Editor's notes

The median rent in SF is now $3,100. Desperate times... 

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tredmond@sfbg.com

EDITOR'S NOTES Everybody's talking about the new data on the price of housing in San Francisco, which is in part because everybody talks about the price of housing in San Francisco anyway and in part because the figures are just so alarming. The figures show that the median rent in San Francisco is $3,100 a month — and while it's hard to know exactly what that means, since some three-bedroom and larger units are in the mix, most San Francisco rentals are smaller, and I'm hearing tell of people paying more than $2,000 for a studio.

Insane. This hurts everyone, particularly small businesses. The much-reviled payroll tax doesn't really affect the bottom lines of most businesses, but the cost of housing absolutely does, since it drives up the cost of employing people. High rents are way worse for business than high taxes. I don't get why all the downtown types refuse to see that.

At any rate, I was listening to KQED's Forum this morning, and the guests, including an economist from Trulia, the real-estate analysis outfit, kept talking about the "healthy" housing market. Again: Insane. This housing market is about as unhealthy as any capitalist market anywhere in the country. It's increasing the wealth gap, impoverishing thousands, forcing vast amounts of displacement and making the city less diverse. In what economic universe is that "healthy?"

When I write about this sort of stuff, my beloved trolls all say that's just how markets work and that any form of regulation (say, rent controls on vacant apartments) just makes things worse. (Not true — see Berkeley in the 1980s.) But it all raises a fun question, and gives me a chance to make a very immodest proposal that is no more outrageous than the existing situation for people who want to live in San Francisco.

Maybe we should take housing in this city out of the private market entirely, regulate it like a public utility — and assign it by seniority.

Remember the college housing lottery? First year, you got stuck with a small dorm room, just like everyone else. You lived with it, and with the roommates they assigned you; rich student, poor student, we all lived in the same place under the same conditions.

Sophomores had a little more choice, and by senior year you could pick the best housing on campus. Nobody complained about unfairness; that's just how the deal worked.

So imagine if everyone who first arrives in San Francisco (or graduates here and enters the job market) had to live in a small SRO or mini-studio. Twitter executive, nonprofit worker, unemployed person — all of us start out with the same housing conditions.

After you've stuck around a while, demonstrating a commitment to the community, you move up — say, after five years you get a one-bedroom apartment, after ten you get a flat, and after 20 years you get a house of your own. People who start families would get more space, but on the same type of schedule. Everyone pays the same monthly rent for the same size place, and eventually, after time, vests into home equity.

What should cities encourage? Stability, community involvement, respect for elders ... all of those things fit into this plan. People who might otherwise never meet each other would be thrown into living in the same places; high-paid professionals would learn what life was like for working stiffs (and vice versa).

It's an eminently fair way of allocating a scarce resource. Anyone have a better idea?

 

Comments

"Maybe we should take housing in this city out of the private market entirely, regulate it like a public utility — and assign it by seniority." Except there is that pesky Takings Clause in the Constitution which says that if the government takes over property, they have to pay the owner just compensation for it. I don't think the City and County of San Francisco can afford to pay for all the housing stock.

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Posted by personal cash online on Apr. 19, 2013 @ 4:45 pm

I suggest we give full control to the SF Housing Authority.

Posted by Guest on Jan. 09, 2013 @ 10:44 am

than realistic. As such, he succeeds.

One of the most fundamental problems of "free market" capitalism is that it treats housing as a speculative commodity rather than as a social need and human right.

The fact that the following is a slogan does not deny its truthfulness:

Housing for people, not for profit.

Posted by Eddie on Jan. 09, 2013 @ 10:47 am

they generally mean that there is a balance of both supply and demand, and that transactions are getting done and closed. It's mostly a statement about buying and selling homes, and not particularly on rentals - Trulia doesn't deal with rentals AFAIK.

You claim that high rents drive up the cost of employing people but that really isn't true. I'm not going to pay my staff more because their rent or mortgage just went up. It simply means that they have less tax-home inco and I'm not going to pay someone more just because they just had a kid, bought a new car or pay a higher rent...

Your seniority model is a non-starter, as I feel sure you know. Aside from its unconstitutionality, we should really give housing to those the city most needs economically, and not based on some vague notion of "commitment" or "community".

Posted by anon on Jan. 09, 2013 @ 11:07 am

When the market can no longer bear the low wages offered by an employer, then those wages will have to rise or the employer will not find workers.

This is as true in the tech market as it is in the restaurant or hotel worker market. The former is bidding up wages due to scarcity of workers which is exactly what will happen if commuting and housing costs make it unfeasible for workers to take a job.

Neither the employer nor employee is a charity, losing money to help the other. The Sacred Scriptures of the Market dictate that each side will split the difference until equilibrium is met even if it means raising the price of goods to account for the higher cost of labor inputs.

Posted by marcos on Jan. 09, 2013 @ 11:53 am

unskilled people come to SF on a "wing and a prayer" hoping to find their sanctuary, that there are more people willing to work for minimum wage than you'd think.

Yes, at the margin, some business will close or relocate out of SF because they cannot compete on price. But that's always been the case and at least SF is good at creating cottage businesses.

Posted by anon on Jan. 09, 2013 @ 12:32 pm

If you live on a fixed income and move to SF in your 70s, then using seniority as a criteria for advancing to a better apartment , should all SF rental units become a public utility isn't appealing. How about using a plain lottery instead?

Posted by Robin on Jan. 09, 2013 @ 12:08 pm

Long-standing tenants are the ones that get the most benefit from rent control, and long-standing home-owners are the ones that get the most benefit from Prop 13.

If anything, we need to go in the other direction and distribute housing by how valuable an economic contribution the person makes to the city. And that is closer to a market model.

Tim just wants to keep all the old hippies here because he is an old hippie.

Posted by anon on Jan. 09, 2013 @ 12:35 pm

Brilliant idea. Why don't you try to find some old communist from the old Soviet Russia to give you some ideas how to achieve it. It worked over there.....NOT !!!

Posted by Guest on Jan. 11, 2013 @ 9:14 pm

He trolled this idea a week ago in the comments. Clearly the Guardian needs to drum up some hits.

Posted by Lucretia Snapples on Jan. 11, 2013 @ 9:29 pm

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