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

[xnetter]

Originally Posted by 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.

Actually, the previous government knew about it but turned a blind eye because the revenues to government from criminals laundering drug money in casinos were too juicy to clamp down on. Or so the allegations go. The current government is in the midst of investigating the situation and characterizing it as being like a movie script is spot on.

BC is the California of Canada so to some extent it is no surprise it is so expensive. You couldn't pay me to live in Vancouver though.

KJ

[jtakeda]

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.

This is happening a lot and I’m not sure it’s working. But instead of a relocation credit it’s more like a wrongful eviction lawsuit.

The problem isn’t only the lack of availability of housing/the cost. It’s that landlords and developers aren’t goin through the proper channels to house new residents. They’re using loopholes, sleazy tactics and downright illegal avenues to get old residents out and new people in.

That’s really at the heart of the housing crisis. Sure it’s about supply/demand but the uproar is from the way the industry is kicking people out of their homes forcibly.

The bay has changed so much and as someone who doesn’t work in tech I’m counting my days here. The cost of living is absurd but what really gets me is the attitude of some of the folks moving in. I’ll post the photo later but I have a screenshot of a craigslist ad for a duplex in West Oakland for $8800. In the ad they use the fact that it was a black panther safehouse/meeting house to upsell it to a tech company to rent.

I’m just disgusted with what I’m seeing here (here being the Bay Area not paceline)

[peanutgallery]

It's all about location. Anybody can move to places that cost way too much and suffer as a result. You have to find the balance that works for you

As far as California goes? Stay there...don't move en mass and wreck someone else's paradise

[XXtwindad]

Originally Posted by jtakeda

This is happening a lot and I’m not sure it’s working. But instead of a relocation credit it’s more like a wrongful eviction lawsuit.

The problem isn’t only the lack of availability of housing/the cost. It’s that landlords and developers aren’t goin through the proper channels to house new residents. They’re using loopholes, sleazy tactics and downright illegal avenues to get old residents out and new people in.

That’s really at the heart of the housing crisis. Sure it’s about supply/demand but the uproar is from the way the industry is kicking people out of their homes forcibly.

The bay has changed so much and as someone who doesn’t work in tech I’m counting my days here. The cost of living is absurd but what really gets me is the attitude of some of the folks moving in. I’ll post the photo later but I have a screenshot of a craigslist ad for a duplex in West Oakland for $8800. In the ad they use the fact that it was a black panther safehouse/meeting house to upsell it to a tech company to rent.

I’m just disgusted with what I’m seeing here

Incredible. No shame in the absolute irony.

[XXtwindad]

Originally Posted by peanutgallery

It's all about location. Anybody can move to places that cost way too much and suffer as a result. You have to find the balance that works for you

As far as California goes? Stay there...don't move en mass and wreck someone else's paradise

Aren't those two paragraphs contradictory? Just curious.

[kppolich]

Originally Posted by peanutgallery

It's all about location. Anybody can move to places that cost way too much and suffer as a result. You have to find the balance that works for you

As far as California goes? Stay there...don't move en mass and wreck someone else's paradise

Agree 100%

Life is 100% about the choices you make. Nobody is forcing you to move to CA, there are tech jobs elsewhere. Yes, I know they don't pay as much, but that is a personal choice you have to make. The Bay area is where the big companies with money are, and they can pay their employees. The real estate & rent react to those salaries and supply and demand. There are only so many jobs, and so many places to live, so the demand goes up while the supply has stayed the same. Will it turn into a concrete jungle, maybe. But, if you make more, so you can pay more correct?

I also get that the previous inhabitants of the bay area may be behind the curve. They probably don't have the same education as these new people showing up, and also not the same skills--therefore their pay is lower. That means they probably rent and down own their homes. If they did own their home, they could sell it and make some good money. Then relocate somewhere if they want and live like kings & queens. Nobody is forcing you to go, nobody is forcing you to stay. Prices go up, bubbles burst.

[Elefantino]

Originally Posted by kppolich

If they did own their home, they could sell it and make some good money. Then relocate somewhere if they want and live like kings & queens.

Exactly.

[FlashUNC]

Originally Posted by kppolich

Agree 100%

Life is 100% about the choices you make. Nobody is forcing you to move to CA, there are tech jobs elsewhere. Yes, I know they don't pay as much, but that is a personal choice you have to make. The Bay area is where the big companies with money are, and they can pay their employees. The real estate & rent react to those salaries and supply and demand. There are only so many jobs, and so many places to live, so the demand goes up while the supply has stayed the same. Will it turn into a concrete jungle, maybe. But, if you make more, so you can pay more correct?

I also get that the previous inhabitants of the bay area may be behind the curve. They probably don't have the same education as these new people showing up, and also not the same skills--therefore their pay is lower. That means they probably rent and down own their homes. If they did own their home, they could sell it and make some good money. Then relocate somewhere if they want and live like kings & queens. Nobody is forcing you to go, nobody is forcing you to stay. Prices go up, bubbles burst.

It's not that simple when communities have been together for nearly a century. And in some cases, yes, people are being forced to leave particularly if you don't own where you've been living, which is entirely possible after a century of redlining and other socio-economic issues.

https://www.theguardian.com/us-news/...-black-oakland

[cfox]

I wish Connecticut was having this type of "crisis", much nicer than an actually housing crisis.

[pdonk]

Here is an interesting option for lower income housing that has recently occurred in my neighbourhood. The city, in partnership with a local not for profit has purchased a rooming house in order to preserve it.

http://www.pnlt.ca/

While this option only preserves a few of the at risk units in the area, it is an interesting option. I see that there is a similar organization in SF, that appears to have about 15 buildings under its management.

https://sfclt.org/

One other example of alternative thinking about affordable housing is a company called options for homes. It offers alternative financing options in order to get people in and typically only sells to end users not "inspeculators". https://www.optionsforhomes.ca/#about_us The feds up here are thinking of a similar approach through CMHC (similar to fannie mae or freddie mae - not sure whose who) in terms of equity mortgages and insurance.

In terms of making housing affordable, creativity is the key and thinking of ways to navigate the regulatory and financial systems in a different manner are the solutions.

I tend to think of housing in the following terms - is it fair to tell me I can't have or want what you have in terms of the location, type or cost of housing?

[Bostic]

My sister and I moved my mother to Reno in 2008 after the apartment complex she was living in in San Francisco was sold. We knew the old landlady for many years. She kept the rent very low for a decade until she herself retired and sold the property. It went downhill from there. New landlord was bound and determined to evict all the residents and jack the rent sky-high. A total jerk trying everything to come up with excuses why the place had to be vacated for renovation. After some hearings with the rent board I finally had enough and said it wasn't worth it. My mom's retirement deserved rest and relaxation and it wasn't going to come from living in San Francisco.

[dem]

If you are paid in stock (which almost all the megatech employees are) bay area house prices have actually declined relative to tech stocks:

https://a16z.com/2019/03/28/asset-th...h-stock-index/

[kppolich]

Originally Posted by FlashUNC

It's not that simple when communities have been together for nearly a century. And in some cases, yes, people are being forced to leave particularly if you don't own where you've been living, which is entirely possible after a century of redlining and other socio-economic issues.

https://www.theguardian.com/us-news/...-black-oakland

Socio-economic doesn't jive here. It's about competition.

Current residents that can't afford to stay don't have the skills necessary to compete with other potential job seekers, and thus lose out on more money that they would need to make in order to stay. That's competition. If they did have the skills they would beat out others for those jobs and have the $ to pay the rising cost of living that comes with the rush of everyone moving to a tech-tropolis.

Keeping out potential high earners looking to move to the Bay Area isn't fair to them either. You work your whole life to get a good job, make good money and want to move to the bay area and work for FB, GOOG, etc. They want to live as close to work as possible, and that it their right. They shouldn't be forced to live farther away and commute more because people have chosen to keep their basic skills/job in 2019 that hasn't seen wage growth/opportunity like technology.

I'm 100% for a fair shake, but i'm 150% for competition.

Let's say they do protect the housing cost, but everything else around them keeps going up in price. More expensive places to eat, shop, schools, etc. Those people who stay and have cheap rent won't be able to afford to keep up with the other stuff around them, so they are silo'd in a rich neighborhood, surrounded by things they can't afford. Where does it stop? Reduced food prices, schools, etc for those same folks who have reduced rent? That doesn't seem very fair to the others around there either.

[pobrien]

Originally Posted by xnetter

Actually, the previous government knew about it but turned a blind eye because the revenues to government from criminals laundering drug money in casinos were too juicy to clamp down on. Or so the allegations go. The current government is in the midst of investigating the situation and characterizing it as being like a movie script is spot on.

BC is the California of Canada so to some extent it is no surprise it is so expensive. You couldn't pay me to live in Vancouver though.

KJ

Hi Xnetter,

You are right. One thing I am a little perplexed about is that none of our US associates have commented on the wild wild west of money laundering in BC.
This could be the script for a decent movie and it is a true story.

If this was discovered in the US, I expect they would be apoplectic. If it were, I expect their administration would be on it pdq.

I went to UBC for eight years so got to like the city and wanted to return when I retired. I was fortunate the stars lined up as it is expensive. I own a place in the West End quite close to English Bay. Not many other parts of the city I would consider living in. Traffic is chaotic, no question. You got us beat there!

Patrick

[MattTuck]

Originally Posted by AngryScientist

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?

There is that word "should" again It might be a noble goal, but I'm not sure how you accomplish it practically and fairly. Look at the issues that NYC faces with rent control apartments in an attempt to solve this same problem. It reminds me of a comic I once read.

Originally Posted by XXtwindad

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.

Yeah, that is crazy. I am not saying that is a situation that isn't problematic. I'm just saying that the solution might not be "go back to the way things were." The changes you observe may be irreversible, and if they are, perhaps the best solution for those being displaced the most is an honest shot at starting over somewhere else.

I drive 30 minutes each way to work (compared to 10 minutes when we were renting). When we had the twins last year, we bought a house after looking at 70 potential houses. We were priced out of the area immediately near where I work, but we could have gotten a house 15 minutes away, but those houses were generally old, smaller and not in the best condition. We went another 15 minutes out, and got a house that was bigger and newer. That is a trade off that we made based on what we valued for our family. Would I like to be closer to work? You bet! But I don't view it as failure that needs to be corrected.