41 ms·

“Your monthly rent .. shall increase from $2145 to $8900”

491 points by aestetix 12y ago

JDiculous 12y ago
Is that legal? In NYC, there are laws in place to limit the amount a landlord can raise rent.
- codezero 12y ago
  If you read the thread it sounds like the landlord used several loopholes and had previous litigation against them and they toughened up their approach after previous failed evictions. I'm glad my rent only went up 20% since I'm in Sunnyvale and not the city.
- x0x0 12y ago
  Yes, it is almost certainly legal. The other option landlords always have is to withdraw the unit from the market. You can Ellis Act anyone you want; the price you pay is $18k per person or so plus waiting 366 days, and a stained title. You can still renovate then TIC the building though, and you'll find plenty of takers. ps -- having been in a legal fight with an sf landlord, the fact of the matter is despite all the pretty bullshit sf claims, there are vanishingly few actual tenant protections that work against a malicious landlord. At best, you can leave and sue after the fact, but be prepared to spend years on a fight. @harry: an ellis act eviction, or other no-fault evictions, permanently prevents the building from utilizing the 2-unit lottery bypass to condo the building, so it will have to remain a TIC. TICs have a variety of negative implications, including complicating mortgages. The lottery, which is still necessary for larger units, is suspended until 2024. see eg http://www.andysirkin.com/HTMLArticle.cfm?Article=158 http://www.andysirkin.com/HTMLArticle.cfm?Article=158 and http://www.andysirkin.com/HTMLArticle.cfm?Article=219 http://www.andysirkin.com/HTMLArticle.cfm?Article=219
  - harryh 12y ago
    What do you mean by "stained title"?
- uptown 12y ago
  In NYC it depends on the property. Unless the property is rent stabilized, rent can legally be raised by any amount the landlord pleases. Example: http://www.brickunderground.com/blog/2013/08/rent_coach_can_my_landlord_raise_my_stabilized_units_rent_by_300_a_month http://www.brickunderground.com/blog/2013/08/rent_coach_can_...
jackowayed 12y ago
If you read the caption, the real issue here is a horrible abuse of the rent control law. When the renter signed their lease, the unit was covered by rent control, putting very tight restrictions on rent increases and evictions. However, the landlord then essentially destroyed the other unit in the building so that they could reclassify the building as a single-family home instead of a multi-unit building. Single-family homes are not covered by the rent control law. This should obviously not be legal; if you're going to have a rent control, you can't let landlords take a unit that should have rent control and make it not rent controlled. At the very least, these kinds of changes shouldn't allow the landlord to escape an active rent control obligation to a current tenant.
- Lewisham 12y ago
  I think it's sort of obnoxious and should be illegal to force landlords to keep renters ad infinitum just because. That hardly seems fair to the landlord, no?
  - jacques_chester 12y ago
    That you dislike a law does not make it any less the law. That a thing is very popular does not make it lawful. The law has always been distinct from morality, with clear gateways from moral sentiment to the law.
    - jsprogrammer 12y ago
      >The law has always been distinct from morality, Has it? If you look at Hebrew and Christian tradition, the two are highly conflated.
      - mod 12y ago
        I think that despite the strong correlation & overlap, yes, law has "always been" distinct from morality, at least where the law wasn't whimsical. If it's not illegal, you can still do it, morals be damned, without being punished. It's pretty much the point of law--to give warning & right to punish. That's not the same as morals.
Sir_Cmpwn 12y ago
YC sings the praises of San Fransisco, and they're right about the culture and the startup scene there. But things like this, and the cost of living overall, make me hesitate to start something out there.
- r0naa 12y ago
  Me too, I have yet to graduate from college but things like that make me feel that I should stay in Waterloo (Canada).
  - mud_dauber 12y ago
    <waves from Austin>
    - balls187 12y ago
      </waves from Austin> <thumbsup city="Austin"/> <thumbsup city="Seattle"/>
      - jeff_marshall 12y ago
        portland is also quite nice....
        jes5199 12y ago
        shhhh! It's a secret
        robobro 12y ago
        hell yeah!
  - psychboo 12y ago
    I'm in nearby Guelph (Canada) and feel the same way. The developing technology scene in Ontario is enough to keep me put for now.
- 12y ago
whiteboarder 12y ago
Build more houses. None of this shit would happen if SF would just build more houses.
- Russell91 12y ago
  Ironically, rent control is exactly why there is so little housing available in SF. Iirc, only 30% of the voting population owns property. So how is it that the rest of us (70%) don't vote to build more? Well, because 3/4 renters are under rent control, and essentially don't care. So only 70%/4 < 30% of people are motivated to push the market towards more housing. The rest profit handsomely from increased home prices due to high demand. This is the real tragedy of rent control in San Francisco IMO. Edit: source: http://www.quora.com/What-percentage-of-San-Francisco-apartments-are-under-rent-control http://www.quora.com/What-percentage-of-San-Francisco-apartm...
  - shit_parade 12y ago
    Sadly, trying to explain simple economic facts to people on HN is a good way to get down voted if it involves criticism of government regulation.
  - jsprogrammer 12y ago
    If the majority of owners don't wish to personally utilize their property and instead choose to extract rent from it, what exactly are the renters supposed to buy? Owners can apparently force renters to bleed ever more money, but renters can't force a squatting owner to sell, they just have to accept it or, as this letter exemplifies, GTFO.
    - AnthonyMouse 12y ago
      > If the majority of owners don't wish to personally utilize their property, and to extract rent from it, what exactly are the renters supposed to buy? If you offer to pay at least as much for the building as the landlord would expect to make from renting it out then any rational landlord will sell you the building. > Owners can apparently force renters to bleed ever more money If they raise the rent significantly above what typical apartments go for in the area then the tenant will move out and they'll have to spend money to find a new tenant and go without rent in the meantime. Rental housing is one of the most efficient markets in existence. Landlords have nothing to gain by gouging tenants who will only move across the street to keep paying what they are now, which is why that rarely if ever happens. But when the local market price of housing changes, adjusting rents to meet the market is completely reasonable and natural.
pdq 12y ago
"(2) Effective May 5, 2015, the security deposit amount required shall increase to $12,500 per month." Is this a typo? I have never heard of a monthly security deposit.
- WalterSear 12y ago
  Probably a typo.
- jsprogrammer 12y ago
  I think it is just a scary way of stating that you must have $12,500 deposited with the owner for the entire month you are leasing. It just rolls over each month.
colanderman 12y ago
"the security deposit [...] shall increase to $12,500 per month" Can someone explain what this means? I've never had to pay a security deposit per month. That must be a copy + paste error?
- tylermac1 12y ago
  The numbers are just there to make it impossible to pay. They want the tenant out so they can sell the house.
  - colanderman 12y ago
    I get that. But the concept of a security deposit is that you get it back when you leave, so long as you haven't damaged the place. Having to pay an additional security deposit each month doesn't make logistical or logical sense. Do they hand you a check for $1M when you leave after ten years? Does the number of damageable surfaces in the apartment increase each month?
    - tylermac1 12y ago
      Not necessarily. I've had security deposits where only a certain percentage is refunded after any necessary deductions. Depends on what they signed in the lease. But still, it was never designed to actually be collected, just a number to scare someone away. Not much more to look into it.
- deleted 12y ago
  [deleted]
- error54 12y ago
  I believe the person was paying month to month so the per month deposit just refers to general security deposit.
azinman2 12y ago
They want to sell the house. This is their way of kicking people out without explicitly doing so.
- deleted 12y ago
  [deleted]
WalterSear 12y ago
I just don't see the news here. It's totally legal, and done all the time: it's why people lease houses rather than go month to month. It's not a reflection of the market in SF. This happens everywhere a landlord who isn't getting on with their month-to-month tenants and want them out, for whatever reason. It happened to me in 2005. It's not a necessarily a reflection of anything outside of the personal situation of the poster, and their relationship with their landlord. If this had happened anywhere but SF, there wouldn't be the flurry of hysterical outrage that's exploding on Twitter and Facebook: there would be crickets.
- maxerickson 12y ago
  They converted the other unit in the building to storage (after hassling that tenant out). I don't think it's anything like 'isn't getting on', the landlord wants to convert the building to some other use and simply doesn't care about the tenants, which isn't the same as finding them disagreeable or whatever (one imagines they might want to do something like sell it as a private home).
  - WalterSear 12y ago
    Legally, it's all under the same umbrella. I never said this was scrupulous. Just legal, and perfectly commonplace. Not news. It's being used as a rallying cry by people who were perfectly content with capitalism until it started being applied to them.
  - cma 12y ago
    You really think they will keep it as storage? Once the remaining tenant is out they will renovate everything and rent both units again.
    - maxerickson 12y ago
      I don't know what they will do with the building. I brought up the storage because it makes their motivation clearer, they weren't getting rid of the tenants for any sort of personal reason, it's about using the building for something else (or as you say, putting it back on the market at higher rates).
s0uthPaw88 12y ago
This is a perfect example of why rent control is a terrible system that leads to market inefficiencies and worse outcomes for a community. The law has made it more profitable for this landlord to remove housing stock and charge market rate for the remaining unit than to rent out both units in the building under rent control laws. Cities with low vacancy rates like SF need to rethink their approach to housing if they want to remain attractive places to live.
- javert 12y ago
  Completely agree with you. However, I think SF has already ceased to be an attractive place to live. I don't live there, so maybe it's not a fair comment, but I would not want to live there for the same reason I don't like flushing money down the toilet.
  - gwillen 12y ago
    > I think SF has already ceased to be an attractive place to live. Or as Yogi Berra allegedly once said: "Nobody goes there anymore. It's too crowded."
  - zobzu 12y ago
    it certainly isnt super attractive for new comers. - rent is very high, and the higher salary won't compensate all that much (salaries didn't move up as fast as the rent) - its crowded, expect queues everywhere, and traffic. Lots of traffic.
- nodesocket 12y ago
  If not for rent control, my studio apartment would be over $3,000 a month. Everyday I thank rent control.
  - meddlepal 12y ago
    So what? Why do you think you should get to live somewhere highly desireable at a below market rate?
gfodor 12y ago
This person should be grateful they were able to live in a place in such high demand so cheaply due to unfair rent control laws. If a 4x increase in rent is bearable by the market then it's not a sign of landlord greed, it's a sign of a broken system. I'm sure if this person was offered the opportunity to make an extra 5k a month with little to no change in effort on their part they would do so and be offended if people labelled them as "greedy." I support some form of rent control but if you are in a situation where there is that large of a gap between market rates and tenant rent then things are fucked -- you are basically creating a privileged class: those who managed to lock up rent controlled space as tenants.
- pimlottc 12y ago
  > If a 4x increase in rent is bearable by the market then it's not a sign of landlord greed, it's a sign of a broken system. It's not bearable by the market. $2145 is low but market rate is nowhere near $8900 for a place like this; not even half that. This is clearly an attempt to force the tenant out with an inflated rate. I'm not going to comment on either sides rights here but this rate is not simply "what the market will bear".
  - remarkEon 12y ago
    Can we really even say what "market rate" is anymore?
    - pimlottc 12y ago
      Good question, but the maps and figures released by the rental companies usually put it in the $3000-some range, plus or minus depending on area.
  - gfodor 12y ago
    Fair point, I was under the assumption this was similar to situation in some parts of NYC where rent control results in huge gap between market and tenant rate.
- scintill76 12y ago
therealwill 12y ago
Here is the home: http://www.trulia.com/homes/California/San_Francisco/sold/7118191-355-Bocana-St-San-Francisco-CA-94110 http://www.trulia.com/homes/California/San_Francisco/sold/71... Taxes are 11,043 with a value of 904,085. $2145 looks like an EXTREMELY low rent for a house of this size in San Francisco. (half of the rent is just property taxes.) The landlord was likely losing money keeping it rented at $2145 even if he owned it free and clear.
- jld 12y ago
  There are multiple units in the house.
  - colanderman 12y ago
    Correction: were. (The fact that the landlord trashed the other unit is key to his shenanigans.)
- thearn4 12y ago
  > 1 full bath, 1,900 sqft Single-Family Home > a value of $904,085 I understand the nature of supply and demand and the appeal of living in an area full of like minded people, but as someone in a flyover state, this absolutely blows my mind.
  - freehunter 12y ago
    Shoot, in the Midwest I have an apartment with about that much square footage, two full baths, and I think I'm getting ripped off at $1400/mo. Did I mention I moved in less than a year ago, and was the first resident in the building, so it's brand new? I understand San Francisco is the home of technology, but get your stuff sorted out, seriously. Is it worth being in a city that absolutely hates you? A city that would do anything to make your lives miserable? I wonder what would happen if Apple and Google packed up and moved to, I dunno, Milwaukee?
    - thearn4 12y ago
bovermyer 12y ago
Regardless of legality, this is obviously wrong. The owner of the property clearly has no understanding of reality; they're going to be financially destroyed by this move, so no additional action necessary on that front. Glad to see someone so evil fall on hard times; pity they won't suffer more. As for the tenant(s); if you want to relocate, I'll put you up in Minneapolis for free for a couple months if you want. No conditions, just let me know.
- WalterSear 12y ago
  From the records on Zillow, assuming they owned the unit free and clear, the landlord was likely losing money at the current rent: it's less than the current taxes on the unit. Should they have been forced to continue to rent the unit out at a loss?
  - cowsandmilk 12y ago
    Zillow has property taxes at $11,043/year The tenant was paying $2,145/month = $25,470/year. According to the letter, they forced out another tenant. IF that tenant was paying a similar amount, the landlord was making >4x taxes in rent, not less than the current taxes. Also, the current owners bought the property on 12/30/2014. Why should anyone have sympathy for them having tenants? They knew they were buying a rent-controlled building. They aren't some owners for the past 30 years being held victim to tenants who won't move out.
    - cowsandmilk 12y ago
      correction to myself on "buying", it appears the previous owner was "SHUKRY & VERA LAMA RVC LVG TR" and the new owner is "LAMA NADIA V", so it probably was an inheritance, not a purchase.
      - cthalupa 12y ago
        If you read the facebook post, it claims they transferred the house from one couple to a sibling as part of the process that allowed them to increase rent.
deleted 12y ago
[deleted]
- cma 12y ago
  The 8900 is just to get her out. Once she is out, they will reconvert the other unit and get two new tenants without priority claims on controlled rent.
  - deleted 12y ago
    [deleted]
jlebar 12y ago
> The few of us who still remain in San Francisco have no choice but to live in sub-par conditions like mold, windows that don't shut, rodents and countless other issues because there is no other choice, because the rents are so high you can't move so you don't. Yes. But the solution isn't more rent controls. That just increases the gap in price between market-rate apartments and rent-controlled apartments. This makes it even harder to move, and it further increases the incentives for landlords not to maintain their rent-controlled apartments or pull stunts like this. The solution is to add supply to meet demand. We should be furious at the forces that have kept supply in SF so absurdly low.
- brc 12y ago
  The rent control creates the mold and stuck windows. That's the point. Supply is the answer. You cannot increase the number of people living in a city without increasing housing stock. Build, build, build. It is the only answer.
  - simoncion 12y ago
    I totally agree that SF needs to build like crazy. Every new residential construction that goes up fills me with a little joy. :) > The rent control creates the mold and stuck windows. That's the point. Bullshit. 1) Friends down the block from me live in a tall "market rate" tower that is in substantially poorer condition than the rent-controlled building that I call home. 2) In SF, stuck windows and mold are must-repair items for landlords, regardless of rent control status. If you as a tenant can't get satisfaction from your landlord, do the repair yourself and present him with a bill. The law guarantees that you'll be reimbursed in circumstances like these.
- sukilot 12y ago
  Do you think the landlords support supply expansion? Construction limits are neatly equivalent to rent control (in the other direction) for landlords.
  - Aloisius 12y ago
dredmorbius 12y ago
This would be an excellent time to: 1. Contact a tenants-rights attorney. 2. Familiarize yourself with housing law and mediation. In San Francisco, the latter is covered under the San Francisco Rent board: http://sfrb.org/ http://sfrb.org/ The former can be located via the San Francisco Tenants' Union: http://www.sftu.org/ http://www.sftu.org/
clarky07 12y ago
Contrary to popular belief, there are other places to live than San Francisco. Almost all of them are more affordable. If you don't want to pay absurd cost of living, move. There are in fact jobs in other parts of the world.
grandalf 12y ago
While this is inconvenient for the tenant, it's not unfair. Rent control is unfair. Now, with the proceeds, the landlord might invest in new flats which will mean more housing for everyone.
cletus 12y ago
Landlord finds loophole to end rent control on a unit. Shocker. To those who say it's unfair to the landlord to force rent control on them I say two things: 1. Yes it is. There are cases when legally allowed rents are below the taxes the landlord needs to pay. If the government really thinks affordable housing is a public good, let the government build or buy apartment buildings and offer it rather than having forced income distribution essentially; and 2. To the landlords: it's not so funny when the shoe's on the other foot is it? I'm talking of course about Prop 13. This allows long term owners to pay basically nothing in property taxes with those taxes only resetting when the property is sold. So the state of California screwed up in creating rent control and Prop 13. Great. Repeal them both. The problem with massive rent control is it creates a dysfunctional market and a huge disincentive to rent out or build new housing supply [1]. New York City ended issuing new rent control leases in 1973. There are very few left. NYC has a functional housing market (in comparison). There are affordable places to live 30 minutes from Manhattan thanks to pretty good infrastructure. SF specifically and South Bay in general are basically an object lesson in NIMBYism gone insane. Honestly, the sooner the startup figures out that the only thing the Valley has got going for it is the weather because everything else sucks, the better. [1]: http://www.sfgate.com/opinion/openforum/article/San-Francisco-rent-control-contributes-to-housing-6010287.php http://www.sfgate.com/opinion/openforum/article/San-Francisc...
- simoncion 12y ago
  > There are cases when legally allowed rents are below the taxes the landlord needs to pay. This does not happen in California. Prop 13 ensures it. Property taxes pretty much never increase. One of the ways that they do is when a property changes hands. Either this landlord purchased the property with the intent of kicking out the tenants whose rent he knew would be less than the re-assessed property tax, or he's being a dickbag and is throwing out a tenant because he feels that he deserves more money from his long-term investment.
kartikkumar 12y ago
So, there's no mention of the tenant's salary in this story. Does rent control in SF or the US in general not stipulate that rent control is also a function of the tenant's ability to pay? Here, in The Netherlands, this is an important criterion in determining what the maximum increase is in rent for a given property [1]. My general understanding of the law in The Netherlands based on having rented once during university is that it heavily favours tenants. The bottomline is that no one is allowed to end up on the street, with the main exception being if the landlord is in dire financial straits. Apart from that, the law sides with the tenant. This even goes to the extent that fixed-term contracts are more or less useless, because if a tenant doesn't want to leave, they don't have to. Is it considered reasonable in SF that the tenant will be able to find alternative accommodation within 60 days? [1] http://www.rijksoverheid.nl/onderwerpen/huurwoning/huurverhoging http://www.rijksoverheid.nl/onderwerpen/huurwoning/huurverho... (Laws on rental increase in The Netherlands in Dutch) [2] https://www.jurofoon.nl/huren/huurovereenkomst-voor-bepaalde-tijd.asp https://www.jurofoon.nl/huren/huurovereenkomst-voor-bepaalde... (Fixed-term contract rules for housing in Dutch)
- phil248 12y ago
  In San Francisco, only residential units constructed prior to 1979 are subject to the local rent control law. This is for market housing, government subsided housing follows different (and differing) regulations, which often do take income into account. http://www.sftu.org/rentcontrol.html http://www.sftu.org/rentcontrol.html
- ageek123 12y ago
  Ability to pay is not factored in. I know many, many Google/Facebook/Apple software engineers living in rent-controlled apartments in San Francisco.
- nedwin 12y ago
  if only SF rent control was linked to the income of the renter! Plenty of well paid engineers and execs living in significantly below market apartments when they could easily afford market-priced housing. If the aim is to create affordable housing for low income earners, rent control is not the solution.
ghshephard 12y ago
I find it interesting that we can, with almost 95%+ success, determine who on these threads owns Real Estate in San Francisco, versus those who don't. There are admittedly some comments that are in the margins, but the number of false positives/negatives is probably pretty close to zero. In particular, those who rant about the evils of uncontrolled rental markets are 99% likely to not own real estate in San Francisco. Therefore, those commentors aren't commenting on the objective good or bad of such issues, so much as they are just explaining what their personal situation is. As soon as those people who cried the evils of uncontrolled rental markets came into possession of San Francisco property, they would immediately change their tune. Should we place any value in ethical principles which are so immediately seen to be self-serving?
- pingswept 12y ago
  How can you verify your assumptions about whether or not a commenter owns real estate? For example, do I own real estate in San Francisco? I think your chances of getting that right are pretty close to 50%.
  - ghshephard 12y ago
    You haven't made any comments about Real Estate ownership, so I can't make any guesses. I really like Warren Buffet's perspective, the rules one believes are right, should be created without you knowing what your circumstance will be. That is, if you are trying to determine what is right, or not, about rent controls, you should create without knowing whether you will be renter, or an owner. I've never met a real estate owner in San Francisco who was rabidly opposed to uncontrolled rent markets - so, with 99% certainly (I'm sure there are some edge cases), anybody who is highly opposed to uncontrolled rent markets is, with a high level of certainty, not a real estate owner in San Francisco.
    - harryh 12y ago
      Incidentally the technical term for what you describe is the: http://en.wikipedia.org/wiki/Veil_of_ignorance http://en.wikipedia.org/wiki/Veil_of_ignorance Most famously described by: http://en.wikipedia.org/wiki/John_Rawls http://en.wikipedia.org/wiki/John_Rawls
dbloom 12y ago
This was almost certainly illegal. Removing dwelling units in SF (as they did to the downstairs neighbor's flat) almost always requires a public hearing. See http://www.sf-planning.org/index.aspx?page=2816 http://www.sf-planning.org/index.aspx?page=2816 (via https://twitter.com/markasaurus/status/577252542419062784 https://twitter.com/markasaurus/status/577252542419062784 )
politician 12y ago
Slightly OT: Does anyone know whether there is there a housing equivalent of the Basic Income movement? Basic Shelter?
- sampo 12y ago
  Affordable housing is something that would actually be solved by free markets. It's the heavily regulated (almost socialistic) systems when building new homes to new people in a growing city is not allowed (because the old residents don't want their city to grow), so supply is now allowed to meet the demand, when we have these problems.
  - shauncrampton 12y ago
    Everything could be solved by a perfect free marker where everyone had perfect information, zero latency in decision making and where making a decision cost nothing. Trouble is, IRL, none of those assumptions is even remotely true. Just as the renter signs an agreement, so does the landlord; rent controls skew the bargain but they do it for both parties. If the landloard didn't want to have a rent-controlled tenant for 10 years, then they should have magically known (using their perfect market information, duh!) that that tenant would be there 10 years and rented to someone else who wouldn't.
    - sampo 12y ago
      A desirable city with very limited new construction will lead to increasing prices. You can use rent control to give cheaper housing to a smallish number of people, who kind of win in this lottery and get cheaper housing the others. But there will be those others, lots of them, who were not among the "lottery winners" and who will have to resort ti living with a much longer commute. If demand is high, building new homes for people should be allowed.
- bau5 12y ago
  It's supposed to be a part of basic income to pay enough for someone to be able to afford rent and to and choose where to live that's within their budget. If it was a separate thing, perhaps people could be given a choice among places with a low cost of living, and then the amount needed for basic income would be lower. http://marshallbrain.com/manna1.htm http://marshallbrain.com/manna1.htm Edit: Manna was more relevant than I thought: > The government had finally figured out that giving choices to people on welfare was not such a great idea, and it was also expensive. Instead of giving people a welfare check, they started putting welfare recipients directly into government housing and serving them meals in a cafeteria. If the government could drive the cost of that housing and food down, it minimized the amount of money they had to spend per welfare recipient. http://marshallbrain.com/manna4.htm http://marshallbrain.com/manna4.htm
donnfelker 12y ago
... and another reason to hire remote. Helps reduce this kind of nonsense from happening.
dools 12y ago
Rent control seems monumentally stupid. In Australia, the government owns houses and rents them out to people cheaply. The owners of the house are compensated when the house is bought. It seems insane that owners of a property should be expected to keep rent artificially low to help poor people. This is the government's job. But then, in America, you guys don't trust the government to do anything like house, educate and heal people. Go figure.
- icelancer 12y ago
  > But then, in America, you guys don't trust the government to do anything like house, educate and heal people. Or fight wars or manage finances. Because there is strong precedence that the government is pretty bad at these things.
BenTZH 12y ago
Terribly high increase. Wow
hindsightbias 12y ago
I can't believe a single glibertarian hasn't quoted Krugman on rent control yet.
hindsightbias 12y ago
Well, like all good things, HN has passed Eternal September. Or more quaintly: http://imgur.com/L00Fn2t http://imgur.com/L00Fn2t
- ageek123 12y ago
  Why, because you disagree with what some people are saying?
JohnLen 12y ago
Wonder how this rental mechanism works
abalone 12y ago
The typical false-wise answer to the housing crisis is something like "build more housing, supply & demand, read an Econ 101 textbook, DUH." The reality is more complex. The real Economics 101 answer is: You can't know the effect of more supply on prices without knowing the demand curve. No one truly knows that, but consider this. The current market price is basically what a startup employee can support on their salary without kids, much savings, etc. If there's a large supply of people willing to move into SF for jobs like this and pay that price, but unable to pay more, then that whole worldwide supply needs to be exhausted before the market price comes down. That could take years or even decades depending on how the startup boom goes. In the meantime, the macroeconomic effects of widespread losses in housing for blue collar, service industry workers, the middle class, artists, etc. can have very undesirable long term effects on a city. There is good reason for city governments to consider managing this growth.
issa 12y ago
Look at this from another perspective. Being a landlord is great. You sign a piece of paper making you the owner of a property. Then other people do actual work and pay you just for having your name on that piece of paper. If we lived in a perfect (or even just a "better") society, this would be fine. But the problem is that we live in a society with different classes. If your parents owned a home or two, you probably will as well. If your parents didn't, you probably won't either. In reality, "rent" is just another way to keep the rich rich and the poor poor. Rent Control is an attempt to mitigate the damage. Personally, I think it's a terrible band-aid that exists because we aren't willing to face the real issues at hand.
G650 12y ago
messed up.
presty 12y ago
Hey everyone, time to retake San Jose.
michaelochurch 12y ago
I can't take San Francisco seriously anymore. If the VCs weren't there, it'd be a third-rate city, and much of what the VCs are funding isn't even technology but the post-apocalyptic sort of "attempt to engage in one of the short-term natural monopolies that technology sometimes creates" gambits that bloom in the caldera of an imploded technology industry. Yet it has become a more expensive place to live than New York, despite being dysfunctional in every measure other than tech salaries. I cannot see why California hasn't done something about Prop 13 NIMBYs. All that those useless parasites do is block progress, drive up the rents by preventing new housing from being built, and cause measles epidemics with their anti-vax nonsense. It's really time to call in some Texans on that shit and fix the NIMBY problem. If California can't do that, then how are we supposed to take them seriously? If they can't get their heads out of the ass of the past that the NIMBYs claim that they are preserving, how can we trust them to build the future?
- dlss 12y ago
  > how can we trust them to build the future? Don't! Whatever the alternative was in your head when you wrote this sentence -- do that! The world needs more future-builders :D
- sumitviii 12y ago
  "much of what the VCs are funding isn't even technology but the post-apocalyptic sort of "attempt to engage in one of the short-term natural monopolies that technology sometimes creates" gambits that bloom in the caldera of an imploded technology industry" Much of what is funded has always been that.
bbarn 12y ago
The reason this article is trending at the top of HN is the reason this person is going through this. The idea that great start-ups must exist on an 47 sq mile piece of land with utterly mediocre weather (the literal definition of mediocre, that is - one many of us love, myself included) in perfect coexistence with a quaint aging population below the poverty line, drug addicts, and the last generation that sought to live there in the last boom is patently absurd. Why so many globally reaching, internet based, in every home in the world companies think that they absolutely must be positioned in the mecca of startupdom is why I just can't take my own career seriously for too long. There's no reason we all need to be on that tiny peninsula! If you need to be there for "reach to investors", "proximity to the startup culture", guess what, your product probably sucks. If it were any good, you could do it from anywhere, without having to sit on the great lords of tech investment's front door begging every day. You want to disrupt something? Why not start with disrupting the idea that being part of "start-up culture" is required to be successful.
- swatow 12y ago
  I think people go to San Francisco for the 20-30 year old girls, not the aging population or drug addicts.
  - conanbatt 12y ago
    Nobody moves to San Francisco looking for girls.
  - bsder 12y ago
    Thanks for the laugh.
- q2 12y ago
  >>> Why so many globally reaching, internet based, in every home in the world companies think that they absolutely must be positioned in the mecca of startupdom Why people join twitter or facebook or any other virtual social network? I think both have similar answers.
john_butts 12y ago
You nerds are sooooo fucked when the rubber meets the road.
bhuga 12y ago
It's an incredible statement on the depth of the bay area talent pool and VC money network that so much tech concentrates in such a tiny place (and thus drives up the rent, as in the article). Nowhere else in the world can compete. It's not for lack of trying. Louisiana, for example, will pay 35% of a programmers salary indefinitely[1]; other states and cities have similar programs. That's serious competition. But the talent/money vortex of the bay area is not just winning, it's actually getting stronger. The other areas with real companies, like Austin, Seattle, and New York, still feel like also-rans compared to SF and the valley. If you want to raise money, it's still the place to go. It's just incredible to think about. Is there any other field where there's just one geographical place that's just so far ahead of anywhere else? Especially fields like biotech, where geography isn't directly related to the business? [1]: http://gnoinc.org/about/digital-media-incentive/ http://gnoinc.org/about/digital-media-incentive/
lucaspiller 12y ago
[Meta] Why has this dropped off the first page? It currently #32 and has 443 points, 447 comments and was posted 4 hours ago - there aren't any other stories more popular than this on the first page.
omarforgotpwd 12y ago
Hopefully the rising prices will encourage investment and lead to a greater supply of housing options in the future. The fact that this kind of thing is happening probably means the rent control laws have been too strict in the past.
geebee 12y ago
I'm coming very late to this (540 comments and counting), but I do want to make one point about the term "NIMBY". While it's a reasonable observation about housing politics, it does invite potentially false equivalence. A kind of equivalence is built into the term itself - "not in my backyard" means everyone recognizes something is needed, but nobody wants it near them. In this case, everyone wants to live in the low density section of a high density area. Still, this term encompasses everyone from bernal heights hippies who want to keep density at 18,311/sq mi to atherton billionaires who want to keep it at 1,400. It includes noe valley "activists" who don't want to tear down 100 year old houses and mountain view city council members who voted to allow massive new corporate construction bringing tens (hundreds?) of thousands of new workers to their region but specifically banned new residential construction near those places of business. All in all, yeah, I hear you on the noe/bernal/mission activists. They are a bit nimbytastic, no doubt. But to me, the actions of the anti-housing forces in some peninsula towns are such an order of magnitude worse (and are causing many of the problems you see in SF) that simply applying the NIMBY label to both without further analysis is an exercise in false equivalence.
pascal1us 12y ago
This sort of thing has been building up for a long time. This is mainly due to the Greed of the SF tenants to who prevent developers from building more units with local politics NIMBY. By constricting the supply artificially it prevents new buildings from going up. Also, the mayor is to blame as well, for incentivizing more companies to come to SF making the situation even worse.
fhf 12y ago
There seems to be a lot of discussion in this topic around the idea that "IF San Francisco did away with rent control, THEN the market would correct the problem." Given that SF hasn't had rent control since 1980 (it only applies to buildings constructed before that), and the market has thus had 25 years to correct, which of the following is true: 1. There is no housing problem 2. Removing rent control didn't make a difference. I'm actually curious to know the opinion of people blaming rent control... (edit: typo)

491 points by aestetix 12y ago

JDiculous 12y ago

Is that legal? In NYC, there are laws in place to limit the amount a landlord can raise rent.

codezero 12y ago
If you read the thread it sounds like the landlord used several loopholes and had previous litigation against them and they toughened up their approach after previous failed evictions. I'm glad my rent only went up 20% since I'm in Sunnyvale and not the city.
x0x0 12y ago
Yes, it is almost certainly legal. The other option landlords always have is to withdraw the unit from the market. You can Ellis Act anyone you want; the price you pay is $18k per person or so plus waiting 366 days, and a stained title. You can still renovate then TIC the building though, and you'll find plenty of takers. ps -- having been in a legal fight with an sf landlord, the fact of the matter is despite all the pretty bullshit sf claims, there are vanishingly few actual tenant protections that work against a malicious landlord. At best, you can leave and sue after the fact, but be prepared to spend years on a fight. @harry: an ellis act eviction, or other no-fault evictions, permanently prevents the building from utilizing the 2-unit lottery bypass to condo the building, so it will have to remain a TIC. TICs have a variety of negative implications, including complicating mortgages. The lottery, which is still necessary for larger units, is suspended until 2024. see eg http://www.andysirkin.com/HTMLArticle.cfm?Article=158 http://www.andysirkin.com/HTMLArticle.cfm?Article=158 and http://www.andysirkin.com/HTMLArticle.cfm?Article=219 http://www.andysirkin.com/HTMLArticle.cfm?Article=219
- harryh 12y ago
  What do you mean by "stained title"?
uptown 12y ago
In NYC it depends on the property. Unless the property is rent stabilized, rent can legally be raised by any amount the landlord pleases. Example: http://www.brickunderground.com/blog/2013/08/rent_coach_can_my_landlord_raise_my_stabilized_units_rent_by_300_a_month http://www.brickunderground.com/blog/2013/08/rent_coach_can_...

jackowayed 12y ago

If you read the caption, the real issue here is a horrible abuse of the rent control law. When the renter signed their lease, the unit was covered by rent control, putting very tight restrictions on rent increases and evictions. However, the landlord then essentially destroyed the other unit in the building so that they could reclassify the building as a single-family home instead of a multi-unit building. Single-family homes are not covered by the rent control law. This should obviously not be legal; if you're going to have a rent control, you can't let landlords take a unit that should have rent control and make it not rent controlled. At the very least, these kinds of changes shouldn't allow the landlord to escape an active rent control obligation to a current tenant.

Lewisham 12y ago
I think it's sort of obnoxious and should be illegal to force landlords to keep renters ad infinitum just because. That hardly seems fair to the landlord, no?
- jacques_chester 12y ago
  That you dislike a law does not make it any less the law. That a thing is very popular does not make it lawful. The law has always been distinct from morality, with clear gateways from moral sentiment to the law.
  - jsprogrammer 12y ago
    >The law has always been distinct from morality, Has it? If you look at Hebrew and Christian tradition, the two are highly conflated.
    - mod 12y ago
      I think that despite the strong correlation & overlap, yes, law has "always been" distinct from morality, at least where the law wasn't whimsical. If it's not illegal, you can still do it, morals be damned, without being punished. It's pretty much the point of law--to give warning & right to punish. That's not the same as morals.

Sir_Cmpwn 12y ago

YC sings the praises of San Fransisco, and they're right about the culture and the startup scene there. But things like this, and the cost of living overall, make me hesitate to start something out there.

r0naa 12y ago
Me too, I have yet to graduate from college but things like that make me feel that I should stay in Waterloo (Canada).
- mud_dauber 12y ago
  <waves from Austin>
  - balls187 12y ago
    </waves from Austin> <thumbsup city="Austin"/> <thumbsup city="Seattle"/>
    - jeff_marshall 12y ago
      portland is also quite nice....
      - jes5199 12y ago
        shhhh! It's a secret
      - robobro 12y ago
        hell yeah!
- psychboo 12y ago
  I'm in nearby Guelph (Canada) and feel the same way. The developing technology scene in Ontario is enough to keep me put for now.
12y ago

whiteboarder 12y ago

Build more houses. None of this shit would happen if SF would just build more houses.

Russell91 12y ago
Ironically, rent control is exactly why there is so little housing available in SF. Iirc, only 30% of the voting population owns property. So how is it that the rest of us (70%) don't vote to build more? Well, because 3/4 renters are under rent control, and essentially don't care. So only 70%/4 < 30% of people are motivated to push the market towards more housing. The rest profit handsomely from increased home prices due to high demand. This is the real tragedy of rent control in San Francisco IMO. Edit: source: http://www.quora.com/What-percentage-of-San-Francisco-apartments-are-under-rent-control http://www.quora.com/What-percentage-of-San-Francisco-apartm...
- shit_parade 12y ago
  Sadly, trying to explain simple economic facts to people on HN is a good way to get down voted if it involves criticism of government regulation.
- jsprogrammer 12y ago
  If the majority of owners don't wish to personally utilize their property and instead choose to extract rent from it, what exactly are the renters supposed to buy? Owners can apparently force renters to bleed ever more money, but renters can't force a squatting owner to sell, they just have to accept it or, as this letter exemplifies, GTFO.
  - AnthonyMouse 12y ago
    > If the majority of owners don't wish to personally utilize their property, and to extract rent from it, what exactly are the renters supposed to buy? If you offer to pay at least as much for the building as the landlord would expect to make from renting it out then any rational landlord will sell you the building. > Owners can apparently force renters to bleed ever more money If they raise the rent significantly above what typical apartments go for in the area then the tenant will move out and they'll have to spend money to find a new tenant and go without rent in the meantime. Rental housing is one of the most efficient markets in existence. Landlords have nothing to gain by gouging tenants who will only move across the street to keep paying what they are now, which is why that rarely if ever happens. But when the local market price of housing changes, adjusting rents to meet the market is completely reasonable and natural.

pdq 12y ago

"(2) Effective May 5, 2015, the security deposit amount required shall increase to $12,500 per month." Is this a typo? I have never heard of a monthly security deposit.

WalterSear 12y ago
Probably a typo.
jsprogrammer 12y ago
I think it is just a scary way of stating that you must have $12,500 deposited with the owner for the entire month you are leasing. It just rolls over each month.

colanderman 12y ago

"the security deposit [...] shall increase to $12,500 per month" Can someone explain what this means? I've never had to pay a security deposit per month. That must be a copy + paste error?

tylermac1 12y ago
The numbers are just there to make it impossible to pay. They want the tenant out so they can sell the house.
- colanderman 12y ago
  I get that. But the concept of a security deposit is that you get it back when you leave, so long as you haven't damaged the place. Having to pay an additional security deposit each month doesn't make logistical or logical sense. Do they hand you a check for $1M when you leave after ten years? Does the number of damageable surfaces in the apartment increase each month?
  - tylermac1 12y ago
    Not necessarily. I've had security deposits where only a certain percentage is refunded after any necessary deductions. Depends on what they signed in the lease. But still, it was never designed to actually be collected, just a number to scare someone away. Not much more to look into it.
deleted 12y ago
[deleted]
error54 12y ago
I believe the person was paying month to month so the per month deposit just refers to general security deposit.

azinman2 12y ago

They want to sell the house. This is their way of kicking people out without explicitly doing so.

deleted 12y ago
[deleted]

WalterSear 12y ago

I just don't see the news here. It's totally legal, and done all the time: it's why people lease houses rather than go month to month. It's not a reflection of the market in SF. This happens everywhere a landlord who isn't getting on with their month-to-month tenants and want them out, for whatever reason. It happened to me in 2005. It's not a necessarily a reflection of anything outside of the personal situation of the poster, and their relationship with their landlord. If this had happened anywhere but SF, there wouldn't be the flurry of hysterical outrage that's exploding on Twitter and Facebook: there would be crickets.

maxerickson 12y ago
They converted the other unit in the building to storage (after hassling that tenant out). I don't think it's anything like 'isn't getting on', the landlord wants to convert the building to some other use and simply doesn't care about the tenants, which isn't the same as finding them disagreeable or whatever (one imagines they might want to do something like sell it as a private home).
- WalterSear 12y ago
  Legally, it's all under the same umbrella. I never said this was scrupulous. Just legal, and perfectly commonplace. Not news. It's being used as a rallying cry by people who were perfectly content with capitalism until it started being applied to them.
- cma 12y ago
  You really think they will keep it as storage? Once the remaining tenant is out they will renovate everything and rent both units again.
  - maxerickson 12y ago
    I don't know what they will do with the building. I brought up the storage because it makes their motivation clearer, they weren't getting rid of the tenants for any sort of personal reason, it's about using the building for something else (or as you say, putting it back on the market at higher rates).

s0uthPaw88 12y ago

This is a perfect example of why rent control is a terrible system that leads to market inefficiencies and worse outcomes for a community. The law has made it more profitable for this landlord to remove housing stock and charge market rate for the remaining unit than to rent out both units in the building under rent control laws. Cities with low vacancy rates like SF need to rethink their approach to housing if they want to remain attractive places to live.

javert 12y ago
Completely agree with you. However, I think SF has already ceased to be an attractive place to live. I don't live there, so maybe it's not a fair comment, but I would not want to live there for the same reason I don't like flushing money down the toilet.
- gwillen 12y ago
  > I think SF has already ceased to be an attractive place to live. Or as Yogi Berra allegedly once said: "Nobody goes there anymore. It's too crowded."
- zobzu 12y ago
  it certainly isnt super attractive for new comers. - rent is very high, and the higher salary won't compensate all that much (salaries didn't move up as fast as the rent) - its crowded, expect queues everywhere, and traffic. Lots of traffic.
nodesocket 12y ago
If not for rent control, my studio apartment would be over $3,000 a month. Everyday I thank rent control.
- meddlepal 12y ago
  So what? Why do you think you should get to live somewhere highly desireable at a below market rate?

gfodor 12y ago

This person should be grateful they were able to live in a place in such high demand so cheaply due to unfair rent control laws. If a 4x increase in rent is bearable by the market then it's not a sign of landlord greed, it's a sign of a broken system. I'm sure if this person was offered the opportunity to make an extra 5k a month with little to no change in effort on their part they would do so and be offended if people labelled them as "greedy." I support some form of rent control but if you are in a situation where there is that large of a gap between market rates and tenant rent then things are fucked -- you are basically creating a privileged class: those who managed to lock up rent controlled space as tenants.

pimlottc 12y ago
> If a 4x increase in rent is bearable by the market then it's not a sign of landlord greed, it's a sign of a broken system. It's not bearable by the market. $2145 is low but market rate is nowhere near $8900 for a place like this; not even half that. This is clearly an attempt to force the tenant out with an inflated rate. I'm not going to comment on either sides rights here but this rate is not simply "what the market will bear".
- remarkEon 12y ago
  Can we really even say what "market rate" is anymore?
  - pimlottc 12y ago
    Good question, but the maps and figures released by the rental companies usually put it in the $3000-some range, plus or minus depending on area.
- gfodor 12y ago
  Fair point, I was under the assumption this was similar to situation in some parts of NYC where rent control results in huge gap between market and tenant rate.
scintill76 12y ago

therealwill 12y ago

Here is the home: http://www.trulia.com/homes/California/San_Francisco/sold/7118191-355-Bocana-St-San-Francisco-CA-94110 http://www.trulia.com/homes/California/San_Francisco/sold/71... Taxes are 11,043 with a value of 904,085. $2145 looks like an EXTREMELY low rent for a house of this size in San Francisco. (half of the rent is just property taxes.) The landlord was likely losing money keeping it rented at $2145 even if he owned it free and clear.

jld 12y ago
There are multiple units in the house.
- colanderman 12y ago
  Correction: were. (The fact that the landlord trashed the other unit is key to his shenanigans.)
thearn4 12y ago
> 1 full bath, 1,900 sqft Single-Family Home > a value of $904,085 I understand the nature of supply and demand and the appeal of living in an area full of like minded people, but as someone in a flyover state, this absolutely blows my mind.
- freehunter 12y ago
  Shoot, in the Midwest I have an apartment with about that much square footage, two full baths, and I think I'm getting ripped off at $1400/mo. Did I mention I moved in less than a year ago, and was the first resident in the building, so it's brand new? I understand San Francisco is the home of technology, but get your stuff sorted out, seriously. Is it worth being in a city that absolutely hates you? A city that would do anything to make your lives miserable? I wonder what would happen if Apple and Google packed up and moved to, I dunno, Milwaukee?
  - thearn4 12y ago

bovermyer 12y ago

Regardless of legality, this is obviously wrong. The owner of the property clearly has no understanding of reality; they're going to be financially destroyed by this move, so no additional action necessary on that front. Glad to see someone so evil fall on hard times; pity they won't suffer more. As for the tenant(s); if you want to relocate, I'll put you up in Minneapolis for free for a couple months if you want. No conditions, just let me know.

WalterSear 12y ago
From the records on Zillow, assuming they owned the unit free and clear, the landlord was likely losing money at the current rent: it's less than the current taxes on the unit. Should they have been forced to continue to rent the unit out at a loss?
- cowsandmilk 12y ago
  Zillow has property taxes at $11,043/year The tenant was paying $2,145/month = $25,470/year. According to the letter, they forced out another tenant. IF that tenant was paying a similar amount, the landlord was making >4x taxes in rent, not less than the current taxes. Also, the current owners bought the property on 12/30/2014. Why should anyone have sympathy for them having tenants? They knew they were buying a rent-controlled building. They aren't some owners for the past 30 years being held victim to tenants who won't move out.
  - cowsandmilk 12y ago
    correction to myself on "buying", it appears the previous owner was "SHUKRY & VERA LAMA RVC LVG TR" and the new owner is "LAMA NADIA V", so it probably was an inheritance, not a purchase.
    - cthalupa 12y ago
      If you read the facebook post, it claims they transferred the house from one couple to a sibling as part of the process that allowed them to increase rent.

deleted 12y ago

[deleted]

cma 12y ago
The 8900 is just to get her out. Once she is out, they will reconvert the other unit and get two new tenants without priority claims on controlled rent.
- deleted 12y ago
  [deleted]

jlebar 12y ago

> The few of us who still remain in San Francisco have no choice but to live in sub-par conditions like mold, windows that don't shut, rodents and countless other issues because there is no other choice, because the rents are so high you can't move so you don't. Yes. But the solution isn't more rent controls. That just increases the gap in price between market-rate apartments and rent-controlled apartments. This makes it even harder to move, and it further increases the incentives for landlords not to maintain their rent-controlled apartments or pull stunts like this. The solution is to add supply to meet demand. We should be furious at the forces that have kept supply in SF so absurdly low.

brc 12y ago
The rent control creates the mold and stuck windows. That's the point. Supply is the answer. You cannot increase the number of people living in a city without increasing housing stock. Build, build, build. It is the only answer.
- simoncion 12y ago
  I totally agree that SF needs to build like crazy. Every new residential construction that goes up fills me with a little joy. :) > The rent control creates the mold and stuck windows. That's the point. Bullshit. 1) Friends down the block from me live in a tall "market rate" tower that is in substantially poorer condition than the rent-controlled building that I call home. 2) In SF, stuck windows and mold are must-repair items for landlords, regardless of rent control status. If you as a tenant can't get satisfaction from your landlord, do the repair yourself and present him with a bill. The law guarantees that you'll be reimbursed in circumstances like these.
sukilot 12y ago
Do you think the landlords support supply expansion? Construction limits are neatly equivalent to rent control (in the other direction) for landlords.
- Aloisius 12y ago

dredmorbius 12y ago

This would be an excellent time to: 1. Contact a tenants-rights attorney. 2. Familiarize yourself with housing law and mediation. In San Francisco, the latter is covered under the San Francisco Rent board: http://sfrb.org/ http://sfrb.org/ The former can be located via the San Francisco Tenants' Union: http://www.sftu.org/ http://www.sftu.org/

clarky07 12y ago

Contrary to popular belief, there are other places to live than San Francisco. Almost all of them are more affordable. If you don't want to pay absurd cost of living, move. There are in fact jobs in other parts of the world.

grandalf 12y ago

While this is inconvenient for the tenant, it's not unfair. Rent control is unfair. Now, with the proceeds, the landlord might invest in new flats which will mean more housing for everyone.

cletus 12y ago

Landlord finds loophole to end rent control on a unit. Shocker. To those who say it's unfair to the landlord to force rent control on them I say two things: 1. Yes it is. There are cases when legally allowed rents are below the taxes the landlord needs to pay. If the government really thinks affordable housing is a public good, let the government build or buy apartment buildings and offer it rather than having forced income distribution essentially; and 2. To the landlords: it's not so funny when the shoe's on the other foot is it? I'm talking of course about Prop 13. This allows long term owners to pay basically nothing in property taxes with those taxes only resetting when the property is sold. So the state of California screwed up in creating rent control and Prop 13. Great. Repeal them both. The problem with massive rent control is it creates a dysfunctional market and a huge disincentive to rent out or build new housing supply [1]. New York City ended issuing new rent control leases in 1973. There are very few left. NYC has a functional housing market (in comparison). There are affordable places to live 30 minutes from Manhattan thanks to pretty good infrastructure. SF specifically and South Bay in general are basically an object lesson in NIMBYism gone insane. Honestly, the sooner the startup figures out that the only thing the Valley has got going for it is the weather because everything else sucks, the better. [1]: http://www.sfgate.com/opinion/openforum/article/San-Francisco-rent-control-contributes-to-housing-6010287.php http://www.sfgate.com/opinion/openforum/article/San-Francisc...

simoncion 12y ago
> There are cases when legally allowed rents are below the taxes the landlord needs to pay. This does not happen in California. Prop 13 ensures it. Property taxes pretty much never increase. One of the ways that they do is when a property changes hands. Either this landlord purchased the property with the intent of kicking out the tenants whose rent he knew would be less than the re-assessed property tax, or he's being a dickbag and is throwing out a tenant because he feels that he deserves more money from his long-term investment.

kartikkumar 12y ago

So, there's no mention of the tenant's salary in this story. Does rent control in SF or the US in general not stipulate that rent control is also a function of the tenant's ability to pay? Here, in The Netherlands, this is an important criterion in determining what the maximum increase is in rent for a given property [1]. My general understanding of the law in The Netherlands based on having rented once during university is that it heavily favours tenants. The bottomline is that no one is allowed to end up on the street, with the main exception being if the landlord is in dire financial straits. Apart from that, the law sides with the tenant. This even goes to the extent that fixed-term contracts are more or less useless, because if a tenant doesn't want to leave, they don't have to. Is it considered reasonable in SF that the tenant will be able to find alternative accommodation within 60 days? [1] http://www.rijksoverheid.nl/onderwerpen/huurwoning/huurverhoging http://www.rijksoverheid.nl/onderwerpen/huurwoning/huurverho... (Laws on rental increase in The Netherlands in Dutch) [2] https://www.jurofoon.nl/huren/huurovereenkomst-voor-bepaalde-tijd.asp https://www.jurofoon.nl/huren/huurovereenkomst-voor-bepaalde... (Fixed-term contract rules for housing in Dutch)

phil248 12y ago
In San Francisco, only residential units constructed prior to 1979 are subject to the local rent control law. This is for market housing, government subsided housing follows different (and differing) regulations, which often do take income into account. http://www.sftu.org/rentcontrol.html http://www.sftu.org/rentcontrol.html
ageek123 12y ago
Ability to pay is not factored in. I know many, many Google/Facebook/Apple software engineers living in rent-controlled apartments in San Francisco.
nedwin 12y ago
if only SF rent control was linked to the income of the renter! Plenty of well paid engineers and execs living in significantly below market apartments when they could easily afford market-priced housing. If the aim is to create affordable housing for low income earners, rent control is not the solution.

ghshephard 12y ago

I find it interesting that we can, with almost 95%+ success, determine who on these threads owns Real Estate in San Francisco, versus those who don't. There are admittedly some comments that are in the margins, but the number of false positives/negatives is probably pretty close to zero. In particular, those who rant about the evils of uncontrolled rental markets are 99% likely to not own real estate in San Francisco. Therefore, those commentors aren't commenting on the objective good or bad of such issues, so much as they are just explaining what their personal situation is. As soon as those people who cried the evils of uncontrolled rental markets came into possession of San Francisco property, they would immediately change their tune. Should we place any value in ethical principles which are so immediately seen to be self-serving?

pingswept 12y ago
How can you verify your assumptions about whether or not a commenter owns real estate? For example, do I own real estate in San Francisco? I think your chances of getting that right are pretty close to 50%.
- ghshephard 12y ago
  You haven't made any comments about Real Estate ownership, so I can't make any guesses. I really like Warren Buffet's perspective, the rules one believes are right, should be created without you knowing what your circumstance will be. That is, if you are trying to determine what is right, or not, about rent controls, you should create without knowing whether you will be renter, or an owner. I've never met a real estate owner in San Francisco who was rabidly opposed to uncontrolled rent markets - so, with 99% certainly (I'm sure there are some edge cases), anybody who is highly opposed to uncontrolled rent markets is, with a high level of certainty, not a real estate owner in San Francisco.
  - harryh 12y ago
    Incidentally the technical term for what you describe is the: http://en.wikipedia.org/wiki/Veil_of_ignorance http://en.wikipedia.org/wiki/Veil_of_ignorance Most famously described by: http://en.wikipedia.org/wiki/John_Rawls http://en.wikipedia.org/wiki/John_Rawls

dbloom 12y ago

This was almost certainly illegal. Removing dwelling units in SF (as they did to the downstairs neighbor's flat) almost always requires a public hearing. See http://www.sf-planning.org/index.aspx?page=2816 http://www.sf-planning.org/index.aspx?page=2816 (via https://twitter.com/markasaurus/status/577252542419062784 https://twitter.com/markasaurus/status/577252542419062784 )

politician 12y ago

Slightly OT: Does anyone know whether there is there a housing equivalent of the Basic Income movement? Basic Shelter?

sampo 12y ago
Affordable housing is something that would actually be solved by free markets. It's the heavily regulated (almost socialistic) systems when building new homes to new people in a growing city is not allowed (because the old residents don't want their city to grow), so supply is now allowed to meet the demand, when we have these problems.
- shauncrampton 12y ago
  Everything could be solved by a perfect free marker where everyone had perfect information, zero latency in decision making and where making a decision cost nothing. Trouble is, IRL, none of those assumptions is even remotely true. Just as the renter signs an agreement, so does the landlord; rent controls skew the bargain but they do it for both parties. If the landloard didn't want to have a rent-controlled tenant for 10 years, then they should have magically known (using their perfect market information, duh!) that that tenant would be there 10 years and rented to someone else who wouldn't.
  - sampo 12y ago
    A desirable city with very limited new construction will lead to increasing prices. You can use rent control to give cheaper housing to a smallish number of people, who kind of win in this lottery and get cheaper housing the others. But there will be those others, lots of them, who were not among the "lottery winners" and who will have to resort ti living with a much longer commute. If demand is high, building new homes for people should be allowed.
bau5 12y ago
It's supposed to be a part of basic income to pay enough for someone to be able to afford rent and to and choose where to live that's within their budget. If it was a separate thing, perhaps people could be given a choice among places with a low cost of living, and then the amount needed for basic income would be lower. http://marshallbrain.com/manna1.htm http://marshallbrain.com/manna1.htm Edit: Manna was more relevant than I thought: > The government had finally figured out that giving choices to people on welfare was not such a great idea, and it was also expensive. Instead of giving people a welfare check, they started putting welfare recipients directly into government housing and serving them meals in a cafeteria. If the government could drive the cost of that housing and food down, it minimized the amount of money they had to spend per welfare recipient. http://marshallbrain.com/manna4.htm http://marshallbrain.com/manna4.htm

donnfelker 12y ago

... and another reason to hire remote. Helps reduce this kind of nonsense from happening.

dools 12y ago

Rent control seems monumentally stupid. In Australia, the government owns houses and rents them out to people cheaply. The owners of the house are compensated when the house is bought. It seems insane that owners of a property should be expected to keep rent artificially low to help poor people. This is the government's job. But then, in America, you guys don't trust the government to do anything like house, educate and heal people. Go figure.

icelancer 12y ago
> But then, in America, you guys don't trust the government to do anything like house, educate and heal people. Or fight wars or manage finances. Because there is strong precedence that the government is pretty bad at these things.

BenTZH 12y ago

Terribly high increase. Wow

hindsightbias 12y ago

I can't believe a single glibertarian hasn't quoted Krugman on rent control yet.

hindsightbias 12y ago

Well, like all good things, HN has passed Eternal September. Or more quaintly: http://imgur.com/L00Fn2t http://imgur.com/L00Fn2t

ageek123 12y ago
Why, because you disagree with what some people are saying?

JohnLen 12y ago

Wonder how this rental mechanism works

abalone 12y ago

The typical false-wise answer to the housing crisis is something like "build more housing, supply & demand, read an Econ 101 textbook, DUH." The reality is more complex. The real Economics 101 answer is: You can't know the effect of more supply on prices without knowing the demand curve. No one truly knows that, but consider this. The current market price is basically what a startup employee can support on their salary without kids, much savings, etc. If there's a large supply of people willing to move into SF for jobs like this and pay that price, but unable to pay more, then that whole worldwide supply needs to be exhausted before the market price comes down. That could take years or even decades depending on how the startup boom goes. In the meantime, the macroeconomic effects of widespread losses in housing for blue collar, service industry workers, the middle class, artists, etc. can have very undesirable long term effects on a city. There is good reason for city governments to consider managing this growth.

issa 12y ago

Look at this from another perspective. Being a landlord is great. You sign a piece of paper making you the owner of a property. Then other people do actual work and pay you just for having your name on that piece of paper. If we lived in a perfect (or even just a "better") society, this would be fine. But the problem is that we live in a society with different classes. If your parents owned a home or two, you probably will as well. If your parents didn't, you probably won't either. In reality, "rent" is just another way to keep the rich rich and the poor poor. Rent Control is an attempt to mitigate the damage. Personally, I think it's a terrible band-aid that exists because we aren't willing to face the real issues at hand.

G650 12y ago

messed up.

presty 12y ago

Hey everyone, time to retake San Jose.

michaelochurch 12y ago

I can't take San Francisco seriously anymore. If the VCs weren't there, it'd be a third-rate city, and much of what the VCs are funding isn't even technology but the post-apocalyptic sort of "attempt to engage in one of the short-term natural monopolies that technology sometimes creates" gambits that bloom in the caldera of an imploded technology industry. Yet it has become a more expensive place to live than New York, despite being dysfunctional in every measure other than tech salaries. I cannot see why California hasn't done something about Prop 13 NIMBYs. All that those useless parasites do is block progress, drive up the rents by preventing new housing from being built, and cause measles epidemics with their anti-vax nonsense. It's really time to call in some Texans on that shit and fix the NIMBY problem. If California can't do that, then how are we supposed to take them seriously? If they can't get their heads out of the ass of the past that the NIMBYs claim that they are preserving, how can we trust them to build the future?

dlss 12y ago
> how can we trust them to build the future? Don't! Whatever the alternative was in your head when you wrote this sentence -- do that! The world needs more future-builders :D
sumitviii 12y ago
"much of what the VCs are funding isn't even technology but the post-apocalyptic sort of "attempt to engage in one of the short-term natural monopolies that technology sometimes creates" gambits that bloom in the caldera of an imploded technology industry" Much of what is funded has always been that.

bbarn 12y ago

The reason this article is trending at the top of HN is the reason this person is going through this. The idea that great start-ups must exist on an 47 sq mile piece of land with utterly mediocre weather (the literal definition of mediocre, that is - one many of us love, myself included) in perfect coexistence with a quaint aging population below the poverty line, drug addicts, and the last generation that sought to live there in the last boom is patently absurd. Why so many globally reaching, internet based, in every home in the world companies think that they absolutely must be positioned in the mecca of startupdom is why I just can't take my own career seriously for too long. There's no reason we all need to be on that tiny peninsula! If you need to be there for "reach to investors", "proximity to the startup culture", guess what, your product probably sucks. If it were any good, you could do it from anywhere, without having to sit on the great lords of tech investment's front door begging every day. You want to disrupt something? Why not start with disrupting the idea that being part of "start-up culture" is required to be successful.

swatow 12y ago
I think people go to San Francisco for the 20-30 year old girls, not the aging population or drug addicts.
- conanbatt 12y ago
  Nobody moves to San Francisco looking for girls.
- bsder 12y ago
  Thanks for the laugh.
q2 12y ago
>>> Why so many globally reaching, internet based, in every home in the world companies think that they absolutely must be positioned in the mecca of startupdom Why people join twitter or facebook or any other virtual social network? I think both have similar answers.

john_butts 12y ago

You nerds are sooooo fucked when the rubber meets the road.

bhuga 12y ago

It's an incredible statement on the depth of the bay area talent pool and VC money network that so much tech concentrates in such a tiny place (and thus drives up the rent, as in the article). Nowhere else in the world can compete. It's not for lack of trying. Louisiana, for example, will pay 35% of a programmers salary indefinitely[1]; other states and cities have similar programs. That's serious competition. But the talent/money vortex of the bay area is not just winning, it's actually getting stronger. The other areas with real companies, like Austin, Seattle, and New York, still feel like also-rans compared to SF and the valley. If you want to raise money, it's still the place to go. It's just incredible to think about. Is there any other field where there's just one geographical place that's just so far ahead of anywhere else? Especially fields like biotech, where geography isn't directly related to the business? [1]: http://gnoinc.org/about/digital-media-incentive/ http://gnoinc.org/about/digital-media-incentive/

lucaspiller 12y ago

[Meta] Why has this dropped off the first page? It currently #32 and has 443 points, 447 comments and was posted 4 hours ago - there aren't any other stories more popular than this on the first page.

omarforgotpwd 12y ago

Hopefully the rising prices will encourage investment and lead to a greater supply of housing options in the future. The fact that this kind of thing is happening probably means the rent control laws have been too strict in the past.

geebee 12y ago

I'm coming very late to this (540 comments and counting), but I do want to make one point about the term "NIMBY". While it's a reasonable observation about housing politics, it does invite potentially false equivalence. A kind of equivalence is built into the term itself - "not in my backyard" means everyone recognizes something is needed, but nobody wants it near them. In this case, everyone wants to live in the low density section of a high density area. Still, this term encompasses everyone from bernal heights hippies who want to keep density at 18,311/sq mi to atherton billionaires who want to keep it at 1,400. It includes noe valley "activists" who don't want to tear down 100 year old houses and mountain view city council members who voted to allow massive new corporate construction bringing tens (hundreds?) of thousands of new workers to their region but specifically banned new residential construction near those places of business. All in all, yeah, I hear you on the noe/bernal/mission activists. They are a bit nimbytastic, no doubt. But to me, the actions of the anti-housing forces in some peninsula towns are such an order of magnitude worse (and are causing many of the problems you see in SF) that simply applying the NIMBY label to both without further analysis is an exercise in false equivalence.

pascal1us 12y ago

This sort of thing has been building up for a long time. This is mainly due to the Greed of the SF tenants to who prevent developers from building more units with local politics NIMBY. By constricting the supply artificially it prevents new buildings from going up. Also, the mayor is to blame as well, for incentivizing more companies to come to SF making the situation even worse.

fhf 12y ago

There seems to be a lot of discussion in this topic around the idea that "IF San Francisco did away with rent control, THEN the market would correct the problem." Given that SF hasn't had rent control since 1980 (it only applies to buildings constructed before that), and the market has thus had 25 years to correct, which of the following is true: 1. There is no housing problem 2. Removing rent control didn't make a difference. I'm actually curious to know the opinion of people blaming rent control... (edit: typo)