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'Facebook is taking everything': rising rents drive out Silicon Valley families
- JumpCrisscross 8y agoCupertino, last year, voted in a referendum to maintain a two-story construction limit. It also voted down multi-family homes. At the end of the day, Silicon Valley's residents--not Facebook--are telling their lower-income neighbors "we prefer higher housing prices".
- jdlyga 8y agoWhen there's not enough land, you build high rises. It's what everyone everywhere else in the world does. It's that simple.
- xienze 8y agoYeah you just need to either find empty land to build said highrises, which doesn't exist, or force people out of their houses through eminent domain. Shocking that homeowners would vote against that.
- rayiner 8y agoThe government doesn’t take land by eminent domain to build high rises. (At least, not in Cupertino.) What these folks re voting for is laws to restrict what property owners can build on the land they own.
- ada1981 8y agoIn Brooklyn they took it away from housing to build a sports stadium.
- rayiner 8y agoEminent domain is limited to taking land for a public benefit. Sports stadiums are on the border, but sports are an important part of the culture of cities so you can see the "public benefit" angle. But governments can't use it just to build an apartment complex.
- ada1981 8y agoI did my grad work a decade ago in Urban Planning at one of the top programs in the world and eminent domain was always a controversial topic. It seems one could argue that affordable housing is much more a public benefit than a for profit sports stadium. As for Brooklyn, looks like the project was a bust. https://reason.com/blog/2016/01/12/barclays-center-eminent-domain-fail https://reason.com/blog/2016/01/12/barclays-center-eminent-d...
- adrianN 8y agoOr you offer sufficiently high prices for their land that they opt to sell? The problem is that people vote to make it illegal to build multi-family homes, no matter how high the price.
- xienze 8y agoMulti-family homes = poor people. Purchasing land for wildly-inflated amounts (remember, if you're not forcing someone to sell the seller has ALL THE LEVERAGE) and renting out to low-income residents isn't exactly a sound business move.
- deleted 8y ago[deleted]
- adrianN 8y agoYou realize that most cities in Europe contain mainly multi family homes and apartment buildings? Look at Paris for example. Rents in luxury apartments are still sky high and poor people can't afford the city center. edit: I hear Manhatten is an example in the US for an area where apartments!=poor people (except in sitcoms).
- drewmate 8y agoI've observed the same re: the culture difference in NYC and other American cities. New York got dense before the advent of the automobile, so generations (both rich and poor) have lived there in apartments of varying quality. Other cities (like San Francisco) had some density but plenty of open land when cars became widespread, so the rich spread into the available land, and the poor stayed in (or immigrated to) the existing density. This is no longer the reality (it's basically rich people everywhere now) but the stigma of living in apartments remains and likely will until a generation or two has grown up in them.
- seanmcdirmid 8y agoParis is famous for its height restrictions inside La Defense, though it is all multi-unit housing, they are only 5 stories or so. Of course, this maintains lots of charm.
- detaro 8y agoOr you allow property owners to replace their existing buildings with bigger ones? It also seems odd that in a city where Apple could buy a massive plot of land for their HQ somewhat recently there's no free space left?
- austenallred 8y agoThat’s not what’s happening. There is plenty of land to build high rises and plenty of developers with land to build it on, it’s just illegal to do so.
- JumpCrisscross 8y ago> which doesn't exist I grew up in Cupertino. There are still tons of empty lots everywhere. (Same in San Francisco.) Note that when I say "empty lot" I don't mean "park". It's just un-owned plots with garbage and grass everywhere.
- xienze 8y agoNo offense, but have you been there lately? That entire valley is packed.
- JumpCrisscross 8y ago> have you been there lately? Three weeks ago. Once in a while, the lots fill in and houses are developed. But there are still tons of empty lots there, at least in Cupertino.
- beamatronic 8y agoWhich part of Cupertino has “tons of lots”?
- JumpCrisscross 8y ago> Which part of Cupertino has “tons of lots”? North of Bubb as you go up towards Regnart Road. (Many are odd-shaped due to Cupertino's history of altering streets to navigate around wealthy peoples' houses.)
- thepangolino 8y agoWhat do you mean by "un-owned" plots? Can I just get a permit and build a house there without anyone stopping me? Someone has to own it.
- JumpCrisscross 8y ago> What do you mean by "un-owned" plots? City owns them and refuses to sell or develop it into a park. Or it's owned but undeveloped, either because the owner is convinced the city will authorize multistory development any day now or the city has put a restriction on developing the lot. Getting construction permits can be very expensive in the Bay Area's suburbs.
- reaperducer 8y ago>It's what everyone everywhere else in the world does Simply not true. London, for example, has very few high rises for the number of people there. And the NIMBY battles are epic. Far more inflamed than even Silicon Valley or the Seattle suburbs.
- toasterlovin 8y agoThe fundamental problem is that the people who already own property have 0 incentive to change anything. They also happen to be the voters.
- izacus 8y agoNo, they're saying "We like our sububriban houses and environment and don't want to live in a crowded city." That's not quite the same.
- jogjayr 8y agoBut they're not paying any of the price of that. They benefit from quickly rising house prices but thanks to prop 13 don't hurt from it. And they're using government to disallow other land owners from doing what they like with their property.
- bbarn 8y agoYep. You want to feel like a nice quiet suburb, but have a bustling tech hub? There's a price.
- techterrier 8y agoOught to be a train fare.
- rayiner 8y agoThe same folks voting for these laws have always hated poor people and immigrant families. In the DC suburbs where I grew up, there is tons of coded racist language around extended-family living situations (because hispanic immigrants disproportionately tend to have extended family living with them). They say “we want to preserve the character of the neighborhood” but what they mean is that they don’t like the idea of living near lower-income families who might try to afford to live in their neighborhood by having relatives share the expense. They don’t like apartments for the same reason: apartment complexes are one of the few ways in which lower-income people can afford to live in a wealthy school district. (In the snotty DC suburb where I grew up, people mocked folks who lived in the few apartment complexes in the area. Only after I grew up did I realize that these were perfectly nice, normal apartment complexes.) There is nothing that brings out peoples’ racist character like housing and schools (check out city-data or the various forums for folks with kids in D.C.-area public schools).
- i_am_nomad 8y agoMuch like the Latinos in the article talking about the newcomers who are “just ruining the community.”
- jeffreyrogers 8y agoIt is easy to assume it's about race, but I think it's more a class issue. They would be doing the same thing if it were poor white people I would imagine.
- deleted 8y ago[deleted]
- jerkstate 8y agos/would be/are/g plenty of white people in the bay area that can't afford housing.
- kryogen1c 8y agoTook the words right out of my mouth. Assuming this is a race issue is basically meaningless political grandstanding. It's a class issue, and the issue is universal. Rich don't want to live around middle class, middle class don't want to live around the poor, and the poor don't want homeless people living in their front yard. Humans are simply tribal, and want to be with members of their tribe. Landlords want to make money, and as the parent pointed out, low income housing is clearly not a priority in the area.
- chongli 8y agoSilicon Valley homeowners are telling that to their neighbours. That's not surprising! They benefit from the externalities created by Facebook's high salaries.
- Someone1234 8y agoThis style of post is everywhere. It is really "short" Vs. "long" term thinking. Let's say they followed through with your ideas/criticism: They allow unlimited multi-story flats to get built, the area is now full of the things. Population density will increase further, but major infrastructure won't, so now you need bigger roads, more roads, maybe a subway, smog goes through the roof, activity areas (e.g. parks, recreation) disappears into building or more roads, and now suddenly Cupertino is downtown LA at rush hour and nobody wants to live there. Or Cupertino can say "no" keep the atmosphere that has made it successful, including its medium density housing, keep population down, keep room for activities, keep road congestion at its current levels, and only have room for a small handful of large companies instead of infinite amounts. Spinning this as "they just hate poor people" is definitely a great way of distracting from the core issues though.
- JumpCrisscross 8y ago> Population density will increase further, but major infrastructure won't, so now you need bigger roads, maybe a subway, smog goes through the roof Los Angeles is a case study in urban transportation failure. The sprawl encouraged by Silicon Valley's low-density preference is more of a contributor to the region's traffic and pollution problems. > Or Cupertino can say "no" keep the atmosphere that has made it successful To be clear, I'm not saying Cupertino should say "yes". Just that the natural consequence of "no" is higher housing prices and people being relocated as a function of income. (Also, the area becoming less attractive to startups vis-à-vis large companies.)
- jeffreyrogers 8y agoI don't think any major city has traffic solved. Even places with very little zoning like Houston have traffic problems. urban sprawl seems to be the default when you don't have constraints on your ability to spread outwards.
- javagram 8y agoSolving traffic problems seems nearly impossible in the US as people will get on the roads and drive until gridlock stops them. But in my experience places like NYC (Manhattan in particular) have done a fairly successful job of allowing people to opt out from the traffic problem by using public transit, walking, or uber/taxi instead. A lot of other cities could play catch up there.
- untog 8y agoAre Silicon Valley residents not commonly also Facebook employees?
- lubesGordi 8y agoI see this argument all the time: build up, create supply, and prices will fall. It's a common sense approach. But why do you think that will happen? It seems to me just as likely that if developers built high rises and rented 1 bedroom apartments for the current prices, they'd have no problem filling them at all. My opinion: I think increasing supply would entail a drastic change in the landscape of the area to the point prices would fall because of decrease in demand to live there (horrible traffic, etc.).
- rconti 8y agoSimple economics, actually. It's virtually a fact. For one, Facebook employs a knowable number of people. It's not infinite (though it may seem like it). The problem is, these things are always done in half measures, and they'll never actually build enough to solve the problem, so you'll never see it proven.
- rconti 8y agoIt's actually somewhat different, because the housing around Facebook is fairly unique. Facebook is in a kind of triangle formed to the south/north/east by the bay, and to the west is East Palo Alto and East Menlo Park, then the 101 freeway. (although it's technically just part of Menlo Park; the 'east' is not part of the name, it is not a city unto itself). EPA and Menlo Park in that area are a bit like the land that time forgot. Historically high crime, heavily minority. East Palo Alto in particular has had much government corruption over the ages. The area has been an oasis of cheaper housing that many people virtually forget about unless reading about a shooting or going to Ikea. In many ways its been isolated from the rest of the housing market. I can only presume that when Sun Microsystems occupied the current FB campus, nobody wanted to live there. Now that Facebook is there, and vastly bigger than Sun ever was, building infrastructure, plus Amazon is there now by the Ikea, the area has become desirable to "rich" people. Whereas places like Cupertino have been relatively desirable for a long time, and the size of the employer doesn't dwarf the habitable units by such a great amount. Source: I'm currently gentrifying a neighborhood <2mi from FBHQ.
- MentallyRetired 8y ago"massive rent increases from a new landlord, who is pricing out long-time residents while advertising the buildings’ proximity to Facebook’s campus" Yes, let's blame Facebook. ...what?
- deadcast 8y agoDang, I thought farcebook was supposed to bring communities/world together. Haha yeah.... /s
- dxxvi 8y agoIt's incorrect to blame Facebook for the rising rents. The landlords' greed must be blamed.
- JumpCrisscross 8y ago> landlords' greed must be blamed Generally speaking, if a fragmented group (e.g. Silicon Valley land owners) is behaving in a cohesive way, greed probably isn't to blame. In this case, it's supply and demand. If rents were capped, we'd instead be talking about housing queues and quotas.
- TeMPOraL 8y agoWhat is then the proper name for market participants causing problems by doing what all homo economicus are doing, that is maximizing the amount of value they can capture instead of leaving some money on the table for others to take? Because I think this is what is meant when someone accuses of greed a large group of people.
- JumpCrisscross 8y agoHuman nature? Emergent behaviour? Natural consequence of the region's housing policies? Calling someone "greedy" works when it can shame them into submission. (For example, shaming a drug company's executives for dramatically raising a patented drug's price.) It doesn't work when the blame can be shared away. The other difference between demand driving prices versus sellers "greedily" increasing them is the risk of shortages. If the drugmaker from my prior example reduces prices, it probably won't cause a shortage. Capping housing prices in the Bay Area, on the other hand, would result in queues and quotas. Calling the Bay Area's landowners "greedy" isn't only ineffective, it's also inaccurate. If someone bought a house recently, they probably need to charge a high rent to cover their mortgage and property taxes.
- TACIXAT 8y agoThe people preventing new construction are greedy. They are dictating what others can and can't do with their land in order to protect their own interests. They get million dollar home values and everyone else is stuck with $3000+/mo rents.
- matt_s 8y agoSan Francisco and surrounding areas are sort of isolated geographically right? If rents become so high won't that essentially drive lower income people completely out of the area? Maybe over time they move away and then how would lower income jobs be filled? Will wage hikes be necessary, which would then likely drive costs up?
- jonathanyc 8y agoI don’t see how the SF Bay Area is more geographically isolated than other regions in the US, could you elaborate? Rent driving lower income people out of the area is possible, but these articles can paint an exaggerated picture of what’s happening. The areas where techies are moving in en masse are not everywhere; SF and Mountain View are neither the entirety nor representative of the SF Bay Area, they’re just what you’ll see articles on here about most often.
- matt_s 8y agoBy that I meant that it doesn't have land west for suburban sprawl to occur with cheaper rent areas. People can move farther out to east but then like another commenter stated they have a 3 hour commute. At some point maybe people give up on that and move out of the overall area?
- jonathanyc 8y agoAre there places where there is land for suburban sprawl to occur that doesn’t involve a commute? I really don’t understand how SF is supposed to be a special case. Look at Hong Kong—even more dense and even higher rents. It’s a counterpoint to almost any claim to SF exceptionalism.
- bittercynic 8y agoI live in Silicon Valley, and of the people I know well enough to discuss these things, every one who doesn't own their home is experiencing some level of distress about rising housing costs. My anecdata isn't proof that the article isn't exaggerated, but the article is pretty consistent with my experience. Just sayin'.
- mlthoughts2018 8y agoI always feel so conflicted about these overly specific human interest takes on this topic. - The rent increases are choices made by landlords, not Facebook. - Even as quoted in the article, residents seem to believe that living in a place for a long time entitles them to continue living in that place longer at a price they find agreeable. I personally have been priced out of neighborhoods I loved living in twice in my life, once after living in the same place for 8 years and feeling a huge sense that it "was my home." It's sad and upsetting, but nobody is entitled to live in some place just because their family historically has lived there a long time or they personally have lived there a long time or theyhave some cultural identity to that place. It's not a nice part of reality, but that's just how it is. Playing on sympathies by hearing people say, "but we've lived here 10 years and Facebook doesn't care" is just an ineffective way to look at it, for all parties. - As usual, the group of people most impacted (displaced tenants) is the group least capable of financially weathering the changing circumstances or politically lobbying for their preferences to be protected. - If I were a Facebook employee, I would feel some measure of resentment towards the property groups doing this. One reason is because the property managers know the bad press will be flung at Facebook, not them. Another reason is that the property managers are essentially looking at the wages paid by Facebook as something they (the property managers) are entitled to (by raising rents to adjust for higher salaries). The landlords are not improving their value-add in any way, just raising prices to capture more of some other productive person's wages. - And, of course as others have pointed out, it's largely driven by lack of new housing or high-rise housing.
- JMCQ87 8y agoNo one might be entitled to that, but it's definitely helpful to the social health of an area if there is policy to ensure that the community stays somewhat stable.
- mlthoughts2018 8y agoI'm not sure that I agree unless we come up with some definition of "stable". Usually a neighborhood is healthy when people want to move into it, meaning it experiences growth, and it can lead to problems depending on how the growth is managed. But when a neighborhood stagnates and becomes known as a place that excludes certain classes of other people or makes them "unwelcome" then the neighborhood's only hope of survival is to contain a bunch of already wealthy people who entrench the existing classism or ageism or racism, etc. When the neighborhood is working class and props up "stability" (in the form of not letting new people in unless they are 'like us'), it's a recipe for disaster. This is an extremely hard problem to solve. I had a good family friend who lost her job as an elementary school teacher because a neighborhood rapidly gentrified and people moving in did not have children. Over about a 2 year period, rents rose and school enrollment dropped severely and the school had to cut staff. But I also have a friend whose car was vandalized repeatedly in a neighborhood of Pittsburgh because he was associated with a tech company there that was popularly blamed for gentrification. He felt scared living there, which he should not have to feel no matter what the reason (i.e. he does not belong to any minority groups in terms of race, etc., but deserves to feel safe at his own home like anyone else does). The idea of "stability in a neighborhood" is hard to pin down, because things can range from outright xenophobia to thoughtless gentrification, and market economics usually just acts like throwing gas on the fire no matter which end of the spectrum you're in.
- fullshark 8y agoI don’t blame the tech giants for this but I’d like to see more done by them about the families living in RVs near their campuses, just from a community perspective.
- gnicholas 8y agoWhen I saw the headline, I thought this was going to be about FB employees bidding crazy high on multimillion dollar houses, which is another (albeit less urgent) problem in Silicon Valley. I’ve seen single-earner FB families purchase homes at prices that make my head spin. I would note that this article mis-identified Jesshill Love, whom they call an “investor”. He may do some investing, but he is first and foremost a real estate lawyer at a small-ish law firm. I know this because his wife was a recruiter at a company I worked at for several years. This mistake doesn’t undermine the general thrust of the article, but it is a little weird to get this detail wrong. He’s the only person they identify by name, and a quick google search would show that he’s a real estate lawyer. Searching “Jesshill Love investor”, on the other hand, turns up nothing of the sort. Not the sign of a well-researched article — even if the gist of it is undeniably true.
- tqi 8y agoI think it was a choice - calling him an "investor" makes it seem like the tech industry is also benefiting from the rising rents, not just causing it.
- 21 8y agoIn the picture from the article I see what is basically a lot of swamp around Facebook. If they were allowed to build let's say 10 20 story buildings there would be no need to evict current renters.
- beamatronic 8y agoEndangered species in the swamp/wetlands
- i_am_nomad 8y agoIt’s not swamp, it’s muddy tidal area. It would be very difficult to build on it, and probably protected by a number of laws and regulations. Plus, it smells.
- quotemstr 8y agoFine: it's a salt marsh. Still, it's a titanic waste of valuable real estate. Building there is just an engineering problem, and it won't smell once it's filled, paved, and turned into buildings.
- rconti 8y agoThat's what they did in Redwood Shores. Likely the tidal land here is owned by Cargill. The park just a half mile to the north (Bedwell Bayfront) is built on a landfill. I'm sure it's been considered.
- adultSwim 8y agoI'm reminded of Starbucks buying massive swaths of land in Ethiopia.
- chrisco255 8y agoVirtually all of Silicon Valley (MV, Cupertino, Menlo, etc) feels like a dated suburb to me, coming from out of state. It seems there is a high incentive to keep everything static and unchanging, to the point where it's sort of an uninteresting place to live.
- observer12 8y agoWith all the blame going around how about California government? Some states have protections to prevent landlords from pricing out current tenants in order to raise incoming tenants prices. For example where I live landlords can only raise rent by 10% every year for current tenants. The landlords can charge whatever they want for new tenants but they are limited for existing tenants.
- sasquatchHunter 8y agoIt's not an easy topic; highly conflictual, emotionally speaking. The market works this way. Facebook is just paying the employees higher than some people in the area are earning. What's the matter? I imagine that for those people this situation is annoying and frustrating, so they are just speaking out of these emotions. I can understand a newspaper publishing such a emotionally driven, nonsense Bolshevik article to get views (mission accomplished). I hope that this article didn't reach the first page just because it contains the word "Facebook" and some complaining I guess. "Let's all look down on the new public enemy" If that's the case, we can do better! PS: I don't work for Facebook and I don't particularly like the company
- i_am_nomad 8y agoOne way the tech giants could alleviate this problem is to leave. Build campuses in the Central Valley, the Midwest, in declining Southern cities. Rents in the Bay Area will drop, and those companies will save huge amounts of money on taxes and payroll. At worst, they can use those savings to build truly utopian communities for their workers in otherwise low-population areas.
- dpc_pw 8y ago"you first". It's a competitiveness and coordination problem.
- pascalxus 8y agoIf the bay area isn't willing to build more housing then they shouldn't allow so many new jobs. It's the imbalance between number of jobs and number of housing that's the source of all these problems.
- Jobjobbing 8y agoI often hear from people working for Google, Facebook that housing near company offices is more expensive than actually renting a property in the city centre. How just is that?