An Incentive To Build More Affordable Housing In S.F.June 9, 2014
For many areas in San Francisco, the number of dwelling units allowed to be built upon a parcel is strictly limited by the size of the lot. For example, within districts zoned RM-1, a common designation which allows for the development of apartments and condos, a developer is allowed to build no more than one dwelling unit for each 800 square feet of lot area.
The current density limits in San Francisco apply regardless of the proposed size of the units to be built and any Below Market Rate (BMR) units count towards the limit. As a result, developers often choose to pay an in-lieu fee rather than building affordable housing onsite, maximize the number of market rate units that can be built.
As proposed by Supervisor Wiener and to be reviewed this week, new legislation would exempt BMR units from the maximum density calculation in a number of districts in exchange for a developer designating at least 20 percent of the building as affordable versus the 12 percent that’s current required for development onsite.
The proposed legislation would not provide any exemptions from other existing limits, such as the height or bulk of the building allowed to rise on the lot, nor would it reduce any requirements for a development’s open space. It would simply allow for more units to be built on the same site.
The [Planning] Department projects that this legislation could facilitate some new affordable and market rate housing production. First, the potential density benefit could encourage projects to provide 20% affordable units onsite. This is a net gain in affordable units from the required 12% onsite requirement. Also, this program could incentivize projects that might otherwise elect to pay the inclusionary housing fee to elect to build the affordable housing units on site, in order to receive the density bonus. This legislation could also benefit parcels, in a limited number of districts in the City, which are zoned for residential use yet their total development capacity is constrained by density limits, rather than the other Planning Code requirements…
However, the Department projects that the total number of development projects that will elect to take advantage of this program will be limited based on a few factors. To start, most parcels in the City are not eligible to participate in this program. The proposed legislation would not apply to RH-1 and RH-2 districts, which make up approximately 72 percent of all existing land parcels, and 50 percent of the City’s developable acreage (meaning non-open space or land that is not federally owned).
The legislation would also not apply to areas subject to a redevelopment plan (such as Mission Bay and Transbay) nor to a district within which density is regulated by bulk and height rather than simply lot size.
Comments from Plugged-In Readers
This is really going to change things.
There is never going to be one ‘magic bullet’ to fix all of our housing issues at once. We are going to have to have an assortment of initiatives both large and small and both short term and long term. It’s a failed policy over the last 50 years and isn’t going to be fixed tomorrow.
Any idea why this proposed legislation wouldn’t apply to RH-1 and RH-2 districts?
These districts generally only allow one or two units, so likely won’t have projects that have 20% affordability. Since the legislation won’t benefit them it makes sense to exclude them – because NIMBY wealthy homeowners freak out if you propose any changes to RH-1 and RH-2; they frame any changes in these districts as a war on families and middle class.
I’ve never understood why we feel the need to legislate the number units AND the height AND the bulk.
The areas covered in the map for western soma around the four corners of mission and south van ness (and along mission to the east) already have zoned 450′ monsters right next to 35′ exisiting residential (M&O Plan) and they want a density bonus?? Try taking that incentive and transferring it to the Castro, Marina, P.Heights or any of the other shaded areas…please.
^Or upzoning those horrendous 35′ parcels. No reason for the center area of SF to have 35′ buildings. None.
ahhh these are extremely small parcels in residential enclaves so zoned by the Western SOMA plan. My point is, in no other location in the city (even the Fillmore Tower next to existing resident) are the proximity so close…less than 25 feet in some cases. That is piss poor planning ala Houston Tx. The “make it higher” crowd just don’t get this particular issue.
The “issue” is a non-issue, that’s why no one “gets” it. I was in Tokyo last month staying with a friend that lives in a three story building surrounded by mostly 10-30 story buildings. The buildings haven’t eaten his children yet. It’s an incredibly nice neighborhood, wish we had more like it here, with a variety of heights, etc. Variety of heights is not a bug, it’s a feature.
Somethin’ ‘sbetteran nutin’.
The SF goal of affordable housing is BS. I just raised the rent on one of my units the allowable 1%, which is down from 1.9% last year. However, the interest paid on deposits remains .4% – the same as last year. The squeeze on landlords continues and rents remain affordable if you are grandfathered.
I feel sorry for property owners of the most valuable real estate in the country.
I think they are in so much pain that they feel the need to post something about their agony as a comment to every single article, regardless of whether it has anything to do with rent control.
no rant control on rent control
This “most valuable real estate in the country” is only “most valuable” if it’s vacant.
If it has long-term well-below-market tenants burrowed in for life, it’s not very valuable – except to speculators who will Ellis Act them out.
So in essence, you’re actually encouraging owners, who might want to turn their property into “the most valuable real estate in the country” to do so – by Ellis Acting their building themselves, or by selling to a speculator who will do so.
If they don’t, their property is only worth the same multiple of the net cash flow as a property in Oklahoma.
Dude , you might not be making out like a bandit , but if you need to make a building improvement at least you can go the way of a Capital Improvement so you can pass on the cost to keep the building in good condition
If you aren’t happy with the value/revenue from your property why don’t you sell it? Right, because you are still making money hand over fist, and the land values in SF have escalated over 300% in the past few years and your rants about rent control are just part of your overall anti-government sentiment.
If property owners agree to give up the subsidies the subsidies they receive through Prop 13 and the federal mortgage interest deduction -then I personally will lead the charge against rent control. Funny, no one has ever taken me up on that offer.
Every rent controlled landlord in town would take that deal in a NY minute. End rent control in exchange for ending Prop 13 on formerly rent-controlled property – sign me up, NOW.
This actually seems plausible to me. Because in an un rent-controlled free-for-all where demand for rental units is outstripping supply (like now), landlords could pass all of the increase in taxes post Prop-13 repeal onto their tenants. Same goes for the loss of the federal mortgage interest deduction, where applicable.
People cannot “pass” anything. In a functioning market, if landlord Joe has a tenant Bob who makes 3K he can’t charge much more than 1200. If he does, then tenant Bob will look for another rental. If tenant Bob switches to a cheaper rental, landlord Joe will have a loss while he finds a new tenant. Landlords will adjust to what the tenants can pay and what the competition is. If tenant Bob cannot find anything within his range, then he’ll probably have to accept a higher rent.
But none of this really has to do with tax deductions, prop 13, etc. At least, again, in a working market.
For instance, right now I am renting a house with a pool in LV. The place was purchased at a foreclosure for 1/3 of what it sold for in 2006. The new owner asked a very low rent, and I jumped on it. I knew what his expected ROI was, which made the deal very easy.
The house next door is owned by an old lady living with her daughter in LA. They’ve been trying to rent it for 5 months now, for a meager $100 more than the place I rent. Identical houses, similar shape. This is the market at work.
Any sane landlord would be asking the highest market price now, not waiting to “pass along” any additional expenses. That’s not how markets work.
I recall the daughter of a landlord who was taking over his dad’s business in the Mission in 2006 and underpriced the rental by a good 20%. She understood very quickly her mistake and accepted an overbid at market price. People were offering her one year rental cash upfront!
It would be better if Planning got rid of the density limits in lots zoned for multi-family along with the parking minimums. Let the height limit and setback requirements be the constraints.
This is how zoning works in the areas that have recently re-zoned. This legislation is an attempt to make the older zoning districts work a little bit more like the new zoning districts.
One band aid after another. This is what happens when you screw with market forces.
But…politicians who screw with market forces gain power by doing so. Do you think our politicians are most concerned with:
1 – the well-being of our city, or
2 – their own personal power.
Think hard, now…. :/
I think I love you EcceMorons
Hey, maybe it will work this time and everyone will have cheap plentiful housing! And unicorns!
What is the average size of RM-1 parcels in the city?
I think most blocks are +/- 3Ksf lots. So who does this help? 3 market rate units require 2400sf of land area, so you get to build a 4th unit, but you have designate it BMR.
Why wouldn’t I just build 3 larger units, knowing that my Sales PPSF is @linear and if I do 3 larger units, I pay for finishes for 3 kitchens and bathrooms, not 4 kitchens and bathrooms.
Also, I still need to satisfy parking requirements for my marginal unit, right?
I’m not convinced that we are remotely close to having the infrastructure in the city to absorb this volume of additional density. Muni is already stretched past the breaking point, parking tight, and other city services struggling to keep up.
People adjust, in more ways than one. For instance bike usage is going up. Big corporate employers are moving their employees in bulk.
Now if we could have a city hall with cojones, we might have a chance at having more subway lines.
Seriously? San Francisco isn’t nearly dense enough to worry about infrastructure. MUNI sucks because of reasons other than infrastructure. City services are struggling because of progressive priorities towards union retirement, healthcare and Homeless Inc. rather than actually servicing city residents.
Density? Not the problem. City governance and corruption? Ding ding ding!
With an annual budget of over $10K per city/county resident, makes you wonder where all that money is going.
Muni is slow because of traffic congestion. If we could keep cars out of the bus lanes, we might have a fighting chance of speeding Muni up.
MUNI isn’t slow because of cars.
It’s slow because there’s not enough density to have enough buses to run each route and not lose even more money.
It’s slow because residents insist on having the bus stop at. every. damn. corner. Just ride the 38 Geary to feel the burn.
Traffic congestion is a red herring.
“As can be expected for a surface-running transit system, some of the most significant sources of delay were from intersections, traffic congestion, narrow lanes, and closely spaced transit stops. “
They sped up the 22 by 5% just by painting some red paint on a few blocks of the route:
What came first, the chicken or the egg? All these things trim at the edges that don’t fix the overall problems. Fact is that with TWU and absurdly high pay, benefits and work rules for drivers, along with not enough density, it’s more about not having enough buses and trolleys on the road to really be a good system rather than traffic. That’s a copout.
San Francisco is in that valley of death for transit – dense enough for traffic, but not enough density for a decent transit system.
Y’all always get really prickly in your lingo when what you’re really talking about is packing ’em in like Sardines. “to rise” and “upon” is all good until what it translates to is the utter wholesale ruin of a great city like Paris or Madrid paved over with no parking lots but lots of high rises. Shame on you.
I like you. I really like you.
Comments are closed.