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

Re: San Francisco braces for commercial real estate crash

#221

Post by RcouF1uZ4gsC » Tue, Sep 06, 2022, 6:38 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:

I think the data on the page you linked to only goes through 2019.

In addition, anecdotally, there is a decent amount of property crime that is not being reported because it is felt is is not worth the effort as the police are not able to do anything about it.

Re: San Francisco braces for commercial real estate crash

#222

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

AlexandrB wrote: post #216

JumpCrisscross wrote: post #180

Earlier quoted context omitted.

> "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.

> For how long?

Infinitely. Wages go up in nominal terms, too. What matters is the real housing price hovering around zero. (Slightly above, localized, is also fine if balanced by migration.)

Re: San Francisco braces for commercial real estate crash

#223

Post by scarby2 » Tue, Sep 06, 2022, 6:39 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…

> Housing can be affordable while going up in nominal terms.

Housing cannot be affordable if it goes up in real terms though. In an ideal world house prices would increase 1:1 with wage growth from an affordable baseline.

There are 2 ways to fix it: either crash the market or introduce policies which will cause either stagnation or below inflation growth in housing prices for at least 20 or 30 years.

Re: San Francisco braces for commercial real estate crash

#224

Post by pessimizer » Tue, Sep 06, 2022, 6:39 PM UTC

JumpCrisscross wrote: post #64

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”?

> Americans overwhelmingly prefer single-family detached homes when given other options. How is choosing a higher-quality of life option “wasted”? It's not. But it's wasteful in an urban core, where that lack of density forgoes real economic opportunity. It also creates an easily-identified cause for the lack of housing supply.

> that lack of density forgoes real economic opportunity.

Which is why SF is so poor and underdeveloped.

> It also creates an easily-identified cause for the lack of housing supply.

An easily identified excuse. Now do suburban Tennessee.

Re: San Francisco braces for commercial real estate crash

#225

Post by hattmall » Tue, Sep 06, 2022, 6:39 PM UTC

onlyrealcuzzo wrote: post #195

bluejekyll wrote: post #171

Earlier quoted context omitted.

> 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 is down - but so is population. Is the decrease statistically significant after adjusting for population loss?

Violent Crime IS low in SF. It's pushed into Oakland. Property crime is insane and artificially held low by apathy with regard to reporting and redefining offense levels.

Re: San Francisco braces for commercial real estate crash

#226

Post by zzzeek » Tue, Sep 06, 2022, 6:39 PM UTC

cpursley wrote: post #191

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…

Money goes to where it's treated best and people vote with their feet. I know people thumb their nose on the state, but Florida is open for business. But the real secret is Puerto Rico and their incredible tax incentives for software companies.

Florida is not a good environment for companies that have female employees, as due to FL's draconian anti-abortion law, state surveillance of pregnancies is now required as miscarriages past 15 weeks now need to be treated as potential homicides.

Re: San Francisco braces for commercial real estate crash

#227

Post by fundad » Tue, Sep 06, 2022, 6:39 PM UTC

jmoak3 wrote: post #160

paxys wrote: post #56

In a way I'm glad that a large chunk of San Francisco's population is getting exactly what they have wanted for years – to get rid of big tech takeover of the city. Maybe they will actually fare better with a significantly reduced number of tech workers and jobs, or maybe they won't. At least we'll know for certain now, and can stop all the whining.

I know people miss SF as it was before the boom, but can it actually readjust to substantially less tax revenue with the city government + responsibilities it has now? From what I read about Detroit, once businesses started shrinking or leaving the tax base shrank. The city was unable to cut down on services and spending, so it raised taxes on everyone remaining and the squeeze of more tax and worse QoL made people l…

It seems the faster people leave, the cheaper the housing gets which attracts more people.

Will the millions of people clamoring to move into SF or any dense US city turn into a negative number?

Re: San Francisco braces for commercial real estate crash

#228

Post by zdragnar » Tue, Sep 06, 2022, 6:39 PM UTC

lokar wrote: post #134

echelon wrote: post #121

Earlier quoted context omitted.

Those with the homes are not the ones complaining.

But they are! It's truly bizarre. Somehow the accepted narrative is that prices are high because greedy developers focus only on luxury condos. I often see new buildings criticized because they will raise the average rent in the area. And people accept that argument. Think about that for a moment.

It is what happened in several neighborhoods that I used to live in or work near.

New construction was expensive, so they geared the apartments towards the upper end of the market. Rents at existing places didn't go down; if anything, it gave them an incentive to go up since they wouldn't be the most expensive place anymore if they did.

Loans and what not put a price floor on the rents of new units; given how hard it is to evict bad tenants (especially with the current backlog), and how hard it is to bring prices back up in rent controlled cities, they're just as well off leaving units empty at full price as they are renting below cost just to stop the bleed.

Re: San Francisco braces for commercial real estate crash

#229

Post by hattmall » Tue, Sep 06, 2022, 6:40 PM UTC

gofreddygo wrote: post #179

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…

In The city You're screwed when you rent a home or office. You're screwed when you own a home. You're screwed when you eat. You're screwed when you drink. You're screwed when you commute. You're screwed when you walk the streets. You're screwed when you (pay) park your car on the street. homeless? neglected commuters? neglected business owners? neglected public workers? neglected tourists? neglected I just don't know…

Who is doing all the screwing??

Re: San Francisco braces for commercial real estate crash

#230

Post by huevosabio » Tue, Sep 06, 2022, 6:40 PM UTC

The political class and a big section of the electorate (mostly boomers that have been living here for a while) have been hell-bent to squeeze all the juice out of the tech boom while providing little value to the rest of society.

This mostly came in the form of insane real estate prices due to restricted supply, making the city residential market essentially an oligopoly and filling the pockets of the landowners. But it also came in outright extortion of the tech scene: gross receipt taxes, income taxes, etc.

Every time they try to squeeze wealth out of tech they end up hurting the city.

The most recent one was the so-called Amazon tax, where TODCO's John Elberling (a local crony) drafted a bill to tax large e-commerce companies. His motivation was to "tax Jeff Bezos' ass"[0]. But instead the bill would tax small and medium retailers in SF... and would not tax Amazon because the guy was dumb enough to spend $400k on the bill without actually estimating the intended impact of the bill, let alone secondary effects.

Mike Solana writes about the extractive tendencies of the SF establishment quite clearly in his "Extract or Die" blog post [1].

I love San Francisco, and hate what the local establishment has done. I have hopes that the crisis will crater support for the establishment (perfectly represented by supervisors Aaron Peskin and Dean Preston) and boost support for serious organizations (e.g. GrowSF [2], Yimby Action [3]) trying to make this city as functional as it is beautiful.

[0] https://sfstandard.com/politics/san-francisco-housing-todco-... [1] https://www.piratewires.com/p/extract-or-die [2] https://growsf.org/ [3] https://yimbyaction.org/