San Francisco braces for commercial real estate crash • Hacker News Board

Re: San Francisco braces for commercial real estate crash

#211

Post by gregwebs » Tue, Sep 06, 2022, 6:36 PM UTC

jeffbee wrote: post #30

ryandrake wrote: post #6

Residential crash is potentially already upon us, at least in the outskirts (East Bay for me). We've had our house on the market for over a month now, and nobody else in the neighborhood is selling either. Big changes from only 3 months ago, when sellers were closing in days.

OH NO A WHOLE MONTH!! Inventory of listed homes remains extremely low. https://fred.stlouisfed.org/series/ACTLISCOUCA Median days on market still near all-time lows SF: https://fred.stlouisfed.org/series/MEDDAYONMAR41860 Cal: https://fred.stlouisfed.org/series/MEDDAYONMARCA USA: https://fred.stlouisfed.org/series/MEDDAYONMARUS

The Monthly Supply of New Houses in the United States is considered by some to be a more reliable leading indicator of the housing market and it is at historical highs: https://fred.stlouisfed.org/series/MSACSR

Days on market is going up dramatically in July where normally it should be going down. The inventory of listed homes is going up as well- overall in all those graphs there is a clear trend in the housing market towards a reversal- saying things are still historically low ignores the trend and ignoring other leading indicator data that is at historical highs.

Re: San Francisco braces for commercial real estate crash

#212

Post by buscoquadnary » Tue, Sep 06, 2022, 6:36 PM UTC

bluejekyll wrote: post #171

darth_avocado wrote: post #127

The city officials are asleep at the wheel. Blame it on remote work and pandemic as much as you want, but the reality is that the city was in decline even before that. It is too expensive to live in the city. It is too expensive to commute to the city. It is too expensive to feed yourself in the city. Crime is rampant. Drug use and filth is everywhere. Most importantly city has been hostile to tech and business owner…

> Crime is rampant According to the data, crime in SF is lower that it was a few years ago: https://www.city-data.com/crime/crime-San-Francisco-Californ... > Drug use and filth is everywhere. Voters can’t seem to wrap their head around better housing policies to get people off the street. It’s disappointing, the entire Bay Area is guilty of this.

> According to the data, crime in SF is lower that it was a few years ago: https://www.city-data.com/crime/crime-San-Francisco-Californ...

Every time I see something like this I will point out that during the anti-police movement that happened a while back, many police started reducing their activity either because they were told to, because prosecutes would refuse to prosecute, or because they didn't want to be the next person on the news. Many people in the LE community that I knew reduced the proactive policing, because of the hostile nature of it.

Every single one of them predicted that crimes would stop being reported and recorded, and that a year from now everyone was going to point to the fact crime has gone down as proof that things are getting better, when the reality was that people were going to stop using or relying on the police for help because they police wouldn't do anything because they had been instructed not to.

Crime isn't any lower, reported crime is.

Re: San Francisco braces for commercial real estate crash

#213

Post by purim » Tue, Sep 06, 2022, 6:36 PM UTC

Still waiting for Vancouver real estate to follow suit but feels weird that in Vancouver its' socially acceptable for people without homes single out a certain ethnic group every cycle. Used to Japanese in the 1980s, Hong Kongers in 90s, Taiwanese in 00s and Chinese in 10s. This type of scapegoating doesn't seem prevalent in other real estate markets like California, their money is correct on high wage disparity between tech workers and those with stagnating wages. In both markets there is surprising silence on REITs and corporations buying up residential living spaces and flipping it. Wouldn't be surprised if those special interest groups also own/influence local media as well.

Re: San Francisco braces for commercial real estate crash

#214

Post by pessimizer » Tue, Sep 06, 2022, 6:36 PM UTC

smcl wrote: post #87

jdkee wrote: post #41

Earlier quoted context omitted.

Americans overwhelmingly prefer single-family detached homes when given other options. How is choosing a higher-quality of life option “wasted”?

I think if people were given the choice - particularly somewhere like San Francisco - they'd would much prefer to live in an apartment they could reasonably afford vs a detached home they could only afford if they travelled back in time 30+ years.

They're given the choice, which is overwhelmingly taken by 99.9% of the people in the world, of not living in SF.

Re: San Francisco braces for commercial real estate crash

#215

Post by cycomanic » Tue, Sep 06, 2022, 6:37 PM UTC

mortenjorck wrote: post #147

ptmcc wrote: post #32

Earlier quoted context omitted.

But that is also key to the problem: the cost to convert these buildings is already prohibitively expensive, and converting them into dormitories cannot possibly recoup the cost. It's like how sometimes it just doesn't make sense to refactor code because it is fundamentally designed for a different purpose. Sure you can grind it out but will it be any better or cheaper than starting fresh?

> converting them into dormitories cannot possibly recoup the cost Once we start talking easing housing code requirements, especially if it's done in the name of increasing access to housing, the conversation becomes about just how much conversion is really necessary, and how little can be done to break even. And there's a big continuum. If one end of this continuum is a standard college dorm setup, the other is lite…

Why should anyone care about the rich owners of the office buildings having to write off their losses and instead make it easier to accommodate people like cattle. The only way they are going to recoup some of their costs is by charging significantly for the right to live in a windowless box.

So it seems this scheme is much less about helping some poor homeless person and much more about some rich investor keeping some money.

Re: San Francisco braces for commercial real estate crash

#216

Post by AlexandrB » Tue, Sep 06, 2022, 6:37 PM UTC

JumpCrisscross wrote: post #180

pixl97 wrote: post #166

Earlier quoted context omitted.

Yea, people love blaming (elected) city officials but NIMBYism and "Housing is an investment that should only go up in price" will eventually kill any market.

> "Housing is an investment that should only go up in price" will eventually kill any market It doesn't have to. Housing can be affordable while going up in nominal terms. Neither do I think most San Francisco homeowners think about housing supply strategically. They're pissed off about a specific view being blocked. Or construction noise. Or their area's average rent going up. (?!?) Alternatively, they're comfortabl…

> It doesn't have to. Housing can be affordable while going up in nominal terms.

For how long? If housing is a good investment, eventually the cost of housing will outpace the ability of new entrants to the market to afford it. If you're already "in the market", you might be OK. But if you're not, even the down payment may be completely out of reach.

Re: San Francisco braces for commercial real estate crash

#217

Post by jjulius » Tue, Sep 06, 2022, 6:37 PM UTC

bluejekyll wrote: post #171

darth_avocado wrote: post #127

The city officials are asleep at the wheel. Blame it on remote work and pandemic as much as you want, but the reality is that the city was in decline even before that. It is too expensive to live in the city. It is too expensive to commute to the city. It is too expensive to feed yourself in the city. Crime is rampant. Drug use and filth is everywhere. Most importantly city has been hostile to tech and business owner…

> Crime is rampant According to the data, crime in SF is lower that it was a few years ago: https://www.city-data.com/crime/crime-San-Francisco-Californ... > Drug use and filth is everywhere. Voters can’t seem to wrap their head around better housing policies to get people off the street. It’s disappointing, the entire Bay Area is guilty of this.

Crime can be down but still remain rampant. Your own link says that crime in SF is "higher than in 94.1% of US cities".

Re: San Francisco braces for commercial real estate crash

#218

Post by nebula8804 » Tue, Sep 06, 2022, 6:38 PM UTC

newaccount2021 wrote: post #3

Not just SF I see For Lease signs on commercial real estate at all price points everywhere I go. WFH has been a paradigm shift and commercial real estate hasn't caught up to the reality yet. Companies that embrace WFH will have access to an entire nations' worth of talent and will end up with a competitive advantage. Requiring RTO means employees must be within thirty miles or so of campus, and lots of talent won't g…

This sounds great right now but scary long term for employees. As talent develops across the country and pushes wages down, I guess the gravy train had to end for tech workers. I don't think there is any other growth industry left to achieve the American dream.

Re: San Francisco braces for commercial real estate crash

#219

Post by [deleted] » Tue, Sep 06, 2022, 6:38 PM UTC

bragr wrote: post #2

Give the corresponding housing crisis in the Bay Area, one wonders if the solution is to "simply" start converting office space to living space until the corresponding demand for office space recovers from a combination of increased demand and decreased supply. Now I'm sure there are all kinds of challenges to doing that, engineering, zoning, other practicalities, but it seems overall reasonable to me, though perhaps…

[deleted]

Re: San Francisco braces for commercial real estate crash

#220

Post by ricardobayes » Tue, Sep 06, 2022, 6:38 PM UTC

darth_avocado wrote: post #127

The city officials are asleep at the wheel. Blame it on remote work and pandemic as much as you want, but the reality is that the city was in decline even before that. It is too expensive to live in the city. It is too expensive to commute to the city. It is too expensive to feed yourself in the city. Crime is rampant. Drug use and filth is everywhere. Most importantly city has been hostile to tech and business owner…

I don't think it's that different to any major city anywhere on the planet. Most cities have rough areas and hotspots to avoid. My personal experience is that it's a rather nice place apart from a few streets in SOMA.