The rent is too damn high

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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.

 

 

Comments

than let Adam Smith determine them, is that no two people will agree on what a "fair" rent is.

Is it what people can afford? Is it what gives a landlord a minimum ROI? Is it what some faceless bureaucrat in a cheap suit says it is? Is it decided by a bunch of old fat white guys with beards and sandals?

"Fair" is a subjective notion. The market is objective. And not everyone who wants to live in SF can afford to do so. Should rents be "fair" in Aspen so that I can go there and live a champagne and caviar lifestyle?

Life isn't "fair". Never was; never will be.

Posted by Anonymous on Jan. 09, 2013 @ 3:40 pm

with your facts and stuff.

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

Places are not fungible, people are not fungible. There is a corporation mentality that wants to make it so, wants to make all of our decisions a matter of what makes fiscal sense.
But people have homes. Some people are natives of a place, and have deep roots. They have community and family in an area.
I know of one woman who grew up in a slum area. She became a leader in her community and worked for years to improve the area. She was instrumental in getting a museum started in her neighborhood. By the time she was in her 70s, the area was gentrified; attractive, even upscale. And she, now living on social security, could no longer afford to live in the community she had devoted her life to.
You could say she was short-sighted; if she had devoted herself to making money instead of improving her neighborhood she could still live there. But it would still be a slum. I do not think she was wrong to support her community instead of selfishly focusing on herself; I think it was wrong for the newcomers to essentially chase her from her home.

Posted by Guest on Jan. 10, 2013 @ 7:01 am

surely have a responsibility to ourselves to look ahead and make prudent provision for the future.

Some will sacrifice maybe some of the things they would like to do, because they do not want to end up being old, vulnerable and subject to external risks like not being able to afford to stay where you currently are.

Others just do exactly what they wants and then sometimes pay the consequences down the line, accepting that fate.

The problem arises when the latetr group, having not made provision then argue that those who were more prudent should pay so that they do not have to face the consequences of the decisions they made earlier in their life.

We'd all take the easy, fun route if we thought someone else would bail us out. That's called moral hazard. But it's a not a real smart way to run a city.

Posted by Guest on Jan. 10, 2013 @ 8:04 am

Heartless, ignorant, elitist comment.

Posted by Eddie on Jan. 10, 2013 @ 8:21 am

chooses to be, say, a poet rather than a CPA can then turn around in their old age and demand that accountants pay more tax so that she doesn't have to leave a home which, had she thought about it, she should have realized that she would not be able to afford?

You want to immunize people from the consequences of their own decisions by simply riading the coffers of those who were more prudent and less self-absorbed.

Posted by anonymous on Jan. 10, 2013 @ 9:06 am

and secure retirement, unlike most Americans and certainly the one alluded to in the above post.

There's more to life than maximizing wealth and hoarding it. The constant premise in your commentary is that somehow you are subsidizing those with jobs or lifestyles you deem inferior.

That's my last comment on this. I don't want to replay the same irresolvable arguments with you.

Posted by Eddie on Jan. 10, 2013 @ 9:31 am

to the extent that you deicde to focus on those other thigns rather than build welath, then you should not be able to simply tap those who made more prudent decisions with their life.

Posted by anonymous on Jan. 10, 2013 @ 9:35 am

This is one of the dumbest articles Tim has produced. The rent is too damn high because of poverty pimps like Ted Glicikson of the tenants union, perverting supposed laws designed to "protect" low income tenants. Creating shortages by scaring landlords out of business in SF. Ted will tell you landlords don't remove their units from the market because their "greeeedy" . Yeah sure....tell that to a small mom and pop land lord who just had to spend half their life savings fending off some trump up lawsuit by a whack job tenant and their predator scumbag lawyer.

The tenant activist and their whores on the board of sups created the problems by inventing crisis and them stymieing development based on evil "gentrification demons".

You need not look any further than at idiots on the board and the poverty pimps when it comes to causing high rents in SF. The evil culprits are the ones standing in the way of development and growth all the while crying foul. Boo hoo.

Posted by Guest on Jan. 11, 2013 @ 9:43 am

of property prices worldwide plotted against the strictness of each country's land use and housing laws.

Without fail, the countries with the strictest land use and housing laws had the highest rents and home values. Regulations designed to help tenants and homeowners actually punish them. Rent control drives rents higher by suppressing supply and discouraging turnover.

Posted by anon on Jan. 11, 2013 @ 10:55 am

The strict land use laws were enacted because of high rents and high land prices, not the reverse as you imply. As an investor, when I see a place that has sharply increasing rents such as a town like San Francisco my goal would be to build as many units as possible to maximize my rent and sales revenue. In towns/cities without strong land-use laws (and there aren't too many), I can buy up cheap real estate, tear down the exisitng structures, and build as high as it makes sense to maximize rents and land value. Most places where this is possible are in relatively dense cities where population income is higher than the norm such as Singapore, London, Paris, and Rio, along with SF and Manhattan in the US.

Without strict and-use laws, it would be easy to buy up the two - four story buildings along Oak and Fell (and along Lincoln and outer Stanyan), tear down the existing buildings, and replace them with 20-50 story high-rises. If San Francisco would give me that power, I'd become one of the richest people in the world.

Many valid points against San Francisco's current planning process have been stated here before:

1) The huge economic wealth created from new construction accrues to the developer, the banks financing the deal, the lawyers, and the PR firms, while the exisiting residents are stuck with most of the external costs of the project, including more congestion, added stresses to existing public services such as parks, police and transit, the loss of light, and a loss of place.

2) The residential units that get built do not meet the current needs of the exisiting residents since a developer's goal is to maximize rents and land value by renting and selling the units to the wealthiest population groups, such as foreigners looking for a place to park a few of their millions, or US millionaires looking to buy another 2nd or 4th home in a "cool city" to hang out for a month or two each year, or the units are marketed to the newly minted tech millionaires created on a weekly basis at companies often not even located in the city.

All one needs to know about the SF Planning Dept, mayor, and BOS is that none of them can tell us the purchaser profiles of the 10,000 units built during the past 12 years, such as where the purchasers lived two and five years prior to their purchase, what was the source of their downpayment, and the percentage of full-time residents living in the purchased units verses whether the units are being rented out as an investment.

Developers and land speculators in the US have it esay. In many places around the world that face housing shortages and sharply increasing rents there are severe restrictions on who can puchase a city's limited housing stock, often preventing foreigners, part-time residents, investors, and a whole host of other exploitive economic players from the market so that the exisitng community does not face the severe dislocation that happens when a city is under siege by outside money. Fortunately for developers, speculators, and real estate investors, San Francisco is a solidly Democratic Party city, and the Democrats are closely tied into big-city landlords, developers, real estate speculators, and big ticket transpo across the country.

Posted by Guest on Jan. 15, 2013 @ 10:44 am

he here now.

They should match the needs of the kind of people we would like to have here, which may be evry different.

And yes, if we tore down outdated, low-density shacks and built high-rises, SF housing would be much more affordable.

You appear to admit that SF's land use laws don't work, since you claim they were introduced to make housing more affordable, and clearly they have failed.

Posted by Guest on Jan. 15, 2013 @ 11:06 am

So long as there are San Franciscans who are housing impoverished, justice suggests that we build safe and healthy housing for them first.

Posted by marcos on Jan. 15, 2013 @ 11:37 am

rigid and must be kept that way.

It's healthier to have a fluid population, with people coming and going, for both economic and other reasons.

We don't owe anybody anything just because they happen to be here at the moment.

Posted by Guest on Jan. 15, 2013 @ 11:49 am

A real estate investor debunks the myths propagated by the right wing apologists who clog up this site with their mindless ignorance.

Posted by Eddie on Jan. 15, 2013 @ 11:10 am

Guest is not a developer, he's one who's been evicted from San Francisco due to speculation and is familiar with the politics and economics of housing in SF, CA the US and globally, and is simply describing developer options as if he were one.

Posted by marcos on Jan. 15, 2013 @ 11:42 am

No developer is going to argue for stricter land use laws.

Posted by Guest on Jan. 15, 2013 @ 11:48 am

Ed Lie was a poverty pimp when he worked for the Asian Law Caucus.

Posted by marcos on Jan. 11, 2013 @ 11:38 am

I am a US Army Infantry combat Veteran. I used the GI Bill to receive a masters degree education in counseling to aid my fellow Veterans suffering from readjustment problems. I work for the Department of Veterans Affairs and can not afford to live in the city who's population I serve. I often get smirks or rolled eyes when I tell people I live in the east bay. Lets not even talk about the commuting costs that the US tax payers pony up for my commute into San Francisco.
San Francisco would not be so bad if it was not for the "bussing" of the tech crowd. Really, bussing six figure earners?

Posted by Guest on Jun. 23, 2013 @ 7:19 pm

I can’t believe how narrow-minded some people can be. There are quite a few individuals who can’t just choose to be somewhere more affordable – there are those out there who have responsibilities which oblige them to remain in the city. The high rate of homeless people is a strong indication that something needs to be done to provide a decent housing plan for the less fortunate. The majority of people who are able to work don’t earn the kind of money that affords them a suitable place to live. They need real help – not some institution cracking down on them or the lucky few who can afford housing in this city insulting them. Put tax dollars to good use!

Posted by Spot Thedog on Sep. 12, 2013 @ 12:12 am