachers = techies whats the solution?
As an example I moved to SF in 2009 for a white collar job. How do you/ the city govt stop that? And even if you could it that legally or morally justifiable?
What kind of units? What sort of units were occupied in 1980? It’s not so simple. Were single people living in 3BR flats in 1980? The vacancy rate was not huge back then.
As i have said previously multiple times, demand obviously affects price and probably dominates price impact cyclically. But supply drives the structural imbalance relative to trend population growth. Its the imbalance that matters – not supply or demand in isolation.
Closed from implies there are x fixed variables that once found will full explain the problem. This doesnt not exist in economics in most cases. You can almost always take any study and say ‘you didnt include this factor’.
I should correct myself. I think the immediate effect of building more market-rate housing on local prices is small, that is in the sense of “the halo effect” and such. In the long run, as Tim said, more white-collar people moving in create more demand for lower-paid service workers, and that exacerbates the problem overall.
Total increase since 1980 = 186k
total units added since 1980 = 73k.
That makes sense to you?
If you dont think thats a cumulative decades long under build I honestly dont know what to say.
The CPI housing line item is Owner equivalent rent. I agree its not a clean measure but has the longest time series on fred.
About your first point, since the only people who can afford to move into that new housing are wealthier than the majority of city dwellers, then in balance the rich guy wins, and the not-rich guy who is already living here loses. Hardly fair, I’d say.
“Epidemiology problems have a closed form solutions which vast majority of economics problems don’t”: that’s often not true. That’s why it takes a lot of studies to settle, one way or the other, suspected connections like dietary aluminum and Alzheimer’s, or cell-phones and cancer. In any case, demand has a clearly defined and well-known effect on prices, and you can’t just ignore it.
So moving away from affordability to quality of life etc. then.
‘We’ is highly subjective and so is ‘overbuilding’ 🙂
If you already live on rent control or own a place here and want to keep your open spaces, less traffic its great if no new building is done. If you want to live but dont already here there is enormous benefit.
Epidemiology problems have a closed form solutions which vast majority of economics problems dont – the comparison is not correct.
It does seem very weird that there could be no new housing, and I think you’re probably right that the redevelopment agency was to blame. I hope enough records of building and demolition permits survive somewhere that it’s possible to reconstruct what actually happened in more detail. If we can get sense of what happened with construction, employment, and prices on a more detailed time scale, we can get a better idea of what caused what.
I see construction following population trends in the first two graphs. That’s not saying anything about prices. The FRED graph shows the housing consumer price index, not raw rents. I’m not sure how they define the CPI here, so I’m not sure how to read it.
population trend –
Construction trend –
To me it shows that we have structurally under built for decades. And when demand surges it pushes prices higher. Thats my point on demand being the bigger cyclical driver and supply the bigger structural driver as it determines the imbalance. If you saw just the supply chart, would you think that its for growing population city like SF?
The y/y price chart for SF. I wish it was longer but shows that current period in not unique in the least.
There’s something odd about that “no net new housing was built between 1960 and 1970”. There are plenty of 1960s apartment houses in the city. Maybe that was counterbalanced by the bulldozing of the Fillmore?
Correlation is not causation, but two data points are not even correlation. A 75% rise in rents is quite a lot, while going from 6.6% to 4.7% vacancy rates is not drastic. Perhaps the white-collar workers moving in had something to do with it, as they do now?
I don’t know if building restrictions have a positive effect on affordability. In this market, in particular, I suspect they might have a small effect, but not as significant as that of demand. Overbuilding, however, does have other negative effects. Why should we have clogged streets, lose open spaces and public buildings, etc. if we get no benefit in return?
You can’t account for all factors, but you should at least try. That is standard procedure in epidemiology, for example.
It is remarkable how little has changed in how people talk about the situation. What *did* change, from the same report, is that SF reportedly built 59,000 new housing units between 1950 and 1960, apparently moderating prices and availability, but upsetting people who wanted a city of large families instead of professionals with small households who were willing to live in relatively small units in relatively tall buildings.
And then the 1960 zoning code happened, and the 1964 height limits happened, and apparently (according to the Census) *no* net new housing was built between 1960 and 1970, only replacement of existing units, and rent increased by 75% over the decade and vacancy fell from 6.6% to 4.7%. Correlation is not causation, so it’s hard to say that the new restrictions on buildings caused the price increases and availability decreases, but it’s also hard to imagine that there was no connection.
If you are not arguing that supply restrictions can reduces prices we are good! Because it follows that at worst less restrictions should have no impact. In that case there is no downside for affordability to less restrictions and we should thus be in favor of it!
Tim and Campos etc are arguing the opposite which is unfortunate.
I dont thinks it sloppy science since they arent trying to control for every factor. In econ (as an economist) that is not a realistic expectation as apposed to physical sciences. There are too many factors! 🙂
Obviously all works can be done better.
The majority supply research is asking given a level of demand, what does more or less restriction do to prices? And the conclusion is that more restrictions increase prices to varying degrees.
Demand is clearly a huge driver of prices and probably a more dominant driver than supply at least in a cyclical sense. I agree with this totally. The question is what do we do about it since we have agreed that restricting supply is not beneficial. I think there is little we can do practically at the local to bridge the imbalance from the demand side.
You may be right, but I still have the nagging feeling that if San Francisco could house people of all income levels for its first 150 years, these last 15 years are an anomaly, and something should be reversible. The same goes for London, New York, etc.
Ultimately, income inequality is the one single universal factor which will have to be reversed. In other words, if tech executives earned the same as teachers, they would all be competing equally for the same housing. When that happens, we can and should talk about building more.
Despite all the things we are discussion, this is happening:
Condo prices fell in Q1! I think speaking with a real estate agent, its due to a lot of condos coming on the market in the last 3-4 months. That point is anecdotal but I think reasonable in by view.
Leaving aside the econ, this is what I think in summary –
We have a large gap between current demand and supply for housing in SF. We can argue and blame whoever for how and why we got here but we are here.
Supply will take took long to catch up to make a real dent.
And it is not possible to stop demand for living in a place like SF outside of recessions etc. There are enough people in the US and the world who will always want to and find a way to live in or own housing in SF. No matter what taxes you throw at them.
And stopping the demand is not even enough if it was possible. You need to DESTROY demand. Make people who are hear leave. Just cant see it happening.
So unfortunately we can talk all we want on here, SF will remain one of the most expensive places in the world.
Focusing on demand doesn’t give you us any solution to the housing problem, because you can’t really control demand. The basic fact is that we need more housing for people, so we should support policies that deliver us that result most effectively. I really wish we did not have Prop 13 in CA so we could raise property taxes on wealthy people like you who actually own homes in SF. Then maybe you would actually start to feel the pain of us renters and realize that we actually need a solution to this problem.
I am trying to be patient, but when you say “No where does it suggest that more supply restrictions can reduce land prices”, I have to repeat myself and say, that is not what I am arguing.
As to the papers, none of them (except Malpezzi’s) try to see the effect of demand is a better predictor of affordability than supply. Most of them don’t try to account for any factors except regulation. That’s just sloppy science. You need to look at every plausible factor, not just the one whose effect you want to prove.
The analysis on the impact of supply is for a given level of demand and implicitly its accounted for IMO. And they are doing it for urban counties in California. That is accounting for geography. You cant run a cross sectional analysis on just LA and SF.
Thanks. I had not seen that. The Aura paper has price to supply elasticity as negative! At best it suggests that the it would take a lot more supply to reduces prices. No where does it suggest that more supply restrictions can reduce land prices.
So even the paper you site shows negative price elasticity to supply, what is the basis for your belief that more restrictions will help SFs housing crisis? You can say that the impact is too little (and I would agree since the gap is too big between the demand and supply) – but you have argued that the impact would be positive i.e. more restrictions reduce prices. If thats not the case then I dont have an issue on this point.
I disagree with your take away from the lit review. Q&R you say doesnt tell you the mechanism. But the they are telling you that. It increases the building costs (taxes, risks, time, etc) and thats the link to higher prices.
Ihanfeldt makes the same point.
I cant remember which paper (and dont have energy to find out) address your point on causality.
My takeaway (and I believe the economics communities consensus) is in line with Furman’s. Nothing suggests more restrictions reduce prices. Lots of work shows modeled and empirically, the more restrictions are at least correlated with higher prices. The point is that all these folks are not pulling this view out of thin air.
If you remain unconvinced at least I tried and you did as well.
What you think of Tims seniority based housing view btw?
PS – I very much appreciate you engaging on the argument with me in a very civic manner. Not common these days. So thanks.
“For example, we show reasonable conditions under which, even if every building in Manhattan were 100 stories tall, prices would fall by less than 15 percent.”
“prices would fall by approximately thirty percent if land supply doubled in
the largest coastal cities”
“maybe some tech companies will decide they would be better off in Detroit, which would be a wonderful thing for Detroit and for SF.”
I suspect it would be a bad thing for Detroit, just as it is now for West Oakland.
If you advocate rationing housing by seniority don’t be surprised when young people organize and vote against you.
(In case wcw’s comment is deleted, these are tweets by local cartographer Eric Fischer, with photos of documents going back 40 years, which show quialitatively similar concerns to the present ones: gentrification, especially in Noe and the Castro, and the gap between high-income white-collar workers and other residents, etc.)
More of the same. They regress measures of affordability against measures of supply, without trying to account for demand (or geography, or any other factors).
Leaving aside all sorts of economic realities and research showing restrictions of supply raise prices, can you explain how you think this seniority basis will be implemented without being unconstitutional? Do you honestly believe that its a solution that is practically possible?
What has lead you to believe that seniority based allocation of housing will be a net positive for the community? Other than your personal belief, can you point the readers so something?
Otherwise its no different that the people advocating for BREXIT. They have zero credible evidence to support their views.
I gave a long reply to your comment in that thread; unfortunately the thread had already become stale, and that comment probably wasn’t read by anyone:
There are many reasons that cities were cheaper in the 1960s, including the White Flight you discuss (and the oil-company and car-company policies of creating freeways to encourage sprawl ….) Demand side? I think housing in a place like SF in a disaster like this one should be based in part on seniority. The people who have been here the longest have the most right to stay. If there’s too much demand for too little supply, money shouldn’t be the defining factor. If that means new high-paid workers have to live in Antioch, instead of low-paid longtime residents being forced out to Antioch, well, maybe some tech companies will decide they would be better off in Detroit, which would be a wonderful thing for Detroit and for SF.
Supply? SF ought to charge developers and tech companies and the wealthy reasonable taxes to take as much housing as possible out of the private sector. The private sector can’t and won’t solve the problem. Why isn’t Nancy Pelosi fighting to HUD money for cities? Why aren’t Clinton OR Sanders talking about the fact that the HUD budget today, under Obama, is less than 20 percent of what it was in the pre-Reagan era?
My overall rule on housing in a crisis is: First, do no harm. First, don’t make things worse. Which is what the mayor and his allies have done.
Also this from the California CAO:
“Considerable evidence suggests that construction of market–rate housing reduces housing costs for low–income households and, consequently, helps to mitigate displacement in many cases.”
Please note the emphasis on the word evidence.
Six college students just moved into the illegal 3-bedroom basement apartment down the street from me. They are paying $550 EACH to share a bedroom. When I asked them why they were willing to pay that much, their answer was “it’s cheaper than the dorms”. Makes me wonder how many college-going students are in SF and how the cost of tuition and room and board is affecting SF’s housing crisis.
Exactly. Hopefully Tim will address this key point.
Also there is a litany of research showing more restrictions are negative for prices (amongst other negatives). Tim needs to show us WHY the entire body of research and analysis and data is wrong and he is right. This is no different than climate denial as I have said before.
Demand side solutions are various forms of restrictions that I show ample (hopefully!) evidence of being largely counter productive. See my other post for links if interested.
Also its not sufficient for Tim or anyone to say what they believe should happen just because they feel or think or want it to be the solution. You have to show evidence to back up your claims. Especially as a journalist. Just theorizing and blaming ‘101 or supply side economics’ without evidence shouldn’t be acceptable.
Yeah, Tim, where’s your coverage of the Lafayette lawsuit? Where’s your campaign for a 1960s style building program in the suburbs?
The nexus study doesn’t show that building more market rate housing makes the affordability problem worse. In order to show that, it would have to show that the high income people moving into SF would not have moved here, but for the new housing. And it doesn’t.
You can read more here if you want: https://docs.google.com/document/d/1SZDmWSM9r5ff7Au4aXPmZocnmms75poLbg-IWFGtb1A/edit
First of all the author of that piece is a Bay Area native and longtime resident, so it’s not like he “suddenly discovered that housing is an issue in San Francisco.”
“One of the main reasons that counterculture types flocked to places like North Beach and the Haight in the 1950s and 1960s? The rent was cheap.”
And why was rent cheap? Because racist housing policies, like cheap GI Bill-funded Mortgages, lured white people from cities and into newly developed suburbs.
So Tim, you love to harp on the demand side. Would you care to offer specific policy proposals as to how we tamper demand? Simply opposing supply side arguments won’t get us affordable housing.
Y (and Tim) – I replied a few days late to your comment related to the Krugman article and his not giving enough evidence. I wanted to reiterate the evidence.
In case you cant read (time consuming) all the research this first link below explains the impact of greater regulations on communities (what you wanted Krugman to do better I think as it explains in the article AND provides tons of evidence and links):
My hope is that I am presenting enough evidence (empirical analysis), and peer review scholarship to make the case against the demand side solutions (i.e. regulations of various sorts on zoning, etc). Almost all (I hesitate to say all since there can always be something I havent seen) the work over decades, geographies, controlling for income, etc generally shows similar results.
If you still have a counter view, please provide concrete reasons for it other than intuition and ideology.
P.S. – Tim – this is not ‘econ 101 theorizing’ as you like to say. This is robust empirical peer reviewed and generally accepted economic consensus extensive work.
George Mason University
White House summary of multiple research works (over 10 links in article to related research)
NBER and the NY federal reserve:
Journal of Urban Economics:
Regional Science and Urban economics and Colombia University:
Quigleys research at Berkley
The buses must have had some effect on bringing in tech workers and driving up prices, but I would guess that the direct economic effect was not as great as the psychological one.
I completely agree — but SF made it easier to live her and work on the Peninsula by legalizing the Google buses.
Of course, if SF and a bunch of other big Bay Area cities had decided to put the brakes on tech, that would be a different story. Mountain View, Sunnyvale and Cupertino are at least equally guilty.
The idea that “Mayor Ed Lee decided that turning SF into a center for tech companies was a great idea” is laughable. There were plenty of tech companies in SF during the dot com boom, and Silicon Valley isn’t that far away.
TLDR: The old white guy gets defensive because he’s totally called out by a NYTimes article. Same old white guy trots out old talking points about how the housing crisis in SF is just not simple and how SF is just such a special snowflake that the laws of supply and demand do not apply
1. “Demand” is not just the number of people living here. Postwar SF population peaked at 827K, only slightly less than at present, without the price increases. It’s the shape of the demand curve that matters. In particular, it’s that the people seeking housing now have a lot more money than the rest, and are bidding up prices.
2. While I have no love for Ed Lee’s bring-in-the-tech-business policy, I doubt that it’s a major factor in bringing in so many high-paying housing seekers. High tech jobs and the people who commute to them are scattered throughout the region. If Twitter didn’t get their tax break, they might have set up shop in town anyway. That was just an exercise in training City Hall to roll over. If Twitter and Salesforce weren’t here, they’d be down the peninsula, and would have their shuttle service, same as the others.
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