Comment by pascalxus | Hacker News Reader

Comment by pascalxus | Hacker News Reader

I know we'd all love to fix the bay area housing problem here. The most obvious answer is to increase the supply. But, fixing the zoning laws and allowing developers to build isn't the only thing that's standing in the way. The problems are too numerous to fix: NIMBYs sueing developers, CEQA, Proposition 13, AND don't forget about the underlying labor cost (all our middle class people's aren't going to come back, after having been forced out). The bay area has forever lost it's ability to produce cost effective housing. One article I read, said that San Jose rents would have to increase another 25% to 4.75$ per sq foot, just to allow developers to break even on high rise construction! This points to some serious fundamental problem with our economy here in the bay area and it's not going to fixed with just one or two adjustments to the above reasons. We've kindof Venezuela'd our bay area economy here.

Edit: here is the link (4.25 - 4.75$/sq foot to build in San jose!): https://www.mercurynews.com/2018/04/27/construction-costs-co...

By all means, let's work to fix the problem. But, for anyone who wants to get cost effective housing in the next 30 years: I'm sorry to say it, its time to bail out. We need to start lobbying software companies to get the heck out of the bay area and CA in general.

Let's get Elon musk to build one of those hyperTubes to some city like Austin, Denver, Albuquerkee, or madison, WI. maybe some of us could commute in for 4 days a week or something.

High-rise construction is expensive, but high-rises aren't necessary for density. Wood-built low- and mid-rise is far more cost efficient, especially when you don't require 1-2 parking spaces per unit.

The reason why we get too many high-rises and too few low-rises is because of regulatory burden. In particular, the long, drawn-out, and capricious manner in which the laws are administered and challenged. In that kind of environment high-rises become more common simply because of the economy of scale--a high-rise developer has resources and the wherewithal to see the project through where developers of smaller developments do not.

The most important thing for commerce and especially real estate development is consistency and predictability. Proposition 13 and the cost of labor can be dealt because they're known quantities. Zoning boards and CEQA[1] are the real killers as the unpredictability compounds, many fold, the nominal regulatory burden.

[1] Compare NEQA to CEQA. The Federal NEQA law isn't much of an impediment to development anymore because an efficient ecosystem has developed--specialized assessment agencies that do the work quickly and cheaply, and relatively efficient administration of the regulatory regime. The cost of a NEQA impact statement is a known quantity and is easily budgeted. By contrast, under CEQA it's much easier for NIMBYs to challenge impact statements, which means the time and budget required for getting over the CEQA hurdle can be indefinite.

Indeed. I wrote about this a few years ago: http://tinyurl.com/6storySF

>Wood-built low- and mid-rise is far more cost efficient

And also tends to be drastically worse build quality and sound isolation. Given a mid-rise or a high-rise built in the same year, you definitely want to live in the high-rise, all else being equal.

Higher quality multi-family buildings that middle-class people could see themselves living in would go a long way towards changing public opinion. Unfortunately, our multifamily housing stock is bifurcated between shoddily built crap for the poor, and ultra-luxury high-rises for oligarchical investors. If people don't want to live in a building themselves, it's harder to accept its externalities for the benefit of others. Most people do live in apartments as students and young adults, and they'd never go back.

For another city to be a plausible substitute for Silicon Valley, it needs California's moonlighting-protection law. Without that, you can't reproduce this environment.

Is CA really still the only state that has that?

First I've heard of that law, why do you think it is so fundamental?

It lets you own your ideas and work that you perform at home, such as a startup you run on the side. In other states, your employer will typically have you sign a work contract granting the employer all rights to everything you create at any time and any location.

Also: It's literally on top of a fault line, most of the land is unsuitable for skyscrapers due to soil liquefaction during an earthquake, 80% of the area surrounding downtown is water

>I'm sorry to say it, its time to bail out. We need to start lobbying software companies to get the heck out of the bay area

Agreed. SF is just a bad location to build a large city.

Tokyo

The only thing they have in common is that they're both near a fault line. Tokyo has a foundation of solid bedrock so soil liquefaction is not an issue. Very little of the area surrounding downtown Tokyo is sea, compared to San Francisco, which is a peninsula around 10 km wide.

Most of SF actually has quite shallow bedrock. As for the part that doesn't, it already has subways and tall buildings (except for the part near Ocean Beach). But anyway, we wouldn't actually need any tall buildings to solve the housing crisis; 4-to-6-story apartments would do the trick.

http://images.slideplayer.com/22/6340453/slides/slide_27.jpg

If being surrounded by water is an insurmountable problem, how do you explain the tall buildings and subways in Manhattan?

>If being surrounded by water is an insurmountable problem, how do you explain the tall buildings and subways in Manhattan?

I'm not saying the water inhibits construction. It just limits the area where you can expand. Look at New York on Google maps and zoom out a bit. The metropolitan area expands in all directions except the very south. Now look at Tokyo. It also expands in all directions except the south-east. Now look at San Fransisco. The north, west, and east are blocked by the Pacific Ocean. There are single long bridges to the north and Oakland, but they serve as choke points limiting movement. Much of the area to the north is also a national park.

I've been saying it for a while: YCombinator could show a lot of leadership if they started up YCombinator Toledo or something, to spread the startup scene out to other areas, areas with lower costs of living and the like.

"The bay area has forever lost it's ability to produce cost effective housing."

Strong statement, if slightly ungrammatical. I think this is a challenge to visionary thinkers and leaders to change the game. Engineering is one part, as is regulatory capture and regressive real estate laws and norms, weak state government in the state, and highly atrophied political participation. What could change that? I can think of one thing, and one thing only, that would "shake up" the status quo.

Ya, as a current renter I've wondered what a giant earthquake would do to housing prices.

On the one hand, lots of people lose their investments and are forced to sell their land or take out loans to rebuild. You might be able to buy land or a damaged property for a good deal. Contractors would all be completely overbooked and the price to rebuild would likely be quite high for some time. Some who have never experienced earthquakes might get scared out of the region altogether.

On the other hand the houses that survive are now part of a much smaller pool of available, livable houses and there's still a lot of money in the region so I could see prices for these houses shoot through the roof.

Contractors are already overbooked. It's nearly impossible to find GCs willing to work on residential projects valued at less than $100k.

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