San Francisco rents increased by 13.5% in 2014

An actual building boom offers better hope that at some nearer point, the rent increases will pause and reverse.

As someone on the inside, I'm sorry to say it's going to get worse before it gets better.

But there is a real chance, that in a few years, we'll see some moderation, as Millennials fail to replace the last crop of new homebuyers and current values fall. That's what I'm hoping for, at least.

And I second your thoughts. Transplants from the coast still think it's an affordability paradise, but for someone who's grown up here all his life, the picture looks bleaker.

I just hope we don't become SF!

> At this rate

Be wary of any trend extrapolation. Better to figure out the dynamics underlying changes.

In this case, the rate will change way before rents have the chance to double. Rental markets are cyclical. In simple terms: They go up; they become unattractive to renters; they go back down.

Tech is always implicated in stories about Bay Area housing and rents, and it does play a role, but too many people forget that the Bay Area has a diverse population and economy. There's a sizable foreign population, and professionals working in industries like finance, law and medicine often make far more than their code-writing peers. For instance, an associate attorney or investment banker with a few years of experience can easily pull in more than $200,000/year.

This said, there are also a lot of young people in tech who earn good money but spend most of it (on rent, eating out, traveling, etc.) believing that the current environment will last forever. If they knew that this wasn't the case, they'd probably be less willing to spend a huge chunk of their take home pay on rent.

You can pay $3000 for rent on $100k salary, it's not ideal but it won't automatically put you in extreme hardship either, you just have to be frugal somewhere else. Granted $100k is still a high salary, but there are a lot of people making that in SF. Still not enough to fill up the town probably, but then you have rent controlled apartments diminishing the supply, and also poorer people packing 2,3,4,5 salaries into 1,2,3 bedrooms. With lack of new construction and a lot of good jobs it's easy to see how the situation has gotten to the current point.

That's not to say people are living well there—you take a significant lifestyle hit to live in SF compared to the mid-tier American cities even with a 50% pay raise, but it's seen as a desirable place to be so prices just keep getting jacked up.

I had an opportunity to take a job in SF directly out of college. I opted to take a job in DC instead, considering the cost of living I'd be making considerably more in DC.

I did have friends that moved to SF and SV to take jobs in tech. A few that worked for twitter lived together in a house in the valley where they each paid around $1.5k each. They then car-pooled into SF (which would take hours on some days).

Others I know are completely broke. They make ~$90k a year and live with several others in very dilapidated apartments.

I will never, ever, understand the draw to living in SF. I've been their and yes it's a lovely city but the cost just makes absolute zero sense. On top of that the pay is really not that much better. I've done extensive research (I've been planning to write up a post about it but just haven't had the time) about wages in the Valley vs. SF vs. other large cities and you're looking at maybe a 10-15% bump, which will in no way cover the difference in the cost of living.

I live in SF and I work in tech. I make north of 100k and my rent is 2k. Your situation seems bizarre to me.

If you and your girlfriend make north of 100k, then you're pulling in cumulatively 13k-15k/mo after taxes. At $3k/mo your rent is below the commonly cited <33% of take-home income for housing. With at least $10k left over between you, why is it so difficult to save? I could very easily save 20% of my take-home or I could "upgrade" to a $3k/mo apartment. The only major payment I don't have in common with you is a car payment (and auto insurance). I'm also not particularly frugal, but I don't go eat at Saison every night either.

You really are doing something wrong. I don't know if you're griping in vain, but you and your girlfriend should review your lifestyle and make some changes.

To live in the city, you really need a household income of $300K+. Anyone below that is either going across the Bay Bridge or south into the peninsula.

Based on your pricing, you're best off heading to the East Bay and commuting in via BART. The peninsula may be a better option but you won't get much relief from the rents and everything is car-based and a bit sleepier for young people.

The benefit of living in London is that there is a super smooth gradient of rent decrease as you move further out in all directions, and there is reasonable commuter rail all the way. The downside of course is tiny rat-infested 150-year-old boxes remodeled 30 times since then, each time with a poorer job than the last. San Francisco has the upper hand here having burned to the ground more recently.

NIMBY Squared

The local politicians and their votes are mostly s. The rent control laws have made affordable housing rare but luxury housing and office spaces reasonably priced.

The problem is further compounded by the zoning laws, parking space related laws and the local community which is consistently voting against any housing projects to make sure their property rates do not go down because of increased supply.

Established and older residents, especially those without children, see no reason we should be "Manhattanized" so more people can live here. They "like SF just the way it is, thank you". If you don't have kids, and you have rent control, you never really need to upgrade your 1BR apartment once you got it.

Secondly, there is no upzoning, and subsequently no increase in density, without eviction, thanks to the rental market. Evictions aren't popular. The Tenderloin is completely insulated from any of this.

Historical preservation is bogus, but has a history. The reason that some people argue for largely have to do with the projects in the Western Addition, which bulldozed a bunch of victorians to make what most people consider an eyesore.

Local politicians don't really care too much. The reason being is any action they take pissed off established residents, who voted them in. That's changing a bit, as more people feel the pressure of the rental market and evictions. Still, there's more of an attempt to protect people who are established then there is an attempt to accommodate those who actually need housing, especially those in the middle class.

And, to add to what everyone else said: there are out-of-towners who are buying up this newly-built property; either as a place to stash some cash (people from China, Russia), or as a crashpad for when they come in to town (from other parts of Bay Area) for an event or something.

Your rent will double every 7-8 years if it keeps increasing that fast.