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Tech Boom Hits San Francisco Rental Prices

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Re: Tech Boom Hits San Francisco Rental Prices

#51

Post by flomo »

planetguy wrote: post #25
ubernostrum wrote: post #19

Earlier quoted context omitted.

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…

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…

> redistributing wealth from the landlord class to the tenant class

This may be true, but SF rental property values are extremely high, indicating investors are more than willing to make long-term bets on the value of rent-controlled units.

Re: Tech Boom Hits San Francisco Rental Prices

#52

Post by joe_the_user »

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…

No, Beverley Hills is desirable specifically for its prestige.

San Francisco is desirable as location convenient to jobs and transportation.

Not having more housing in Beverley Hills has no real impact on the rest of LA. Not having more housing in San Francisco means the extra demand spills over into a variety of other places.

Higher Density housing does not necessarily result in a location being less-nice. Vancouver BC has made a point of choosing trading density over suburban sprawl with supposedly nice results:

http://en.wikipedia.org/wiki/Vancouver#Cityscape

Re: Tech Boom Hits San Francisco Rental Prices

#53

Post by _delirium »

kemiller wrote: post #44
articwombat wrote: post #37

Earlier quoted context omitted.

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.

As long as the rules are reasonably stable, it's not "pinned on landlords", because they presumably already took those considerations into account when purchasing their property, so everything is priced in already, and it's a wash from their perspective. The only people really injured would be those who purchased property under one regulatory regime, and then unexpectedly had it changed out from under them to a different regulatory regime.

Re: Tech Boom Hits San Francisco Rental Prices

#54

Post by thwarted »

_delirium wrote: post #5
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…

I don't think they're prohibiting dense housing per se, just not approving/building enough of it. There have been several 50-story condos opened in the past few years, and several more currently under construction, but they're not enough to keep pace with growth in demand. It didn't help that there was a ~2-year lull in construction when a bunch of developers got into financial trouble during the financial crisis and…

An east-west Geary subway line has been proposed since the 1930s, but it's really expensive to build in an earthquake zone, and the city / taxpayers just haven't been willing to pay what it'd cost.

That hasn't stopped the MUNI subway expansion north under 4th Street and Stockton.

http://centralsubwaysf.com/

Re: Tech Boom Hits San Francisco Rental Prices

#55

Post by jseliger »

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…

there's only so much you can do. That's not really true, per the linked article above.

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.

See Edward Glaeser's Triumph of the City for more about why this is a problem. For example, he cites an array of research that comes to this conclusion:

"Cities enable collaboration, especially the joint production of knowledge that is mankind's most important creation. Ideas flow readily from person to person in the dense corridors of Bangalore and London, and people are willing to put up with high urban prices just to be around talented people, some of whose knowledge will rub off.

Rousseau famously wrote, 'Cities are the abyss of the human species,' but he had things completely backward. Cities enable the collaboration that makes humanity shine most brightly. Because humans learn so much from other humans, we learn more when there are more people around us. Urban density creates a constant flow of new information that comes from observing others' successes and failures" {Glaeser "Triumph"@247}.

In other words, having a large concentration of smart people leads to new ideas and "the joint production of knowledge." Preventing people from moving to cities through price restrictions means less knowledge and has an array of negative environmental consequences.

Re: Tech Boom Hits San Francisco Rental Prices

#56

Post by shard »

eweise wrote: post #34
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…

"The real problem is SF prohibiting any dense housing from being built anywhere in the city" Huh? In most of SF the houses are about 1 inch from each other. It must have the densest housing on the west coast.

I suspect it's referring to per-volume density, not per-area density.

Re: Tech Boom Hits San Francisco Rental Prices

#57

Post by planetguy »

_delirium wrote: post #53
kemiller wrote: post #44

Earlier quoted context omitted.

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

As long as the rules are reasonably stable, it's not "pinned on landlords", because they presumably already took those considerations into account when purchasing their property, so everything is priced in already, and it's a wash from their perspective. The only people really injured would be those who purchased property under one regulatory regime, and then unexpectedly had it changed out from under them to a diffe…

Well that's even worse, as the whole cost is pinned not just on landlords but on a single generation of landlords. Bam, I just took away hundreds of thousands of dollars of your money with a stroke of a pen, how do you feel about that?

Much better overall if the increased cost merely gets reflected in a rise in wages for unskilled labour in the city. If indeed it ever is an actual problem which I don't believe it is.

Re: Tech Boom Hits San Francisco Rental Prices

#58

Post by kemiller »

_delirium wrote: post #53
kemiller wrote: post #44

Earlier quoted context omitted.

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

As long as the rules are reasonably stable, it's not "pinned on landlords", because they presumably already took those considerations into account when purchasing their property, so everything is priced in already, and it's a wash from their perspective. The only people really injured would be those who purchased property under one regulatory regime, and then unexpectedly had it changed out from under them to a diffe…

But it does matter, because it tends to be a disincentive to get into the landlording business, which tends to further decrease inventory, which tends to make the problem worse, which tends to necessitate more onerous regulation, etc.

I mean, hell. It would even be an improvement to just levy a tax on all landlords to pay for a housing stipend for public workers. That way it's evenly spread among landlords instead of just the ones unlucky enough to have ultra-tenacious tenants.

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