OT: the housing crisis in the Bay Area (and beyond...)

[pdonk]

[QUOTE=GonaSovereign;2540256]

Originally Posted by pdonk

Actually I'm actually the scapegoat - a planner that works for a developer.

Just as long as you aren't the guy knocking down the Matador to build condos. That guy will be haunted by the ghost of Leonard Cohen.

I work in the 905. Making rural roads less safe

[FlashUNC]

Originally Posted by bward1028

That's still only ~80 billionaires.

One thing people forget is that SF has a population of 885k, basically the same as Columbus Oh. Austin's more populous.

How many billionaires they got in Columbus?

The wealth concentration here has thrown everything else completely out of whack.

[quehill]

The fact that this conversation has gotten to four pages and no one has brought up Proposition 13 yet is crazy/interesting/crazy-interesting.

Just to dip my toe in the very deep waters:

Prop 13 incentivizes housing speculation and buying in at ANY price, because it's only going to cost more tomorrow and in the unlikely event that home prices go down you can get a reappraisal anyway.

Prop 13 disincentivizes local governments from zoning for new housing, of any kind, because over even the mid-term housing is a tax base loser for governments.

Add localized inflation from tech money to the above and you get the Bay Area housing market.

[GonaSovereign]

[QUOTE=pdonk;2540272]

Originally Posted by GonaSovereign

I work in the 905. Making rural roads less safe

Semi-serious question: was riding down Heritage Rd in the 905 last weekend, looking at the farms morphing into tract housing. Between my tears I wondered if there is a way to incentivize developers to fund wide paved shoulders as an offset to all the new stoplights and distracted parents. The current admin is unlikely to budge on that one, but it seems like a potential win...

(Thread back on track: I live in Toronto and work in the Bay Area.)

[XXtwindad]

Originally Posted by quehill

The fact that this conversation has gotten to four pages and no one has brought up Proposition 13 yet is crazy/interesting/crazy-interesting.

Just to dip my toe in the very deep waters:

Prop 13 incentivizes housing speculation and buying in at ANY price, because it's only going to cost more tomorrow and in the unlikely event that home prices go down you can get a reappraisal anyway.

Prop 13 disincentivizes local governments from zoning for new housing, of any kind, because over even the mid-term housing is a tax base loser for governments.

Add localized inflation from tech money to the above and you get the Bay Area housing market.

AKA rent control of owners. Definitely one of the elephants in the room.

[muz]

Originally Posted by XXtwindad

AKA rent control of owners. Definitely one of the elephants in the room.

Even worse is that Prop 13 applies to commercial real estate as well. As a result, commercial real estate NEVER gets sold, which means the tax basis is never leveled up. You have a holding company that owns the property, and you sell the company instead of the property.

[buddybikes]

>>evelopers to fund wide paved shoulders as an offset to all the new stoplights and distracted parents.

Don't worry, they will just make bigger/wider SUV's to offset the wider road

[93KgBike]

I tend to agree that if the rent in an area outstrips one's ability to earn, then yeah, you have to move.

A lot of us lived like this as young people. But a lot of us thought, go to school, find work, problem solved.

We did not think we'd lose, in a single generation, the entire manufacturing and small farm base. There's no longer a single pharmaceutical manufacturer in New Jersey.

The rent is too high, for many, because pricing is pegged to wealth rather than wages.

There's no such thing as a housing crisis. There are houses. There are people. There are banks.

But all the union-wage jobs that rebuilt the world after WWII are now slave wage jobs farmed out to low-rent dictators and acolyte kleptocracies.

[HugoBear]

There has been talk of Bay Area appreciation/bubble since I lived there in late 90’s/early 2000’s.
There was recent research showing wage growth in major cities from 2000-2017 and 2010-2017.
It also looked at housing costs.
When income growth is taken into consideration, the gap for Bay Area is much lower than many cities.
Miami had the worst but the data is skewed by low incomes of rich retirees.
The younger non super rich share places among several tenants or just don’t put much in savings. Many are cool with this until they want to have a family.
It became very clear to me that my income upside was not that high so we decided to move in 2001.
It is a great place if you can afford the freight.

[paredown]

Originally Posted by 93KgBike

I tend to agree that if the rent in an area outstrips one's ability to earn, then yeah, you have to move.

A lot of us lived like this as young people. But a lot of us thought, go to school, find work, problem solved.

We did not think we'd lose, in a single generation, the entire manufacturing and small farm base. There's no longer a single pharmaceutical manufacturer in New Jersey.

The rent is too high, for many, because pricing is pegged to wealth rather than wages.

There's no such thing as a housing crisis. There are houses. There are people. There are banks.

But all the union-wage jobs that rebuilt the world after WWII are now slave wage jobs farmed out to low-rent dictators and acolyte kleptocracies.

Yes--and the elites from those kleptocracies and dictatorships then end up as major participants in the global pool of (sometimes hot) money, that moves to where the opportunities are--like London, Vancouver, New York, San Francisco-- that distorts local economies and housing prices.

Someone already mentioned the lack of really well-paying jobs in Vancouver, and in terms of affordability index (wages to house prices) it is one of the three worst in the world).

Here's a US comparison of affordability:
https://www.citylab.com/equity/2018/...-whack/561404/

Here's the international comparison--2017--I know I have seen a different study--but it puts Hong Kong first, Vancouver 3rd and San Francisco 9th:
https://www.scmp.com/business/articl...-straight-year
Here's Bloomberg from 2018--their index places San Francisco second after Hong Kong--and Vancouver is only at 16th:
https://www.bloomberg.com/

[pdonk]

[QUOTE=GonaSovereign;2540280]

Originally Posted by pdonk

Semi-serious question: was riding down Heritage Rd in the 905 last weekend, looking at the farms morphing into tract housing. Between my tears I wondered if there is a way to incentivize developers to fund wide paved shoulders as an offset to all the new stoplights and distracted parents. The current admin is unlikely to budge on that one, but it seems like a potential win...

(Thread back on track: I live in Toronto and work in the Bay Area.)

The developer typically has to provide land for road widenings, in that instance it is either Peel or Brampton's responsibility to program the cross section, which is paid for through Development Charges, paid by the developer and ultimately the new home buyer. Just remember every social service/park/feature you want to see in a community is ultimately paid for by the end user.

[pobrien]

A couple of posts commented on Vancouver house pricing being high and that is certainly true. This applies to condominiums and the like as well.

One aspect that has not been mentioned is the recent 'revelation' that Chinese interests has washed approximately $5 billion of illicit money in Vancouver real estate and in the local casinos. This sounds like a movie script.

The federal and provincial governments are quite embarrassed that the money laundering has gone on for so long and nobody flagged it for investigation. It is only now that our elected officials are being forced to investigate the matter.

The city is beautiful and many Asians call it home. The 'average' people either rent expensive apartments (sharing them with others quite often) or live in the suburbs where prices are not quite as high as in the city. Long commutes are the norm. I could not imagine commuting to and from the city. Chaos.

[MattTuck]

Originally Posted by XXtwindad

When I first moved to San Francisco, in December of 1989, I rented a studio in the Tenderloin for $325 a month. The average Tenderloin studio now goes for $1,800 per month. That area has long been considered San Francisco's "seedy" neighborhood, although it is much more gentrified since I last lived there.

I do believe that people besides high tech workers should be able to call the Bay Area home.

I have a hard time with the last part. If you want to ease the housing crisis, the best thing to do is probably offer $10,000 relocation credits for folks who might find the economic prospects in SF to be undesirable.

Trying to find a solution for someone earning $40K is like pushing on a string. That person may be better served, and actually prefer, by giving them a bit of a kick start in a new area.

[AngryScientist]

Originally Posted by MattTuck

Trying to find a solution for someone earning $40K is like pushing on a string. That person may be better served, and actually prefer, by giving them a bit of a kick start in a new area.

yea, but when you think of any wealthy area, there are a ton of support functions that go along with that. there are bike mechanics, baristas, restaurant staff, car mechanics, and a host of other people who do not have the earning power of facebook tycoons, but still make a decent paycheck in the area, and they should be able to live in a reasonable proximity to their work, no?

[XXtwindad]

Originally Posted by MattTuck

I have a hard time with the last part. If you want to ease the housing crisis, the best thing to do is probably offer $10,000 relocation credits for folks who might find the economic prospects in SF to be undesirable.

Trying to find a solution for someone earning $40K is like pushing on a string. That person may be better served, and actually prefer, by giving them a bit of a kick start in a new area.

Well Matt, I think there might be a bit of disconnect going on here. I mean no disrespect, because you're one of my favorite writers on this site. But New Hampshire isn't the Bay Area. The stuff happening here is unreal.

I know of two couples (both of whom are at least of moderate means) that are in failed relationships. They have both divorced (one couple was never married). And yet, they continue to live in the same house and live separate lives. Because that is by far the most affordable option. That is simply crazy.

The tech industry has certainly changed San Francisco, and many people would say not for the better. Economic, cultural, and racial diversity are important to the lifeblood of a city.