I told you this isn't rocket science (fight rising rent with more construction) (San Francisco: apartments, renters)

[bmw335xi]

If 10,000 people are trying to move to the city and you don't build nee units for them, then they will directly compete with existing residents, which spikes rent. I don't understand why so many here don't understand this. It's common sense.

Rent increases slow dramatically as increased construction catches up with demand - On The Block

[ssmaster]

I for one am heartened to learn that people making more than $150,000 a year won't be subjected to steep rent increases.
"These newly built rental buildings tend to target the top of the market, which is where Kunes says the competition for rentals has been “fiercest.” In a recent AppFolio survey, nearly 80 percent of San Francisco respondents making more than $150,000 said that competition from other renters was the worst part of the rental process. But this may begin to change with the increased inventory. “Additional supply at the top of the market is one factor behind the overall slowing of rental growth,” Kunes said."

[Oakformonday]

Originally Posted by ssmaster

I for one am heartened to learn that people making more than $150,000 a year won't be subjected to steep rent increases.
"These newly built rental buildings tend to target the top of the market, which is where Kunes says the competition for rentals has been “fiercest.” In a recent AppFolio survey, nearly 80 percent of San Francisco respondents making more than $150,000 said that competition from other renters was the worst part of the rental process. But this may begin to change with the increased inventory. “Additional supply at the top of the market is one factor behind the overall slowing of rental growth,” Kunes said."

Would you prefer that these people making $150k fight with each-other over apartments in the new shiny towers or is it better that they fight with each-other and the rest of SF over hovels? I'm honestly curious. Obviously if these high earners are going after the dumps the rest of us live in then they will win, right?

I've never understood the "Do not build and they won't come" crowd. Oakland housing activists are doing the same thing here. Not sure why they don't realize the results will be the same.

[ketch89]

Originally Posted by ssmaster

I for one am heartened to learn that people making more than $150,000 a year won't be subjected to steep rent increases.
"These newly built rental buildings tend to target the top of the market, which is where Kunes says the competition for rentals has been “fiercest.” In a recent AppFolio survey, nearly 80 percent of San Francisco respondents making more than $150,000 said that competition from other renters was the worst part of the rental process. But this may begin to change with the increased inventory. “Additional supply at the top of the market is one factor behind the overall slowing of rental growth,” Kunes said."

Ridiculous post. Housing units do not exist in a vacuum... If there isn't a luxury unit available for an upper class person to live in, they simply move into a unit that a middle class person might otherwise have lived in. The middle class person then moves into a unit that a lower class person might have lived in. The lower class person then either never moves out of their parents home, or picks up and moves to Texas. More supply at the top of the market keeps the cheaper units from rising in price.

[bodyforlife99]

Originally Posted by bmw335xi

If 10,000 people are trying to move to the city and you don't build nee units for them, then they will directly compete with existing residents, which spikes rent. I don't understand why so many here don't understand this. It's common sense.

Rent increases slow dramatically as increased construction catches up with demand - On The Block

Why does that matter to you? Didn't you say in a previous post that you live in Florida?

[ssmaster]

If the high end of the market is where all the frothy money is being made developers will NOT build any units for middle class and working class folks. Developers would rather pay a penalty than build units with a lower return on investment.This lack of new development in the lower end of market combined with rent control and owners deciding it is better to hold units off the market (estimated to be around 20-25%) means little benefit for less affluent renters.
You have to remember that not all new residents are affluent most are not if no one builds units for them competition in that market segment will not decrease.

[Oakformonday]

Very good point. There is no workforce housing being built. It is high end expensive or subsidized with nothing in between. I can't imagine how a middle class person can afford anything decent here now without spending 50+% of their income. I think it needs to be tackled on a regional basis. For example, can we make towns in the peninsula build denser housing or enough to accommodate all the jobs they allow to be created in their municipalities? I don't know. This is probably 50 years in the making. Since we cannot go back in time we need to think of what is needed now and what will be needed in the future.

[ketch89]

Originally Posted by ssmaster

If the high end of the market is where all the frothy money is being made developers will NOT build any units for middle class and working class folks. Developers would rather pay a penalty than build units with a lower return on investment.This lack of new development in the lower end of market combined with rent control and owners deciding it is better to hold units off the market (estimated to be around 20-25%) means little benefit for less affluent renters.
You have to remember that not all new residents are affluent most are not if no one builds units for them competition in that market segment will not decrease.

New units are not for middle and working class folks. They're NEW. New units are always more expensive than older units. Expecting shiny new units to somehow magically be priced the same as those built in the 1970's is absurd.

The construction of these new units makes older units more affordable, by reducing demand for them.

The challenge is building the type of new units that will gradually become more affordable over time, in the right locations. Glassy towers with gyms and rooftop terraces do not become more affordable over time (which is fine, luxury housing is a part of the market like any other). 4 to 7 story wood frame buildings do become more affordable over time, but only if they are located outside the city center. The implications are simple: we need to build as densely as possible in places that will never be affordable anyway (city centers, basically everywhere along BART from 24th Street in the city to Macarthur in Oakland), and overcome NIMBY resistance to the construction of 4-7 story wood frame buildings everywhere else.

[bmw335xi]

Originally Posted by Oakformonday

Would you prefer that these people making $150k fight with each-other over apartments in the new shiny towers or is it better that they fight with each-other and the rest of SF over hovels? I'm honestly curious. Obviously if these high earners are going after the dumps the rest of us live in then they will win, right?

I've never understood the "Do not build and they won't come" crowd. Oakland housing activists are doing the same thing here. Not sure why they don't realize the results will be the same.

Exactly... even if 100% of the new construction is only for millionaires, it's still better they are built so the millionaires can just move into these new buildings. The alternative would be them going after existing units, which will just encourage landlords to jack up rates and that's not them being greedy, but just smart.

[bmw335xi]

Some people are still missing the point... these people are going to move here regardless of whether or not their are shiny new apartments or condos. If they don't build new apartments and condos, these people will still move, which increases demand, which increases rent, which pushes out low and middle earners because the new people are offering landlords more money. They will come regardless, so at least the new construction is keeping most from having to compete with the average person already living here.