#sfbarf

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[sfbarf]

We Need Maximum Affordable Housing for EVERYONE in San Francisco

Are you paying way too much for rent in San Francisco, or commuting long hours every day? If so, you need to watch this video and then read the REAL story behind the ZERO SUM GAME this group is playing with SF housing politics.

The CURRENT PLAN for 1979 Mission (at 16th street, above the BART station) includes 90 units of affordable housing (about half of which would be offsite) out of 309 units total it would finance. 

This is actually a pretty good plan, and it addresses the current criticism that only 7% of the housing in the pipeline in the Mission is affordable. It does have some critics though, as you can see in the video. They have organized into a coalition called Plaza 16 who you see shouting down a developer community presentation. They are demanding 100% affordable housing or none at all.

SFBARF members went to their planning meeting for this protest to see if we could help craft a compromise proposal that would add much needed housing in the city and get the maximum benefit for renters and future home buyers at all income levels. They tried to join the committee Plaza 16 members had set up to work on a Plaza 16 proposal, and they were told there would be no proposal. The building would be stopped to set an example.

Imagine if the Plaza 16 Coalition had to propose something based on their demands...

THE PLAZA –309 PLAN - We can make some rough estimates on what a best-case plan would look like. I mean, assuming they successfully stop the current plan, they don’t just want to leave the Walgreens and the Burger King there and build no housing do they? 

Let's start with the city using $60 million up front ($30 million it can make back, $30 million is a subsidy) and "the community" getting 90 units of subsidized 4 story projects on top of one story of retail at the existing BART station. This conforms to currently accepted formulas for cost and subsidy of affordable units. The city doesn’t actually have that money set aside, so the plan involves either using money from an affordable housing bond, or waiting till the affordable housing fund developers pay into saves enough money for this project. Alternatively they could take money from Muni, Education, Parks, etc or raise city income tax, sales tax or tax something else. That is a great discussion to have. Until the money is raised, Plaza 16′s plan is to continue holding the city hostage. That part of their proposal they are clear on.

What is also clear is that this plan doesn’t maximize housing based on the zoning of the site, or even come close to the amount of density we should be expecting on top of a major subway station and bus intersection. In my neighborhood in Central Market, a project that reached those goals would be considered the minimal contribution the neighborhood should make in this the housing crisis. Several areas have been upzoned to add density. On Van Ness and Market, in the Tenderloin, in SoMa, the expectation is you will build up to max zoning heights, and they are MUCH higher than in the Mission. 4x higher in this case, between the 16th street BART and the Van Ness Muni stop.

I'm not sure how Plaza 16 would pay for the reconfigured BART plaza that the original project was also supplying as a community benefit. Let's just forget about that for now.

But I digress. We were examining the best case scenario if Plaza 16 gets their demands. There is still a theoretical second parcel that would have absorbed the offsite contribution (about half of the affordable units), so lets double our numbers - $120M borrowed of which $60M is a subsidy, for 180 affordable units between the two sites.

Of course under this plan 300-500 additional wealthy people with high paying jobs and good credit would still be roaming "the community", showing up with big wads of cash at every open house, bidding up all the remaining places and making landlords really want to evict people on rent control. Why? Because we didn't build those market rate units. Wishing these people out of existence does not actually make them go away.

So let's call this the PLAZA –309 PLAN. (negative 309 because they want to kill 309 units, get it?) 

With all due respect to the city-funded non-profit leaders and affordable housing think-tanks and well meaning supporters who want desperately to preserve the status quo, this is frankly a very shortsighted approach. 

THE SFBARF PLAN - If we had the $120 million up front to do this (which we don't, unless we pass an affordable housing bond this November - please vote for it) we could let the private sector build the first 309 units at 1979 Mission and the offsite affordable location down the street. Then we could use $60M of the bond ($30M subsidy) to stack affordable floors onto the location of the offsite affordable units, adding another 90 units at the second site. Yes. We will have a twelve story building instead of a five story building. Worse things have happened, like 90 more families being evicted. The sky won't fall, and 90 more families now have an affordable home with a killer view.

Now on the same 2 pieces of land we got 399 total units, including 180 affordable. 300-500 rich people are off the market (which will relieve pricing pressure on the people who make fairly good money but not "tech money" good money). After all that, we still have $60M in bond money to spend doing it again at the next pair of sites...

So, dear reader, for our $120M ($60M subsidy) in bond money we get twice as many (360) units of permanently affordable housing and develop twice as many sites at more than twice the density and with better average construction quality, for a total of 800 units and 1000 rich people off the market. 

Oh, and we paid for the new BART plaza.

WHAT'S THAT YOU SAY? You wanna friggin' turbocharge that bond money and HELP EVERYONE ALL ACROSS THE INCOME SPECTRUM? You want 800 instead of 180 units for your $60M in taxpayer subsidies?

This is what we call the SFBARF PLAN. Abundant housing creates affordable housing and a jobs/housing balance that benefits everyone.

~Written by Jon Schwark  (@vjon on twitter)

Image by Alfred Twu

The San Francisco Bay Area Renters Federation – Please like our FB page and keep in touch. Make your voice matter in the housing crisis.

[holycrapscience-blog]

This video was recently circulated on the SFBARF mailing list and elsewhere suggesting that building more houses in SF wouldn't lower the market price of housing. There are so many methodological problems with the analysis in this video that I don't know where to start. But you gotta start somewhere. 

First of all, this Calvin Welch fellow is talking about sale prices of houses which is not the same as rental prices obviously. Both are interesting but which one you care about depends on your perspective. It would be wrong for us to make any conclusions about rentals from the scant information given about condo prices, for example. The actual relationship between rental prices and sale prices is complicated and not historically consistent (e.g. this paper). Calvin is also using condo price FROM ZILLOW.COM as a proxy for the overall price of housing. He makes no attempt to show that Zillow prices are a representative of non-Zillow listings or non-condo listings or that condos are big fraction of the market. To add insult to injury, there are obviously many factors that affect the prices of condos in the real world other than construction of new condos. Calvin did not normalize prices for increases in demand over the same time periods, made no mention of inflation or of the prevailing rental vacancy rate or particular events (e.g. launch of AirBnB) that may have affected prices without changing the size of the housing stock. 

OK, so let's proceed on the assumption that he's right and condo prices don't go down just because new stock is built. It's a plausible enough argument methodological problems notwithstanding. Still - what about rental prices? Does anyone have data they can share? Also, Calvin claims that we have a fixed amount of land in the Bay area but this is patently false. There are many previously non-residential areas that have been "up-zoned" to residential (e.g. Dogpatch) or could be upzoned in the future. Far less industrial space is required in the area now than in the past and we could reclaim that land for people to live on. We can also convert short buildings into tall ones, claiming more airspace for human life. These are all ways of effectively creating "new land" that Senor Welch ignores without comment. Moreover, Calvin also mentioned that only 1/4 of units for sale units new construction (calculated how?) and claims that it is unsurprising that changes to the new housing stock don't change prices. And he's right, it is not surprising that in a relatively large city like SF (about 800k residents) there would be many more old houses than new ones. But he neglects the future effects of building new housing units today. How will we increase the number of units for sale in 2030 if we build 10,000 new units today? How will we change the rental vacancy rate in 2030 if we build 10,000 new units today. I am not saying I know the answers to these questions, but only that he is asking the wrong ones and misleading us with overly simplistic analysis. 

The unfortunate truth about the complexity of modern life is that it is easy for people to impress us with hollow statistics. We should demand better and ask harder questions. Even if Mr. Welch turns out to be right, I don't think that the take-away from this video would be that we might be "spinning our wheels" by advocating for more housing. Mr. Welch claims on several occasions that the reason that new building doesn't lead to decreased prices is entrenched interests (i.e. oligarchy). This exactly what we've been trying to disrupt at SFBARF -- by showing up for meetings and representing interests that are not entrenched (i.e. those of renters).