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Average Rent in San Francisco Has Dropped $1k This Year

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Re: Average Rent in San Francisco Has Dropped $1k This Year

#61

Post by ashtonkem »

SpicyLemonZest wrote: post #43
ashtonkem wrote: post #30

Earlier quoted context omitted.

I’m not sure why, but a surprising number of people seem to have convinced themselves that supply and demand doesn’t apply to housing.

I think most people doubt supply and demand to some degree. How often have you seen someone argue we should secure the supply of food to disaster zones by repealing price gouging laws? Rent control is popular because many people believe, wrongly but wholeheartedly, that landlords are just price gougers and everyone could get cheap adequate housing if they weren’t manipulating it.

My opinion is that rent control is much less about actually controlling rent, and more about controlling who is allowed to be in the city and where. Most rent control systems I’ve seen strongly favor those who have been in their current apartment for a long time, as moving often resets the rents back to market rate. And while that does help avoid evicting long time (and old) tenants, it also has the effect of forcing everyone on rent control to stay where they are.

I mentally couple the way that rent control works with the pretty common opinion that the city was great until “they” came, and would be excellent again if they’d just leave. While the “they” changes from place to place and time to time, the attitude seems to be pretty common. You even see this attitude here on HN, with occasional assertions that those who moved there for tech jobs should move and let rents fall for those who have always been there.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#62

Post by throwaway0a5e »

pydry wrote: post #42
SllX wrote: post #13

Earlier quoted context omitted.

Both. I spent the last decade having these conversations with people who also grew up here and can’t afford to remain here without staying with their parents, with some of the stranger conversations devolving into my counter parties brainstorming ways to kick tech people out of the City and stop new people from moving in altogether, as if freedom of movement in the United States wasn’t really a thing. It’s not “suppl…

It's a side effect of de-taxing land. The more land becomes an asset and the less it becomes a liability (e.g. by capping property taxes) , the greater incentive there is to hoard it and jealously guard its value with NIMBYism which leads to even less development, greater shortages and even higher prices on an upward spiral. Saying "it's about supply and demand" is not technically wrong but it glosses over the toxic…

Even if land were historically taxed at say NYC rates in SF the supply and demand problem would still rear its head. The problem is artificial supply constraints created first and foremost by zoning and secondly by a myriad of other regulation that infringed upon property rights and adds friction (time, money, risk, all of the above) that prevents people from exercising their property rights. Prop 13 (a monetary incentive to not sell) falls into this latter category. LVT would just be the revers of Prop 13. It's not going to solve a fundamental supply and demand problem that's created at a lower level. You'd have everything built out as much as the zoning allows for but the net result would still be inadequate because the zoning is too restrictive and the regulatory friction is going to still works its magic at the margin.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#63

Post by jeffbee »

PedroBatista wrote: post #7

Drop 50% and then we can start to talk about reasonable values..

Yes, even at current levels the typical SF dwelling is not affordable to the typical SF income, to say nothing of the typical income of a person who works in SF, which is much lower.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#64

Post by duxup »

momokoko wrote: post #56
duxup wrote: post #45

Earlier quoted context omitted.

On a semi related note, I've seen a lot more 'stop' and 'stop it' on the internet lately. Arguably the various forms of saying the same thing come and go in terms of what is commonly used, but I've been surprised to see such empty words suddenly so common. Personally I would be a bit embarrassed to just tell people to 'stop it' as to me it seems sort of childish, but apparently not everyone. It's strange.

Because it gets old listening to the same tired uninformed troupes from some random person on the internet that is just regurgitating misinformation. For people that actually live in San Francisco this is a real issue that affects our daily lives. Having some random person spreading more incorrect info is insulting and actually potentially harmful to the people that actually live here and have to pay those rents like…

I suggest informing people rather than resorting to 'stop it'.

I don't have an opinion on prices in any of these places, but when reading your posts I don't think your posts in this thread don't provide any information.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#65

Post by lotsofpulp »

ihaveajob wrote: post #52
xyst wrote: post #40

If the city would rezone all of the single family homes into higher density buildings, this wouldn't be a problem. Flood the area with supply and the cost will go down to reasonable levels. This is a problem all across the nation. Everyone wants a single family home, so this leads to two things: outrageously high costs of homes, or people moving out to the suburbs and thus worsening the rush hour traffic and smog iss…

Honestly I'm surprised no other city in the bay area has taken the baton and aimed to overtake SF in terms of relevance by becoming the densest, most thriving city in the region. Oakland is at least trying to cope with demand in some neighborhoods. I'm rooting for that.

I would say it’s basically impossible to recreate a dense city based on today’s codes of construction requiring numerous safety/ADA measures in the US.

In an existing city, the cost to purchase land and buildings that would need to demolished, rezoned, and rebuilt as a higher density area with accompanying infrastructure is astronomical and wouldn’t be possibly by anyone other than the federal government only because they can print money. And politically, that effort would be dead on arrival.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#66

Post by SllX »

pydry wrote: post #42
SllX wrote: post #13

Earlier quoted context omitted.

Both. I spent the last decade having these conversations with people who also grew up here and can’t afford to remain here without staying with their parents, with some of the stranger conversations devolving into my counter parties brainstorming ways to kick tech people out of the City and stop new people from moving in altogether, as if freedom of movement in the United States wasn’t really a thing. It’s not “suppl…

It's a side effect of de-taxing land. The more land becomes an asset and the less it becomes a liability (e.g. by capping property taxes) , the greater incentive there is to hoard it and jealously guard its value with NIMBYism which leads to even less development, greater shortages and even higher prices on an upward spiral. Saying "it's about supply and demand" is not technically wrong but it glosses over the toxic…

> Saying "it's about supply and demand" is not technically wrong but it glosses over the toxic systemic changes which brought us here and exculpates the people who deliberately fought for them to create this mess.

I am happy to discuss all variables which inform the price, so long as we agree to give supply and demand top billing. We can even discuss the variables which inform supply if you like.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#67

Post by bluntfang »

FreakyT wrote: post #22
SllX wrote: post #13

Earlier quoted context omitted.

Both. I spent the last decade having these conversations with people who also grew up here and can’t afford to remain here without staying with their parents, with some of the stranger conversations devolving into my counter parties brainstorming ways to kick tech people out of the City and stop new people from moving in altogether, as if freedom of movement in the United States wasn’t really a thing. It’s not “suppl…

Exactly -- there's a pervasive belief in the bay area that high rents are solely due to the evil cabal of landlords who meet every week in a dimly lit room and agree to charge sky-high rents while cackling maniacally and twirling their perfectly-waxed moustaches. The sudden COVID-related rent price drop indicates that this theory is nonsense, and that the high rents are solely a function of supply and demand, but I'm…

even for hyperbole this is hogwash. No one thinks people become landlords because they want to treat their tenets like shit. Obviously they just want to make ends meet like everyone else, they just happen to do so in a way that hurts communities, not on purpose, mind you, but because that's how you get ahead in this society.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#68

Post by aabhay »

ihaveajob wrote: post #52
xyst wrote: post #40

If the city would rezone all of the single family homes into higher density buildings, this wouldn't be a problem. Flood the area with supply and the cost will go down to reasonable levels. This is a problem all across the nation. Everyone wants a single family home, so this leads to two things: outrageously high costs of homes, or people moving out to the suburbs and thus worsening the rush hour traffic and smog iss…

Honestly I'm surprised no other city in the bay area has taken the baton and aimed to overtake SF in terms of relevance by becoming the densest, most thriving city in the region. Oakland is at least trying to cope with demand in some neighborhoods. I'm rooting for that.

Some have, e.g. Daly City. The issue is that the rent is skyrocketing because people are desperate to live in that tiny patch of land that is precisely walking distance to their and other startup HQs. It’s a massive network effect.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#69

Post by randomdata »

ashtonkem wrote: post #24
SllX wrote: post #3

> the weighted average asking rent for an apartment in the city, which currently measures around 2.3 bedrooms when counting a studio as having one, has dropped to $3,100 a month. Still too high. Was checking into apartment prices earlier in the year and it is amazing the number of landlords that will try and sell you on a “kitchen” that is a mini-fridge, tiny sink, microwave and a hot plate whilst still charging you…

Over the years I’ve come to the realization that a number of “kitchens” in luxury apartments are clearly designed for making at most breakfast and otherwise looking pretty. It’s not all luxury apartments, not by a long shot, but a surprising number were unusable due to layout mistakes or a complete lack of equipment (on the owners side). The conclusion I came to is that the people who rented these units valued a pret…

> If land is incredibly expensive and one intends to eat most of their meals out, it doesn’t actually make sense to rent a full kitchen.

It is hard to beat the economies of scale of a restaurant, as much as the "you only need to factor the cost of raw food" camp like to tell otherwise. From a purely economic perspective, a kitchen at home, when other sources of food are widely available, is tough to justify. From a wider point of view, a kitchen is easier to justify as a nice luxury, being that cooking at home is something that people enjoy doing. When land is cheap, it is a luxury that can be afforded. When land is expensive, it is not surprising that it's the first thing to go. Similar to why people are likely to maintain a garden at home when land is cheap, but not when land is expensive.

Re: Average Rent in San Francisco Has Dropped $1k This Year

#70

Post by ambicapter »

SllX wrote: post #66
pydry wrote: post #42

Earlier quoted context omitted.

It's a side effect of de-taxing land. The more land becomes an asset and the less it becomes a liability (e.g. by capping property taxes) , the greater incentive there is to hoard it and jealously guard its value with NIMBYism which leads to even less development, greater shortages and even higher prices on an upward spiral. Saying "it's about supply and demand" is not technically wrong but it glosses over the toxic…

> Saying "it's about supply and demand" is not technically wrong but it glosses over the toxic systemic changes which brought us here and exculpates the people who deliberately fought for them to create this mess. I am happy to discuss all variables which inform the price, so long as we agree to give supply and demand top billing. We can even discuss the variables which inform supply if you like.

Is Supply and Demand really the end-all, be-all of economics? Don't things like Veblen goods demonstrate that there is some nuance to the topic.
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