13 ms·

Should we build lots more housing in San Francisco?

71 points by Osiris30 9y ago

crb002 9y ago
Deregulate. Let the market decide.
- fredley 9y ago
  What if those in control of the market are those who can benefit more (in the short term) by restricting the supply? A completely free market works well for many things, but not for housing, in part because there is a extremely limited supply of land, and nobody's making any more.
  - Retric 9y ago
    There is actually a lot of land, what makes land expensive is being close to useful infrastructure. But, the median cost of an acre of land in the US is still well under 10k.
    - falcolas 9y ago
      That median acre is also in the middle of nowhere with no power, water, sewer, or roads within thousands of feet, if not miles. It's probably covered in wheat or corn too.
      - Retric 9y ago
        Well sure, but again you can still generally turn that into a house with water and power for vastly less than a tiny SF condo. Hell, you can even add both a small airstrip and an airplane and still be less executive than a SF condo. Or skip the land and buy a solar powered houseboat which can go just about anywhere for less than a 600sf condo.
  - snidane 9y ago
    How about you make the rules of the game fair in the first place and then let the market work. Let the owners of land pay price for having that privilege (land tax) and only those who make use of that land will hold it. If they decided to just hold the land out of use, they would pay the taxes for you, so it would be win win.
    - fredley 9y ago
      Exactly. Parent was suggesting deregulation. Making the rules of the game fair is regulation.
- jonbarker 9y ago
  If you deregulate in a market where a group (homeowners and landlords) is already invested, you likely end up with a scenario in which the local politics favor investors and not tenants. While deregulation seems like it might work it would require a blank slate, and no city is a blank slate.
  - bcoates 9y ago
    The local politics are always going to side with the people with power and money, that's what politics is. The point of deregulation is to lower the influence of the powerful, which is mostly expressed through their iron grip on local politics.
    - mcguire 9y ago
      Because government is the only avenue to express power, or because deregulation makes power disappear?
      - bcoates 9y ago
        Because, in practice, governance is positive leverage on power. Rich people are still more powerful than average/poor people in the absence of intensive, high-impact statist government, but the rich people:everyone else power ratio in traditional western governance is long regulation.
    - dragonwriter 9y ago
      > The point of deregulation is to lower the influence of the powerful Except all actual concrete deregulation proposals are backed by powerful interests, and not because it reduces their power. Now, the sales pitch to the public might be about reducing the influence of the powerful, but that's never the actual goal sought by the powerful backers. At best, it'd reallocation of power from one segment of the powerful to another, but more often it's just loosening constraints on the powerful.
    - jonbarker 9y ago
      I agree that politicians typically side with the powerful but I think a good working definition of politics is the rhetoric used by politicians in public and private meetings. This rhetoric can theoretically benefit any group.
- dredmorbius 9y ago
  The market seeks asset price inflation through supply constraints. https://www.reddit.com/r/dredmorbius/comments/608w97/asset_price_inflation_of_maslovian_and_productive/ https://www.reddit.com/r/dredmorbius/comments/608w97/asset_p...
- CPLX 9y ago
  The market on its own will ruin cities. Unless you're enamored with Houston. Classic tragedy of the commons problem. In an actual literal sense in this case, as we all have to share "the commons" in cities.
  - jostmey 9y ago
    At least Houston is affordable. Lower income families have places to live. Sure, San Francisco and many other cities may be nicer when you are rich
  - bcoates 9y ago
    What's wrong with Houston that growth restriction would solve? Assuming your point isn't "I don't like Houston and wish there were less of it." It's not like those last 2 million people are what prevented it from being a 1000 year old, bike-friendly northern european hamlet or something.
    - CPLX 9y ago
      Perhaps I've been misunderstood. I strongly believe in growth and density and believe the SF approach is literally insane. I live in New York City where we have our problems but appear to know how to actually build housing for people. But with that said, a knee-jerk cry of "deregulate" isn't going to be much better. The right answer is to figure out a more thoughtful system that enables the market to be channeled properly. Which basically all modern successful cities have figured out.
      - humanrebar 9y ago
        > I live in New York City where we have our problems but appear to know how to actually build housing for people. Uh... housing costs in NYC are pretty ridiculous. Commute times as well. The furor over the subway wouldn't be as pronounced if everyone had relatively short commutes.
        CPLX 9y ago
0x4f3759df 9y ago
I come to understand that its not legally/economically feasible to build affordable housing largely from this post "I'm an architect in LA specializing in multifamily residential. I'd like to do my best to explain a little understood reason why all new large development in LA seems to be luxury development" https://www.reddit.com/r/LosAngeles/comments/6lvwh4/im_an_architect_in_la_specializing_in_multifamily/ https://www.reddit.com/r/LosAngeles/comments/6lvwh4/im_an_ar...
- 48snickers 9y ago
  The reasons outlined on that thread are very specific to the Los Angeles area. Not that crazy regulations don't exist in SF, but the car-centric parking space regulations in Los Angeles are a huge part of the outlined cost. I don't think that applies broadly.
  - loeg 9y ago
    Car-centric parking space regulation is very common in American cities, not just LA.
    - mandelbrotwurst 9y ago
      I don't know this for sure, but as someone who lives in SF, I would guess that's less the case here than in LA. The city is much less supportive of private vehicle ownership (for good reason imo, but that's a bit off-topic) than most cities in the U.S.
      - dkasper 9y ago
        That's true now but up until the 2000s SF did have residential parking requirements for most of the city.
    - ryandrake 9y ago
      And thank goodness for that! As much as everyone here hates cars, the unfortunate fact is we currently need them. If I could snap my fingers and be able to afford a $1.2M "starter home" within walking distance to work, trust me, I would do it in a heartbeat. If there were any politicians serious about building useful public transit, I'd vote for them. But, for now, at least in most metro areas (where the jobs are), most people can only afford to live in places where you need a car to get anywhere.
sogen 9y ago
Isn't SF an earthquake area?
- Moshe_Silnorin 9y ago
  I agree; an off-the-charts earthquake is the only practical solution to bay-area NIMBYism.
  - sogen 9y ago
    Yeah, I've heard SF is mostly 3-story buildings "so flimsy walls don't kill you in the event of an earthquake ".
  - kofejnik 9y ago
    what's so wrong with NIMBYism?
    - davidw 9y ago
      Because it hurts people - and mostly those who are poorer or middle class: https://www.nytimes.com/2016/07/04/business/how-anti-growth-sentiment-reflected-in-zoning-laws-thwarts-equality.html?_r=0 https://www.nytimes.com/2016/07/04/business/how-anti-growth-... https://www.washingtonpost.com/news/wonk/wp/2016/08/10/why-cities-need-to-care-more-about-works-in-them-not-just-who-lives-in-them/?utm_term=.468a99556d40 https://www.washingtonpost.com/news/wonk/wp/2016/08/10/why-c...
      - kofejnik 9y ago
        it hurts some people (those who want to live in SF), but it helps other people (those who already live there), pretty much like any other resource with finite availability
        davidw 9y ago
        Yes, a bunch of rich people get richer, and the poor get poorer because they can't access jobs in one of the most productive, wealthy parts of the country. All because we don't allow the market to function properly. Seems like a failure to me. Here's Ed Glaeser: "Reforming local land use controls is one of those rare areas in which the libertarian and the progressive agree. The current system restricts the freedom of the property owner, and also makes life harder for poorer Americans. The politics of zoning reform may be hard, but our land use regulations are badly in need of rethinking." https://www.brookings.edu/research/reforming-land-use-regulations/ https://www.brookings.edu/research/reforming-land-use-regula...
projectramo 9y ago
This post could benefit greatly from a little more quantitative analysis. The first, and main point, about whether the supply would appreciably drop the price is a great example of where it is needed. Has there been any study of the elasticity of house pricing? Give us the range, and then we know roughly how much housing it would take to drop the price by $10/sf. Then let's see how much extra housing we could build, and what the bottlenecks are. Now we are having a conversation. Otherwise it is just intuition mongering (which, by the way, is a useful and noble exercise as well, but it is not complete). Edit - I found some: http://urbanpolicy.berkeley.edu/pdf/HQ_REStat80.pdf http://urbanpolicy.berkeley.edu/pdf/HQ_REStat80.pdf http://budgeting.thenest.com/price-elasticity-affect-housing-industry-23106.html http://budgeting.thenest.com/price-elasticity-affect-housing... https://www.rand.org/content/dam/rand/pubs/reports/2009/R2846.pdf https://www.rand.org/content/dam/rand/pubs/reports/2009/R284... Berkeley and Rand, so trying to cover different views.
- Analemma_ 9y ago
  > This post could benefit greatly from a little more quantitative analysis. It sounds like she's just articulating the arguments of both sides, rather than taking a stance herself, so I don't know how much quantitative analysis would really improve it.
- jobu 9y ago
  > This post could benefit greatly from a little more quantitative analysis. The article does actually mention quantitative analyses some, and why critics dismiss it: Critics think advocates put too much trust in quantitative analyses which try to estimate the effect of supply on prices. (Like this one [1] which estimates that adding 5,000 new units each year would be enough to stabilize real prices.) Such studies inevitably make dubious simplifying assumptions, and it’s all too easy to set up an analysis to get the conclusion you want. [1] http://experimental-geography.blogspot.com/2016/05/employment-construction-and-cost-of-san.html http://experimental-geography.blogspot.com/2016/05/employmen...
  - projectramo 9y ago
    I don't think the quant analysis eliminates debate (i.e. it will have advocates and critics). However, it does focus the debate on better issues. The question of housing may hang on exactly how much new housing is introduced by allowing people to kill more birds, for instance. Without the quantification, you might still be arguing about how much green space should be mandated. (These examples are pulled out of thin air). To put my point another way, the absence of criticism is not a benefit of quant analysis.
dredmorbius 9y ago
How have housing prices changed relative to wages from 1965 to present in the US? They've doubled. https://fred.stlouisfed.org/graph/fredgraph.png?g=ekXr https://fred.stlouisfed.org/graph/fredgraph.png?g=ekXr https://plus.google.com/104092656004159577193/posts/Akjfruv9zbe https://plus.google.com/104092656004159577193/posts/Akjfruv9... San Francisco rents over 70 years, showing a 6.6% annual rate of increase. https://medium.com/newco/a-guy-just-transcribed-30-years-of-for-rent-ads-heres-what-it-taught-us-about-sf-housing-prices-bd61fd0e4ef9#.r7qldtd56 https://medium.com/newco/a-guy-just-transcribed-30-years-of-... 6.6 percent is 2.5 percentage points faster than inflation, which doesn’t seem like a lot but when you do it for 60 years in a row it means housing prices quadruple compared to everything else you have to buy. That’s bad. But that’s SF today, compared to 1956. So what caused prices to go up? That’s the really exciting part of Fischer’s discovery. Armed with his data, he more or less answered that question.... It would take a 53% increase in the housing supply (200,000 new units), or a 44% drop in CPI-adjusted salaries, or a 51% drop in employment, to cut prices by two thirds. Why the increase? Asset price inflation of Maslovian goods. https://www.reddit.com/r/dredmorbius/comments/608w97/asset_price_inflation_of_maslovian_and_productive/ https://www.reddit.com/r/dredmorbius/comments/608w97/asset_p...
- mcguire 9y ago
  Thanks for that! The article you link to as "some pretty persuasive criticism of Fischer’s initial model"[1] is also very good. One highlight: "These kind of responses miss the simple fact that of the three variables in Fischer’s model, only employment and wages really matter. (The demand-only model achieves an R squared value of .924 and adding the supply variable, housing units, gets us to .940)....Another found that the best model of San Francisco rents needs just one variable: wages (although wages and housing were a close second)." I think that kind of confirms my gut feeling on first hearing about the problem years ago: the issue is that there is too much money flowing into (a particular sector of) San Francisco. [1] https://www.theurbanist.org/2016/05/27/rents-in-san-francisco-are-determined-by-demand-new-data-show/ https://www.theurbanist.org/2016/05/27/rents-in-san-francisc...
  - wbl 9y ago
paulpauper 9y ago
I don't think building more will help. There will always be a finite number of single-family homes in sought-after areas. Building on the outskirts of SF is not a substitute for prime locations
- tmh79 9y ago
  there will only be a legal number of single family homes because we legally require the land to be used for single family homes. Change the land use regulations to change the makeup of the land. If they upzoned the land from RH-1 to RH-4 most of those SFHs would be subdivided into multiple units. Thats the reason many apartments in SF are in divided victorians.
musgrove 9y ago
"We"who? If it was a financially good idea, developers would be or are doing it. How about run some realistic rates of return and market analysis? You may also find the biggest reason: it's unworkable because of current San Francisco culture.
- schoen 9y ago
  A lot of the political debate relates to the regulatory difficulties that developers encounter, and reducing the ability of neighbors and/or politicians to exercise discretion to prevent development projects or place conditions on them.
- Retra 9y ago
  >If it was a financially good idea, developers would be or are doing it. Or not. They could not know it is a good idea, fail to do it, and cause a bunch of problems as a result. That could in fact be the very source of the problems being discussed here.
- rthomas6 9y ago
  Something can be a good idea and unworkable due to political and regulatory hurdles. Just look at broadband access. Or medical records. Two industries that would benefit greatly from some disruption, but we're not seeing much there because of how hard it is for other than market reasons.
jseliger 9y ago
One important question too is, "When did the housing market in SF shut down new development?" I address related questions here: https://jakeseliger.com/2015/09/24/do-millennials-have-a-future-in-seattle-do-millennials-have-a-future-in-any-superstar-cities/ https://jakeseliger.com/2015/09/24/do-millennials-have-a-fut...: Oddly, cities began to freeze in earnest, via zoning laws, in the 1970s. One can see this both from the link and from Google’s Ngram viewer, which sees virtually no references to gentrification until the late 70s, and the term really takes off later than that. Moreover, the book Zoning Rules! discusses how this actually happened: https://www.amazon.com/Zoning-Rules-Economics-Land-Regulation/dp/155844288X?ie=UTF8&tag=thstsst-20&linkCode=as2&camp=1789&creative=390957 https://www.amazon.com/Zoning-Rules-Economics-Land-Regulatio.... The fact that it used to be relatively easy to build new housing as demand increases means that we could make it easy again. This is fundamentally a legal problem (we should not allow so many property rights to be violated by non-owners) and a political problem (we are not addressing housing and issues at the right level of government). It's striking how few affordable housing discussions have a historical view of the issue!
- davidw 9y ago
  That book is awesome - a super deep dive into the nuances of the legalities and economics of zoning. The guy has even visited a number of sites cited in important court cases. I also like "Zoned in the USA" for its comparisons with other countries, particularly in Europe, which - to my way of looking at things - seem to get some things right that are very strange in the US. Here's a bunch of other articles and things I've found interesting/useful: https://bendyimby.com/2017/06/12/yimby-reading/ https://bendyimby.com/2017/06/12/yimby-reading/
- pmoriarty 9y ago
  Have the changes of the kind you advocate happened anywhere else in the United States? How did they manage to do it?
  - 0x4f3759df 9y ago
    Duany Platter-Zyberk made some nice things. http://www.dpz.com/Projects/All http://www.dpz.com/Projects/All
timothycrosley 9y ago
You keep telling yourselves that while we in Seattle keep building and funneling more people that would have lived in San Francisco here because we're able to keep up with Demand ;)
- delecti 9y ago
  The 10% rent increase I'm looking at this year leaves me skeptical of your argument that Seattle is adequately keeping up with demand.
  - futhey 9y ago
    I'm actually pretty proud of Seattle's efforts to re-evaluate zoning regulations in the late 2000's. Almost every neighborhood has been zoned to build taller, and if we're speaking strictly about rents, it's been quite effective. The city added just under 200,000 new residents (2005 - 2017), and the increases in mean rent costs were comparatively modest when compared to increasing demand (https://goo.gl/zadHW6 https://goo.gl/zadHW6). There has still been a noticeable increase, but in part because the City of Seattle underestimated the rate of future growth in demand (https://goo.gl/QKpb36 https://goo.gl/QKpb36). (The city is actually making moves right now to increase housing supply over the next few years to prevent accelerating increases in rents). Demand, however, is not the only factor commonly cited as putting pressure on housing prices. As tech workers flood the city and mean incomes outpace inflation (which has a positive effect on the overall economy), their purchasing power increases. New construction is of comparatively higher quality, especially in neighborhoods like Capitol Hill, which was not nearly as desirable before 2000. This is another part of the “noticeable increase”. As neighborhoods become more desirable (such as SLU, Ballard, and Capitol Hill), residents suddenly find themselves paying a premium (which is not reflected in mean pricing). I believe this is much of what has contributed to the idea that rents have risen dramatically (even when the data says otherwise). Things may not be optimal (there are certainly challenges with market mismatch and misplaced incentives), but I don't think anyone in the industry is saying the major challenges are regulatory.
- grillvogel 9y ago
  does the ";)" mean you're being sarcastic, because I have no idea how you reached that conclusion otherwise
ensiferum 9y ago
Can't be done. Anything that would lower the cost of housing can't be done because rich ppl (property owners) would lose money.
- cjlars 9y ago
  There's probably a natural balancing mechanism -- prices go too high, renters are outraged and are moved to action, prices go too low, owners are outraged and are moved to action. Looks like we're in the first zone right now.
Robotbeat 9y ago
Of course we should build more housing. Unless we've decided we're against growth on principle and want housing to remain expensive and growth to stagnate. (The ecological argument against growth in this case is backwards, though. Urban development is less resource intensive than the alternative of suburban or exurban development that uses up a lot more land and requires much longer commutes. And urbanization also tends to suppress birth rates, if you're concerned with very long-term ecological consequences.)
mc32 9y ago
My sentiment has always been we need a regional (ala ABAG) authority which has oversight over regional growth so that it would be less haphazard and more coordinated. Yes, build in SF, but also build on the Penn, East Bay, South Bay, etc. and coordinate transit development, zoning, etc., etc.
- tmh79 9y ago
  you should call your state assembly person and have them vote yes on SB35. This bill gives teeth to the RHNA numbers and provides an accelerated pathway to approval for certain developments if the cities are not meeting their housing construction quota as mandated by the RHNA numbers.
- specialist 9y ago
  WA State has the Growth Management Act. Like everything else smelling of civility or the public good, it's vehemently opposed by the local "libertarians". https://en.wikipedia.org/wiki/Washington_State_Growth_Management_Act https://en.wikipedia.org/wiki/Washington_State_Growth_Manage...
RobLach 9y ago
If the claim that higher supply doesn't lower prices is accurate, and if we assume that higher density means a higher efficiency regarding city services (which has been historically true), then increasing supply seems like an obvious move since you increase tax revenue which could be directed towards social services that help soften the harshness of the SF housing market.
pascalxus 9y ago
It's absolutely shocking: the degree of lack of understanding of basic economics, especially in a city with such a high percentage of bachelors Degrees!! I'm deeply concerned for the future of our country - I don't want it to end up like venezuela. I believe, economics should be one of the primary subjects taught in school in K-12, that and personal finance (learning how to manage your own money). In this day and age, these are the 2 most important subjects you need to learn. We need an informed citizenry, if we're not going to end up like venezuela.

71 points by Osiris30 9y ago

crb002 9y ago

Deregulate. Let the market decide.

fredley 9y ago
What if those in control of the market are those who can benefit more (in the short term) by restricting the supply? A completely free market works well for many things, but not for housing, in part because there is a extremely limited supply of land, and nobody's making any more.
- Retric 9y ago
  There is actually a lot of land, what makes land expensive is being close to useful infrastructure. But, the median cost of an acre of land in the US is still well under 10k.
  - falcolas 9y ago
    That median acre is also in the middle of nowhere with no power, water, sewer, or roads within thousands of feet, if not miles. It's probably covered in wheat or corn too.
    - Retric 9y ago
      Well sure, but again you can still generally turn that into a house with water and power for vastly less than a tiny SF condo. Hell, you can even add both a small airstrip and an airplane and still be less executive than a SF condo. Or skip the land and buy a solar powered houseboat which can go just about anywhere for less than a 600sf condo.
- snidane 9y ago
  How about you make the rules of the game fair in the first place and then let the market work. Let the owners of land pay price for having that privilege (land tax) and only those who make use of that land will hold it. If they decided to just hold the land out of use, they would pay the taxes for you, so it would be win win.
  - fredley 9y ago
    Exactly. Parent was suggesting deregulation. Making the rules of the game fair is regulation.
jonbarker 9y ago
If you deregulate in a market where a group (homeowners and landlords) is already invested, you likely end up with a scenario in which the local politics favor investors and not tenants. While deregulation seems like it might work it would require a blank slate, and no city is a blank slate.
- bcoates 9y ago
  The local politics are always going to side with the people with power and money, that's what politics is. The point of deregulation is to lower the influence of the powerful, which is mostly expressed through their iron grip on local politics.
  - mcguire 9y ago
    Because government is the only avenue to express power, or because deregulation makes power disappear?
    - bcoates 9y ago
      Because, in practice, governance is positive leverage on power. Rich people are still more powerful than average/poor people in the absence of intensive, high-impact statist government, but the rich people:everyone else power ratio in traditional western governance is long regulation.
  - dragonwriter 9y ago
    > The point of deregulation is to lower the influence of the powerful Except all actual concrete deregulation proposals are backed by powerful interests, and not because it reduces their power. Now, the sales pitch to the public might be about reducing the influence of the powerful, but that's never the actual goal sought by the powerful backers. At best, it'd reallocation of power from one segment of the powerful to another, but more often it's just loosening constraints on the powerful.
  - jonbarker 9y ago
    I agree that politicians typically side with the powerful but I think a good working definition of politics is the rhetoric used by politicians in public and private meetings. This rhetoric can theoretically benefit any group.
dredmorbius 9y ago
The market seeks asset price inflation through supply constraints. https://www.reddit.com/r/dredmorbius/comments/608w97/asset_price_inflation_of_maslovian_and_productive/ https://www.reddit.com/r/dredmorbius/comments/608w97/asset_p...
CPLX 9y ago
The market on its own will ruin cities. Unless you're enamored with Houston. Classic tragedy of the commons problem. In an actual literal sense in this case, as we all have to share "the commons" in cities.
- jostmey 9y ago
  At least Houston is affordable. Lower income families have places to live. Sure, San Francisco and many other cities may be nicer when you are rich
- bcoates 9y ago
  What's wrong with Houston that growth restriction would solve? Assuming your point isn't "I don't like Houston and wish there were less of it." It's not like those last 2 million people are what prevented it from being a 1000 year old, bike-friendly northern european hamlet or something.
  - CPLX 9y ago
    Perhaps I've been misunderstood. I strongly believe in growth and density and believe the SF approach is literally insane. I live in New York City where we have our problems but appear to know how to actually build housing for people. But with that said, a knee-jerk cry of "deregulate" isn't going to be much better. The right answer is to figure out a more thoughtful system that enables the market to be channeled properly. Which basically all modern successful cities have figured out.
    - humanrebar 9y ago
      > I live in New York City where we have our problems but appear to know how to actually build housing for people. Uh... housing costs in NYC are pretty ridiculous. Commute times as well. The furor over the subway wouldn't be as pronounced if everyone had relatively short commutes.
      - CPLX 9y ago

0x4f3759df 9y ago

I come to understand that its not legally/economically feasible to build affordable housing largely from this post "I'm an architect in LA specializing in multifamily residential. I'd like to do my best to explain a little understood reason why all new large development in LA seems to be luxury development" https://www.reddit.com/r/LosAngeles/comments/6lvwh4/im_an_architect_in_la_specializing_in_multifamily/ https://www.reddit.com/r/LosAngeles/comments/6lvwh4/im_an_ar...

48snickers 9y ago
The reasons outlined on that thread are very specific to the Los Angeles area. Not that crazy regulations don't exist in SF, but the car-centric parking space regulations in Los Angeles are a huge part of the outlined cost. I don't think that applies broadly.
- loeg 9y ago
  Car-centric parking space regulation is very common in American cities, not just LA.
  - mandelbrotwurst 9y ago
    I don't know this for sure, but as someone who lives in SF, I would guess that's less the case here than in LA. The city is much less supportive of private vehicle ownership (for good reason imo, but that's a bit off-topic) than most cities in the U.S.
    - dkasper 9y ago
      That's true now but up until the 2000s SF did have residential parking requirements for most of the city.
  - ryandrake 9y ago
    And thank goodness for that! As much as everyone here hates cars, the unfortunate fact is we currently need them. If I could snap my fingers and be able to afford a $1.2M "starter home" within walking distance to work, trust me, I would do it in a heartbeat. If there were any politicians serious about building useful public transit, I'd vote for them. But, for now, at least in most metro areas (where the jobs are), most people can only afford to live in places where you need a car to get anywhere.

sogen 9y ago

Isn't SF an earthquake area?

Moshe_Silnorin 9y ago
I agree; an off-the-charts earthquake is the only practical solution to bay-area NIMBYism.
- sogen 9y ago
  Yeah, I've heard SF is mostly 3-story buildings "so flimsy walls don't kill you in the event of an earthquake ".
- kofejnik 9y ago
  what's so wrong with NIMBYism?
  - davidw 9y ago
    Because it hurts people - and mostly those who are poorer or middle class: https://www.nytimes.com/2016/07/04/business/how-anti-growth-sentiment-reflected-in-zoning-laws-thwarts-equality.html?_r=0 https://www.nytimes.com/2016/07/04/business/how-anti-growth-... https://www.washingtonpost.com/news/wonk/wp/2016/08/10/why-cities-need-to-care-more-about-works-in-them-not-just-who-lives-in-them/?utm_term=.468a99556d40 https://www.washingtonpost.com/news/wonk/wp/2016/08/10/why-c...
    - kofejnik 9y ago
      it hurts some people (those who want to live in SF), but it helps other people (those who already live there), pretty much like any other resource with finite availability
      - davidw 9y ago
        Yes, a bunch of rich people get richer, and the poor get poorer because they can't access jobs in one of the most productive, wealthy parts of the country. All because we don't allow the market to function properly. Seems like a failure to me. Here's Ed Glaeser: "Reforming local land use controls is one of those rare areas in which the libertarian and the progressive agree. The current system restricts the freedom of the property owner, and also makes life harder for poorer Americans. The politics of zoning reform may be hard, but our land use regulations are badly in need of rethinking." https://www.brookings.edu/research/reforming-land-use-regulations/ https://www.brookings.edu/research/reforming-land-use-regula...

projectramo 9y ago

This post could benefit greatly from a little more quantitative analysis. The first, and main point, about whether the supply would appreciably drop the price is a great example of where it is needed. Has there been any study of the elasticity of house pricing? Give us the range, and then we know roughly how much housing it would take to drop the price by $10/sf. Then let's see how much extra housing we could build, and what the bottlenecks are. Now we are having a conversation. Otherwise it is just intuition mongering (which, by the way, is a useful and noble exercise as well, but it is not complete). Edit - I found some: http://urbanpolicy.berkeley.edu/pdf/HQ_REStat80.pdf http://urbanpolicy.berkeley.edu/pdf/HQ_REStat80.pdf http://budgeting.thenest.com/price-elasticity-affect-housing-industry-23106.html http://budgeting.thenest.com/price-elasticity-affect-housing... https://www.rand.org/content/dam/rand/pubs/reports/2009/R2846.pdf https://www.rand.org/content/dam/rand/pubs/reports/2009/R284... Berkeley and Rand, so trying to cover different views.

Analemma_ 9y ago
> This post could benefit greatly from a little more quantitative analysis. It sounds like she's just articulating the arguments of both sides, rather than taking a stance herself, so I don't know how much quantitative analysis would really improve it.
jobu 9y ago
> This post could benefit greatly from a little more quantitative analysis. The article does actually mention quantitative analyses some, and why critics dismiss it: Critics think advocates put too much trust in quantitative analyses which try to estimate the effect of supply on prices. (Like this one [1] which estimates that adding 5,000 new units each year would be enough to stabilize real prices.) Such studies inevitably make dubious simplifying assumptions, and it’s all too easy to set up an analysis to get the conclusion you want. [1] http://experimental-geography.blogspot.com/2016/05/employment-construction-and-cost-of-san.html http://experimental-geography.blogspot.com/2016/05/employmen...
- projectramo 9y ago
  I don't think the quant analysis eliminates debate (i.e. it will have advocates and critics). However, it does focus the debate on better issues. The question of housing may hang on exactly how much new housing is introduced by allowing people to kill more birds, for instance. Without the quantification, you might still be arguing about how much green space should be mandated. (These examples are pulled out of thin air). To put my point another way, the absence of criticism is not a benefit of quant analysis.

dredmorbius 9y ago

How have housing prices changed relative to wages from 1965 to present in the US? They've doubled. https://fred.stlouisfed.org/graph/fredgraph.png?g=ekXr https://fred.stlouisfed.org/graph/fredgraph.png?g=ekXr https://plus.google.com/104092656004159577193/posts/Akjfruv9zbe https://plus.google.com/104092656004159577193/posts/Akjfruv9... San Francisco rents over 70 years, showing a 6.6% annual rate of increase. https://medium.com/newco/a-guy-just-transcribed-30-years-of-for-rent-ads-heres-what-it-taught-us-about-sf-housing-prices-bd61fd0e4ef9#.r7qldtd56 https://medium.com/newco/a-guy-just-transcribed-30-years-of-... 6.6 percent is 2.5 percentage points faster than inflation, which doesn’t seem like a lot but when you do it for 60 years in a row it means housing prices quadruple compared to everything else you have to buy. That’s bad. But that’s SF today, compared to 1956. So what caused prices to go up? That’s the really exciting part of Fischer’s discovery. Armed with his data, he more or less answered that question.... It would take a 53% increase in the housing supply (200,000 new units), or a 44% drop in CPI-adjusted salaries, or a 51% drop in employment, to cut prices by two thirds. Why the increase? Asset price inflation of Maslovian goods. https://www.reddit.com/r/dredmorbius/comments/608w97/asset_price_inflation_of_maslovian_and_productive/ https://www.reddit.com/r/dredmorbius/comments/608w97/asset_p...

mcguire 9y ago
Thanks for that! The article you link to as "some pretty persuasive criticism of Fischer’s initial model"[1] is also very good. One highlight: "These kind of responses miss the simple fact that of the three variables in Fischer’s model, only employment and wages really matter. (The demand-only model achieves an R squared value of .924 and adding the supply variable, housing units, gets us to .940)....Another found that the best model of San Francisco rents needs just one variable: wages (although wages and housing were a close second)." I think that kind of confirms my gut feeling on first hearing about the problem years ago: the issue is that there is too much money flowing into (a particular sector of) San Francisco. [1] https://www.theurbanist.org/2016/05/27/rents-in-san-francisco-are-determined-by-demand-new-data-show/ https://www.theurbanist.org/2016/05/27/rents-in-san-francisc...
- wbl 9y ago

paulpauper 9y ago

I don't think building more will help. There will always be a finite number of single-family homes in sought-after areas. Building on the outskirts of SF is not a substitute for prime locations

tmh79 9y ago
there will only be a legal number of single family homes because we legally require the land to be used for single family homes. Change the land use regulations to change the makeup of the land. If they upzoned the land from RH-1 to RH-4 most of those SFHs would be subdivided into multiple units. Thats the reason many apartments in SF are in divided victorians.

musgrove 9y ago

"We"who? If it was a financially good idea, developers would be or are doing it. How about run some realistic rates of return and market analysis? You may also find the biggest reason: it's unworkable because of current San Francisco culture.

schoen 9y ago
A lot of the political debate relates to the regulatory difficulties that developers encounter, and reducing the ability of neighbors and/or politicians to exercise discretion to prevent development projects or place conditions on them.
Retra 9y ago
>If it was a financially good idea, developers would be or are doing it. Or not. They could not know it is a good idea, fail to do it, and cause a bunch of problems as a result. That could in fact be the very source of the problems being discussed here.
rthomas6 9y ago
Something can be a good idea and unworkable due to political and regulatory hurdles. Just look at broadband access. Or medical records. Two industries that would benefit greatly from some disruption, but we're not seeing much there because of how hard it is for other than market reasons.

jseliger 9y ago

One important question too is, "When did the housing market in SF shut down new development?" I address related questions here: https://jakeseliger.com/2015/09/24/do-millennials-have-a-future-in-seattle-do-millennials-have-a-future-in-any-superstar-cities/ https://jakeseliger.com/2015/09/24/do-millennials-have-a-fut...: Oddly, cities began to freeze in earnest, via zoning laws, in the 1970s. One can see this both from the link and from Google’s Ngram viewer, which sees virtually no references to gentrification until the late 70s, and the term really takes off later than that. Moreover, the book Zoning Rules! discusses how this actually happened: https://www.amazon.com/Zoning-Rules-Economics-Land-Regulation/dp/155844288X?ie=UTF8&tag=thstsst-20&linkCode=as2&camp=1789&creative=390957 https://www.amazon.com/Zoning-Rules-Economics-Land-Regulatio.... The fact that it used to be relatively easy to build new housing as demand increases means that we could make it easy again. This is fundamentally a legal problem (we should not allow so many property rights to be violated by non-owners) and a political problem (we are not addressing housing and issues at the right level of government). It's striking how few affordable housing discussions have a historical view of the issue!

davidw 9y ago
That book is awesome - a super deep dive into the nuances of the legalities and economics of zoning. The guy has even visited a number of sites cited in important court cases. I also like "Zoned in the USA" for its comparisons with other countries, particularly in Europe, which - to my way of looking at things - seem to get some things right that are very strange in the US. Here's a bunch of other articles and things I've found interesting/useful: https://bendyimby.com/2017/06/12/yimby-reading/ https://bendyimby.com/2017/06/12/yimby-reading/
pmoriarty 9y ago
Have the changes of the kind you advocate happened anywhere else in the United States? How did they manage to do it?
- 0x4f3759df 9y ago
  Duany Platter-Zyberk made some nice things. http://www.dpz.com/Projects/All http://www.dpz.com/Projects/All

timothycrosley 9y ago

You keep telling yourselves that while we in Seattle keep building and funneling more people that would have lived in San Francisco here because we're able to keep up with Demand ;)

delecti 9y ago
The 10% rent increase I'm looking at this year leaves me skeptical of your argument that Seattle is adequately keeping up with demand.
- futhey 9y ago
  I'm actually pretty proud of Seattle's efforts to re-evaluate zoning regulations in the late 2000's. Almost every neighborhood has been zoned to build taller, and if we're speaking strictly about rents, it's been quite effective. The city added just under 200,000 new residents (2005 - 2017), and the increases in mean rent costs were comparatively modest when compared to increasing demand (https://goo.gl/zadHW6 https://goo.gl/zadHW6). There has still been a noticeable increase, but in part because the City of Seattle underestimated the rate of future growth in demand (https://goo.gl/QKpb36 https://goo.gl/QKpb36). (The city is actually making moves right now to increase housing supply over the next few years to prevent accelerating increases in rents). Demand, however, is not the only factor commonly cited as putting pressure on housing prices. As tech workers flood the city and mean incomes outpace inflation (which has a positive effect on the overall economy), their purchasing power increases. New construction is of comparatively higher quality, especially in neighborhoods like Capitol Hill, which was not nearly as desirable before 2000. This is another part of the “noticeable increase”. As neighborhoods become more desirable (such as SLU, Ballard, and Capitol Hill), residents suddenly find themselves paying a premium (which is not reflected in mean pricing). I believe this is much of what has contributed to the idea that rents have risen dramatically (even when the data says otherwise). Things may not be optimal (there are certainly challenges with market mismatch and misplaced incentives), but I don't think anyone in the industry is saying the major challenges are regulatory.
grillvogel 9y ago
does the ";)" mean you're being sarcastic, because I have no idea how you reached that conclusion otherwise

ensiferum 9y ago

Can't be done. Anything that would lower the cost of housing can't be done because rich ppl (property owners) would lose money.

cjlars 9y ago
There's probably a natural balancing mechanism -- prices go too high, renters are outraged and are moved to action, prices go too low, owners are outraged and are moved to action. Looks like we're in the first zone right now.

Robotbeat 9y ago

Of course we should build more housing. Unless we've decided we're against growth on principle and want housing to remain expensive and growth to stagnate. (The ecological argument against growth in this case is backwards, though. Urban development is less resource intensive than the alternative of suburban or exurban development that uses up a lot more land and requires much longer commutes. And urbanization also tends to suppress birth rates, if you're concerned with very long-term ecological consequences.)

mc32 9y ago

My sentiment has always been we need a regional (ala ABAG) authority which has oversight over regional growth so that it would be less haphazard and more coordinated. Yes, build in SF, but also build on the Penn, East Bay, South Bay, etc. and coordinate transit development, zoning, etc., etc.

tmh79 9y ago
you should call your state assembly person and have them vote yes on SB35. This bill gives teeth to the RHNA numbers and provides an accelerated pathway to approval for certain developments if the cities are not meeting their housing construction quota as mandated by the RHNA numbers.
specialist 9y ago
WA State has the Growth Management Act. Like everything else smelling of civility or the public good, it's vehemently opposed by the local "libertarians". https://en.wikipedia.org/wiki/Washington_State_Growth_Management_Act https://en.wikipedia.org/wiki/Washington_State_Growth_Manage...

RobLach 9y ago

If the claim that higher supply doesn't lower prices is accurate, and if we assume that higher density means a higher efficiency regarding city services (which has been historically true), then increasing supply seems like an obvious move since you increase tax revenue which could be directed towards social services that help soften the harshness of the SF housing market.

pascalxus 9y ago

It's absolutely shocking: the degree of lack of understanding of basic economics, especially in a city with such a high percentage of bachelors Degrees!! I'm deeply concerned for the future of our country - I don't want it to end up like venezuela. I believe, economics should be one of the primary subjects taught in school in K-12, that and personal finance (learning how to manage your own money). In this day and age, these are the 2 most important subjects you need to learn. We need an informed citizenry, if we're not going to end up like venezuela.