4 ms·

You can't just hand-wave away red tape as a factor. If you read the whole article (granted it is ridiculously long) she points out that SF has one of the greate

You can't just hand-wave away red tape as a factor. If you read the whole article (granted it is ridiculously long) she points out that SF has one of the greatest divergences between building cost and housing cost. That in most markets building cost approximates housing cost but in SF housing cost is 140% above base housing costs. That is the cost of zoning and other red tape. While developers may not build into falling markets it it disingenuous of you to say that additional housing stock at market price doesn't help, where do you think the people occupying those shiny new market-price rentals would go if they were not there, I'm guessing not Oakland... I think you are mistaking rising rents for lack of downward pressure. It's possible to have both at the same time as long as the influx of people exceeds the growth in supply.

timr 13y ago
"You can't just hand-wave away red tape as a factor...in most markets building cost approximates housing cost but in SF housing cost is 140% above base housing costs. That is the cost of zoning and other red tape." I read the whole article. The source she cites for that factoid is an article that excludes apartments from its analysis. It deals only with single-family housing. Oops: http://www.nber.org/papers/w8835.pdf?new_window=1 http://www.nber.org/papers/w8835.pdf?new_window=1 I've also read a whole bunch of other stuff on it, and it doesn't agree with the assertion. An example of what architects and developers have to say about it: http://markasaurus.com/2013/10/22/why-can%E2%80%99t-developers-build-housing-in-san-francisco-for-the-people-who-need-it-most-instead-of-for-the-rich/ http://markasaurus.com/2013/10/22/why-can%E2%80%99t-develope... The biggest consistent complaint that I read from developers is subsidy for low-income housing, which is onerous, but still only 12%. This guy suggests that average bureaucratic costs are ~30%. "where do you think the people occupying those shiny new market-price rentals would go if they were not there, I'm guessing not Oakland..." The article has a table that points out that SF has built something like 200% of the anticipated demand for high-end construction. If that's to be believed, the answer is: they'd be just as empty as they are today.
orky56 13y ago
No need to hate on Oakland. Crime has gone down and gentrification has definitely occurred there as shown in the article. A 40% decrease in blacks has changed the ethnic landscape thereby changing the diversity in another bay area city.

timr 13y ago

"You can't just hand-wave away red tape as a factor...in most markets building cost approximates housing cost but in SF housing cost is 140% above base housing costs. That is the cost of zoning and other red tape." I read the whole article. The source she cites for that factoid is an article that excludes apartments from its analysis. It deals only with single-family housing. Oops: http://www.nber.org/papers/w8835.pdf?new_window=1 http://www.nber.org/papers/w8835.pdf?new_window=1 I've also read a whole bunch of other stuff on it, and it doesn't agree with the assertion. An example of what architects and developers have to say about it: http://markasaurus.com/2013/10/22/why-can%E2%80%99t-developers-build-housing-in-san-francisco-for-the-people-who-need-it-most-instead-of-for-the-rich/ http://markasaurus.com/2013/10/22/why-can%E2%80%99t-develope... The biggest consistent complaint that I read from developers is subsidy for low-income housing, which is onerous, but still only 12%. This guy suggests that average bureaucratic costs are ~30%. "where do you think the people occupying those shiny new market-price rentals would go if they were not there, I'm guessing not Oakland..." The article has a table that points out that SF has built something like 200% of the anticipated demand for high-end construction. If that's to be believed, the answer is: they'd be just as empty as they are today.

orky56 13y ago

No need to hate on Oakland. Crime has gone down and gentrification has definitely occurred there as shown in the article. A 40% decrease in blacks has changed the ethnic landscape thereby changing the diversity in another bay area city.