Wednesday, June 03, 2015


This is a hot word right now in the San Francisco Bay Area, where you have to be a multi-millionaire to be able to rent an apartment.  Well, in San Francisco, anyway.  Farther out, not so much.

In San Francisco a supervisor actually proposed an ordinance that would ban all new housing development in the Mission District, where poor-to-middle class Latino families are being pushed out by new, much richer residents who want to live close to the action.  It failed, the other supervisors having some common sense; but the proponents haven't given up.  They don't want "gentrification."

In Oakland, currently full of people who aren't quite rich enough to buy or rent in S.F. but who would still like to live a short trip from the action, a city council meeting was not quite interrupted recently by a group of protesters who don't want the city to sell a block of public land near Lake Merritt to a housing developer. They want the land used to build affordable housing (not that I've heard them suggesting a funding source for this).  They don't want "gentrification" either.

The argument behind both of these movements is:  new housing is always market-rate (which means, "I can't afford it").  We need more affordable housing ("stuff I can afford", actual rents not specifically defined).  The best way to make this happen is to stop those awful people from building expensive luxury condos and apartments, and make them build more stuff we can afford.

Consider Super Bowl tickets.  There are a fixed number of them.  Many more people want to buy them, than there are tickets.  The net result, as we all know, is that the price of scalped Super Bowl tickets goes through the roof.  This is what happens every time there is a limited supply of a very desirable commodity:  the price goes through the roof.  Got that?

This is what's happening in the Bay Area.  All over the Bay Area, actually.  More people want to live here than there is housing for them to live in, so the incomers are bidding up the price of the places that exist, even crummy places that formerly only the poor could afford.  Yes, they are driving out people who can't afford to pay the higher rents, or the higher home prices.  That is how the real estate market works; that's how any market works.  Money talks.  Rent control ordinances are the only reason there are any relatively poor folks left in any of the inner Bay Area towns.  Everyone else commutes from Antioch, or Tracy.

I know of only one way to drive down the price of housing, in any area.  Build more housing.  Build housing on every square foot of land you can find.  And build tall housing, lots of floors, lots of apartments and condos.  Because the prices will continue to skyrocket until there are more homes available for rent or sale than there are people wanting to buy or rent them.  Prices never go down in a seller's market; only in a buyer's market.

But - we can't have that!  That will ruin our beautiful city! 

Yeah, it will ruin our beautiful city.  That attitude is exactly why we have this situation. The entire Bay Area should have been building thousands of units of housing every year for the last ten.  But we didn't, because of any one of a number of reasons which all boil down to this:

We don't want the area to change. We want it to stay just the way it is, without apartment buildings higher than 4 stories, with single-family residences on nice lots.  And in Oakland we want to be able to see across the bay.  The amount of housing needed to make it "affordable" for anybody would interfere with all of that, which is why it hasn't happened.  Since we didn't accommodate the market, the market has taken over, and driven up housing prices.   Stopping the building of new housing will just make the situation get worse, faster. 

There isn't any pretty, convenient solution to all of this.  And given that it takes years to build any housing, what with permitting and hearings from people who don't want it to happen, the situation will not improve.  It will get worse. 


  1. Hedera:

    I'm surprised to hear you make this argument. Maybe it isn't an argument, just a passive acknowledgment of realities.

    For years I've been advocating world population control. There is a lot of resistance to it, for a number of reasons. But the bottom line is that excess population drives most of the problems in the world today.

    Excess population creates poverty, environmental devastation, regional wars, unwanted refugee-ism, unemployment, disease and famine, and reduced quality of life. Demands for infrastructure improvements, more "jobs," more schools, more sewer lines, more prisons, higher taxes, more welfare, more of everything--are always based on the principle of capital growth, and a growing population.

    But the earth is finite. Most of the earth's surface is uninhabitable. The few places where it is habitable, have been settled for hundreds, even thousands of years. We're quickly running out of space, and even more quickly running out of resources. In the West, we're running out of water, and there are no practical solutions to make more.

    In the so-called nine Bay Area Counties, we've seen unprecedented growth since World War Two. A veritable explosion. This has turned what was a relatively pleasant region into a teeming, crowded mass of humanity, criss-crossed by ugly freeways, a strained infrastructure, and for most of its residents, inconvenience and reduced quality of life. Open space is falling to development everywhere. Meanwhile, the cities are being encouraged to "increase density"--as if that were a solution to crowding and the housing crisis.

    But the real problem is in the pretense (the illusion) that this growth was a good thing to begin with, or that more growth is desirable in the future. The new high density paradigm of people living in tiny efficiency apartments, without a private car, confined to a narrow corridor of "shopping" and "recreation"--barely able to make ends meet--is not one conducive to quality of life, not to speak of rearing children. Ultimately, the endgame looks something like the huge "ghetto"-metropolises of India, or China.

    Post-war suburbia had its advocates, and its detractors. Incremental infill is much more user-friendly, and produces stable neighborhoods, as long as there is economic stability. But any kind of city or regional planning depends upon limits. The plain fact is that the world, and our nation, and our region, are big enough already, and don't "need" growth.

    Therefore, any kind of influence that can frustrate growth is a good thing. Expensive housing is good, as long as it frustrates potential arrivistes. If people realize that living in Tracy or Stockton isn't all it was cracked up to be, maybe they'll stay in Kansas or Tijuana or Hong Kong, instead of coming here. That would be a good thing.

    Unlimited growth is bad. Unplanned growth is bad. And for those of us who care about quality of life, growth itself is bad.

  2. Think of it as an acknowledgement of reality, Curtis. I agree with you about population control (let's hear it for Planned Parenthood) and growth; but the point is we HAVE growth. And you can't frustrate the people who are willing to pay ridiculous amounts of money to live in a certain area by restricting the amount of housing. That will merely make the ridiculous amounts of money larger.