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Remote work is reshaping San Francisco, as tech workers flee and rents fall

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Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#391

Post by vmception »

adjkant wrote: post #192

These HN comments don't seem to grasp that there are two distinct groups of people here, and these trends can/will counteract eachother: the ones that are in the city for work, and the ones that are in the city because they love cities. COVID creates an exodus of one, but people in the latter category are also moving into cities as well as prices drop and they are no longer priced out. HN folks love to complain about…

> and I know many people who moved away temporarily for economic reasons who are very much not doing as well mentally and are looking forward to being back in the city.

The same has happened in SF.

I've gotten many women to come back to the city because they were going crazy in whatever part of the frontier they ventured out into, or even worse: being an adult at their parent's house in Bumbawhat, USA.

Many people find the value systems and insensitivities in the rest of the country to be completely foreign and shocking. So they are looking for any excuse to be back here, even if just to visit someone.

> COVID creates an exodus of one, but people in the latter category are also moving into cities as well as prices drop and they are no longer priced out.

That doesn't offset housing/rental price drop. Not that you claimed it did, just pointing that out.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#392

Post by jonahbenton »

onlyrealcuzzo wrote: post #375
jonahbenton wrote: post #325

Earlier quoted context omitted.

Mortgage interest rates at all-all-all time lows. It's a little ridiculous to say that given that mortgages are, say, a 50 year old product. All time not very long. But debt and interest have been with us for thousands of years and it is likely that there has never been such low cost liquidity for durable assets (houses) as there is now. When you think about why THAT is, it should make you worried to buy that house.

Why is it?

To be blunt- the other side of the deal is REALLY INTERESTED in having a party committed to 30 years of payments on a valuation that, they realize, almost certainly has to drop.

Mortgage interest could be 0.5% and lenders would...probably still make the deal.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#393

Post by pjlegato »

p1mrx wrote: post #367
baron816 wrote: post #327

Earlier quoted context omitted.

Alternate experience: I just moved into SF a week ago from elsewhere in the Bay. I was able to get a large, modern, luxury 1BR in a decent location for under $3K + almost a 1 month concession and no deposit. Being a single, young(ish) guy, it still makes sense to be in a city. I have more space than I need now, and I can afford the rent. Maybe things aren’t that nice right now, but I’m hoping they’ll get back to semi…

But you're just renting... won't the price skyrocket when things go back to normal?

Almost all apartments in SF are rent controlled. The landlord can only raise the rent by some tiny nominal percentage mandated by the rent board every year.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#394

Post by ericmcer »

wwwwwwwww wrote: post #59
roenxi wrote: post #53

Earlier quoted context omitted.

All analogies break down fairly quickly, so I'll preface this with a clear vote of support for what you said. But in this case the purpose of a hospital is to provide for the sick. The purpose of a city is to do the opposite of homelessness - a city is a massive collection of homes. The existence of a large homeless population is concerning for reasons you allude to, but because a more appropriate analogy might be "t…

> the purpose of a hospital is to provide for the sick And the purpose of society is to provide for its people. All of them.

historically: no. Currently outside of progressive cities: no. Giant impoverished tent encampments in the middle of an extremely wealthy city is pretty unique to SF at this particular period of time. Also a society is an organization of people living under a set of agreed upon rules, we are currently dealing with how best to update these rules to deal with massive income inequality and poverty.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#395

Post by akavi »

baron816 wrote: post #358
verst wrote: post #353

Earlier quoted context omitted.

Assuming the 1BR is 700+ sqft and the location is something like SOMA or Hayes Valley this would be a good deal. Yes SF rents are generally insane.

820sf and right between those two neighborhoods.

> right between those two neighborhoods

So, in the tenderloin? Suddenly not a great deal.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#396

Post by ci5er »

01100011 wrote: post #307
adjkant wrote: post #244

Earlier quoted context omitted.

I think you underestimate the density of restaurants and cuisines available. No suburb I have encountered gets close to matching this situation. Suburbs also typically require cars, something I don't own and never want to own. I don't want a backyard either as that just means another thing to maintain against entropy! All of this to say, it depends on what you value :)

My gym is 2 blocks away. Within 2 blocks I have about 10 restaurants. I also don't have to walk over syringes or navigate homeless camps. I think you're stereotyping non-urban environments.

I used to! The dry-cleaner shut down as did 8/10 restaurants (This is in Northern Austin). All the chains stayed open, so I guess that is something?

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#397

Post by bananaface »

r29vzg2 wrote: post #388
bananaface wrote: post #122

Earlier quoted context omitted.

I don't fully buy this argument. New York offices rarely outsource to Equador.

This isn't true, we outsource work to Colombian developers frequently.

I meant relatively. We outsource a lot more to India. But my main point was that South American countries aren't making a significant dent in New Yorkers' wages.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#398

Post by klipt »

phkahler wrote: post #379
jonahbenton wrote: post #325

Earlier quoted context omitted.

Mortgage interest rates at all-all-all time lows. It's a little ridiculous to say that given that mortgages are, say, a 50 year old product. All time not very long. But debt and interest have been with us for thousands of years and it is likely that there has never been such low cost liquidity for durable assets (houses) as there is now. When you think about why THAT is, it should make you worried to buy that house.

There's only one way for interest rates to go from here, and home prices vary inversely with those rates. For middle class folks still working, I'd say save your money and wait for the next housing collapse. Sure, interest rates may be higher but you'll have cash. Or I could be wrong...

Some economists think negative interest rates can work. I for one look forward to having a mortgage where the bank pays me every month.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#399

Post by htormey »

eastbayjake wrote: post #383
htormey wrote: post #317

Earlier quoted context omitted.

I manage a team of 10 people in San Francisco and confirm a similar pattern. 8 of them have moved out of their SF apartments either to move somewhere else more spacious or in with their parents outside of the Bay Area. Other people I know at my company have renegotiated rents. Most but not all are open to the idea of moving back depending on how things play out over the next 6-12 months. I think their is still a big…

> I would expect somewhat of a swing back away from remote work when we get a vaccine. I think a lot of people will move back to where offices are located, but I'm wondering if we'll see an increase in people who fly in for a few days every few weeks for meetings then jet back home to a cheaper part of the country. Relationships are hugely important -- and deep relationships are almost always only built in-person --…

Yeah I could totally see that. It’s a conversation me and my wife have been having a lot lately. I’m thinking about moving out of SF myself. Probably Oregon or Washington but we haven’t made any decisions yet. We want to see how the world looks after the elections in November.

Re: Remote work is reshaping San Francisco, as tech workers flee and rents fall

#400

Post by kbenson »

smallnamespace wrote: post #282
kbenson wrote: post #144

Earlier quoted context omitted.

The article actually notes this: > It should be noted that San Francisco had an unusually low inventory relative to other large cities prior to the pandemic. Historically, the ratio of homes for sale relative to total housing has been a quarter of New York's. But then they go on to assert that this is important regardless, but don't actually provide any information to back it up. > Regardless, the 96% year on year ch…

If you're a renter and you when lease renewal time comes up and you see twice as many open units in your apartment, wouldn't you also bargain more aggressively with your landlord? Conversely, if you're a building manager and you an X% occupancy rate target, you're going to need to cut prices in order to maintain that rate if a bunch of tenants don't renew. This is pretty much textbook microeconomics 101. Going a bit…

I agree with this in general. I'm not sure how it bolsters or refutes what I said.

The premise I was responding to is that noting change in inventory will show much larger swings if there's relatively few units on the market, and that may be a poor indicator of what's going on.

Simplified, it's the difference between a market of 100 units of this 10 are avaiable inventory, and seeing an increase of 3 units (30% raise in available inventory) and a a market of 100 units that has 1 unit available and sees an increase of 2 units (200% increase in available inventory). There was an increase in inventory, and it helps, but probably not as much as 200% would lead one to believe.

The article itself noted the latter was the case in SF as there was "unusually low inventory" compared to other cities beforehand. Of course the difference is going to look outsized, in that case.

> if the prior non-occupancy rate was very low, you'd expect a shock that doubles the rate (say, 5% -> 10%) to lead to perhaps a larger price change than in a less tight market (such as 10% -> 15%)

That depends on so many other factors that I think you can't easily generalize like that for housing. If the inventory is still very low, and now instead of being uber-rich you just need to be very-rich, you're still so constrained in your potential customers that the price range may not change significantly, or if you're still catering to a class of people that do or don't traditionally commute, or if the price is hovering near the break even for a lot of people for commuting vs living local, or whether the work in the area that many of the potential customers does can be done remotely (as these articles are about), etc. Housing is one of the most complicated markets, and there are numerous counterexamples of the exact opposite happening to what you describe

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