The rent is too damn high


You look at numbers like this and you go: Whoa. The rent really, really is too damn high. Median rent in San Francisco is now over $3,000 a month. WHo can pay that? Seriously.

The federal government says your rent payment shouldn't be more than a third of your income. That means to qualify for the median -- not the highest, but the median -- rent in this town, you need to be earning $9,000 a month, or $108,000 a year. That is NOT, by any standard, the median income in town.

So let's say you spend half your income on rent. You still have to make $72,000 to afford the median apartment. Crazy stuff. And when local politicians say they support "rent control," that's nice but it's not the point. Controlling rent at $3,000 a month doesn't make the city affordable.

If rent controls applied to vacant apartments, then rents overall, across the city, would rise at the level of inflation -- and people on fixed incomes (social security, disability, SSI) would be able to keep pace. You want to know why there are so many homeless people in this city? One reason: Two decades ago, SSI paid enough every month to cover the cost of an apartment and leave enough to buy clothes and eat. Now, it doesn't pay enough for an SRO hotel, even if you don't buy anything else.

So people wind up on the street.




those vacant untis very quickly. It just takes one high-tech SF company to hire a few hundred new graduates and that probably overwhelms the local inventory of vacant rentals.

So yes, you're right, rent control is great if you've been in your place for a decade or more, but it really mitigates against those who arrive here. For newly-minted knowledge workers, it just makes like harder. But for those with few skills who "just want to live in SF", it's game over.

Posted by Guest on Jan. 04, 2013 @ 1:27 pm

Also, anyone over 50 is almost always out of luck when looking to rent an apartment in SF. Only the rich, young, and transitory need apply.

What a backwards system we've created.

Posted by Guest on Jan. 04, 2013 @ 1:51 pm

As a former landlord, that always impresses.

Posted by Guest on Jan. 04, 2013 @ 2:03 pm

...and can't afford anything like that?

Posted by Hortencia on Jan. 10, 2013 @ 9:20 am

does all the time anyway, and find a home and a location that you can afford.

When did America become a place where everyone can have whatever they want regardless of whether they can afford it?

Posted by anonymous on Jan. 10, 2013 @ 9:40 am

move to Portland...

Posted by Guest on Jan. 04, 2013 @ 1:10 pm


Posted by marcos on Jan. 04, 2013 @ 1:26 pm

board with your one-word allegations, you are making it impossible for any of the rest of us to see the most recent posts. Since that is the best way of capturing what's going on here right now, I implore you to stop.

If there's someone here you don't like or whom you think is trolling, then just ignore them. Don't feed the troll.

Posted by anon on Jan. 04, 2013 @ 1:46 pm

Concern Troll

Posted by Guest on Jan. 04, 2013 @ 3:04 pm

How's it shaking?

Posted by Guest on Jan. 04, 2013 @ 3:19 pm

Shaky Troll

Posted by Jen on Jan. 04, 2013 @ 3:46 pm

And in fact it's odd because, unlike San Francisco, it has a shitty economy. Not to mention a stonking state income tax that kicks in at much lower levels than CA.

The one good thing there is no sales tax. But of course you can enjoy that without living there. Live in Vancouver, WA - right across the Columbia from PDX - and you can shop in Portland while not paying state income tax - WA has none.

I even make trips up to the malls and outlets in Medford, OR a couple of times a year to save sales tax. The saving kore than pays for the gas.

Gotta love this country.

Posted by Guest on Jan. 04, 2013 @ 1:43 pm

As more people with higher incomes move to or remain in the Bay Area, they compete with their higher incomes for desirable locations. That's what sends locational values up. Acknowledging that locational values are a function of community growth in economic power and desirability indicates that community accounts for rising land values. Collecting most of those rising land values kills speculation in land ownership and hoarding, returns vast sums to the community for social purposes, and kills debt-for-land interest-bearing lever money lenders have respecting land/location.

Come along on a walking tour of San Francisco, noticed on IndyBay for Saturday morning, and then go tell a friend. The walk's free. But you can contribute to a "Help the Bay Guardian get the story straight campaign."

Posted by Guest on Jan. 04, 2013 @ 4:53 pm

Eminent domain on an entire city?

Posted by Guest on Jan. 04, 2013 @ 6:28 pm

Taxes are the first agenda item for any community or country that forms a union for a common purpose. Besides the initial reason(s) for wanting to form a common society (protection from outside forces, sharing of resources, common regulations, etc.), the first question they have to address is, "how do we pay for it?" Thus, courts give tremendous leeway for tax policy decisions by legislative bodies. Indeed, the massive Obamacare legislation was largely approved by the US Supreme Court as part of the government's legitmate taxing function. Without the taxes that tied all of the disparate pieces of the healthcare legislation together, it's quite possible the court would have never approved such a massive government intervention into the healthcare system.

Court's would have no problem allowing a tax of 100% of community ground rent. Any buildings on the property would still have economic value and would be tax-free, so it's not a complete property taking, and it's a reasonable way to collect taxes since it's the community that determines land values, not individual landlords.

For any non-landlords out there, take the walking tour. It's bound to be a learning experience.

Posted by Guest on Jan. 06, 2013 @ 7:48 pm

Income tax which, in CA, can come to almost 50%.

How much higher than that are you suggesting tax on rents should be?

Posted by Guest on Jan. 07, 2013 @ 12:41 pm

The average SF home price is about $720,000. The prevailing market yield on residential property in SF is about 5%, give or take. So we know that the average market rent on the average market property is $36,000 per year, or 3K per month. Your figures add up.

Now suppose you want a scheme where such a propery is rented out for half of that, say $1,500 per month, so that it is affordable - by the one third rule - for someone on $54,000 per annum (a figure which is significantly below the average SF family income of around $75,000 per annum).

How would the financing look for the city to be able to do that? Well, the city can do that now - they don't need any new legislation. The city can simply buy that property when it comes up for sale on the open market (which I believe is what Marcos was suggesting). it then turns around and rents it for half the market rent. Bingo, problem solved, for one lucky family anyway.

But the city is losing $18K per annum on that. Can that be sustained? Will it scale? Will the voters tolerate such generosity with their money? you can use revenue bonds, of course, but their yield would have to be double the rent in the same way. Either way, there's a direct public subsidy.

It's a nice idea, Tin, but shading over the numbers does not lend credibility or seriousness to the suggestion. so next time, please, provide some math and fiscals to show how this would actually work. As noted, it could be done now, but nobody is suggesting it, and I think we can all see why.

Posted by Guest on Jan. 05, 2013 @ 5:23 pm

Quoted from Wiki:

The SFBG never successfully transformed itself for the Internet era, failing to hire staff that understood new media and could grow online readership and revenue. It is stuck in the past technologically, ideologically and substantively, acting as this were the 1970s and 1980s and the SFBG was still the voice of a developing local progressive movement. The SFBG never adjusted to San Francisco's increased wealth and changing racial and ethnic demographics.

Posted by Guest on Jan. 06, 2013 @ 5:01 pm

Quoted from Wiki:

The SFBG never successfully transformed itself for the Internet era, failing to hire staff that understood new media and could grow online readership and revenue. It is stuck in the past technologically, ideologically and substantively, acting as this were the 1970s and 1980s and the SFBG was still the voice of a developing local progressive movement. The SFBG never adjusted to San Francisco's increased wealth and changing racial and ethnic demographics.

Posted by Guest on Jan. 06, 2013 @ 5:02 pm

One: People who already live here -- many who were born and/or grew up here -- are not able to live here because of disproportionate housing costs. (The other costs-of-living are not so inflated nor so out of step with the rest of No. California. You can eat pretty decent food here even if you're poor. Public transit is reasonably priced, imho.) This is really basically unjust, to be forced away from all and everyone you know because it's profitable for someone else.
Two: why is the debate "kill rent control vs. keep as is" ? Changing rent control is not really an impossible idea.
Three: Though several on this comment thread think that just regular folks all work in biotech and IT and make 100k, that is not the whole economy of SF. Is there an available statistical workup showing what actual jobs in SF pay, and where those people live, how much this local economy depends on some kind of balance there?
We've already been aware that less than half our emergency worker-force lives in the city, which fact is a problem for all of us. What about necessary maintenance workers? Teachers (of course)? Cabbies? Tourist industry workers (i was one)? How far need a person commute to make min. wage cashiering at the corner store, delivering our pizzas, doing our drycleaning, all those mundane *physical* tasks that make the city function? A lot of us make less than 60k. Importing the basic-function workforce every morning does not seem to make for a sustainable, and certainly not environmentally sane, city.

Posted by not rich, duh on Jan. 06, 2013 @ 5:13 pm

rents are half what they are in SF, meaning that someone there can live the lifestyle of someone in 120K in SF. It's just 7 minutes by BART or car.

Hey, how do those service workers in Aspen and Aruba manage?

Posted by Guest on Jan. 06, 2013 @ 5:48 pm

so your numbers are bogus. A free marketer shows his true colors--income restrictions as a requirement for residence in San Francisco. Modern day restrictive covenants.

Posted by Eddie on Jan. 06, 2013 @ 6:09 pm

determine where you can afford to live and where you cannot afford to live?

I cannot afford Aspen or La Jolla or Los Altos? Is that wrong? Should the government somehow fix that?

Posted by Guest on Jan. 06, 2013 @ 6:23 pm

...those small towns with a world city like San Francisco?

Posted by Hortencia on Jan. 07, 2013 @ 12:31 pm

Both expensive, both huge (10 times the size of SF) and both with no rent control

Posted by Guest on Jan. 07, 2013 @ 12:38 pm

The first time I visted Aspen it was early evening. After turning off the interstate towards the town, I couldn't understand why there was a heavily congested stream of cars coming in the other direction on a weekday night. After a few minutes scouting the town, it was obvious. There is almost no housing in Aspen that isn't catering to higher income people (or to people like myself willing to spend a few hundred dollars of limited disposible income to ski at one of the best mountains in the country.)

On the way back to Denver a few days later I toured Glenwood Springs, which I had learned was where most of the "day help" lived. The town was mostly dusty streets, with lots of trailer parks and few commercial or social amenities like restaruants or parks. The 40 mile access road the GS residents traveled each day was long, narrow, windy, and often deadly in the severe storms that hit the region each winter. The oil resources consumed and money spent traveling back and forth was, for most, their second highest expense after housing costs.

Just as the Aspen govvernment made a decision it didn't want lower income people to live there, San Francisco politicians have made the same decision. Ed Lee and his biggest backers know that his "more jobs" mantra is a code phrase for, "poorer residents, you will be displaced from SF when your apartment (eventually) is converted to a TIC or owner-move-in, so don't get too comfortable."

The housing solutions are fairly easy, but there is no political will in the city, state, or country to accomplish them.

1) Require every large company in the area to build housing for all of their employees, or mandate that they ship the jobs outside the Bay Area.

2) Impose an annual excise tax of $50,000 per employee for every housing unit not provided by large employers, earmarking the money to build new housing.

3) Disallow all private landlords, turning over the landlord function to non-profits.

4) And since housing costs and rents are ultimately determined by the community and what they are willing to pay and not by the landlord or home seller, impose a 75% rent tax and 90% capital gains tax on all rental housing transactions, using the money to build more housing.

Many of our forebearers fled europe, asia and countries south of us because the landlords who controlled almost all of the land had made sure there was no economic hope for the masses. Any higher incomes the tenants received merely resulted in higher rents. And of course a landlord had no incentive to fix up a property as long as there are willing renters begging to live there. Our forebeares came to the US becaiuse of cheap housing, the foundation of any stable community.

The landlords have finally caught up in the US (at least on the two coasts) as they have elsewhere in the world. If a family doesn't own real estate, or if they're not in the top 30-40% of area income earners, they can realistically expect a diminished economic future as rents, purchased housing costs, and taxes continue to creep (or leap at times) ever skyward. The landlords, banks, and politicians have basically won the economic game in the US. And large companies are busy expanding to far more profitable and growing partsof the world, leaving only their lhighly trined and highely paid staff here, although that too is slowly changing since the internet has revolutionized how work gets distributed across the globe.

Fortunately there are a lot of other exciting and far more reasonably priced places to live in the world, some even in the US. Incomes may be much lower there, but the costs of rent and home prices are far lower too. And as anyone who checks out this chatboard or sfgate can attest, the shrillness, economic fractionalism, and "soundbite activism" in SF and the Bay Area doesn't make it a particulary pleasant or productive place for someone to live unless they're mostly committed to a career and making a large salary.

Posted by Guest on Jan. 06, 2013 @ 7:05 pm

The problem here is a problem of entitlement. Because SF is deemed cool, people want to live here who cannot afford it. They come here anyway, struggle, and end up being "housing activists" because they think it is important that people like them be able to afford a place that they know they cannot afford.

It's like me wanting to drive a Rolls Royce and, not affording one, petition the government to subsidize Rolls Royce buyers.

Posted by Guest on Jan. 07, 2013 @ 12:37 pm

People who live here already are being pushed out. Most are not looking for "coolness". They could afford SF before perhaps the last, or last 2, or last 3, separate spirals of housing inflation and this is their home.
It is Not At All like your desire for a Rolls. A luxury car is a luxury. Housing is a necessity of life for human beings.
Living in Oakland is another life entirely. Neighborhood safety is an issue for a lot of us, esp. the old, gay, disabled, transgender, for example -- this is a whole other discussion. SF has great public transit, and makes improvements to it. Oakland keeps destroying theirs. (Do you realize how much more expensive taxis are there?) Most everyone I know who has been priced out of SF and moved to Oakland or western Contra Costa/Alameda towns has had to get a car, a car they never needed to own in SF. Like for the Aspen workforce described above, the transportation costs soar. And the quality of life dives.

Posted by not rich, duh on Jan. 09, 2013 @ 7:52 pm

not everyone can afford Aspen.

Posted by anonymous on Jan. 10, 2013 @ 9:38 am

Why does every story in the SFBG that touches on economics feel like the author failed Econ 1A?

Once the warlords became respectable landlords and formed governments to protect their "property rights," the economic issues were mostly decided. If you want lower rents (or lower housing prices) then reduce the area income (substantially), build a few hundred thousand more housing units, kick out all of the large companies and their highly paid workers, or keep increasing the taxes on landlords until they give up their holdings.

Bemoaning basic economics while living in a mostly feudalistic society isn't very productive. Both Dems and Repubs agree that landlords and bondholders are the most important segments of society, as witnessed by the billion-dollar tax subsidies both groups receive every year, while lower income people fight over the crumbs. At least companies build goods (including housing) and produce services that people want or they'd be out of business, whereas neither landlords nor bondholders produce anything of value other than the extraction of wealth from the rest of society.

Posted by Guest on Jan. 06, 2013 @ 8:15 pm

They think governments can repeal the laws of science by passing laws that deny that science. And then wonder why there is tsunami of Ellis evictions, TIC's and Condo's.

Posted by Guest on Jan. 07, 2013 @ 12:40 pm

is not science. Without government protection, the present economic system would have collapsed and been replaced by a more rational one.

Posted by Eddie on Jan. 07, 2013 @ 12:59 pm

100 years ago, it would have been taught as liberal arts.

Big difference.

The US government may have bailed out the odd bank or car manufacturer, but they haven't bailed out cpaitalism. Iceland lets it's banks fail and they're still capitalistic.

Posted by Guest on Jan. 07, 2013 @ 1:54 pm

2) One hundred years ago, the education system wasn't a wholly owned subsidiary of the U.S. Chamber of Commerce.

3) You are an idiot troll.

Posted by lillipublicans on Jan. 07, 2013 @ 2:59 pm

continues to bail out the entire financial system to the tune of at least $12.8 trillion as of 2009, so undoubtedly the total cost is much higher.

Under true free market capitalism, there is no such thing as too big to fail.

Socialism for the rich, capitalism for the rest.

Posted by Eddie on Jan. 07, 2013 @ 4:06 pm

the taxpayer made a profit on some of them. Not GM tho, that's a basketcase and should have been allowed to fail, I agree.

Posted by Guest on Jan. 07, 2013 @ 4:52 pm

The original TARP money was repaid, but it was only a small percentage of the $13 trillion I cited, the much larger backdoor bailouts. You are also leaving out the economic wreakage that the banksters left in their wake--the total loss to the economy and wealth--more trillions.

I suggest the work of Dean Baker, a liberal mainstream Keynesian economist--certainly no Marxist.

Posted by Eddie on Jan. 07, 2013 @ 9:38 pm

it's in the same ballpark.

What have you read by the Cato Institute and the Heritage Foundation about this topic?

Posted by Guest on Jan. 08, 2013 @ 6:51 am

Troll. By the measure of your rudimentary grasp of politics and economics, Richard Nixon governed as did Leonid fucking Brezhnev, clearly a product of post-Prop 13 California schooling.

Posted by marcos on Jan. 08, 2013 @ 11:18 am
Posted by marcos on Jan. 09, 2013 @ 10:07 pm

Imp Troll.

Posted by marcos on Jan. 09, 2013 @ 10:09 pm

Do I have to come here and tell you how life works? here it is 2 real cases: mario,25, Immigrant came here working in 3 jobs and going to City College and never spent a cent in a restaurant, he would buy a 25Ls of rice and have some vegetables when possible, Jimmie Hendricks Skywalker, also 25, move here from Yonkers but want to rent in Noe Valley and always did the best restaurants in town, lease a BMW after BMW, fast forward 25 years. Mario moved to the the Bay View as homeowner where he had 2, 5 kids and wife that he argues everyday , but has 400k in his 400k, and house paid off but it needs constant repair because it is an old house, Mario no longer has any hair. now the other guy also know as JHS is now protected with a GOLD HANDCUFF in the same Noe rental with his Wife as a DINK. Although he as only 10% of Mario total fortune he is a happy man. Now what is your choice to live longer and happy and spend all of your money and go broke to a retirement, or live the life of a Salmon and turn red at some point but have the money for the just in case?

Posted by Mario Self Portray on Jan. 07, 2013 @ 1:41 pm

"That means to qualify for the median -- not the highest, but the median -- rent in this town, you need to be earning $9,000 a month, or $108,000 a year."

"Damn lies and statistics!"

Or, in a word, BULLSHIT!

Clearly, your interpretation of the figures is skewed toward single individuals.

"You" do not have to have an income of $108,000/year to afford the median rent.

"You" have to have a household that earns that much.

The median rental price for a studio is $2,150...NOT $3,000.

And the median family income (i.e. plural households) in San Francisco is $103,000.


Posted by Guest on Jan. 07, 2013 @ 2:12 pm

There are only three stats that matter:

Average SF home price: 720K
Average SF rental: 36K per month
Average SF FAMILY/HOUSEHOLD income: 72K pa

So the average SF home is ten times the average household income, and the average SF rent is half the average SF household income.

About average for a desirable town. No biggie, especially since super-cheap Oakland is on our doorstep.

Posted by Guest on Jan. 07, 2013 @ 2:27 pm

There are only three stats that matter:

Average SF home price: 720K
Average SF rental: 36K per month
Average SF FAMILY/HOUSEHOLD income: 72K pa

So the average SF home is ten times the average household income, and the average SF rent is half the average SF household income.

About average for a desirable town. No biggie, especially since super-cheap Oakland is on our doorstep.

Posted by Guest on Jan. 07, 2013 @ 2:27 pm

As a person with disabilities, I need to correct those who say, "Just move to a place that's cheaper." At very low income, I need good mass transit. I need health care services nearby. Community resources allow me to live better, which at this point is bare decency.

We've seen long term cuts in subsidized housing.

Speculative and criminal activities by the F.I.R.E. (Financial, Insurance & Real Estate) industries have contibuted to high rents too!

btw, I was a youth development professional when I developed my disabling condition. And I got screwed by Workers Comp. Surprise.

Posted by Guest Bill Schwalb on Jan. 07, 2013 @ 4:08 pm

You have access to transit, healthcare and community resources - by your own admission. Yet you seem angry you don't have more. Lots of people are angry they don't have more.

Posted by Lucretia Snapples on Jan. 07, 2013 @ 4:29 pm

much cheaper than SF. Why would you ever expect to be able to afford to live in a place as affluent as SF?

Posted by Guest on Jan. 07, 2013 @ 4:51 pm

You need to suck on tits of the welfare state.

Posted by marcos on Jan. 15, 2013 @ 9:19 am

New buildings aren't subject to rent control in San Francisco. I've known people who have rented in them and received rent increases of FIVE HUNDRED A MONTH after their year lease came up. That's just crazy and suggests that if we did not have any rent-controlled apartments, we'd all be subject to market rates and not rates that are both fair to the tenants and the landlord. Being able to raise the rent at 60 percent of the annual Consumer Price Index, as rent-stabilization laws allow, seems fair to me. If not, at least we might all agree that an increase of $500 (almost 17%) is NOT FAIR. I know people who live in Chicago where there is no shortage of housing and no rent control (and they experience inflation in Chicago as well), and they hardly ever get yearly rent increases. It's clear that high rates are based on what the market will bear and not on new tenants offsetting the cost of low-rent paying long-term tenants. I suspect that a building full of tenants paying 1990 rents are still covering the cost of maintaining the building and providing some profit to the owner. If not so, someone please prove me wrong. Also, I appreciate the sentiment of this article, but I've read it here before and saying the same thing over and over again is starting to come across as hacky. Do some research. What is the median income of residents, if not 72K? What is the real median rent of tenants, not just current cost of vacant apartments? What is the real vacancy in San Francisco? How many buildings have been taken off the market and sit empty? What is the real cost of owning and maintaining a building in San Francisco? Must us readers do all our own research in order to get the answers. And if so, why would we continue to read this publication?

Posted by Guest on Jan. 09, 2013 @ 3:10 pm