The Chron put the story on the front page of the Sunday paper: There is no housing crisis in San Francisco.
It is a good time to be condo shopping in San Francisco — if you happen to be rich.
From the Embarcadero to Yerba Buena Island to Nob Hill to South of Market, the wave of deluxe condo offerings washing over the city will test the upper reaches of one of the nation’s priciest housing markets.
For the wealthiest people in the country, who are looking to invest in SF real estate, there are all sorts of great options for new luxury condos in the city. Developers have been building lots of new homes; they just cost around $5 million or more.
The cheapest of the new options: About $1.3 million for a one-bedroom unit. That’s about $6,000 a month in mortgage and taxes, assuming the buyer has $130,000 cash to make a ten-percent down payment. To afford that low-end unit you would need an income of $218,000 a year.
Of course, many of the folks who will be buying these condos aren’t going to have to worry about that:
Paul Zeger, who is heading up sales at One Steuart Lane [said]:“The buyers for these homes are not people worried about paying the mortgage. This is not necessity housing. This luxury is for the discerning buyer.
From Polaris Pacific research director Miles Garber:
Buying a unit in one of these buildings is, Garber said, “a discretionary purchase.” They are to shelter what a Maserati is to transportation.
In fact, according to the story by J.K. Dineen, the private market today is only delivering one type of housing:
Only two sorts of projects make economic sense: developments for the superrich and subsidized affordable projects for very low-income people. Housing for everyone else is increasingly difficult to finance.
Part of that, developers complain, is the approval process and the time it takes to get a project through. But even if we went the way of Houston and eliminated all zoning and let anyone build anything anywhere they want, the cost of land, construction materials, and labor would still make it impossible for any developer to get financing to build even remotely affordable housing for most working San Franciscans.
John Rahaim, the outgoing planning director, says that the new condos for the rich will take some of the pressure off the rest of the market; these folks won’t be competing for existing housing:
Rahaim said he has mixed feelings about the deluxe condo market, but that it’s part of the city’s housing scheme.
“If we don’t build it, people with those incomes will find other places to buy, and that will push other people out,” he said.
Actually, maybe not:
Sotheby’s broker Gregg Lynn said a client flew in from Hong Kong last week to look at the Four Seasons project. … Broker Mia Takami said she recently put two units in contract for clients at the Four Seasons residences. One of her clients plans to buy condos in both the Four Seasons and One Steuart Lane.
“My clients are CEOs of startups,” she said. “They have a lot of money to spend, and they want to spend some of it on real estate. He likes the Four Seasons because of the services and lifestyle and One Steuart Lane because it’s the last waterfront project.”
Clients from overseas who invest in local real estate (and then leave the units empty) and clients who buy a couple of condos, because what the hell, they have plenty of money, are not doing anything to help affordability in San Francisco.
Then we have Willie Brown, who in his Chronicle column today said that government can’t solve the homeless crisis. It’s a remarkable statement that essentially says nothing (short of locking up mentally-ill people) will make any difference:
Newsom’s decision to very publicly declare war on homelessness may be well intentioned, but in terms of the politics, it’s a mistake.
The key to good politics is solving problems you can solve. And as we have seen in San Francisco, government cannot solve homelessness.
As a former mayor, Newsom should know this better than anyone.
The three underlying causes of homelessness are poverty, mental health problems and drugs.
No governor or even president is going to wipe out poverty. For years the federal government waged a War on Poverty, and we lost.
The laws that put the “rights” of mentally ill people to wander the streets ahead of their need for care have been a resounding failure as well.
And now we have the scourge of addiction to opioids and meth.
No one has an answer for this problem, let alone the money to implement one. There may be some pilot programs that show promise for a few, but nothing that will work for 151,000 homeless people in the state.
That last paragraph is factually wrong. There are plenty of people with answers to the problem, all of which start with decreasing economic inequality, ending evictions, and building affordable housing.
We don’t have the resources? Seriously? If Newsom just dedicated five percent of the state budget to non-market supportive housing for the next five years, California could house every single homeless person in the state.
What, exactly, does our former mayor think we should do — give up? Elect another billionaire who thinks the market will solve all of our problems?
Apparently that’s Willie’s plan.