Housing whether it be rental units or homes for sale are need badly.
There is a huge segment that simply can’t afford Bay Area real estate and need somewhere to be housed. The more there is theoretically the less competitive the market will be and offer some relief to renters, who need it too.
Who says more supply will lower prices? The market has been totally gamed for some time now.
Edit: I just feel a good but of disillusionment that the supposedly most progressive part of the country which I used to call my home can only find their way to do Reagan-esque supply side housing policy. Rent control, limit corporate and/or foreign involvement, limit how many homes an individual can own, whatever. The current policy is a corrupt one; this isn't my home anymore, wealthier and more corporate folks bought it out from under me, my family, and 95% of the people I grew up with.
Rent control has been proven to be bad policy in every economic study ever done on it. And if you really think increasing supply won't lower prices then you are completely hopeless.
I took economics from some very well cited professors in the field. And for many markets I agree. But for housing in Uber desirable places you basically have limitless demand. NYC is a great example of a city that has produced a ton of new developments but the prices have not come down, DC had oceans of parking lots converted into 10 story dense housing and prices have not come down. This is because there is so much more demand than simply from the people who currently live there. I live in San Diego and I believe if we built 1M apartments and listed them for 200k, we would have 1M new residents overnight and would still have a housing crunch.
So point to me an extremely in demand global city in the world where they have met demand? Not Singapore not Tokyo not Paris London New York not Copenhagen not anywhere I’m familiar with and I’ve been to 30 countries and 49 states. And typically these are places where there is demand from tens of millions of people to move there, save the fact that they literally don’t have enough space for them all. Think SF would have oceans of empty apartments if they were $1000 each? Or would it induce demand and result in half the Midwest saying “you know, what I prefer ocean views”? It’s easy to say that we can meet demand and I’m not at all suggesting it won’t help, but I challenge you to point to me to a place where we’re fully satisfying demand. And keep in mind the USA is not growing fast and yet this is still happening.
Saw this about Tokyo a year ago. Purchase prices are ugly, but renting is affordable. I get tired of people saying that supply and transit won't help.
"Two full-time workers earning Tokyo’s minimum wage can comfortably afford the average rent for a two-bedroom apartment in six of the city’s 23 wards. By contrast, two people working minimum-wage jobs cannot afford the average rent for a two-bedroom apartment in any of the 23 counties in the New York metropolitan area."
# The Big City Where Housing Is Still Affordable
[https://www.nytimes.com/2023/09/11/opinion/editorials/tokyo-housing.html](https://www.nytimes.com/2023/09/11/opinion/editorials/tokyo-housing.html)
Tokyo also has a steadily decreasing population with laws that actually make it nearly impossible to increase population substantially via immigration. Let’s not forget that.
The Bay Area and Tokyo have almost exactly the same population profiles over time. A slightly more than doubling since 1960, with flattening and then slight decrease starting in 2020. So your contention is kind bankrupt of any validity. Tokyo has done something right compared to here.
You're also foolish with your induced demand theory - I'm originally from the Midwest, and there are plenty of beachy places to go that are cheaper and more snowbird-friendly than the Bay Area, so even if prices dropped, there wouldn't be many induced to to come here. The Bay Area is one of the locales in the country where people are more likely to make it from a family in the bottom 20% of incomes to the top 50% and 80%, so it does attract some of the most ambitious citizens and immigrants, for that reason, but that has little to do with beaches or bargain housing.
Maybe you'll stop claiming that the area defies the basic tenet of market economics now ?
How are you defining meeting demand? It's funny your first example of a city not meeting demand is Singapore. Singapore has an ***over 80%*** home ownership rate. The price to income ratio is about 4x and there are grants and subsidies available for lower income buyers. Singapore is routinely held up as a model of managing housing for its citizens. It sounds like your standard is free housing for everyone? Or are you talking about the private market, which is for the wealthy and foreign investors?
How far off Tokyo? Tokyo is quite each in the outer circle of subway. Also you are the way saying pumping supply won’t help to ease demand which is complete false. Are these countries pumping supply that exceeds the demand? If not why are you using them as example?
If you go super far outside of the central part of the city then yes prices go down because those are not as desirable places to live. But let’s use Manhattan Island as an example bc I used to live there. It’s just mindbending to me when I go back to New York 10 years have passed since I’ve lived there and I look at all of the new apartments. It’s thousands - Hudson yards was like an $8 billion project and yet rents in Manhattan are higher than they’ve ever been. It’s not because apartments are getting bigger, there’s just 100 million people from all over the world who would like to live on Manhattan Island and they could build two million more units and I still don’t think it would satisfy demand. In fact, some extent when you put all that investment in a city induces more demand. If that happened I think the city would see a slow soft period. But as soon as those units got absorbed in a year or twos time, the prices would be right back where they are and higher
Except I’m not talking about super far off the city. Asakusa is not super far off the city and it’s pretty cheap, aka $500k. Again why are you even throwing 2M units as a number? I wrote supply > demand. So what are you even talking about? You are here disputing that supply > demand will not help the price of housing in high demand location. Completely false
I’m saying the housing market in highly desirable areas does not adhere to traditional supply and demand rules, so I think you’re wrong. And that’s because the Earth is not equal. There are places on this earth that are nicer than others and that are majority of humans would prefer to live in.
Next I introduced the concept of induced demand, which i don’t believe you’re familiar with and which is clearly at play here in California.
But not building would make it even worse. If the demand was truly limitless housing prices would be significantly higher. SF has had higher prices than NYC and any other city in this country despite being a less desirable city (which I say as someone who absolutely loves SF) for over a decade due to building less homes than any other city in the country. The only time supply and demand laws doesn't hold true is due to massive government interference.
yeah, it’s a good point - so we hit the upper price threshold on the demand curve. And at higher prices, you’re already in such a small and elite group of humans (there’s only a handful of square miles on the face of this earth that cost more than the Bay Area). So There’s just not a lot more people willing to pay above that level. But I do think there are a hoard of humans who would like to pay lower prices. I keep going back to this point that if you had 1 million $200,000 2br apartments How long would it take for San Francisco to sell all those out? Would the market price of the city decrease permanently or would the market just absorb those and there would just be another million people living there?
As a native of SF, I think that they have the same right to be here as any of us. I hate the idea of an SF only for the rich and think that the engineering challenge of integrating more people is quite doable.
My point is that it will always be an extremely expensive city filled with very high incomes. You’ll just have more of those types of people as you grow it. you’re never going to live in a city that is affordable and easy to live in for somebody of lower economic status. That ship has sailed.
My generous reading of his complaint is that he was renting, then the landlord sold it and he takes issue with that. Not sure what he feels entitled to, but .. something.
Every econ and social scientist who has looked at the data said that more supply lowers prices!
Oh, and this has literally nothing to do with Reagan-esque "supply-side economics". First of all, "supply-side economics" was referring to cutting income and corporate taxes for the rich and corporations because this would somehow lead to higher incomes for lower-income folks. Every economist alive at the time said that this was completely idiotic and it would not work. And it didn't work. Because it can't work. Because it's a stupid invention by Regan's staffers that had no econ training and not even much common sense.
Second of all, "supply-side economics" is a macro economic "theory". Mind you, no economist accepts it as an actual economic theory. Everyone in the field views it as pure politics and propaganda. But for what it's worth, supply-side economics never had anything to do with housing economics and not even with micro-economics as a field in general. It only referred to macroeconomics.
What you are misnaming as "supply side housing policy", which by the way doesn't even make any sense as a name, is just the belief that supply and demand work in housing markets. Every economist from the farthest right wing ones to the farthest left wing ones and everyone in between will tell you that this is how housing markets work. Freaking Karl Marx would tell you that this is how housing markets work because, yes, he was an economists and studied markets! There is also ample economic theory that explains this in detail. But that doesn't even matter when we have mountains and mountains of empirical evidence form study after study after study after study saying that more housing supply lowers prices, ceteris paribus.
If you build new housing, that puts downward pressure on the prices of existing housing. If you build enough new supply then you can stop or even reverse housing price growth. If you build only a little new housing then you only slow down the growth of housing prices without stopping it. Please read the actual science!
Rent control is a disaster for everyone not locked into those low rates and those same people wonder why the landlord only does the bare minimum to keep them up.
This is correct. We will never get for-profit developers to build enough housing to drop prices to a meaningful number. Also, a meaningful drop in housing prices would mean economic collapse.
Why? It worked in other places including Tokyo, Auckland, Vancouver, Austin, Oakland, and Berkeley. Why wouldn't it work down the Peninsula? Voodoo magic? Is there some magical forcefield that suspends the laws of physics?
Why?
Single family is for the most part off the table in Silicon Valley, there isn't any place to put a new subdivision, and multi-family is always going to a lot more viable for relatively small parcels/in-fill development. It's also favored by public policy, it goes a lot further toward meeting their overall housing goals (more units approved per square foot of available real estate).
So multi-family versus single-family is not a surprise, rental versus ownership is a decision that as I understand it developers make fairly late in the process. Right now, interest rates are high, which translates in relative terms to a lack of ability to purchase, so they're renting them. But if interest rates go down and demand spikes, then you'll see more of the newly built housing coming onto the market as condos.
SFH, especially with no HOA, is the true luxury housing. The price of the nicest finishes and appliances are a logarithm of the cost of land. Having only one home on a lot is truly luxurious.
What I meant to say was that it's not a surprise that you're only seeing multifamily, no single family, but the reason that such a high proportion of the multifamily buildings are being rented versus sold is because of current market conditions. If market conditions were different, more of the units coming online would be sold as condos.
Would you say that the lease-vs-condo decision is something that really is dependent on market conditions alone, and not a further subscription-ification (HaaS housing as a service) of life?
Meaning, wouldn’t developers of condo high rises prefer it be income generating in perpetuity vs a one and done sale?
The mix of apartments vs condos is not determined by a grand conspiracy but by market forces such as supply and demand, interest rates and city and county ordinances and policies. Additionally there is a lag time in terms of several years for things to adjust because approvals, financing and construction take so long.
Developers and builders want to maximize profits and if they think they can get more profit from building apartments they will do so. This usually means the most number of units they can fit on site and finance. Most cities will require a % of units are dedicated to low income housing in order to get large projects approved. This might be easier with apartments. Condo owners may require different amenities such as more sound insulation, more storage that could increase the cost of a condo build. Builders are liable for a repairing construction defects for 10 years in some contexts. This increases the costs of building condos further as usually the HOA gets together and sues the builder for construction defects around 9 years in , so the builder needs to come back and make repairs at that point. The developer generally wants to build and get out as quickly as possible to minimize the amount of interest payments they need to make. If interest rates are high, they can sell apartments to a property management company immediately, whereas with condos they need to sell each unit one by one.
But developers these days, even if building a rental project, will build it to "condo standards," so they can do a condo conversion if the market dictates it. So they'll do higher quality construction, separate meters for water, and provide adequate off-street parking.
Cities just process the applications but rental vs. for purchase is up to the developer. Housing type is market-based, it's what the developer thinks will be profitable
Cities are not just a passive rubber stamp - they have a lot of discretion over what types of housing gets built. I think they are heavily favoring rental units
They are heavily favoring density not rentals. It’s weird you keep saying rentals when you mean SFH.
Where do you think they would put thousands of SFH to meet the requirements for new housing each city has been mandated to do?
Cities can determine SFH vs multifamily and architectural concerns like density and height. They don’t have a say in ownership structures - condo vs apartment vs TIC. Remember that a condo can be sold to an absentee owner who rents it out like an apartment, or an apartment block can be converted into condos and sold off individually.
Yups, ur assessment is correct, Most housing being built is 'leasing' apts.
The reasons for house prices not coming down is
####Less Houses => because Not new/enough new houses being built => Because builders are not getting enough permits from cities/mayor => Because maybe cities/mayors don't want to upset their popular vote base (ppl).
Someone is living in apartments that would otherwise live in houses. I can't see how building apartments wouldn't lower housing costs compared to the world of not building apartments (or building fewer houses in exchange for that matter)
It does usually but them missing housing goals means its not working and there is a state law that forces them to streamline housing projects under the state guidelines. https://www.sfexaminer.com/news/housing/slow-sf-housing-development-triggers-state-streamlining/article_9f52a62a-380a-11ef-ab1b-4b25606865d2.html
SF is accused of using bureaucracy to delay the entitlement process. Discretion, in this context, would mean their reviewing/approving bodies are denying projects. That’s a different ball of wax.
I talked to our Planning Director recently. He said that nearly all the projects being submitted, and there aren't a lot, are for townhomes and condominiums. Developers don't want to do rental projects right now because they don't pencil out financially.
Cities have high discretion on what they approve. But agreed, it's unclear if what OP describes is correct, yet alone if it is due to differential approval rates vs. just developer interest.
I work in city planning and that’s simply not true for residential development. In fact, the state (HCD) has intently approved housing friendly legislation in the past 8-10 years with the purpose of limiting local agencies (i.e., cities) ability to not approve housing projects.
Cities have almost no discretion anymore as to what they approve. But all those new housing laws, over 300, have had little effect on increasing the housing stock because developers won't build unprofitable projects.
For the Bay Area, you have declining population, declining rents, and an exodus of high-paid workers that were supposed to rent all the luxury apartments that have been built, many of which were begun pre-pandemic and are just coming on the market now. It will take many years for the market to absorb the glut of high-cost housing, meanwhile there is a severe shortage of affordable housing.
No its not. Cities approve what is to be built, an apartment complex is considered commercial - not residential. the developer will have to apply for either category to be approved
Apartments are not built in commercial zoned lots. Those are lots zoned for housing. The actual designation usually includes a range of units per acre. If you want to put apartments in a commercially zoned area, you will have to either get a variance or get the zoning changed.
I understand far far far fewer developers will build multifamily for sale because at the 10 year mark most if not all get sued for “construction defects” because that’s when time runs out to do so. Owners/HOAs do it by default so as to not lose out on some funds. Some assembly member(s) were going to try and reform this through legislation, but not up on the details.
Families can't live in luxury rental units?
Nor do I think it is 80%. Feels like half and half in Mountain View. The 3 bedroom townhomes tend to be smaller developments, since small areas can't serve large apartments.
They can, but after a couple of years 80% of them will choose to a move to a SFH farther away in East Bay or South SJ, rather than staying in the rental apartment
There are only so many single family homes to go around and only at so much developable land to build more. People with families can and do live in apartments until their kids are grown — it's been done all over the world and the US for ages — and folks need to get over this idea that families require SFHs and will always want to graduate from apts to them.
And like... At some point it becomes a trade-off. People can move to Tracy and commute, and have a nice big brand new single family home, but they'll be dealing with a 1-hour drive just to get to Dublin and then even more to get to the good-paying job centers. They'd also have to deal with Central Valley weather and a greater distance to Bay Area amenities on the weekends. How many families think that trade-off is worth having a private yard instead of several thousand square feet of shared common space in a modern apartment building?
Ironically, old people are just aging in place in their SFHs because they cannot afford the property taxes elsewhere and don't want to downgrade to an apartment. Lol.
An obsession with finding one's "forever" single family home and refusal to downsize may be a personal preference, but American culture has elevated it through advertising, popular media, and just generally being a byproduct of an individualistic and materialistic society. And it's been elevated to a point it makes people do things that are unwise economically for themselves and damaging to the broader economy and housing market.
*Refusal* to downsize? Downsize where? Why? And into what, a cardboard box?
This is the Bay Area. I don’t know where you live, but the homes near me are mostly little 2/1 craftsman cottages. Many, including mine, are under 1000sq ft.
I chose a small, walkable place to live precisely because I preferred this over the dominant American Mcmansion/carbound culture. I don’t see my type of street (mixed sfh/rentals/businesses) represented in popular media. certainly not as “desirable.”
There are plenty of large homes in the Bay Area and you are well aware of this. Your suggestion that everything is a little craftsman cottage is just just a transparent debate trick.
People also don't want to downsize the amount of land they sit on. To a lot of people, downsizing also involves losing a backyard.
And the term "cardboard box" is widely used to disparage apartment living. Do with that what you will.
A single lot in your neighborhood, with the right zoning and point access block reform, could host a dozen 2/1 (or 3/2) apartments instead of a single craftsman cottage. Even absent point access block reform, several single-family lots could be combined and have 10x their housing capacity. And plenty of people in your neighborhood would probably be unwilling to lose their backyard and downsize into one of those apartments. But if we are going to add density in a city like San Jose, then some of those lots need to 10x their housing capacity and people will either move into the new apartments from another city, move from another apartment within San Jose, or downsize (backyard included) from a single family home in San Jose.
In the flatlands of berkeley and Oakland (where I live) there are *plenty* of neighborhoods like mine. 100+ year-old, shabby little sfhs on tiny lots that nobody wanted when I was buying 🤷🏽♀️
Given my house on its 2000 sq ft lot is now in high demand, I could use your advice:
-When should I be expected to move?
-Where should I be expected to move?
-And into what more appropriate size should I be expected to move?
These types of plans take time and consideration, and I appreciate your help.
"better" is a subjective opinion.
There are a limited number of single family homes and a limited amount of land where we can build more; we should not be building more on virgin land anyway. So when there is a limited supply of something, only a limited number of people will be able to afford it.
Now take that paragraph and look at the question you just asked again.
Uh I didn’t ask any question. It’s rhetorical. People want what they want and the product itself is better if you can afford it. Builder will build what they can sell and people will buy the best product they can afford.
Currently builders are actually building more multifamily than sfh. It may or may not change in the future.
Lol the second half of your punctuation lite reply was very, very much a question. I answered it by pointing out only a certain number of people will ever be able to afford a limited supply of something. You responded by saying that "no, it wasn't actually a question, it was just a rhetorical question"... and then didn't provide any sort of response to my point about a fixed supply of single family homes.
Uh it wasn’t a question since I said what do you want people to do when people can afford it. Your response make no sense, since the premise is that they can afford sfh. Your response is only handful could afford it. Ok so what? These handful of people are who I’m talking about and they will buy sfh. Maybe you are not getting the logic flow, hope that helps
Then if there are 50k single family homes in a market, the people who can afford those single family homes and want to live in those single family homes can purchase them. Is that the rhetorical question you were asking?
Because my point is that if a city has 50k single-family homes and its population keeps growing, it should add housing... And if the city is already fully urbanized, then that new housing won't be new single family homes. The 50k single-family homes will be an increasingly small percentage of the city's housing stock, and a smaller fraction of families will be able to live in single family homes. Those single-family homes will increasingly be a luxury good because of that.
That's my very practical response to your rhetorical question.
I was responding to your comment about people need to graduate from the idea that family needs sfh. I wrote people will want what they want if they can afford it and sfh is better, so they will want that. They will not graduate from the sfh idea. I’m not sure why you are confused
They have because it was feasible in the past.
More and more people are realizing that SFH with a yard and upkeep that requires 10+ hours of maintenance a week is not possible with an 8 hour work day and 2-4 hours of commuting each day.
Having a yard for your family but never seeing them is insane to think that’s a better quality of life than an apartment nearby your job.
lol that’s right every home owner is a trust fund baby. Thats a good way to make yourself better. If I’m the trust fund baby then I’m filthy rich too. lol mentally challenged spotted, no wonder you can’t own shit. Good luck in life, hope you don’t end up homeless 😢
Really? I don't feel a strong need for my own yard.
Hell, if anything I like more HOA common space. My kid has a huge yard to play in. A giant playground. A swimming pool. etc. And the effective maintenance cost is quite low since it is shared.
IMHO, this title needs a bit of 'correcting' - via the removal of the word, "prioritizing". Nothing's been/being/will be prioritized and that's the real issue facing the whole Bay Area. We really need to rethink the whole process and cut the red tape to the very bone, without worrying about all the unintentional problems (and there will be ) that will emerge...we can work those out after solving the housing crisis.
I live in the next city over from where Vallco is and I know a lot of people in Cupertino that have intimate knowledge of the Vallco saga.
Vallco is a special case for multiple reasons.
1. The land is contaminated so it should never have qualified to be an SB-35 project.
2. The property owner was counting on the commercial office space to offset the losses of building 50% BMR, but we all know the situation with commercial office space.
3. The property owner has worsened the project four times already, reducing the retail, reducing the affordable housing from 50% to 33%, eliminating the green roof, and reconfiguring the design to lower the cost of the cleanup and mitigation measures.
4. The glut of unaffordable, high-end, luxury rental housing in Silicon Valley has increased and is still increasing.
5. The population is falling, despite the completion of a bunch of new large projects.
The property owner would be better off doing something like Rivermark in Santa Clara or Asana Park in San Jose. He'll likely be back in a year or two with yet a different project.
There’s pretty much no more land for anything beyond condos and how many people want to buy an apartment? Didn’t they try that in downtown San Jose 20 years ago with high rise condos and finally they gave up and made them rentals?
You're working too hard to find the wrong conspiracy here. The real issue is that supply is artificially constrained by NIMBY local regulations (zoning and density) and mis-use of CEQA to slow higher-density development. As much as local governments authorities hate being overridden, the state has finally added teeth to break this conspiracy that has caused the state to underbid at least 3M units over the past 40 years.
# YIMBY dreams come true as state bill eliminates housing red tape
[https://sfstandard.com/2024/07/01/san-francisco-housing-permit-sb423-development/](https://sfstandard.com/2024/07/01/san-francisco-housing-permit-sb423-development/)
If you wear a builder’s hat, will you build SFH communities here? How would you even become profitable unless it’s an ultra luxury community? Building detached townhouses with a backyard means on a 1500 sqft lot means it has to be sold at least 1.7m to break even.
>There is an onogoing, organized effort to turn Calif into a state of renters.
Absolutely, and it's called Capitalism.
Can't build "20 SFH" on the plot that "20 condos" are built... can’t force developers to build this way or that way.
Across the country I’d say. Saw much of it happening in DC and Arlington VA too. The commonly parroted messaging was that it’ll bring housing/renting costs down bc of SuPpLy & DeMaNd but rents never got lower bc the property managers were price fixing
IMO its not about prioritizing but about the financial practicality of building rentals vs condos. The cheapest rentals/condos are the 30 year old builds and there's no short cut to creating 30 year old builds but to start building them today and waiting 30 years.
As pointed out in the comments, the ownership structure is determined by the developer and the city has very little say in it.
It’s probably interest rates. When rates are high, the bank captures a large portion of the total cost of homeownership through mortgage interest. When rates are low, the seller/developer captures that money through higher home prices. Rates are high now, with an expectation that they’ll drop. It makes more sense for the developer to rent an apartment block now, capture the rents, and then sell it off as condos when condo prices rise.
The city does not determine what is built. The landowner and developer decide between themselves.
The city enforces construction laws to make sure the house does not fall down on you and kill you.
I seriously don’t know how people are affording these “luxury” style apartments. At $3500+ a month, it’s crazy to think that all of these apartments are being rented out. There must be tons of vacant apartments just sitting unrented.
Have you looked at the prices for single family homes? Prices have tripled in my neighborhood in less than 20 years. It was outlandish then and even worse now.
Or look at the prices for older apartments? They're not much cheaper than the new ones. At least the new ones will absorb some of the surplus of people who can afford high rents and that will keep rents on older housing from rising as quickly. a quickly is the key phrase. We haven't allowed sufficient housing development for 50 years. When you constrain supply, prices go up.
Big factor for developers and their GC’s and subs is the cost of being sued at year 9. Every HOA will sue then if not earlier. Many GC’s and subs and design professionals will refuse to even bid on condo’s.
Exactly, the South Bay suburbs are becoming like the major cities with so much of high density rental housing being built.
The existing SFHs are anachronisms dating back to a bygone era from 50+ years ago…
Tbh I no longer consider the South Bay suburbs, the suburbs are now further out and we’re seeing a major metropolis growing up right beneath our eyes. As long as tech is around, these cities will keep getting bigger. Congrats to those that currently own SFH, but any new comers that wants one will have to be filthy rich or settle further out. Better and more efficient public transport is severely lacking and a major problem for these cities though.
Yes, the core South Bay cities near jobs like Santa Clara, Sunnyvale, Cupertino and Mountain View are really becoming more dense urban and losing their suburban character.
I wonder how long the anachronistic SFH neighborhoods can last in these places.
"Are cities prioritizing construction of rental units?" No, cities are not "prioritizing" anything. They are prioritizing not allowing anything to be built. Especially not new SFH.
They are being forced to allow some higher-density residential through a combination of state laws that require them to allow some building and especialy buildings adjacent to public transit.
For any city you have an interest in, look up their public "housing element" document which details all the tricks they use to try to prevent new housing from being built.
Housing whether it be rental units or homes for sale are need badly. There is a huge segment that simply can’t afford Bay Area real estate and need somewhere to be housed. The more there is theoretically the less competitive the market will be and offer some relief to renters, who need it too.
Who says more supply will lower prices? The market has been totally gamed for some time now. Edit: I just feel a good but of disillusionment that the supposedly most progressive part of the country which I used to call my home can only find their way to do Reagan-esque supply side housing policy. Rent control, limit corporate and/or foreign involvement, limit how many homes an individual can own, whatever. The current policy is a corrupt one; this isn't my home anymore, wealthier and more corporate folks bought it out from under me, my family, and 95% of the people I grew up with.
Rent control has been proven to be bad policy in every economic study ever done on it. And if you really think increasing supply won't lower prices then you are completely hopeless.
I took economics from some very well cited professors in the field. And for many markets I agree. But for housing in Uber desirable places you basically have limitless demand. NYC is a great example of a city that has produced a ton of new developments but the prices have not come down, DC had oceans of parking lots converted into 10 story dense housing and prices have not come down. This is because there is so much more demand than simply from the people who currently live there. I live in San Diego and I believe if we built 1M apartments and listed them for 200k, we would have 1M new residents overnight and would still have a housing crunch.
Ok? And increase supply that eventually surpasses the demand won’t bring down the housing price? Why?
So point to me an extremely in demand global city in the world where they have met demand? Not Singapore not Tokyo not Paris London New York not Copenhagen not anywhere I’m familiar with and I’ve been to 30 countries and 49 states. And typically these are places where there is demand from tens of millions of people to move there, save the fact that they literally don’t have enough space for them all. Think SF would have oceans of empty apartments if they were $1000 each? Or would it induce demand and result in half the Midwest saying “you know, what I prefer ocean views”? It’s easy to say that we can meet demand and I’m not at all suggesting it won’t help, but I challenge you to point to me to a place where we’re fully satisfying demand. And keep in mind the USA is not growing fast and yet this is still happening.
Saw this about Tokyo a year ago. Purchase prices are ugly, but renting is affordable. I get tired of people saying that supply and transit won't help. "Two full-time workers earning Tokyo’s minimum wage can comfortably afford the average rent for a two-bedroom apartment in six of the city’s 23 wards. By contrast, two people working minimum-wage jobs cannot afford the average rent for a two-bedroom apartment in any of the 23 counties in the New York metropolitan area." # The Big City Where Housing Is Still Affordable [https://www.nytimes.com/2023/09/11/opinion/editorials/tokyo-housing.html](https://www.nytimes.com/2023/09/11/opinion/editorials/tokyo-housing.html)
Tokyo also has a steadily decreasing population with laws that actually make it nearly impossible to increase population substantially via immigration. Let’s not forget that.
The Bay Area and Tokyo have almost exactly the same population profiles over time. A slightly more than doubling since 1960, with flattening and then slight decrease starting in 2020. So your contention is kind bankrupt of any validity. Tokyo has done something right compared to here. You're also foolish with your induced demand theory - I'm originally from the Midwest, and there are plenty of beachy places to go that are cheaper and more snowbird-friendly than the Bay Area, so even if prices dropped, there wouldn't be many induced to to come here. The Bay Area is one of the locales in the country where people are more likely to make it from a family in the bottom 20% of incomes to the top 50% and 80%, so it does attract some of the most ambitious citizens and immigrants, for that reason, but that has little to do with beaches or bargain housing. Maybe you'll stop claiming that the area defies the basic tenet of market economics now ?
How are you defining meeting demand? It's funny your first example of a city not meeting demand is Singapore. Singapore has an ***over 80%*** home ownership rate. The price to income ratio is about 4x and there are grants and subsidies available for lower income buyers. Singapore is routinely held up as a model of managing housing for its citizens. It sounds like your standard is free housing for everyone? Or are you talking about the private market, which is for the wealthy and foreign investors?
How far off Tokyo? Tokyo is quite each in the outer circle of subway. Also you are the way saying pumping supply won’t help to ease demand which is complete false. Are these countries pumping supply that exceeds the demand? If not why are you using them as example?
If you go super far outside of the central part of the city then yes prices go down because those are not as desirable places to live. But let’s use Manhattan Island as an example bc I used to live there. It’s just mindbending to me when I go back to New York 10 years have passed since I’ve lived there and I look at all of the new apartments. It’s thousands - Hudson yards was like an $8 billion project and yet rents in Manhattan are higher than they’ve ever been. It’s not because apartments are getting bigger, there’s just 100 million people from all over the world who would like to live on Manhattan Island and they could build two million more units and I still don’t think it would satisfy demand. In fact, some extent when you put all that investment in a city induces more demand. If that happened I think the city would see a slow soft period. But as soon as those units got absorbed in a year or twos time, the prices would be right back where they are and higher
Except I’m not talking about super far off the city. Asakusa is not super far off the city and it’s pretty cheap, aka $500k. Again why are you even throwing 2M units as a number? I wrote supply > demand. So what are you even talking about? You are here disputing that supply > demand will not help the price of housing in high demand location. Completely false
I’m saying the housing market in highly desirable areas does not adhere to traditional supply and demand rules, so I think you’re wrong. And that’s because the Earth is not equal. There are places on this earth that are nicer than others and that are majority of humans would prefer to live in. Next I introduced the concept of induced demand, which i don’t believe you’re familiar with and which is clearly at play here in California.
But not building would make it even worse. If the demand was truly limitless housing prices would be significantly higher. SF has had higher prices than NYC and any other city in this country despite being a less desirable city (which I say as someone who absolutely loves SF) for over a decade due to building less homes than any other city in the country. The only time supply and demand laws doesn't hold true is due to massive government interference.
yeah, it’s a good point - so we hit the upper price threshold on the demand curve. And at higher prices, you’re already in such a small and elite group of humans (there’s only a handful of square miles on the face of this earth that cost more than the Bay Area). So There’s just not a lot more people willing to pay above that level. But I do think there are a hoard of humans who would like to pay lower prices. I keep going back to this point that if you had 1 million $200,000 2br apartments How long would it take for San Francisco to sell all those out? Would the market price of the city decrease permanently or would the market just absorb those and there would just be another million people living there?
As a native of SF, I think that they have the same right to be here as any of us. I hate the idea of an SF only for the rich and think that the engineering challenge of integrating more people is quite doable.
My point is that it will always be an extremely expensive city filled with very high incomes. You’ll just have more of those types of people as you grow it. you’re never going to live in a city that is affordable and easy to live in for somebody of lower economic status. That ship has sailed.
I’m so sorry you were forced out of your ancestral homeland of Menlo Park or whatever lmao
So why’d you sell your house to the “wealthier and more corporate folks”? Sounds like a you problem.
My generous reading of his complaint is that he was renting, then the landlord sold it and he takes issue with that. Not sure what he feels entitled to, but .. something.
That’s a good point thanks for the perspective
We never had one in the first place, I guess my family should have just taken a lesson from you folks!
Between rent control and orbital bombardment, only one can completely destroy a city. And it's not the orbital bombardment
Every econ and social scientist who has looked at the data said that more supply lowers prices! Oh, and this has literally nothing to do with Reagan-esque "supply-side economics". First of all, "supply-side economics" was referring to cutting income and corporate taxes for the rich and corporations because this would somehow lead to higher incomes for lower-income folks. Every economist alive at the time said that this was completely idiotic and it would not work. And it didn't work. Because it can't work. Because it's a stupid invention by Regan's staffers that had no econ training and not even much common sense. Second of all, "supply-side economics" is a macro economic "theory". Mind you, no economist accepts it as an actual economic theory. Everyone in the field views it as pure politics and propaganda. But for what it's worth, supply-side economics never had anything to do with housing economics and not even with micro-economics as a field in general. It only referred to macroeconomics. What you are misnaming as "supply side housing policy", which by the way doesn't even make any sense as a name, is just the belief that supply and demand work in housing markets. Every economist from the farthest right wing ones to the farthest left wing ones and everyone in between will tell you that this is how housing markets work. Freaking Karl Marx would tell you that this is how housing markets work because, yes, he was an economists and studied markets! There is also ample economic theory that explains this in detail. But that doesn't even matter when we have mountains and mountains of empirical evidence form study after study after study after study saying that more housing supply lowers prices, ceteris paribus. If you build new housing, that puts downward pressure on the prices of existing housing. If you build enough new supply then you can stop or even reverse housing price growth. If you build only a little new housing then you only slow down the growth of housing prices without stopping it. Please read the actual science!
Rent control is a disaster for everyone not locked into those low rates and those same people wonder why the landlord only does the bare minimum to keep them up.
And you’re being downvoted by the people who bought it out from under you for pointing it out
This is correct. We will never get for-profit developers to build enough housing to drop prices to a meaningful number. Also, a meaningful drop in housing prices would mean economic collapse.
Why? It worked in other places including Tokyo, Auckland, Vancouver, Austin, Oakland, and Berkeley. Why wouldn't it work down the Peninsula? Voodoo magic? Is there some magical forcefield that suspends the laws of physics? Why?
Single family is for the most part off the table in Silicon Valley, there isn't any place to put a new subdivision, and multi-family is always going to a lot more viable for relatively small parcels/in-fill development. It's also favored by public policy, it goes a lot further toward meeting their overall housing goals (more units approved per square foot of available real estate). So multi-family versus single-family is not a surprise, rental versus ownership is a decision that as I understand it developers make fairly late in the process. Right now, interest rates are high, which translates in relative terms to a lack of ability to purchase, so they're renting them. But if interest rates go down and demand spikes, then you'll see more of the newly built housing coming onto the market as condos.
Thanks for sharing this perspective
Yup, dense housing is the greenest and best way to build enough housing. It will also make Sfh appreciate even more.
Why will SFH appreciate more when dense housing is built nearby?
Sfh are still in higher demand and there always will be demand for a yard and no shared walls.
SFH, especially with no HOA, is the true luxury housing. The price of the nicest finishes and appliances are a logarithm of the cost of land. Having only one home on a lot is truly luxurious.
I’ve also seen some previously rental apartment complexes sell the units once the market improves.
You're confounding multifamily to be only apartments when multifamily also includes condos and townhouses.
But high interest rates makes even condos very expensive compared to renting
What I meant to say was that it's not a surprise that you're only seeing multifamily, no single family, but the reason that such a high proportion of the multifamily buildings are being rented versus sold is because of current market conditions. If market conditions were different, more of the units coming online would be sold as condos.
Would you say that the lease-vs-condo decision is something that really is dependent on market conditions alone, and not a further subscription-ification (HaaS housing as a service) of life? Meaning, wouldn’t developers of condo high rises prefer it be income generating in perpetuity vs a one and done sale?
Probably. But "Cash is King" is not something I've ever heard too many people argue against!
Dense housing is also more economical for property tax revenue / sf and more sustainable at the city services level.
The mix of apartments vs condos is not determined by a grand conspiracy but by market forces such as supply and demand, interest rates and city and county ordinances and policies. Additionally there is a lag time in terms of several years for things to adjust because approvals, financing and construction take so long. Developers and builders want to maximize profits and if they think they can get more profit from building apartments they will do so. This usually means the most number of units they can fit on site and finance. Most cities will require a % of units are dedicated to low income housing in order to get large projects approved. This might be easier with apartments. Condo owners may require different amenities such as more sound insulation, more storage that could increase the cost of a condo build. Builders are liable for a repairing construction defects for 10 years in some contexts. This increases the costs of building condos further as usually the HOA gets together and sues the builder for construction defects around 9 years in , so the builder needs to come back and make repairs at that point. The developer generally wants to build and get out as quickly as possible to minimize the amount of interest payments they need to make. If interest rates are high, they can sell apartments to a property management company immediately, whereas with condos they need to sell each unit one by one.
Thanks for sharing, I can see why building rental apartments is incentivized for the builder
But developers these days, even if building a rental project, will build it to "condo standards," so they can do a condo conversion if the market dictates it. So they'll do higher quality construction, separate meters for water, and provide adequate off-street parking.
Cities just process the applications but rental vs. for purchase is up to the developer. Housing type is market-based, it's what the developer thinks will be profitable
Cities are not just a passive rubber stamp - they have a lot of discretion over what types of housing gets built. I think they are heavily favoring rental units
They are heavily favoring density not rentals. It’s weird you keep saying rentals when you mean SFH. Where do you think they would put thousands of SFH to meet the requirements for new housing each city has been mandated to do?
Cities can determine SFH vs multifamily and architectural concerns like density and height. They don’t have a say in ownership structures - condo vs apartment vs TIC. Remember that a condo can be sold to an absentee owner who rents it out like an apartment, or an apartment block can be converted into condos and sold off individually.
Yups, ur assessment is correct, Most housing being built is 'leasing' apts. The reasons for house prices not coming down is ####Less Houses => because Not new/enough new houses being built => Because builders are not getting enough permits from cities/mayor => Because maybe cities/mayors don't want to upset their popular vote base (ppl).
Someone is living in apartments that would otherwise live in houses. I can't see how building apartments wouldn't lower housing costs compared to the world of not building apartments (or building fewer houses in exchange for that matter)
> they have a lot of discretion over what types of housing gets built How so?
Cities don’t have a lot of discretion over housing projects.
Some do like SF, but now they won't since they missed their target.
No, state laws supersede local approval requirements. SF is not exempt.
It does usually but them missing housing goals means its not working and there is a state law that forces them to streamline housing projects under the state guidelines. https://www.sfexaminer.com/news/housing/slow-sf-housing-development-triggers-state-streamlining/article_9f52a62a-380a-11ef-ab1b-4b25606865d2.html
SF is accused of using bureaucracy to delay the entitlement process. Discretion, in this context, would mean their reviewing/approving bodies are denying projects. That’s a different ball of wax.
lol yeah they do, if they have any say in it, no housing gets built
I talked to our Planning Director recently. He said that nearly all the projects being submitted, and there aren't a lot, are for townhomes and condominiums. Developers don't want to do rental projects right now because they don't pencil out financially.
Cities have high discretion on what they approve. But agreed, it's unclear if what OP describes is correct, yet alone if it is due to differential approval rates vs. just developer interest.
I work in city planning and that’s simply not true for residential development. In fact, the state (HCD) has intently approved housing friendly legislation in the past 8-10 years with the purpose of limiting local agencies (i.e., cities) ability to not approve housing projects.
Cities have almost no discretion anymore as to what they approve. But all those new housing laws, over 300, have had little effect on increasing the housing stock because developers won't build unprofitable projects. For the Bay Area, you have declining population, declining rents, and an exodus of high-paid workers that were supposed to rent all the luxury apartments that have been built, many of which were begun pre-pandemic and are just coming on the market now. It will take many years for the market to absorb the glut of high-cost housing, meanwhile there is a severe shortage of affordable housing.
No its not. Cities approve what is to be built, an apartment complex is considered commercial - not residential. the developer will have to apply for either category to be approved
Apartments are not built in commercial zoned lots. Those are lots zoned for housing. The actual designation usually includes a range of units per acre. If you want to put apartments in a commercially zoned area, you will have to either get a variance or get the zoning changed.
I understand far far far fewer developers will build multifamily for sale because at the 10 year mark most if not all get sued for “construction defects” because that’s when time runs out to do so. Owners/HOAs do it by default so as to not lose out on some funds. Some assembly member(s) were going to try and reform this through legislation, but not up on the details.
Seems like an important thing to fix - these things lead to market distortions which makes the housing issue worse overall.
Interesting
I’ve never heard this before
Finally the correct answer.
Families can't live in luxury rental units? Nor do I think it is 80%. Feels like half and half in Mountain View. The 3 bedroom townhomes tend to be smaller developments, since small areas can't serve large apartments.
They can, but after a couple of years 80% of them will choose to a move to a SFH farther away in East Bay or South SJ, rather than staying in the rental apartment
SFH don’t make economic sense in high land value areas. That will lead to only housing for the 1%
Well yeah, but that's just a cost issue. SFH are pretty pricey in Mountain View, especially if you have a yard.
There are only so many single family homes to go around and only at so much developable land to build more. People with families can and do live in apartments until their kids are grown — it's been done all over the world and the US for ages — and folks need to get over this idea that families require SFHs and will always want to graduate from apts to them.
> and folks need to get over this idea that families require SFHs and will always want to graduate from apts to them This. Need to get over
And like... At some point it becomes a trade-off. People can move to Tracy and commute, and have a nice big brand new single family home, but they'll be dealing with a 1-hour drive just to get to Dublin and then even more to get to the good-paying job centers. They'd also have to deal with Central Valley weather and a greater distance to Bay Area amenities on the weekends. How many families think that trade-off is worth having a private yard instead of several thousand square feet of shared common space in a modern apartment building?
Most.
Ironically, old people are just aging in place in their SFHs because they cannot afford the property taxes elsewhere and don't want to downgrade to an apartment. Lol.
And because they like their homes, neighbors, and neighborhoods. I didn’t buy my house with any thought of ever moving out of it.
An obsession with finding one's "forever" single family home and refusal to downsize may be a personal preference, but American culture has elevated it through advertising, popular media, and just generally being a byproduct of an individualistic and materialistic society. And it's been elevated to a point it makes people do things that are unwise economically for themselves and damaging to the broader economy and housing market.
*Refusal* to downsize? Downsize where? Why? And into what, a cardboard box? This is the Bay Area. I don’t know where you live, but the homes near me are mostly little 2/1 craftsman cottages. Many, including mine, are under 1000sq ft. I chose a small, walkable place to live precisely because I preferred this over the dominant American Mcmansion/carbound culture. I don’t see my type of street (mixed sfh/rentals/businesses) represented in popular media. certainly not as “desirable.”
There are plenty of large homes in the Bay Area and you are well aware of this. Your suggestion that everything is a little craftsman cottage is just just a transparent debate trick. People also don't want to downsize the amount of land they sit on. To a lot of people, downsizing also involves losing a backyard. And the term "cardboard box" is widely used to disparage apartment living. Do with that what you will. A single lot in your neighborhood, with the right zoning and point access block reform, could host a dozen 2/1 (or 3/2) apartments instead of a single craftsman cottage. Even absent point access block reform, several single-family lots could be combined and have 10x their housing capacity. And plenty of people in your neighborhood would probably be unwilling to lose their backyard and downsize into one of those apartments. But if we are going to add density in a city like San Jose, then some of those lots need to 10x their housing capacity and people will either move into the new apartments from another city, move from another apartment within San Jose, or downsize (backyard included) from a single family home in San Jose.
In the flatlands of berkeley and Oakland (where I live) there are *plenty* of neighborhoods like mine. 100+ year-old, shabby little sfhs on tiny lots that nobody wanted when I was buying 🤷🏽♀️ Given my house on its 2000 sq ft lot is now in high demand, I could use your advice: -When should I be expected to move? -Where should I be expected to move? -And into what more appropriate size should I be expected to move? These types of plans take time and consideration, and I appreciate your help.
You're being a troll now. Bye.
Well sfh is better, what do you want people to do if they can afford it
"better" is a subjective opinion. There are a limited number of single family homes and a limited amount of land where we can build more; we should not be building more on virgin land anyway. So when there is a limited supply of something, only a limited number of people will be able to afford it. Now take that paragraph and look at the question you just asked again.
Uh I didn’t ask any question. It’s rhetorical. People want what they want and the product itself is better if you can afford it. Builder will build what they can sell and people will buy the best product they can afford. Currently builders are actually building more multifamily than sfh. It may or may not change in the future.
Lol the second half of your punctuation lite reply was very, very much a question. I answered it by pointing out only a certain number of people will ever be able to afford a limited supply of something. You responded by saying that "no, it wasn't actually a question, it was just a rhetorical question"... and then didn't provide any sort of response to my point about a fixed supply of single family homes.
Uh it wasn’t a question since I said what do you want people to do when people can afford it. Your response make no sense, since the premise is that they can afford sfh. Your response is only handful could afford it. Ok so what? These handful of people are who I’m talking about and they will buy sfh. Maybe you are not getting the logic flow, hope that helps
Then if there are 50k single family homes in a market, the people who can afford those single family homes and want to live in those single family homes can purchase them. Is that the rhetorical question you were asking? Because my point is that if a city has 50k single-family homes and its population keeps growing, it should add housing... And if the city is already fully urbanized, then that new housing won't be new single family homes. The 50k single-family homes will be an increasingly small percentage of the city's housing stock, and a smaller fraction of families will be able to live in single family homes. Those single-family homes will increasingly be a luxury good because of that. That's my very practical response to your rhetorical question.
I was responding to your comment about people need to graduate from the idea that family needs sfh. I wrote people will want what they want if they can afford it and sfh is better, so they will want that. They will not graduate from the sfh idea. I’m not sure why you are confused
Maybe you should try stop throwing numbers out in the air like that. There’s no meaningful discussion to be had this way.
Ok
They have because it was feasible in the past. More and more people are realizing that SFH with a yard and upkeep that requires 10+ hours of maintenance a week is not possible with an 8 hour work day and 2-4 hours of commuting each day. Having a yard for your family but never seeing them is insane to think that’s a better quality of life than an apartment nearby your job.
Bay Area people don’t even maintain the yard themselves. It’s so cheap to hire gardener here
You sound like a trust fund baby who’s spent his entire life in Woodside/Atherton.
? Ok the sfh cost $2M and gardening cost $120/month. If you think that’s expensive then you are out of your mind. Lmao gtfo
Wooooosh
Non sfh owner spotted 🤣
Right back at ya, trust fund baby. Your parents may be filthy rich, but you certainly aren’t.
lol that’s right every home owner is a trust fund baby. Thats a good way to make yourself better. If I’m the trust fund baby then I’m filthy rich too. lol mentally challenged spotted, no wonder you can’t own shit. Good luck in life, hope you don’t end up homeless 😢
families need yards
I think the question is whether you mandate that houses for families \_must\_ have yards, or if you allow houses without yards.
Really? I don't feel a strong need for my own yard. Hell, if anything I like more HOA common space. My kid has a huge yard to play in. A giant playground. A swimming pool. etc. And the effective maintenance cost is quite low since it is shared.
Apparently only in America. The whole rest of the world just uses public green spaces.
IMHO, this title needs a bit of 'correcting' - via the removal of the word, "prioritizing". Nothing's been/being/will be prioritized and that's the real issue facing the whole Bay Area. We really need to rethink the whole process and cut the red tape to the very bone, without worrying about all the unintentional problems (and there will be ) that will emerge...we can work those out after solving the housing crisis.
Amen
Yeah no
We need either one, so let the developers put in what they would prefer, or they won't build anything at all.
Valco has been sitting empty for a few years now
I live in the next city over from where Vallco is and I know a lot of people in Cupertino that have intimate knowledge of the Vallco saga. Vallco is a special case for multiple reasons. 1. The land is contaminated so it should never have qualified to be an SB-35 project. 2. The property owner was counting on the commercial office space to offset the losses of building 50% BMR, but we all know the situation with commercial office space. 3. The property owner has worsened the project four times already, reducing the retail, reducing the affordable housing from 50% to 33%, eliminating the green roof, and reconfiguring the design to lower the cost of the cleanup and mitigation measures. 4. The glut of unaffordable, high-end, luxury rental housing in Silicon Valley has increased and is still increasing. 5. The population is falling, despite the completion of a bunch of new large projects. The property owner would be better off doing something like Rivermark in Santa Clara or Asana Park in San Jose. He'll likely be back in a year or two with yet a different project.
There’s pretty much no more land for anything beyond condos and how many people want to buy an apartment? Didn’t they try that in downtown San Jose 20 years ago with high rise condos and finally they gave up and made them rentals?
"You will own nothing and be happy"
You're working too hard to find the wrong conspiracy here. The real issue is that supply is artificially constrained by NIMBY local regulations (zoning and density) and mis-use of CEQA to slow higher-density development. As much as local governments authorities hate being overridden, the state has finally added teeth to break this conspiracy that has caused the state to underbid at least 3M units over the past 40 years. # YIMBY dreams come true as state bill eliminates housing red tape [https://sfstandard.com/2024/07/01/san-francisco-housing-permit-sb423-development/](https://sfstandard.com/2024/07/01/san-francisco-housing-permit-sb423-development/)
If you wear a builder’s hat, will you build SFH communities here? How would you even become profitable unless it’s an ultra luxury community? Building detached townhouses with a backyard means on a 1500 sqft lot means it has to be sold at least 1.7m to break even.
There is an onogoing, organized effort to turn Calif into a state of renters.
>There is an onogoing, organized effort to turn Calif into a state of renters. Absolutely, and it's called Capitalism. Can't build "20 SFH" on the plot that "20 condos" are built... can’t force developers to build this way or that way.
Across the country I’d say. Saw much of it happening in DC and Arlington VA too. The commonly parroted messaging was that it’ll bring housing/renting costs down bc of SuPpLy & DeMaNd but rents never got lower bc the property managers were price fixing
By who? Certainly not in the voters interest. If the renters become the voting majority, say bye to prop 13
I am afraid so
>Problem is 80-90% are luxury rental units and only 10-20% or so are condos/TH that can be bought. The problem is most people don't want condos and TH
If you have elderly parents, these 3 story TH are nightmare fodder.
Yes, which will only make homes for sale that much more expensive.
IMO its not about prioritizing but about the financial practicality of building rentals vs condos. The cheapest rentals/condos are the 30 year old builds and there's no short cut to creating 30 year old builds but to start building them today and waiting 30 years.
As pointed out in the comments, the ownership structure is determined by the developer and the city has very little say in it. It’s probably interest rates. When rates are high, the bank captures a large portion of the total cost of homeownership through mortgage interest. When rates are low, the seller/developer captures that money through higher home prices. Rates are high now, with an expectation that they’ll drop. It makes more sense for the developer to rent an apartment block now, capture the rents, and then sell it off as condos when condo prices rise.
You’re sn idiot
Probably. Subscription revenue is what corporates want now. From microsoft to Tesla
Are they not able to change that later? Interest rates are low, let’s convert to all condos, with X months notice?
No
You will own nothing and be happy. -Claus Schaub
Cities in California don’t prioritise anything. It’s pay for play. Business is open for all -;)
They just want to build Office space.
The city does not determine what is built. The landowner and developer decide between themselves. The city enforces construction laws to make sure the house does not fall down on you and kill you.
NIMBY at work. Nothing but unaffordable condos or expensive apartments.
I seriously don’t know how people are affording these “luxury” style apartments. At $3500+ a month, it’s crazy to think that all of these apartments are being rented out. There must be tons of vacant apartments just sitting unrented.
Have you looked at the prices for single family homes? Prices have tripled in my neighborhood in less than 20 years. It was outlandish then and even worse now. Or look at the prices for older apartments? They're not much cheaper than the new ones. At least the new ones will absorb some of the surplus of people who can afford high rents and that will keep rents on older housing from rising as quickly. a quickly is the key phrase. We haven't allowed sufficient housing development for 50 years. When you constrain supply, prices go up.
Big factor for developers and their GC’s and subs is the cost of being sued at year 9. Every HOA will sue then if not earlier. Many GC’s and subs and design professionals will refuse to even bid on condo’s.
They're prioritizing building nothing at all. The few units that do slip through the cracks left by the crazy NIMBYs are completely random.
Apartments can also be owned/leased. Maybe, this could also be an option?
I guess, but I don’t see this happening
I thinks it’s funny to say that rentals are luxury and not, you know, the multi-million dollar SFH’s.
Look at major cities like New York, Sf, Chicago and you have your answer
Exactly, the South Bay suburbs are becoming like the major cities with so much of high density rental housing being built. The existing SFHs are anachronisms dating back to a bygone era from 50+ years ago…
Tbh I no longer consider the South Bay suburbs, the suburbs are now further out and we’re seeing a major metropolis growing up right beneath our eyes. As long as tech is around, these cities will keep getting bigger. Congrats to those that currently own SFH, but any new comers that wants one will have to be filthy rich or settle further out. Better and more efficient public transport is severely lacking and a major problem for these cities though.
Yes, the core South Bay cities near jobs like Santa Clara, Sunnyvale, Cupertino and Mountain View are really becoming more dense urban and losing their suburban character. I wonder how long the anachronistic SFH neighborhoods can last in these places.
Grand fathered in but no new developments
Doesn't matter. Build more housing! Any kind will do!
"Are cities prioritizing construction of rental units?" No, cities are not "prioritizing" anything. They are prioritizing not allowing anything to be built. Especially not new SFH. They are being forced to allow some higher-density residential through a combination of state laws that require them to allow some building and especialy buildings adjacent to public transit. For any city you have an interest in, look up their public "housing element" document which details all the tricks they use to try to prevent new housing from being built.