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Tech Boom Hits San Francisco Rental Prices

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Re: Tech Boom Hits San Francisco Rental Prices

#41

Post by planetguy »

jseliger wrote: post #24

The basic problem is simple: lots of demand chasing little supply, as discussed extensively here: http://www.slate.com/articles/business/moneybox/2012/05/face... (HN discussion: http://www.slate.com/articles/business/moneybox/2012/05/face... ). See also this: http://www.theatlantic.com/magazine/archive/2007/11/a-tale-o... . This is one of these problems that has a simple, obvious solution—raise or remove height limit…

Well, ultimately the problem is that San Francisco is a small area where a lot of people want to live, and they're willing to pay a premium to live there. You can fiddle around with the supply side of this "problem" if you like (which will by your prescription also lower the demand by making the city a less nice place to live), but there's only so much you can do.

As far as I'm concerned the lack of cheap housing in San Francisco is no more of a problem than the lack of cheap housing in Beverley Hills.

Re: Tech Boom Hits San Francisco Rental Prices

#42

Post by strlen »

jaems33 wrote: post #35
jseliger wrote: post #24

The basic problem is simple: lots of demand chasing little supply, as discussed extensively here: http://www.slate.com/articles/business/moneybox/2012/05/face... (HN discussion: http://www.slate.com/articles/business/moneybox/2012/05/face... ). See also this: http://www.theatlantic.com/magazine/archive/2007/11/a-tale-o... . This is one of these problems that has a simple, obvious solution—raise or remove height limit…

Doesn't SF's risk of liquefaction plus the current soft soils around the city make it potentially quite dangerous to build taller buildings? http://earthquake.usgs.gov/regional/nca/soiltype/map/ http://thefrontsteps.com/2010/11/22/san-francisco-neighborho...

Not necessarily: there are ways to build high rise buildings in such an environment. It also isn't hypothetical: San Francisco skyscrapers are some of the safest places to be during an earthquake.

See also Taipei 101 -- designed to withstand seismic events and typhoons through some rather interesting "hacks".

Re: Tech Boom Hits San Francisco Rental Prices

#43

Post by planetguy »

shawnee_ wrote: post #28
gergles wrote: post #3

I used to live in a building near a Google shuttle stop on the border of the TL. They wanted to raise my rent almost 20% y/y for a lease renewal, and the place was a trainwreck quality-wise (as was the neighborhood.) When I went to move out, the leasing agent just shrugged and said "Some Googler will happily pay even more than that." The real problem is SF prohibiting any dense housing from being built anywhere in th…

Part of the problem is that when rents are raised in a predatory fashion, the purchasing power of the renter is diminished. Homeownership rate, 2006-2010 in SF County = 37.5% Homeownership rate, 2006-2010 in California = 57.4% Median value of owner-occupied units, SF 2010 = $785,200 (2000 = $396,400) Median value of owner-occupied units, California 2010 = $458,500 (2000 = $211,500) Sources: http://quickfacts.census.g…

Why should renters be "immune" from the fact that the property they occupy is suddenly worth a lot more? This is the gamble you take when you choose to rent rather than buy.

Besides, price booms are the natural result of demand outstripping supply. If rents don't go up to reflect this fact, then how do you cope with the fact that the number of people who want to live in San Francisco outstrips the number of people who can fit into San Francisco?

Re: Tech Boom Hits San Francisco Rental Prices

#44

Post by kemiller »

articwombat wrote: post #37
planetguy wrote: post #25

Earlier quoted context omitted.

That's the stated justification. The real reason is that politicians of certain stripes enjoy redistributing wealth from the landlord class to the tenant class and getting rewarded with votes for it, so the stated reason is disingenuous anyway, but let's examine the stated reason carefully. Has this ever actually happened? Has any city ever run out of garbagemen and janitors due to a lack of rent control? I have neve…

Yes, this happened in San Jose during the last bubble, when Firefighters and Police couldn't afford to live in the city. Who on minimum wage can afford to drive a car for an hour to work each way?

So they should be paid better, and the burden spread among the constituents of those services. Not pinned on landlords.

Re: Tech Boom Hits San Francisco Rental Prices

#45

Post by 1234the1234 »

planetguy wrote: post #15
_delirium wrote: post #11

Earlier quoted context omitted.

There's a plan currently under discussion for bus rapid transit on the Geary corridor, which is sort of the el-cheapo version of that idea ( http://www.sfcta.org/content/view/37/70/ ). Give the bus a dedicated, physically separated lane to reduce traffic problems, and build light-rail-esque, less frequent stations in the median with level boarding. Not a full solution, but the hope is that it'll raise the average bus…

I hope they plan to raise the average bus quality too; riding Muni is less like public transport and more like a homeless shelter. I couldn't imagine doing it every day.

> riding Muni is less like public transport and more like a homeless shelter.

Douchebag alert. Sorry regular people interfere with your nerd boner.

Edit: See what I did there, I mocked you for being a "nerd". Really just different from me. See, it sucks when people stereotype you as homeless or whatever you don't like because you don't scroll & pinch their way home everyday.

Re: Tech Boom Hits San Francisco Rental Prices

#46

Post by 205guy »

Did anybody see the other article in WSJ about SF real-estate? The title is "China in Talks With U.S. Home Builder / State Bank in Talks to Provide Lennar $1.7 Billion for Two Long-Stalled Projects [for 20,000 units in SF]"

http://online.wsj.com/article/SB1000142405270230445860457748...

Pwn'd is the word that comes to mind.

Re: Tech Boom Hits San Francisco Rental Prices

#47

Post by refurb »

articwombat wrote: post #37
planetguy wrote: post #25

Earlier quoted context omitted.

That's the stated justification. The real reason is that politicians of certain stripes enjoy redistributing wealth from the landlord class to the tenant class and getting rewarded with votes for it, so the stated reason is disingenuous anyway, but let's examine the stated reason carefully. Has this ever actually happened? Has any city ever run out of garbagemen and janitors due to a lack of rent control? I have neve…

Yes, this happened in San Jose during the last bubble, when Firefighters and Police couldn't afford to live in the city. Who on minimum wage can afford to drive a car for an hour to work each way?

That's called the free market, no?

If someplace is paying minimum wage and can't find people to fill the positions (due to high housing/transportation costs), they'll have to raise the wages or close down.

This actually happened in Calgary, Canada a few years back. McDonald's was paying 50-100% more than minimum wage in order to attract employees. Stores actually closed on Sunday because they couldn't find staff.

Re: Tech Boom Hits San Francisco Rental Prices

#48

Post by refurb »

shawnee_ wrote: post #28
gergles wrote: post #3

I used to live in a building near a Google shuttle stop on the border of the TL. They wanted to raise my rent almost 20% y/y for a lease renewal, and the place was a trainwreck quality-wise (as was the neighborhood.) When I went to move out, the leasing agent just shrugged and said "Some Googler will happily pay even more than that." The real problem is SF prohibiting any dense housing from being built anywhere in th…

Part of the problem is that when rents are raised in a predatory fashion, the purchasing power of the renter is diminished. Homeownership rate, 2006-2010 in SF County = 37.5% Homeownership rate, 2006-2010 in California = 57.4% Median value of owner-occupied units, SF 2010 = $785,200 (2000 = $396,400) Median value of owner-occupied units, California 2010 = $458,500 (2000 = $211,500) Sources: http://quickfacts.census.g…

Would you apply the same logic to cars? If you happen to own a car that suddenly became desirable, should the gov't step in and prevent you from getting the best price for it?

How about if you own a start-up? Was Instagram guilty of "predator" pricing when Facebook bought them?

What people don't seem to understand is that in a free-market system, there is no free lunch. Look at the rental market in SF. People pay "key money" to secure a place. Or the landlord rents to their friend, not the best tenant because if he can't get fair market value in terms of a rental rate, he'll get it someway else (and buyers will pay, because they value it the same way).

Re: Tech Boom Hits San Francisco Rental Prices

#49

Post by _delirium »

planetguy wrote: post #41
jseliger wrote: post #24

The basic problem is simple: lots of demand chasing little supply, as discussed extensively here: http://www.slate.com/articles/business/moneybox/2012/05/face... (HN discussion: http://www.slate.com/articles/business/moneybox/2012/05/face... ). See also this: http://www.theatlantic.com/magazine/archive/2007/11/a-tale-o... . This is one of these problems that has a simple, obvious solution—raise or remove height limit…

Well, ultimately the problem is that San Francisco is a small area where a lot of people want to live, and they're willing to pay a premium to live there. You can fiddle around with the supply side of this "problem" if you like (which will by your prescription also lower the demand by making the city a less nice place to live), but there's only so much you can do. As far as I'm concerned the lack of cheap housing in…

I agree w.r.t. San Francisco proper (it's already very dense, certainly by American standards), but I think quite a bit more could be done in the Valley, which would also ease some of the pressure on SF. A lot of jobs are in the Valley, but people (esp. young people) end up living in SF because the Valley refuses to build anything other than suburban housing for the most part.

San Jose has been building condos and apartment buildings near the Diridon Caltrain station, so that's something. But much of the rest of the Valley between SJ and SF is extremely anti-development. Try to get approval to put in a condo tower in Palo Alto! I don't even mean that jokingly: given the demand created by the Palo Alto tech businesses and Stanford, it could easily support several condo towers near the downtown area. The fact that the city government bans them means that that demand is displaced elsewhere, e.g. to SF.

Re: Tech Boom Hits San Francisco Rental Prices

#50

Post by zeroonetwothree »

ubernostrum wrote: post #19
tokenadult wrote: post #7

Earlier quoted context omitted.

I think there should absolutely be a rent stabilization law -- everywhere Do you think this on the grounds of economic theory? The empirical finding is that rent control laws limit the supply of rental housing unduly wherever they are enforced. What's a successful example of a place with a "rent stabilization law"? http://www.econlib.org/library/Enc/RentControl.html http://econjwatch.org/articles/rent-control-do-econ…

You seem to be conflating "rent control" and "rent stabilization", which are two different things. Also, these economists appear to be ignoring a simple practical matter. The idea behind most rent regulation is to avoid pricing low-income-but-necessary-to-basic-function people out of an area. These are, basically, the garbagemen and janitors and cooks and such, who can quickly find themselves priced out of anything w…

In practice areas with rent control have higher rents than those without it. So I don't really see how this argument could at all be valid.
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