Grand Jury Housing Chart

In order to meet the Mayor’s goal of creating 30,000 new and rehabilitated homes in San Francisco by 2020, developers will need to deliver an average of 5,000 units of housing per year for the next six years, an average that is greater than any single year’s maximum to date.

In addition, in order to meet the Mayor’s goal of having one-third (10,000) of those 30,000 units considered to be “affordable” to households with incomes of under 120 percent of the Area Median, not only will all the Housing Authority’s Public Housing rehabs (4,575) need to be counted and completed, but all of the affordable units in the city’s current housing pipeline — which already includes the development of Treasure Island, Hunters Point, and Parkmerced — will need to be delivered as well.  And then some.

From the conclusions of a Civil Grand Jury which set out to investigate the feasibility of delivering a successful response to the Mayor’s housing production goals:

San Francisco Affordable Housing production will be particularly challenged once the [San Francisco Redevelopment Agency and Office of Community Infrastructure and Investment] dissolution is complete. Couple this loss with decreasing State and Federal funding resources and the picture could be glum for providing additional housing support to financially vulnerable segments of the City’s population. However, the Jury does subscribe to the notion that the availability of housing that is affordable to the widest spectrum of socio-economic levels fosters a more vital and dynamic urban environment and is in the best long-term interest of all our citizens. This means continuing to invest in building Affordable Housing stock to provide opportunities to those in need who otherwise are unable to afford market rate pricing.

Residential projects take years to design and build. It is not unusual for projects to take 4-6 years in the City today and rarely can a project be completed in two years from entitlement. The Mayor’s 30K plan is a goal that will provide some relief to the current shortage, but exactly how far it will go in addressing the affordability issue depends on many factors and the outlook tends to be gloomy. San Francisco’s population increase toward one million by 2032, and its role as a job center and transit nexus, will mean more need for housing and competition for funds with a host of other infrastructure needs.

That being said, the Grand Jury’s report does note another possibility:  “On the other hand, the current affordability “crisis” could also dissipate, at least temporarily, should technology employment turn out to be a bubble, as occurred in 2000 after the “dot com” cycle when laid-off workers left San Francisco and vacancy rates increased.”

The Grand Jury’s full report: “The Mayor’s Office of Housing:  Under Pressure and Challenged to Preserve Diversity.”

48 thoughts on “Grand Jury: Gloomy Outlook For Affordable Housing In SF, Unless…”
    1. It’s all about the current market and the foreseeable future. Developers see a price drop, they think the party is over and stop planning new construction. Then prices recover and they pick up where they left off.

      1. Except the sad part of the joke was that even in the downturn, S.F. housing prices were among the highest in the nation. Developers should have continued building even then, because they could still get good returns – just not the starry-eyed soaring returns that they thought they were going to get in 2006 and 2007.

  1. they need to shake things up at the government level and streamline the approval process. the demand, the money, the occupants, and the projects are all there. it’s just the city we’re waiting on to quit dragging its heels.

    1. I agree but the real problem is the citizen review process that holds up these projects, the planning department would love to fast track more projects but every NIMBY in the city has the power to delay a project on a wide array of sometimes dubious concerns that often just mask personal interests, entitlement and fear of change. Unfortunately I don’t think it will ever change because theses groups will never allow the tiniest bit of power to be taken away from them and given back to the trained building and urban professionals in the city. Housing prices will continue to grow out of reach as demand increases and supply doesn’t follow and we will continue to get more of the same poorly designed cheap architecture that we are currently getting because design budgets are often slashed in order to pay for the insanely long and very costly approval process.

      1. Give me a break! Design budgets are never cut because of the approval process. Developers spend as much (or as little) on design as they think will provide a return on the investment. If the approval process was shorter, developers profits might increase, but there is absolutely no reason to think that they would then munificently spend that extra money on better design.

        It is unfortunate that you don’t think that citizen’s should have a say in what happens in their City — but contemptuously referring to people in the community as NIMBY’s does not help your cause. It just shows arrogance (and lack of understanding of what the word NIMBY really means).

  2. 70% of SF residents are home owners or living in rent controlled units, thus have no incentive to increase housing supply. Until this changes, nimbys will get in the way making the approval process increasingly difficult, limiting supply.

  3. Here’s a studio in Vallejo for sale for $49K. 10 minute walk to the ferry.

    http://www.redfin.com/CA/Vallejo/1715-Sonoma-Blvd-94590/home/2405815

    With $10K down, a $39K mortgage for 30 years at 4.5% is $197 per month.

    Affordable housing should be a regional strategy. Vallejo and places like it are dying for the energy of new families and new entrants. The bay area offers plenty of affordable places for people to live, there’s just no promise of those places being in the city of San Francisco.

    1. i agree. not sure why everyone feels entitled to live in SF. a ferry ride away for cheap cheap housing is not too bad

      1. That is a really long and expensive ferry ride and most people don’t work in downtown SF who need affordable housing so this is not helpful

        1. i didnt say it would help “most ” people. But it is helpful for people who do work downtown. And theres lots of people who work dowtown.

        2. Actually it’s very helpful. The market sends clear price signals to people about good places to live.
          Some families move from San Francisco to San Mateo.

          Have you yourself not moved your family to the peninsula? You didn’t stamp your feet for political change – you made a choice that was right for your family and your budget.

          Why shouldn’t the same decision process to all income levels?

          Taking the ferry to Vallejo is a fine example (one can after all connect to other public transportation downtown).

      2. Yeah, even technies are choosing to live in East Bay. In my last company about a quarter of technies commute from East Bay. Some like the life style. Others go there because of the price.

  4. San Francisco has a roughly thirty-five percent homeownership rate. Then 172,000 units of the city’s 376,940 housing units are under rent control. (That’s about 75 percent of the city’s rental stock.)

    Homeowners have a strong economic incentive to restrict supply because it supports price appreciation of their own homes. It’s understandable. Many of them have put the bulk of their net worth into their homes and they don’t want to lose that. So they engage in NIMBYism under the name of preservationism or environmentalism, even though denying in-fill development here creates pressures for sprawl elsewhere. They do this through hundreds of politically powerful neighborhood groups throughout San Francisco like the Telegraph Hill Dwellers.

    Then the rent-controlled tenants care far more about eviction protections than increasing supply. That’s because their most vulnerable constituents are paying rents that are so far below market-rate, that only an ungodly amount of construction could possibly help them. Plus, that construction wouldn’t happen fast enough — especially for elderly tenants.

    So we’re looking at as much as 80 percent of the city that isn’t naturally oriented to add to the housing stock.

    1. Well, that’s one point of view. Rather generalized and biased I feel, but your opinion.

      I’m a homeowner (like many SS regulars) and I have no incentive to protest new housing, by your definition. The value of my single family home is not threatened by new construction, whether it be high end, low end or affordable housing. Single family homes like mine are not being built in SF at any significant rate, so I have no competition, nor am I concerned about that. And no, I am not a Nimby.

      I support new housing that is well designed, located near good transit corridors, within EXISTING zoning and height limits and contributes/respects neighborhood context.

      The slow increase of new housing, and the high cost of it stems from many factors including: cost of land and scarcity of new land, high fees and long entitlement processes, too much public input and ease of DR’s filed by the opposition.

      1. So, you’re basically saying the same thing as robin!

        Within EXISTING zoning- means virtually no new high density building, every where else is already built up with low density.

        You agree that there is too much DR, and public blocking. Basically NIMBYism.

        Bottom line: most homeowners don’t want density increases in their hood. Most renters couldn’t give a sh*t about any of this except the lame rent control advocates, which further entrench low renters to stay in their units.

        All these people that are basically “set” like SF the way it is. 30,000 new units? Sure, and I want a pony!

        1. Oh, let’s not be so dramatic now.

          Plenty of high density new housing being built: Octavia Blvd. Mid-market, Vann Ness corridor, upper Market. Hunter’s Point, to name a few.

          I can’t comment on the rent-controlled occupants and their point of view. You may be right, but I seriously don’t think rent control is about to be repealed. Do you?

          So where do you fit in? Are you a property owner or occupant of a rent controlled unit?

          1. Futurist, Seattle is building 15,000 housing units per year, San Francisco is building 3,000. Seattle is a smaller city and supposedly with a weaker economy. The result? Rents do in fact go down.

            http://www.smartgrowthseattle.org/keep-simple-housing-supply-demand/

            Because supply and demand works. I know that you are a Supply Denier. Good luck with destroying the urban fabric of your own city by pricing and displacing people out of it.

          2. According to a recent report in the Seattle Times (namelink), average rents are going up in Seattle and in the Seattle area. Curiously, part of the explanation is the new inventory:

            “Apartments in Seattle’s Ballard neighborhood saw the biggest increase in rents. The average asking rent was 12.3 percent higher over the quarter, rising to $1,628.
            But Ballard also had a vacancy rate of 8.6 percent, the highest in Seattle. And when new apartments that just opened are included, the vacancy rate shoots up to 18 percent.
            The apartment boom in Ballard has led to a doubling of the inventory over the past six years, said Tom Cain, head of Apartment Insights Washington. When the units now being built are complete, Ballard’s inventory will have quadrupled.
            New units rent for a premium, and they’re part of what’s driving up market rents, Cain said.”

    2. @Robin: There really is very little evidence that opposition to new housing is any way driven by concern over housing values. Perhaps you are a developer and only think about money. But that doesn’t mean that everyone else thinks that way. If you actually listened to what the community says (rather than demeaning them as NIMBYs), you might learn more about people’s real concerns.

      1. Yes of course. Homeowners don’t care about the future value of their homes. And NIMBY’s generally care about the greater community good, and not their own views, privacy, street parking, etc. Maybe that’s the way it is in guilty-liberal-noe-land, where unicorns jump over rainbows too.

        1. And SFrentier is generalizing once again. without facts, but merely drama. And why is it that he is targeting Noe Valley? So many here seem to spew vitriol to one particular neighborhood, of many neighborhoods.

          Completely without merit or intelligence.

          1. You’re just talking out of your ass. What I said was very specific: most people living in SF are not interested in significant density increase. 1- SF is mostly seen as a city of quaint low/mid rise neighborhoods. 2- homeowners naturally want to preserve property values. 3- renters tend to squat cheap units, drastically restricting supply. Yes, the city did some selective smart re zoning, on Octavia, market/van ness, etc. But that will not add enough housing in such a small city, given the above restrictions and the tech industry/workers that love it here.

            Also, it’s pure amateur hour when this city gov tries to deal with this issue. Although in many ways SF is a world class city, it governing body has the maturity and vision of an 8 year old on steroids. Can you imagine Paris, London or NYC acting like our BOS? I didn’t think so.

  5. I am shocked–shocked!-that the Mayor would set an unrealistic, unenforceable goal.

    Seriously, though, as noted above, if he really wants more housing to be built, he could do the heavy lifting on changing the approval process (as Gavin Newsom or Willie Brown could have done but didn’t). Don’t hold your breath that Ed Lee will do it.

  6. Doesn’t the data presented in this article specifically contradict the “plenty of high density new housing is being built”? What am I missing? Aren’t we clearly falling short of our housing goal…aka not enough development!

    Nimbys don’t even realize they are Nimbys, I’m starting to understand the problem.

    1. And you don’t even know what the term NIMBY means — but it is a nice way for you ignore your opponent’s arguments.

      1. Rather then wasting time on this forum with a childish back and forth argument, explain you actual positions. I have read posts for months here, and aside from the rare thoughtful post, most of the comments fall into the “you are a NIMBY,” or “no, I am not a NIMBY, you are in the pocket of greedy developers.” If that is all you people have to offer, them get off this site and go out and live your lives because you have already said all of that multiple times and none of you are further the discussion on this message board.

  7. Can San Francisco add the wanted level of affordable housing built , NO ,
    But if there is sufficient construction labor , and the red tape to get projects approved gets reduced I can see 30,0000 units being built ,
    But I think its also dependent on letting the SOMA to have its building heights increased,

    1. …and boom goes the dynamite.
      Joseph hit all three nails on the head.
      Contractor shortage? Check!
      Red tape? Check!
      SOMA height limits? Check!
      Fix those three things, and 30K won’t seem like such a stretch.

      1. agree. the western SOMA plan is a huge joke. that should be promptly revisited. that plan made since in 1984, but not 2014

  8. I am still totally perplexed as to why the mayor doesn’t consider the entire Bay Area as a whole in planning for affordable housing. Why must it be physically located in San Francisco (other than the city falls under his remit and the rest of the Bay Area does not).

    If you just draw concentric circles extending eastward out from the city… you will find ample, very affordable housing at 5, 10, 15 and 20-mile radii from the middle. Just none of it in the city proper… but who cares?

    It’s time to start looking at the metropolitan region as a whole and develop a unified transit and housing policy.

    1. Very good point. I agree.

      Trouble is the affordable housing advocates want ALL new housing to be affordable for the all the young tech people to be in only a select few locations: Valencia corridor, The Mission, Upper Market. That’s about it.

      They dare not even consider Oakland, East Bay or SF southern neighborhoods.

        1. I have no idea. Do you? the point is the entire Bay Area has to address the housing situation and do their share in creating more units. Affordable? not so sure. SF and the entire Bay Area will never truly be “affordable”.

          1. much of bay area is currently affordable. fremont, hayward, vallejo, petaluma, san leandro, etc

    2. Because the Mayor has no political power outside the city. The region does not act as a single political entity, beyond some very basic planning (e.g. plan bay area). Regionalism is, of course, the best solution. Imagine how well we could develop the areas around, say, San Leandro Bart, Colma Bart, etc etc. Take a look at how Arlington, VA did it with its Metro stations.

    3. Want to know why people don’t want to live outside San Francisco?
      I have two words for you:

      SamTrans.
      ACTransit.

      For all everyone complains about Muni, it is leaps and bounds better than the alternatives East and South. Try one of those transit agencies, and you’ll come crying back to Muni saying you’re so sorry you ever left.
      If you live in the Outer Bay Area (not San Francisco), and happen to be near a Bart station or a ferry terminal, then great. If you have to take a bus though, forget about it.

    4. Doesn’t state law *require* each city and county to address and provide for affordable housing within its boundaries – they can’t say “city X” or “county Y” will provide the region’s needs. The basis for this is the (arguably laudable) goal of not allowing wealthy environs to shirk their responsibility. But in a balkanized region such as the Bay Area – where the City / County of S.F. is barely the size of lower Manhattan – it’s patently illogical.

      We need an overarching planning and transit agency that’s empowered to override the concerns of every little local community – it’s ludicrous that every little Brisbane and Emeryville get to do their own planning, with no regard not only for the region as a whole, but not even for abutting jurisdictions.

  9. I like all the comments here. They all have varying degrees of merit within them. Particularly liked the regional stuff. It would be very practical if the housing affordability problem was considered regionally, but maybe Lee doesn’t want to be tainted by Quan or he doesn’t want to share any potential tax base. Some people may be doing that are there own…walking away from San Francisco to more affordable places in the Bay Area.

    To me it is mostly about the land and they aren’t making any more land for San Francisco. It will be hard if not impossible to get rid of the 40 foot height limit that exists in the residential neighborhoods.
    If Lee had some balls, he would swallow hard and make a choice, say this is a public emergency based on the grand jury report and give up some of the public land around McLaren Park, to low keyed, fairly low density development. Of course he would have to fast track it with the Planning Department, but I guess they would need to solve the Schlage development first….

    1. He cannot manage our own city bureaucracy and now you want him to be speaking to other fiefdoms?

      All the evidence you need that the process is dysfunctional is to look at the land use next to many BART stations

    2. And given that schlage and the HP Shipyard developments were like 10-15 year developments (and still barely started, much less completed) fast track in this city is a non term. Like I said above, it’s amateur hour with city gov.

    3. Maybe this is just a variant of the anti-Prop 13 diatribe, but if underdeveloped parcels and empty parking lots were taxed based on their fully-developed potential, instead of as raw land or a simple parking lot, then their owners would be strongly incentivized to actually build something beneficial to the urban fabric as a whole.

  10. This report makes it clear that Mayor’s Lee’s vision is just a bunch a hot air, and not a lot of substance. Most of the “prescriptions” ranted on here are not likely to happen or even increase housing production (e.g. repeal rent control, get rid of NIMBYs, move all the poor people out of the tenderloin from another thread). But there are clear actions Lee could take to make a difference:: redo west SOMA plan ASAP, prioritize surplus city land for affordable development (see reservoir on Russian Hill), push hard for upzoning transit corridors, streamline BRT on Geary, push Muni to develop land at Balboa Park, etc. But instead he just issues press releases and vaguely worded policy statements on the ballot. He is not willing to take on any of the city’s entrenched power interests to get stuff done – leadership from behind, by the blandest, most cautious, least bold mayor in years.

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