A national housing crisis is brewing

This is absolutely the way people think, but it might actually not be true.

The person in question may be able to sell their land for a large multiple of their purchase price, if a developer were able to tear down the structure to build a multi-tenant dwelling. As it currently stands, the maximum economic value that can be derived is based on that of a single family home for the top x% of earners who can afford to buy one. But if you could house ten families on the same land, the economic value probably skyrockets.

Two important concepts about this. The first is that in places like SF, those making the speculation are also the ones that dominate the elections. Figure that SF has a high amount of renters, of the which many are foreigners that can't vote. That shows a skewed and corrupt political system.

Second, that such a ploy of decreasing housing shortage is economically inefficient, and thus makes the whole poorer. In an efficient system, the more housing, the more people, the more services and tax income and everybody wins. So how can the home-owners be benefitted more if the pie shrinks than if it grows? Its the tax system that double punishes renters and prizes landlords. SF spends 2,600U$S a month per household. If the city levied its taxes on land instead, it would literally eat up all the rental prices of land, and housing would be worth next to nothing: but because instaed it punishes workers coming into the city with sales taxes, and companies with corporate taxes, landlords actually get a double pay: they get paid by the renters twice.

Funny that you call a realistic, economically sound criticism of NIMBY-ism "propaganda" but then go on to attack the entire problem as "techbros".

Wow, talk about intellectual dishonesty.

I'm so glad we all learned today that the only problem with SF is "techbros!" That's certainly not "propaganda"! All we have to do fix SF is kick all the techbros out! How convenient for your preferred ideology!

Nonetheless, I personally "agree" with your solution (in that I work in tech and don't live in SF), but hoping for the free market to do something that it is not doing has never been the solution to a question of public policy. Even if you took the most anti-tech public policy options possible in the city of SF, it wouldn't solve the fact that tech is firmly embedded in the entire metropolitan region which is outside of SF's municipal control.

If you really wanted to get "tech bros" out of your city you would need a solution on the level of the California state government, ideally something that intentionally disincentivizes business and venture capital. Good luck on that, in the mean time you're just going to have more "tech bros" moving in and voting for anyone who speaks out in favor of upzoning.

When the tech bro jobs leave, SF will be in dismay, it wont get better. SF city spends 2,600U$S a month per household. If it were to lose its corporate/sales tax revenues, it would have to cut spending aggressively, and it will not make rent cheaper: it will make it unaffordable, exacerbating unemployment which could lead to rising homeless ness.

SF is in a terribly delicate position right now, its just masked by a lot of money.

And how do you conclude from 1 and 2 that "Really the solution is not more housing"?

I was with you on point 1 (housing and transport go hand in hand. That makes sense).

Detroit, along with every other city in the world has been trying to create their own Silicon Valley and ignite a revolution but its just not that easy to do. Just google innovation and government and read a few books worth of text on the various theories of what the problem is. (Not enough VC, not enough tech talent, not enough money, not enough infrastructure etc etc).

Once you add in questionable California regulations, the price jumps up to about $$750-800 per square foot. (None of this extra money is in the house itself; it is in the surrounding site.)

I think existing homeowners have been voting through “wouldn’t it be nice if everybody else paid for X, even though I would never do that myself” NIMBY regulations which further exasperates the housing shortage.

Two concrete examples:

In my neighborhood, accessory dwelling units (ADU’s) are capped at 1200 sq ft, but primary homes are capped at 6000 sq ft. There are no colleges nearby, and per TFA, only 50,000 houses under 1400 sq ft were built next year. The ADU is too small to be rented to a family. It is only for au pairs, inlaws and airbnb. The stated purpose of the ADU rule is to increase housing supply. Heh. If this was for adding housing stock, the rule would be “two houses, not to exceed 7200 sq ft”.

We are being forced to upgrade our driveway to the point where runoff and landslides may be an issue (the existing driveway is adequate for heavy construction equipment). We will probably need to add retaining walls, and maybe an underground cistern to mitigate the environmental impact of the driveway.

http://time.com/money/5355518/home-price-salary-every-state/

So I agree with the OP, the author of this article is unjustifiably projecting the SF housing crisis onto the rest of the country.

Obviously that list of cities makes up a large group of Americans, but it still isn't really representative of the country as a whole.

That said, at least in my field, the vast majority of jobs are in those cities, and so it becomes problematic when from an employment perspective, it is difficult to avoid those areas, while from a livability perspective, it is financially difficult to get by (at least, without the torturous commutes).

The problem is “eventually” has an unclear definition in both cases, and few are willing to sacrifice their potential of attaining certain careers or income in exchange for working low wage jobs waiting for a hypothetical future correction of this inequality.

It’s hard to level existing residences in many historic cities and so housing costs rise, yet people are still wanting the opportunities afforded by those cities enough to sacrifice having better housing conditions elsewhere.

if too many developers do this, that high-priced housing will have to become low-priced housing if they actually want to clear the market.

When building was allowed, you got richer people moving into new luxury housing and as buildings aged, instead of fixing the luxury features, landlords would lower the rent and target a different market.

Now that many cities do not allow enough building you get richer people staying on those aging buildings or even moving into the city and competing for fairly run down housing.

If we don't allow building then two options are allocating housing by price or by lottery(like rent control), but either way people lose out because you can't put 110 families in 100 apartments. Unless more housing is allowed to be built there will be this frustration

I can't speak for California, but in Boston rents are high and mortgages to sustain the same units are much much higher. Regardless of the existence of a housing shortage, this is bubble economics.

In a zero-speculation environment, the total cost of homeownership should be comparable to the cost of renting. Without speculation, market prices in places like Boston mean investment properties are absolutely horrid investments because they have little or no return (when you factor in the total cost of managing the property and the opportunity cost of the capital used to purchase the property). The fact that despite this most properties are rented means that landowners are banking on rents rising to meet current prices (or they aren't confident they can sell at current "market price" in a short amount of time - real estate can't be easily liquidated with a click like stocks can, plus there's tons of overhead costs involved in trying to liquidate real estate)

Or to put it in other words, the high rents in boston reflect the current housing shortage and the higher home prices in boston reflect the expected continuation of the housing shortage (backed by the reality that population here is increasing faster than housing is being built)

If you have a couple of DINKs, it's 2250 per person per month, or about $27000/year. 150k/year per person, about 90-100k/year after tax, and that's well under 30% of your take home pay.

I used round numbers and I'm probably off, but even if you have to tweak the math, it's pretty easy to see where people are coming from.

When I was looking to buy in the area, a bunch of people looking at the open houses were couples with both people sporting their Amazon/Microsoft/Google/whatever backpacks or jackets.