Monday, September 11, 2017

The housing crisis #1: Honesty and stupidity


A few days after I praised Paul Krugman for his honesty on the housing crisis, he's stupid  on the subject:

Houston’s sprawl gave the city terrible traffic and an outsized pollution footprint even before the hurricane. When the rains came, the vast paved-over area meant that rising waters had nowhere to go.

So is Houston’s disaster a lesson in the importance of urban land-use regulation, of not letting developers build whatever they want, wherever they want? Yes, but.

To understand that “but,” consider the different kind of disaster taking place in San Francisco. Where Houston has long been famous for its virtual absence of regulations on building, greater San Francisco is famous for its NIMBYism — that is, the power of “not in my backyard” sentiment to prevent new housing construction. The Bay Area economy has boomed in recent years, mainly thanks to Silicon Valley; but very few new housing units have been added.

If San Francisco is so "famous for its NIMBYism," why doesn't Krugman---and others who make that claim---cite some city organizations and individuals leading that movement? 

Note too that Krugman abruptly shifts his argument above and below from San Francisco to "the Bay Area economy," as if they were the same thing (Only New York City is already more densely populated than SF):

More Krugman:

The result has been soaring rents and home prices. The median monthly rent on a one-bedroom apartment in San Francisco is more than $3,000, the highest in the nation and roughly triple the rent in Houston; the median price of a single-family home is more than $800,000. And while geography — the constraint imposed by water and mountains — is often offered as an excuse for the Bay Area’s failure to build more housing, there’s no good reason it couldn’t build up. San Francisco housing is now quite a lot more expensive than New York housing, so why not have more tall buildings?

The reality is that San Francisco is in the middle of a housing boom, as explained in Curbed, the real estate blog, back in 2013: "Construction cranes are popping up like weeds across the city, and these days folks are used to new buildings rising up in just a matter of months. The current construction boom is one for the record books..." 

San Francisco is currently experiencing its highest level of housing production since the 1960s’ Urban Renewal. According to the City Planning Department’s Housing Inventory, almost 3,500 units were built in the year 2014, and we can estimate another 3,500 homes were completed in 2015. The last time we reached such levels of production was between 1963 and 1965, during the heady and controversial days when entire neighborhoods were bulldozed to make way for new construction.

Thousands more units are currently midconstruction, or have been approved and are simply waiting for developers to start construction. According to the City Planning Department’s “Pipeline” data as of October 2015, there are almost 9,000 units of housing in various stages of construction and another 4,300 fully approved homes that have yet to begin construction. (This does not include the 23,000 units approved in the huge Hunters Point Shipyard, Treasure Island and Park Merced projects, which will be built in the coming years).

The real issue is discussed by Calvin Welch: Can We Build Our Way to Housing Affordability in San Francisco? 

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At 7:01 PM, Anonymous Anonymous said...

It's called a hot market. When the city puts housing bonds on the ballot that has to do with selling off city property to developers giving them a tax break if not tax free just to build. They're all rented at market rate why? The market is hot. We've had "affordable housing" for years. It's called section 8.
You can't convince anybody that building housing over and over will bring affordable housing.

But what does "affordable" meanexactly?? "Within one's financial means". So if you can't afford it shut the fuck up and don't rent it. I'm done with this fake "affordable housing" argument. It's simple supply and demand.

I don buy a Mercedes because I can't afford it. So I buy a Honda. I don't go cry to the city using a non profit lying to people demanding a new Mercedes factory being built will lower the price making it affordable.

Those still believing this crap are a bunch of fucking idiots. They have no idea that this arguement is being used to re-zone cities, creating and changing laws under our noses forcing us into stack and pack housing.

Let's call it like it is.... horse shit!

At 3:08 PM, Anonymous Anonymous said...

As long as more people want to live in SF than available supply, the price will increase.

Perhaps the answer is to continuing to enable street people to live on the street and do all the things that make the streets horrible. Perhaps the answer is to continue to enable drug dealers and users to practice their trade, and the violence that goes along with the drug trade. If things continue as they have in the last decade then people will not want to live here...demand will decline...prices will perhaps moderate over time.

At 4:13 PM, Blogger Rob Anderson said...

Not likely. Even now drug dealers don't ply their trade to much effect in many city neighborhoods. Not many people shot on the streets in Pacific Heights or in the Marina. Nor is it clear that things have gone downhill in the last ten years.

But agreed that supply and demand rules relentlessly in real estate. A relatively small, attractive city with a benign climate can only accommodate so many people and increasingly that's people with money.

Think of Corinthian Island in Belvedere/Tiburon in Marin. Funny, but one never hears about the lack of affordable housing on Corinthian Island!


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