The only two ways out of the eviction crisis

Either we treat housing as a tightly regulated utility, or we take it out of the speculative private sector altogether. If there's another option that works, I don't know what it is

We are all talking this week about the eviction of seniors, about how San Francisco has become such a hostile place for long-time residents. We are talking about how so many of the young people who have in the past brought new life to the city (the ones who aren’t rich, anyway) are now talking about leaving – and I think it’s safe to say than much of the current generation of young people looking to make a start in the dynamic US city are going somewhere else. You just can’t afford to come to SF and start life – not without a trust fund or a high-paying job.

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I have always said that we can’t solve this problem just by looking at housing supply, that the demand side is also a factor. You can’t decide to become the finance and real-estate capital of the West Coast without making sure the developers who built the highrise offices also provided housing (huge planning mistake in the 1970s and 1980s leading to suburban sprawl, an early housing-cost boom, traffic problems, and underfunded transit). And you can’t decide to be the tech capital of the world without understanding that there’s not enough living space for all the people who are going to arrive here from someplace else to take those tech jobs.

It’s astounding, the failure of local urban planning. It’s as if the only thing that matters is creating jobs (mostly for people who don’t live here) and ensuring developer profits, and the consequences for housing, transit, and infrastructure don’t count.

I have been having these talks with local housing activists, and we can demand an increase in the percentage of affordable housing in market-rate development, which is good. We can use whatever resources we can wrangle to build more permanently affordable housing, which we need to do. We can fight evictions, which we have to do. All of that will help.

But in the long term, I can think of only two ways to get out of the eviction crisis: regulate housing as a public utility, or take it entirely out of the speculative private market.

 

The public-utility model

If the state Legislature were willing to go along, we could block a lot of evictions and create effective rent control. We could start treating housing as a public utility, not a commodity.

That’s what some cities did in the 1980s, when they established rent control that applies to vacant apartments. Berkeley, West Hollywood, and Santa Monica set base rents for all housing units, which would never rise by more than an annual inflation-based adjustment, no matter who lived there. Tight regulation kept rents low in those popular cities, and it was not only difficult but pointless to try to do a no-fault eviction. No money in it.

Essentially, those cities said housing was a human right, and that as long as it was in the private sector, the market had to be tightly controlled. Landlords were allowed to make a profit, but not unlimited profit.

Landlords who howled about the concept that housing would fall into disrepair were blowing smoke. Those cities did just fine under strict rent regulation. Landlords who didn’t maintain their units were cited. Very few buildings were ever abandoned – and under serious housing regulations, the city should have the right to seize those properties anyway.

The landlords went all the way to the US Supreme Court to try to block effective rent control, and failed. Starting in the mid-1980s, they went to the state Legislature year after year to outlaw rent controls on vacant apartments. Every year, their bill passed out of the state Assembly. Every year, it got to the state Senate, were David Roberti was the president pro-tem, representing West Hollywood. Every year, Robert refused to allow the bill to come to the floor (where it almost certainly would have passed.)

Then term limits forced Roberti out in 1994, and a year later, the bill became law.

I talked to Roberti a few months ago, and he’s still proud of what he did to save affordable housing for a decade. “It wasn’t going to happen on my watch,” he said. But he wasn’t there to stop it forever.

The Costa-Hawkins Act outlaws effective rent control and encourages evictions of long-term tenants. It mandates that cities allow rents to rise to market rate whenever a unit becomes vacant, forbids rent controls on some types of housing, and bans all rent control on buildings constructed after 1995.

Landlord advocates said it would encourage developers to build more rental housing, and thus bring prices down. Note how well that’s worked.

Now Tenants Together, a statewide organizing group, is getting a lot of traction on efforts to change the pro-landlord climate in the state Legislature. A Santa Monica legislator has introduce a bill to repeal Costa-Hawkins, and even the California Apartment Association is saying it could pass.

If it does – and that’s still a big if in a very pro-landlord Legislature – then San Francisco will have a political battle over rent control the likes of which we haven’t seen since 1985, when then-Sup. Harry Britt got seven votes for a vacancy-control bill – and then-Mayor Dianne Feinstein vetoed it. One more vote on the Board of Supes and we would have had real, working rent control in this town. It was one of the clearest litmus-test issues you could find: You were with the tenants on the biggest agenda item they had, or you were with the landlords. No room for the squishy center to hide.

I’m pretty sure that six of the current supes would side with the tenants if vacancy control came before the board – and incumbents facing re-election, like Jeff Sheehy, would be forced to take a difficult stand. Could Mayor Ed Lee, a former tenant lawyer, actually veto that law? If it didn’t pass, could anyone running in 2018 who wouldn’t commit to supporting it get elected from any but the most conservative districts?

Who would vote against expanding rent control to all units in the city? (Developers would still build luxury rentals — rent control starts with the existing base rent. So there wouldn’t be much impact on new housing.) But existing tenants would get real protection, the air would escape from the speculative bubble, and most San Franciscans would be way better off.

The social housing model

That’s if the state acts, and functional rent regulation becomes part of the picture. There’s one other long-term solution that will transform San Francisco’s housing situation. We could take as much housing as possible out of the private, for-profit sector, permanently.

There are baby steps now. The city has committed a few million dollars for small-site acquisition, to allow land trusts to buy up properties that would have been sold to private speculators and turn them into permanently affordable housing.

But imagine if our top priority as a city was to buy every unit that goes on the market, to begin a 30-year plan to convert at least half of the existing private rental housing stock into housing owned and operated by nonprofits or land trusts and kept affordable forever.

It’s crazy how much housing costs, which makes my idea crazy expensive. It’s also crazy expensive to build subways, but then-Sup Scott Wiener insisted that the city craft a long-term plan for underground transit, which is the only way to move people quickly around a city with traffic-clogged streets.

I have been talking about this for at least 25 years, and sometimes I want to cry: There was a time when the city could have bought most of the three- and four-unit buildings in the Mission for $100,000, and we didn’t. Now those are going to cost $1 million. Five years from now? Maybe even more.

And yet:

Friends of the Urban Forest reminds us that the best time to plant a tree was 25 years ago. The second best time is now. Legend has it that when Julius Caesar was marching his troops through the heat of an Italian summer along the Appian Way, he ordered one of his lieutenants to begin planting trees on both sides of the road, to shade the troops from the sun. “But Caesar,” the junior officer said. “It will take decades for the trees to grow.” Yes, Caesar responded – “that’s why you need to start right away.”

Every piece of residential rental property that is taken out of private, for-profit hands is a housing unit that is saved, a series of evictions that are prevented, a group of tenants who will never face homelessness.

Let’s say the average price for a housing unit that goes on the market today is about $600,000. (That means a median three-unit building goes for $1.8 million.) We can argue figures, but I’m somewhere in the ballpark.

So we can buy 1,000 units for $600 million. Do that for 30 years, and a significant part of the rental stock is out of the private market. If we had started 30 years ago, at least a quarter of all the rental units in the city would be social housing – owned and operated either by nonprofits, or tenant co-ops, or land trusts, where no rents would ever go up beyond the level needed to maintain the place and no tenants would ever be evicted so a landlord could make a profit.

There are plenty of social housing models. Limited-equity co-ops allow people to buy their units, and live there with all the rights of ownership – except the right to sell for a profit. Nonprofit affordable housing is run by community-based organizations who set rents based on income levels. Land trusts allow tenants to buy their units – but again, they can’t be sold for profit.

The city doesn’t have a great record running public housing, but that doesn’t mean the model is all wrong. It just means the city has done a terrible job with it.

In some cities (Hong Kong, Stockholm, others) more than 80 percent of the housing is social housing of one sort or another.

As long as landlords can make huge profits evicting tenants, we are going to fighting building by building. If we can regulate the profit out of evictions, we can slow this down. If we can get the private landlords out of the housing picture entirely, we can turn it around.

Otherwise, we are going to be fighting eviction after eviction for the rest of our natural lives.

I anyone has a better idea that might actually work, I’m listening.