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Some other related statistics I thought were interesting: According to the Census, the median household income in SF was $72,947. According to census data fro

Some other related statistics I thought were interesting: According to the Census, the median household income in SF was $72,947. According to census data from 2007-2011, approximately 1/3 of SF residents make over 100k. There's a notable doubling of households making >200k between 2000 and 2011, from ~20k to ~42k. Based on the two datasets, it seems like 2/3rds of the population of SF either cannot or can only barely afford to live in the city. I for one am ready for the rent bubble to pop. http://quickfacts.census.gov/qfd/states/06/0667000.html http://quickfacts.census.gov/qfd/states/06/0667000.html http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk http://factfinder2.census.gov/faces/tableservices/jsf/pages/... http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk http://factfinder2.census.gov/faces/tableservices/jsf/pages/...

cynicalkane 14y ago
There is no rent bubble. Bubbles are caused by speculation. There isn't a large amount of people renting or owning speculatively in San Francisco. In fact, pro-tenant regulations in San Francisco make it an especially bad place to speculate. I have heard of the city forcing landlords to renew leases for suspected drug users that leave spent needles all over the porch. High rents in San Francisco are caused purely by scarcity. That is, everyone wants to live there, but the city refuses to allow more units to be built or make it easier to rent. This damage is self-inflicted; California liberals hate density and gentrification although such things are green, decrease broad-market housing costs thereby serving the "displaced" poor, increase urban vibrancy, and reduce traffic congestion compared to the status quo. I saw a study that suggested the economic cost for permission to build a unit in SF (calculated by subtracting a unit's cost from the value of the land it sits on plus the cost of building it) is $600k. By contrast, it's $100k in Chicago and five figures in any major city in Texas.
- dreamdu5t 14y ago
  I don't think it's correct to imply that the city refusing to build more units is why SF is expensive. There's only so much space in SF, regardless of how high, fast, or dense you want to build.
  - rayiner 14y ago
    SF isn't particularly dense. It's twice as big as Manhattan,[1] but has only half as many people. It's the second-densest major city on paper, but it seems to me that this is because the city itself doesn't have the "long tail" of less-dense urban area merging into the suburbs that other cities have. If you look at the downtown areas of Manhattan, places like Midtown are over 100,000 people per square mile. Neighborhoods like Rittenhouse Square in Philadelphia top out over 60,000 per square mile, and neighborhoods like Gold Coast in Chicago are around 50,000. The only neighborhoods that dense in San Francisco are Chinatown (75,000/square mile) and Nob Hill (50,000 per square mile). There are a lot of neighborhoods in San Francisco like the Mission District that are in the 20,000-30,000 range. The near north side in Chicago is about 30,000, and there are vast swaths of low-rise areas there that could be built up (the whole west side of the near north side is semi-industrial). If built with high-rises with generous street set-backs, 50,000 people per square mile is very easy to achieve without feeling cramped.[2] [1] And frankly, even Manhattan as room to grow. If upper manhattan were as densely built as lower manhattan, you could probably fit another half a San Francisco onto the island easily. [2] When people think of 50,000+/square mile density, they think of Manhattan, but that's a bit misleading. Manhattan's paper density is understated because it has an absolutely enormous daytime population (almost 4 million people, or 180,000 per square mile). This is the result of everyone commuting in from NJ, CT, etc. Manhattan also has relatively poor set back and air and light requirements, no alleys (so people share street space with trash bags), tons of tourists, etc, which all make the place feel more cramped than it would otherwise be. My neighborhood in Chicago is 50,000 residential per square mile, and it can feel pretty empty if you stay away from the tourist areas. That's because land area is saved by having residential high-rises, which allows very generous set-backs for air and light and broad sidewalks.
    - subsystem 14y ago
      While I admit I don't know a lot about SF, I have a hard time seeing that large scale redevelopment would make sense once an area is already gentrified, not least from an infrastructure perspective. I also think gentrification works best when it "moves around" to new places, something that seems to have happened successfully in NY.
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- nugget 14y ago
  I would argue that there indeed is quite a bit of speculation going on. Most of my friends are spending an unsustainable % of their income on rent, betting that their stock options will pay off. Of course for most, they won't, and once that sinks in the market will adjust.

cynicalkane 14y ago

There is no rent bubble. Bubbles are caused by speculation. There isn't a large amount of people renting or owning speculatively in San Francisco. In fact, pro-tenant regulations in San Francisco make it an especially bad place to speculate. I have heard of the city forcing landlords to renew leases for suspected drug users that leave spent needles all over the porch. High rents in San Francisco are caused purely by scarcity. That is, everyone wants to live there, but the city refuses to allow more units to be built or make it easier to rent. This damage is self-inflicted; California liberals hate density and gentrification although such things are green, decrease broad-market housing costs thereby serving the "displaced" poor, increase urban vibrancy, and reduce traffic congestion compared to the status quo. I saw a study that suggested the economic cost for permission to build a unit in SF (calculated by subtracting a unit's cost from the value of the land it sits on plus the cost of building it) is $600k. By contrast, it's $100k in Chicago and five figures in any major city in Texas.

dreamdu5t 14y ago
I don't think it's correct to imply that the city refusing to build more units is why SF is expensive. There's only so much space in SF, regardless of how high, fast, or dense you want to build.
- rayiner 14y ago
  SF isn't particularly dense. It's twice as big as Manhattan,[1] but has only half as many people. It's the second-densest major city on paper, but it seems to me that this is because the city itself doesn't have the "long tail" of less-dense urban area merging into the suburbs that other cities have. If you look at the downtown areas of Manhattan, places like Midtown are over 100,000 people per square mile. Neighborhoods like Rittenhouse Square in Philadelphia top out over 60,000 per square mile, and neighborhoods like Gold Coast in Chicago are around 50,000. The only neighborhoods that dense in San Francisco are Chinatown (75,000/square mile) and Nob Hill (50,000 per square mile). There are a lot of neighborhoods in San Francisco like the Mission District that are in the 20,000-30,000 range. The near north side in Chicago is about 30,000, and there are vast swaths of low-rise areas there that could be built up (the whole west side of the near north side is semi-industrial). If built with high-rises with generous street set-backs, 50,000 people per square mile is very easy to achieve without feeling cramped.[2] [1] And frankly, even Manhattan as room to grow. If upper manhattan were as densely built as lower manhattan, you could probably fit another half a San Francisco onto the island easily. [2] When people think of 50,000+/square mile density, they think of Manhattan, but that's a bit misleading. Manhattan's paper density is understated because it has an absolutely enormous daytime population (almost 4 million people, or 180,000 per square mile). This is the result of everyone commuting in from NJ, CT, etc. Manhattan also has relatively poor set back and air and light requirements, no alleys (so people share street space with trash bags), tons of tourists, etc, which all make the place feel more cramped than it would otherwise be. My neighborhood in Chicago is 50,000 residential per square mile, and it can feel pretty empty if you stay away from the tourist areas. That's because land area is saved by having residential high-rises, which allows very generous set-backs for air and light and broad sidewalks.
  - subsystem 14y ago
    While I admit I don't know a lot about SF, I have a hard time seeing that large scale redevelopment would make sense once an area is already gentrified, not least from an infrastructure perspective. I also think gentrification works best when it "moves around" to new places, something that seems to have happened successfully in NY.
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nugget 14y ago
I would argue that there indeed is quite a bit of speculation going on. Most of my friends are spending an unsustainable % of their income on rent, betting that their stock options will pay off. Of course for most, they won't, and once that sinks in the market will adjust.