Mission Moratorium Report

Despite what you might have read elsewhere, according to the City’s Office of Economic Analysis, “a temporary moratorium on market-rate housing would not affect the supply or price of housing in San Francisco,” at least not over the long term.

While a temporary moratorium would “slightly raise housing prices during and briefly after the period that it was in effect,” increasing the citywide cost of housing by a projected $8 per month for households newly renting or buying while the moratorium was in effect, according to the City’s report, housing production would grow at elevated levels after the moratorium expired, at which point households would then pay less for new housing because of the expanded supply.

The real question, which remains unanswered, is what would, or even could, be accomplished while the proposed moratorium was in effect.

While the moratorium would halt the development of privately-owned sites, “it’s unlikely that it would provide any greater incentive to a property owner to sell to an affordable housing developer.” And in fact, with a temporary rise in prices, “the owner of a developable parcel may well be better off after a moratorium, and even less inclined to sell to an affordable housing developer at a pre-moratorium price.”

Comments from Plugged-In Readers

  1. Posted by Elitist Pig

    This is the political folly that just keeps on giving! At least Campos & Co. can put this on their resume and pretend they accomplished something.

  2. Posted by SFcitizen

    Maybe the City should just invoke imminent domain and seize private property for public housing. Levy personal income tax on all residents to build and maintain new public housing.

    • Posted by Elitist Pig

      Yeah, because that won’t turn into a massive legal cluster…

    • Posted by anon

      That might actually be a good thing.

      I think we could use a few Soviet style public housing blocks around the city to provide ‘affordable’ living for the masses.

      Hey, how about even follow Hong Kong’s public housing model, and build a couple ‘New Towns’ of inexpensive 100-story high-rises here and there.

      Housing shortage: solved…

      • Posted by Futurist

        Of course you would say that. The scary thing is that even with your sarcasm, I actually think you would welcome Chinese style 100 story towers scattered around the city.

  3. Posted by Conifer

    “imminent domain”
    Indeed the city has been taking domain imminently in many ways for years. One never knows how soon it will come.

  4. Posted by Sam

    “The real question, which remains unanswered, is what exactly would be accomplished while the proposed moratorium was in effect”

    To me that’s the most obvious part of all. It would limit the amount of high end restaurants and boutiques that could move in, as there would be comparatively less yuppies paying $4000 a studio to live in the Mish. One of the goals with this moratorium is to try to keep the character of 24th street, for instance, more espiga de oro and less sous beurre kitchen, more pops pre-the kind of lame Madrone guy ‘fixing it up’.

    • Posted by Elitist Pig

      You are living in the same fantasy as the people behind the moratorium. You really think high end restaurant / commerce is going to be deterred by this? The money in this city isn’t going to suddenly flee from the Mission and leave it to whoever you think “belongs” there, it’s still a popular area of the city to live and spend your time in.

      I wouldn’t be shocked if development just moved outside of the borders set by this farce. This moratorium won’t stem the flow of your “yuppies” from enjoying the “Mish” and providing incentive for these businesses to set up shop.

      • Posted by Sam

        Im not saying I think the Moratorium is a reasonable thing, but I do think it will slow the gentrification of particular areas of the Mission (specifically the Southeastern areas and lower 24th street.) I mean look at Capital Hill in Seattle, that area went from the Mission to the Marina in what feels like 5 years. Massive building does influence the surroundings.

        • Posted by jb

          Why does the mission get a moratorium? Why can’t my neighborhood have a moratorium until the define how they are going to better support the mass development?

          • Posted by two beers

            what neighborhood is that?

          • Posted by spencer

            The mission is more monolithic now than the marina. Every person ( hipster)in the mission looks and dresses the same

        • Posted by Richard

          Well put Sam. The initiative isn’t really about housing. It’s about slowing racial and cultural change in the Mission. That’s why the city’s report will have little persuasive effect on the supporters of the initiative. They know what they’re voting for.

          • Posted by spencer

            Their voting in favor of racism?

          • Posted by SFrentier

            ^ and increasing property values for existing mission property owners.

            It’s an interesting combo!

        • Posted by Marco

          Please explain how your opinion is different from the guy espousing “no more Chinese”. He was arrested for “hate crime.”

        • Posted by parklife

          Sam,

          I lived in Capitol Hill in the early 80’s and then moved to the Mission in the late 80’s. Capitol Hill was never like the Mission and, frankly, was already becoming gentrified in the 80’s. Capitol Hill was gentrified in much the same way as the Castro was gentrified.

    • Posted by Luke

      As someone who lives in the neighborhood, frequents Espiga De Oro, celebrates birthdays at Sous Beurre, and has spent much time drinking at the old Pops and the new Pops, I can say that each of these businesses has added to the texture and character of the neighborhood. The neighborhood provides a great mix of old and new, latino and white, rich and poor, just like any City should. And I’m pretty sure than makes slightly above minimun wage to work at a local non-profit precludes me from being a “yuppie”.

      • Posted by Sam

        Yes you’re saying you like it right now, what happens when it’s all Sous Beurre and fancy Valencia stores? That trains a comin, comin reaallll fast

        • Posted by SFrentier

          I call BS on that. Dumps like el farolito are part of the “old culture” and are making bank. Seen the lines there recently for over priced crap burritos, with indifferent service? Both bros and hombres are cuing up for that.

          • Posted by Ohlone Californio

            so, El Faralito is over priced and crap, now? man do you not know food.

          • Posted by anon

            Lard, cornmeal, and really cheap, lousy meat. Bleh. But somehow they’ve gotten people to wait in line to pony up $5 for 30 cents worth of lousy food made in pretty filthy conditions. There’s one born every minute. Making bank indeed. The “undesirable” Sous Bierre types could never get these kinds of profit margins.

          • Posted by SFrentier

            Wrongo bucko. El farolito was pretty good, if inconsistent, years ago. Now they have jacked their prices, the workers have attitude, and they don’t care because newbies like you cue up. There are better burritos in the mission, but I ain’t telling where.

          • Posted by Ohlone Californio

            I’m a newbie based off what? I know el faraloto is both ok, not great, and priced normally? or because you’re so o.g. everybody else is a newbie even though you moved to the mission in the late 90s at the earliest?

  5. Posted by Dave

    Though not the initiative that needs to be put in place, I will vote for the moratorium as a warning to the City PTB that business as usual as regards approving luxury condos and apartment towers will no longer cut it.

    A more appropriate initiative and there are rumblings out there regarding this would be a City-wide mandate that any new condo project set aside 40% of the units as BMR. With a 10 year expiration on the initiative. A test period. IMO developers would come forward over that time and build such projects which are sorely needed in SF.

    • Posted by j_blu

      40% BMR would make meaningful change in what is built in the city; a moratorium in one nabe will not as the development will just be in La Lingua and SoMissPo and Western SoMa instead. Please don’t vote for the moratorium, spend some time working toward meaningful change (like the BMR increase you intoned here) instead.

      • Posted by Dave

        The proof developers can make money with a greatly increased affordable component is the Giant’s proposal on the ballot this fall. 33% affordable. They upped the amount when polls apparently showed just a 50/50 chance of passing. Feet to the fire, it can be done.

        • Posted by anon

          The Giants proposal is a huge project in a highly desirable location. That’s why they have a little flexibility there, but you shouldn’t assume it’s typical.

          You need to look at this from the point of view of the developer. To them, BMR requirements just simply add to the cost of the project. They won’t take that extra cost out of their own pocket either, because their investors demand certain returns. What they do instead, is just offset the extra cost by either increasing the price of the non-BMR units, or increasing total number of units in the building.

          There’s really no such thing as a free (or BMR) lunch…

          • Posted by RobBob

            It comes out of their profit margin and their calculation of whether or not a building can be built and make money. You can’t just raise the price of a unit because the price is determined by the market. If you price units too high they will just sit empty and vacant. Developers selling newly constructed units want to see their units move at a certain rate a month, otherwise they are exposing themselves to additional market risks if they hold on to units hoping the price will go up.

          • Posted by Not Bashing

            RobBob – this is an oversimplification. The price is indeed set by the market, but adding huge BMR requirements to all new development will only increase market price. Developers will pass this cost on, that is just how business works. They are not non – profits. And unfortunately, as market price rises, below market price also rises.

        • Posted by zig

          The Giants are leasing the land from the Port of SF are they not?

      • Posted by S

        No more BMR’s – affordable rentals are better. These buildings are going to have high HOA dues so by virtue of that they aren’t going to be affordable anyway. You also still need to have a down payment and decent credit to get a loan.

        The owners of BMR’s are also unable to sell at market rate so there’s really no point in investing aside from a marginal increase in housing security, undermined by the fact that HOA’s can always go up.

        • Posted by Not Bashing

          Exactly. No more BMR’s, no more of this nonsense period. Just build market rate housing and move on. If someone can’t afford to live here, they shouldn’t. I don’t mean that in a malicious way, it is not in their best interests. Housing is not the only expensive thing in SF. Move to Oakland, buy a house that is a better investment and grow your money the same way everyone else has done.

    • Posted by la

      Are you willing to donate your income to a BMR fund?

      Of course not.

      Everyone else should.

    • Posted by spencer

      Your plan would vastly raise market rate housing price.

    • Posted by sfcommie

      Temporailly raising the BMR requirement while the sun is out would be an option. But 40% for 10 years? That’s a no go. That’ll raise the market rate so high, the city will become unlivable for middle/upper moddle class; it’ll become a city of poor or very rich, and nothing in between. That is if the economy keeps chugging along. If it slows, you can bet no more housing will be built, much sooner than it should.

      • Posted by parklife

        Middle and upper middle class housing will be as it has been for some time, TIC or older condos. You will just have an increased incentive for investors (aka speculators) to Ellis and TIC existing housing stock.

  6. Posted by badlydrawnbear

    So it does everything the critics said it would.

    Raise prices while in place and once expired and new supply can be built prices would fall.

    So, why aren’t we just adding the supply again?

  7. Posted by Ivan

    Did we really need to do an Economic Analysis to come to this conclusion?

    • Posted by Elitist Pig

      It’s for the people who think it’s a good idea that will magically transform the Mission into an affordable haven for the downtrodden.

  8. Posted by jb

    What makes the “Mission” so darn special that it should have a moratorium. It is like the neighborhood of The Mission is some incredible crown jewel of the city. Don’t get me wrong. It’s a great neighborhood, but every neighborhood in the city is experiencing gentrification and extreme development.

    Can we stop development in the area around Twitter because it is pushing out artists? Can we have a moratorium in Potrero Hill because there is no infrastructure to accommodate the 5000 home being built?

    We should moratorium on all building in San Francisco until the incredibly wise city planners define their perfect solution. Furthermore, we should have a moratorium on new businesses, school, homeless until we define a perfect plan.

    • Posted by spencer

      I support a moratorium on campos’ stupid ideas

  9. Posted by sparky-b

    One thing I keep wondering about the Moratorium is what exactly is it stopping. I read it to say that the DBI won’t process an final approval of a permit during the Moratorium. If that is the case it will have no effect on the sale of lots. You simply can’t by a lot in SF for a largish build and have it permitted in 30 months.

    The 600 South Van Ness site had it’s first neighborhood meeting in August of 2013, so it was bought and designed before that, so give or take 3 years for that one.

    So the question is does the Moratorium stop pre-app. meeting and notices and Building intake and plan reviews, or does it just stop final approval?

  10. Posted by jb

    Per the Chronicle, below, the city’s chief economist indicates the moratorium will have significant negative impact???

    “A temporary halt to construction of market-rate housing in the Mission proposed in a November ballot measure would lead to fewer units being available and harm the very residents it seeks to help if passed, the city’s chief economist said in a damning report issued Thursday.”

    [Editor’s Note: As we said, despite what you might have read elsewhere…]

    • Posted by jb

      Right. I just assumed the “elsewhere” would not be another city funded analysis. Any idea which agency caries more clout or objectivity; City Chief Economist or Office of the Controller?

      [Editor’s Note: It’s the exact same report.]

  11. Posted by BayviewSF

    Since the moratorium will not pass any way, we should spend time on a more productive topic. Forget about this silly proposal and forget the person who proposed this.

  12. Posted by Ohlone Californio

    I think it’s a good thing and I hope it will pass. Because the white people who moved to the Mission in the 90s are all cooler and more worthwhile than the white people moving to the Mission now. Let’s be real for a second. Millennials all think that Dia De Los Muertos is fun time for them. It ain’t. Have some respect.

    • Posted by zig

      Keep it real cause some of those white folks from the 90’s subsisted on burritos from el farolito and la cumbre for weeks at a time. These new white peoples are eating $6 toast!

  13. Posted by g

    The lack of long term effects is predicated on the moratorium being allowed to expire. Since we all know there would be no appreciable improvement while it’s in effect the most likely outcome will be to extend it indefinitely in the hope of compelling land owners sell their properties at sub-market values (which they won’t do).

  14. Posted by bleeper

    socketsite is showing its hand on this one. I’m surprised. I dont come here to read about how not to build housing. Are you guys employing former bay guardian employees?

    • Posted by phil

      One should appreciate Socketsite’s journalistic integrity on this issue. I am glad to read an unspun analysis.

      • Posted by bleeper

        personal opinion does not equal “journalistic integrity”

        • Posted by SocketSite

          The only opinions stated above are those of the City’s analysts, not ours.

          • Posted by bleeper

            no, you just cherry picked items from the Cities analysis to create your own narrative

          • Posted by SocketSite

            If you honestly believe that’s the case, please feel free to contradict anything in our summary above with material from the City’s report to which we linked above. Our summary is sound and without bias.

  15. Posted by BobN

    We should do it because it’ll be soooooo goooooooood when we stop.

  16. Posted by Luke

    If the train is coming so fast, why does Mission street look very similar to how it did 5 years ago? Why does a place like North Beach still have a good mix of new and old? Relax.

    • Posted by Ohlone Californio

      Mission st looks similar, sure. Easy criteria, “similar.” But it also has multiple storeys higher buildings all over the place.

      • Posted by Dan

        Very little building of condos on Mission St. so far. There is Vida, greased by multiple campaign contributions to Campos.

        • Posted by Ohlone Californio

          There are four or five others underway and you probably know that.

        • Posted by Futurist

          The Mission needs more luxury condos.

  17. Posted by Jon S @ SFBARF

    First, the giant’s proposal is 40% affordable, but they could only afford to get to that number because 1: its a parking lot. No demolition, and 2: it has a huge office component.

    The truth is, Mission Rock will add 11k jobs and only 1,500 units of housing. If you analyze it like Ted Egan did in this report, it will make housing prices in the city go up by a couple of percent. much more than the moratorium would, becasue it is creating demand for about 5,500 units of housing.

    Despite Jane Kim’ swoop in to get her affordable photo op, in fact, if you go by the nexus study which progressive supervisors love, Mission Rock only creates about 8% of the affordable housing need IT ITSELF CREATES. Its fine if you like it, but dont hold it up as an example of an affordable housing success story. it is anything but.

    • Posted by Sara Short

      I am BARFing at your big lie “affordable” housing. It’s SUBSIDIZED housing you suck out of other people. It’s wrong and unfair why should few special people get their housing paid of and not EVERYONE fairly? It’s government economic segregation!

    • Posted by Not Bashing

      You’re right – clearly the solution is to remove the 40% affordable from the project and just build market rate. In every development. This is pointless.

  18. Posted by DJD

    How about a hurrah for Ted Egan and his reality-based and thoroughly defensible analysis of a very contentious issue. Anyone unhappy with the report has nothing other than spin to go on, because he’s got the facts nailed. Nice to see a SF Gov employee earning our tax dollars for a change.

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