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The Decline of Investment in San Francisco Startups

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Re: The Decline of Investment in San Francisco Startups

#391

Post by closeparen »

timr wrote: post #328
pcwalton wrote: post #293

Earlier quoted context omitted.

I am much less interested in what "should" happen in a macroeconomic sense than what is happening: lots of people need to live here right now . It's worth remembering that the people most hurt by NIMBY policies are not, by and large, the tech workers making six-figure salaries. The victims are the teachers, firefighters, artists, nurses, secretaries, and everyone else who isn't a programmer. Yeah, it might be nice if…

"The victims are the teachers, firefighters, artists, nurses, secretaries, and everyone else who isn't a programmer." OK...but that's also an argument for creating public policy that discourages tech companies from locating in the city. We could start by eliminating the mid-Market tax incentives. The "yimby" movement is at least as much about tech companies who have invaded and now want to change their environment, a…

There is no such thing as "invading" your own country. The level at which we can make such claims, and implement such controls, is the national border.

The equal protection clause of the Constitution establishes freedom of movement for all Americans. Native and longtime San Franciscans have no more or less right to be there than the Iowans and Wisconsinites flooding in.

If you want to change that, then secede from the United States.

Re: The Decline of Investment in San Francisco Startups

#392

Post by closeparen »

randomdata wrote: post #266
Hydraulix989 wrote: post #114

Earlier quoted context omitted.

Compensation isn't nearly as elastic as housing prices though. Not only that, the demand side for housing is also the supply side for the job market, so prices are squeezed on both sides.

> Compensation isn't nearly as elastic as housing prices though. Because there is usually room to give. If people were on the brink of actually having to leave due to rising costs, incomes would lose their inelasticity pretty quickly, insofar as the need for labour is required. There is always superfluous work that is useful at a low price, but fine to give up completely if costs grow too high. > Not only that, the d…

Almost, except that progressive taxation significantly advantages low-income-low-COL. The $145k earner will pay more than proportional taxes, so will need lower than $145k expenses to achieve that $5k surplus.

Lenders also don't seem wild about letting you commit 80% of your take-home to a mortgage, even if your discretionary cash after the mortgage would be the same as in a cheaper place with a mortgage at 25% of your take-home.

Re: The Decline of Investment in San Francisco Startups

#393

Post by closeparen »

potatolicious wrote: post #239
RobertoG wrote: post #100

Earlier quoted context omitted.

maybe they were born there and their family, community and network is there? or is that a nonsense thing to say in the States? In some places of Europe that would be a pretty normal feeling.

> "or is that a nonsense thing to say in the States?" It's a nonsense thing to say in front of the educated American elite. Most of America agrees with you, but as we've seen, there is a disturbing trend amongst American elites to mock anyone who is unwilling to sacrifice their families, communities, and networks in the name of career development/personal advancement. I'm not into most aspects of the populism that is…

Each of the places that elites think we should abandon was created, in its time, by people uprooting their families to move to it. Most had zero or minimal population until a few generations ago.

It's unclear why migration should stop now. Why is this the status quo that should be locked in, rather than the status quo of 50 years ago or 50 years from now?

The disturbing trend is that migration has slowed to historical lows. Among Americans, being unwilling to move for opportunity is the new development. Of all the settlement patterns that could be locked in for eternity, today's is a poor choice.

Re: The Decline of Investment in San Francisco Startups

#395

Post by TuringNYC »

Zahlmeister wrote: post #383
TuringNYC wrote: post #381

Earlier quoted context omitted.

>> Wages don't naturally rise just because rent is higher, if anything the converse is true. I'll offer a lay-person first-person view in contradiction to this theory: rents set a solid bottom salary level acceptable to people. A typical Bay Area rent can consume 100% of your salary once you have a family involved. As countless HN threads discuss, i'll pre-answer the typical nay-sayers. Yes, i realize I can raise my…

What are you contradicting? You are supporting my point. You are sitting in NYC because you're not getting enough money in SF. High rents didn't make wages rise enough to make SF attractive even for you, a hot shot software developer. Now think about all the ordinary people that hail from SF...

I see what you are getting at and I see your point, thank you. I had an orthogonal point that high rents put an absolute minimum on required salaries. You are absolutely right that sometimes that absolute minimum required salary is realized by the job simply not being taken!

Re: The Decline of Investment in San Francisco Startups

#396

Post by Zahlmeister »

ido wrote: post #388
Zahlmeister wrote: post #384

Earlier quoted context omitted.

Affordable housing is actually quite scarce inside the city right now, people on average don't really earn that much. The rent controls had no actual effect on price increases. It has been suggested that the rules are simply being ignored and most tenants won't pick a legal fight with their landlords when housing is so scarce: https://www.welt.de/finanzen/immobilien/article150877146/Die... There's more than enough ho…

Rent control in berlin goes beyond the mietpreisbrmese - most significant is that you can't increase the rent once you get a tenant beyond the rate of inflation and that you (almost) can't kick out a tenant. I have friends in London whose rent (in the same apartment) went up 10% every year for years until they had to leave the apartment. This is not happening in Berlin.

You can increase the rent up to 15% (Berlin) within three years, well above the rate of inflation. This forces some people to move out, as well.

Rents in Berlin are a joke compared to London. You can actually get cheap and plentyful housing just outside the city, but then you'll need a car as well.

Re: The Decline of Investment in San Francisco Startups

#397

Post by ido »

Zahlmeister wrote: post #396
ido wrote: post #388

Earlier quoted context omitted.

Rent control in berlin goes beyond the mietpreisbrmese - most significant is that you can't increase the rent once you get a tenant beyond the rate of inflation and that you (almost) can't kick out a tenant. I have friends in London whose rent (in the same apartment) went up 10% every year for years until they had to leave the apartment. This is not happening in Berlin.

You can increase the rent up to 15% (Berlin) within three years, well above the rate of inflation. This forces some people to move out, as well. Rents in Berlin are a joke compared to London. You can actually get cheap and plentyful housing just outside the city, but then you'll need a car as well.

I didn't know that, every place I lived in here had much slower rent increases (despite the market around the apartment raising more than that - in fact in my current place I'm still paying then same rent 3 years into living here).

Either way 15% in 3 years is still rent control.

Re: The Decline of Investment in San Francisco Startups

#398

Post by Zahlmeister »

ido wrote: post #397
Zahlmeister wrote: post #396

Earlier quoted context omitted.

You can increase the rent up to 15% (Berlin) within three years, well above the rate of inflation. This forces some people to move out, as well. Rents in Berlin are a joke compared to London. You can actually get cheap and plentyful housing just outside the city, but then you'll need a car as well.

I didn't know that, every place I lived in here had much slower rent increases (despite the market around the apartment raising more than that - in fact in my current place I'm still paying then same rent 3 years into living here). Either way 15% in 3 years is still rent control.

Like I said, there's a demand for affordable housing and in Berlin that means very affordable. Lots of students, lots of artistans, and also lots of unemployed people.

> Either way 15% in 3 years is still rent control.

...which affects very few people.

There are some places that suddenly became "hip", where rent increases drove out lots of low-income people, which caused political backlash. These people really just had to move to less popular places.

Re: The Decline of Investment in San Francisco Startups

#399

Post by ubernostrum »

randomdata wrote: post #385
ubernostrum wrote: post #334

Earlier quoted context omitted.

anyone providing value to the local economy Nice to see that all the people who actually make the city function -- so that those high-paid "value providers" can live there and get work done there -- are completely written off in your analysis.

Where are they written off, exactly? They are most definitely included. If anything, they are specifically the people who am I talking about. Unless there is some reason their function isn't actually necessary, in which case, yes, the jobs may disappear. But I do not see the trouble with unnecessary jobs disappearing. Nobody is crying over the loss of loom operators either.

Turns out a city needs police officers. And firefighters. And garbage collectors. And transit operators. And cooks. And cleaners. And waiters. And teachers. And construction workers. And... lots and lots of jobs that don't involve getting paid $200k to use node.js to build a platform that does nothing, earns no revenue, and goes under 12 months later having provided no return on $100m in VC money. But for some reason that is the job people on HN think is "value".

Re: The Decline of Investment in San Francisco Startups

#400

Post by vedanta »

kec wrote: post #264
vedanta wrote: post #243

Earlier quoted context omitted.

Prop 13 affects all of CA, you don't see prices in LA going up 100% in 3-5 years like you do in most south bay cities.

LA hasn't seen anything like the VC / tech boom that the bay area is currently in. Prop 13 reduces liquidity, but that doesn't automatically have an outsized effect on prices. It's only when a market is illiquid and there's a huge spike in demand that you see ridiculously negative effects like this.

Prop 13 is a factor: http://lao.ca.gov/Publications/Report/3497#Does_Proposition....

And overturning it for commercial real estate won't do much to help housing prices, except for any re-zoning that happens. Overturning prop 13 or amending it might not happen for 5+ years, if ever. Note: https://www.bizjournals.com/sanjose/news/2017/07/19/californ...

Over the short, medium, and long-term then, building more is the only choice (SB 35, AB 71). Since you see prices not increasing as much in other parts of the state, it means building more can in fact keep prices down, as the deep-east bay construction shows.

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