Can we build our way to affordable housing?
|From the Office of the Controller|
By Calvin Welch
The price of housing and the dramatic increase in evictions have once again propelled housing affordability into the forefront of debate in San Francisco. The usual suspects make the usual arguments: if we only unleash the power of the market by removing “regulations” (rent control, height limits, density requirements, traffic analysis, take your pick) from our over-regulated housing market, we could have affordable housing thanks to the immutable “law” of supply and demand.
The graph above shows that in 41 of the last 65 quarters housing production increased in San Francisco and that with that increase in supply THERE WAS AN INCREASE IN PRICE, standing the normal “supply and demand” assumption on its head in San Francisco.
This graph is not an isolated “data point.” In fact, between 1960 and 2010 San Francisco has built nearly one and a half housing units for each new resident: our population increased by 64,000 during that period, yet we have built some 92,000 homes and condos. No major housing development has ever been turned down in San Francisco during that period. Over the last decade alone, San Francisco has exceeded its market rate housing production goal of some 11,000 units by over 50%, building some 16,500 market rate units from 2000 to 2010....