6 ms·

San Francisco House Prices Drop Back to 2019 as Tech Jobs Evaporate

50 points by jarsin 2y ago

jarsin 2y ago
With the way tech hiring is going it doesn't seem far fetched to see a retest of the 2008 bubble highs.
jmpman 2y ago
And yet we wanted to double our H1B count?
- adamredwoods 2y ago
  H1B are sometimes paid less, so profit at the top increases while wages drop. https://www.epi.org/press/a-majority-of-migrant-workers-employed-with-h-1b-visas-are-paid-below-median-wages-large-tech-firms-including-amazon-google-and-microsoft-use-visa-program-to-underpay-workers/ https://www.epi.org/press/a-majority-of-migrant-workers-empl...
  - addicted 2y ago
    H1Bs don’t displace local jobs. They displace offshoring. If the companies looking to H1B workers are only doing so to cut their costs irrespective of the quality of talent why wouldn’t they outsource the work to someone in India for 1/4th the salary and fewer benefits instead?
    - jmpman 2y ago
      So, put tariffs on offshored IT work?
- seanmcdirmid 2y ago
  SF prices dropping back to 2019 doesn't mean much of anything given how high those prices were back then. SF throughout much of our history hasn't been the place for tech jobs, that happened sometime in the mid 2000s but wasn't true before then (Silicon Valley/San Jose were the places for tech). I expect that we won't see many big tech offices opening in SF anymore because they simply have a lot more better/affordable options to choose from.
  - jhbadger 2y ago
    But before the current tech boom in the mid 2000s, there was the "dot-com" boom in the 1990s and many early Web companies were in SF in the 1990s. And in the 1980s there was the financial sector boom as SF was the west-coast financial hub. You pretty much have to go back to the hippie era in the late 1960s/early 1970s to find a time when it was a cheap place to live.
    - seanmcdirmid 2y ago
      SF will never be a cheap place to live like Honolulu will never be a cheap place to live. It is just such a nice city (even with the unhoused problem) that rich people without jobs will always bid up property prices, and young people will settle for various careers and substandard living situations.
- coldtea 2y ago
  Somebody needs to cross-check the LLM output, and it's better if they're cheaper than a domestic employee
  - arresin 2y ago
    And can be threatened into working unpaid hours
toomuchtodo 2y ago
"San Francisco Housing Affordability At 2019 Levels"
almosthere 2y ago
"as tech jobs evaporate" sooooo... you want us to be in the office but even if we're there it's not good enough. So now we're forced away, and since there won't be remote jobs either... :shrug: I think this is going to be a lot worse than 2000 bust. Especially with AI coming into the picture. There is a feeling that AI will be writing ALL the code soon. Is there something to look forward to in this specific market or at this point should I just look at carpentry jobs?
- kazinator 2y ago
  Idiots writing tons of code with AI will create employment for armies of people who actually know how to debug it into working. Remember Knuth's witticism about debugging being twice as hard as writing? So if you're as clever as you can be when writing a program then you might not be smart enough to debug it? Now suppose you're as clever as you can be, plus armed with AI ...
  - falcor84 2y ago
    I would actually bet that AI will prove to be particularly good at classical debugging - i.e. the effort of changing the code to make a given failing test pass while keeping all the other tests green too. This is pretty much what SWE-Bench is judging, and the progress there has been phenomenal. We will still probably need humans to do validation (vs. verification), but I don't think it'll take "armies of people".
    - kazinator 2y ago
      Classical debugging is looking at a dump of memory in search for the bit that is flipped wrong. :)
      - bsaul 2y ago
        never had to do that in 25 years of software dev
        2y ago
hindsightbias 2y ago
Faster, Please.
huitzitziltzin 2y ago
No one wants to look at actual data to confirm the claim in the headline? https://fred.stlouisfed.org/series/SFXRSA https://fred.stlouisfed.org/series/SFXRSA Nothing like that claim appears to be true.
- jarsin 2y ago
  Wolfstreet wrote an article on why they don't use Case-Shiller anymore and switched to Zillow data. https://wolfstreet.com/2024/09/02/why-well-replace-the-case-shiller-home-price-index-for-our-series-the-most-splendid-housing-bubbles-in-america/ https://wolfstreet.com/2024/09/02/why-well-replace-the-case-...
  - alephnerd 2y ago
    Zillow's pricing metrics aren't free of flaws either, as it's not an appraisal but an estimate based on aggregate data collected by Zillow (which is non-exhaustive). In SF (and the Bay in general), a lot of listings are handled locally via local RE agents or family offices and do not show up on Zillow (most notably in Chinese heavy neighborhoods like Sunset as well as the more old money Nov Hill+Richmond+Pac Heights areas). And finally, based on the information provided by this blog, it just doesn't seem like a credible source. A blog dedicated on writing about the "Housing Crisis 2.0" on a near daily basis is not a great source. Personally, as someone who is in the process of buying, inventory is low and prices are still fairly high (when factoring interest rates) because most buyers were able to buy up or refi during the near-0 interest rate days, and will not budge for that reason.
    - jarsin 2y ago
      I think they are using the Zillow indexes that do include private sales, tax record sales etc. But I'm no expert just looked it up when op said it didn't match Case-Shiller. > The ZHVI is based on millions of data points in its Database of All Homes, including historical transaction prices of closed sales from public records (tax data), MLS, brokerages, real-estate agents, and individual households across the country for properties. It includes pricing data on off-market deals and for-sale-by-owner deals. The Database of All Homes also has all sales pairs.
Hilift 2y ago
SF real estate transfer tax for 2024 is $177 million, 5% less than 2023. Astonishingly, the city had projected revenue of $222 million. That means there is another $45 million revenue gap. SF is now expecting an $876 million deficit in 2025, which may exceed $1 billion if requested federal disaster funds aren't fulfilled. And expenses are expected to increase by $1.7 billion for a budget that is currently $16 billion. Oakland is broke too. https://finance.yahoo.com/news/san-francisco-expects-876-million-015856027.html https://finance.yahoo.com/news/san-francisco-expects-876-mil... https://www.bizjournals.com/sanfrancisco/news/2024/12/09/transfer-tax-fiscal-year-2024-san-francisco.html https://www.bizjournals.com/sanfrancisco/news/2024/12/09/tra... https://www.sfchronicle.com/sf/article/daniel-lurie-stares-down-dire-s-f-deficit-19954605.php https://www.sfchronicle.com/sf/article/daniel-lurie-stares-d... https://sfethics.org/commission/budget https://sfethics.org/commission/budget
ribadeo 2y ago
As "tech jobs evaporate" or as commercial real estate values in a city plummet. There. Fixed it. Ai chicken thigh. No real programmers will be replaced. The dumb bubble of poo will implode, which brings its own issues...
- danjl 2y ago
  +1 for "dumb bubble of poo"

50 points by jarsin 2y ago

jarsin 2y ago

With the way tech hiring is going it doesn't seem far fetched to see a retest of the 2008 bubble highs.

jmpman 2y ago

And yet we wanted to double our H1B count?

adamredwoods 2y ago
H1B are sometimes paid less, so profit at the top increases while wages drop. https://www.epi.org/press/a-majority-of-migrant-workers-employed-with-h-1b-visas-are-paid-below-median-wages-large-tech-firms-including-amazon-google-and-microsoft-use-visa-program-to-underpay-workers/ https://www.epi.org/press/a-majority-of-migrant-workers-empl...
- addicted 2y ago
  H1Bs don’t displace local jobs. They displace offshoring. If the companies looking to H1B workers are only doing so to cut their costs irrespective of the quality of talent why wouldn’t they outsource the work to someone in India for 1/4th the salary and fewer benefits instead?
  - jmpman 2y ago
    So, put tariffs on offshored IT work?
seanmcdirmid 2y ago
SF prices dropping back to 2019 doesn't mean much of anything given how high those prices were back then. SF throughout much of our history hasn't been the place for tech jobs, that happened sometime in the mid 2000s but wasn't true before then (Silicon Valley/San Jose were the places for tech). I expect that we won't see many big tech offices opening in SF anymore because they simply have a lot more better/affordable options to choose from.
- jhbadger 2y ago
  But before the current tech boom in the mid 2000s, there was the "dot-com" boom in the 1990s and many early Web companies were in SF in the 1990s. And in the 1980s there was the financial sector boom as SF was the west-coast financial hub. You pretty much have to go back to the hippie era in the late 1960s/early 1970s to find a time when it was a cheap place to live.
  - seanmcdirmid 2y ago
    SF will never be a cheap place to live like Honolulu will never be a cheap place to live. It is just such a nice city (even with the unhoused problem) that rich people without jobs will always bid up property prices, and young people will settle for various careers and substandard living situations.
coldtea 2y ago
Somebody needs to cross-check the LLM output, and it's better if they're cheaper than a domestic employee
- arresin 2y ago
  And can be threatened into working unpaid hours

toomuchtodo 2y ago

"San Francisco Housing Affordability At 2019 Levels"

almosthere 2y ago

"as tech jobs evaporate" sooooo... you want us to be in the office but even if we're there it's not good enough. So now we're forced away, and since there won't be remote jobs either... :shrug: I think this is going to be a lot worse than 2000 bust. Especially with AI coming into the picture. There is a feeling that AI will be writing ALL the code soon. Is there something to look forward to in this specific market or at this point should I just look at carpentry jobs?

kazinator 2y ago
Idiots writing tons of code with AI will create employment for armies of people who actually know how to debug it into working. Remember Knuth's witticism about debugging being twice as hard as writing? So if you're as clever as you can be when writing a program then you might not be smart enough to debug it? Now suppose you're as clever as you can be, plus armed with AI ...
- falcor84 2y ago
  I would actually bet that AI will prove to be particularly good at classical debugging - i.e. the effort of changing the code to make a given failing test pass while keeping all the other tests green too. This is pretty much what SWE-Bench is judging, and the progress there has been phenomenal. We will still probably need humans to do validation (vs. verification), but I don't think it'll take "armies of people".
  - kazinator 2y ago
    Classical debugging is looking at a dump of memory in search for the bit that is flipped wrong. :)
    - bsaul 2y ago
      never had to do that in 25 years of software dev
      - 2y ago

hindsightbias 2y ago

Faster, Please.

huitzitziltzin 2y ago

No one wants to look at actual data to confirm the claim in the headline? https://fred.stlouisfed.org/series/SFXRSA https://fred.stlouisfed.org/series/SFXRSA Nothing like that claim appears to be true.

jarsin 2y ago
Wolfstreet wrote an article on why they don't use Case-Shiller anymore and switched to Zillow data. https://wolfstreet.com/2024/09/02/why-well-replace-the-case-shiller-home-price-index-for-our-series-the-most-splendid-housing-bubbles-in-america/ https://wolfstreet.com/2024/09/02/why-well-replace-the-case-...
- alephnerd 2y ago
  Zillow's pricing metrics aren't free of flaws either, as it's not an appraisal but an estimate based on aggregate data collected by Zillow (which is non-exhaustive). In SF (and the Bay in general), a lot of listings are handled locally via local RE agents or family offices and do not show up on Zillow (most notably in Chinese heavy neighborhoods like Sunset as well as the more old money Nov Hill+Richmond+Pac Heights areas). And finally, based on the information provided by this blog, it just doesn't seem like a credible source. A blog dedicated on writing about the "Housing Crisis 2.0" on a near daily basis is not a great source. Personally, as someone who is in the process of buying, inventory is low and prices are still fairly high (when factoring interest rates) because most buyers were able to buy up or refi during the near-0 interest rate days, and will not budge for that reason.
  - jarsin 2y ago
    I think they are using the Zillow indexes that do include private sales, tax record sales etc. But I'm no expert just looked it up when op said it didn't match Case-Shiller. > The ZHVI is based on millions of data points in its Database of All Homes, including historical transaction prices of closed sales from public records (tax data), MLS, brokerages, real-estate agents, and individual households across the country for properties. It includes pricing data on off-market deals and for-sale-by-owner deals. The Database of All Homes also has all sales pairs.

Hilift 2y ago

SF real estate transfer tax for 2024 is $177 million, 5% less than 2023. Astonishingly, the city had projected revenue of $222 million. That means there is another $45 million revenue gap. SF is now expecting an $876 million deficit in 2025, which may exceed $1 billion if requested federal disaster funds aren't fulfilled. And expenses are expected to increase by $1.7 billion for a budget that is currently $16 billion. Oakland is broke too. https://finance.yahoo.com/news/san-francisco-expects-876-million-015856027.html https://finance.yahoo.com/news/san-francisco-expects-876-mil... https://www.bizjournals.com/sanfrancisco/news/2024/12/09/transfer-tax-fiscal-year-2024-san-francisco.html https://www.bizjournals.com/sanfrancisco/news/2024/12/09/tra... https://www.sfchronicle.com/sf/article/daniel-lurie-stares-down-dire-s-f-deficit-19954605.php https://www.sfchronicle.com/sf/article/daniel-lurie-stares-d... https://sfethics.org/commission/budget https://sfethics.org/commission/budget

ribadeo 2y ago

As "tech jobs evaporate" or as commercial real estate values in a city plummet. There. Fixed it. Ai chicken thigh. No real programmers will be replaced. The dumb bubble of poo will implode, which brings its own issues...

danjl 2y ago
+1 for "dumb bubble of poo"