Recently, I moderated a Commonwealth Club World Affairs panel, and when I asked several journalists if they thought the city would meet the state mandate of adding about 82,000 units by the deadline, the reaction was, essentially, that no sane person believes it will, and that the mandate is that the city get out of the way of such development, not that it actually take place. Mayor Daniel Lurie’s Family Housing plan would, at best, boost production by a small amount of that; are there plans for what comes next?
It’s one of the few things liberals and conservatives seem to agree on these days: No new housing near me.
As activists have gone bananas over a redevelopment of a San Francisco Safeway into much-needed housing, all of the usual complaints have been rolled out. The proposed building would replace a controversial grocery store and bring 790 much-needed new units to the city’s Marina neighborhood. But from the reaction, you’d think they were instead planning to build a nuclear waste dump manned by drug addicts and pimps. Lurie and Supervisor Stephen Sherrill reportedly oppose it, even though it is unlikely to be built in its currently proposed form. (Mission Local does a nice roundup of various city leaders and candidates who were asked about the project.) People complain it’s too big; it isn’t in keeping with the nebulously defined “character” of the neighborhood; that it’ll block their view of the bay. The old chestnut about how San Francisco should avoid “Manhattanization” has been replaced in this instance with opponents claiming it would lead to “Miamification.”
Those claims have always puzzled me, because they seem to imply “we all know no one would want to live in a hellhole like Manhattan (or Miami).” Except that people do want to live in both places; nearly 1.7 million people reside in Manhattan and it continues to grow, despite a dip during the pandemic; and Miami’s population has been growing by double digits.
What is it with San Francisco and California that makes for such inhospitable ground for housing development? Whether it’s luxury housing, middle class housing, or affordable housing, it is unwelcome. Forget about Manhattanization or Miamification; San Francisco’s powerful NIMBY forces have settled for Monaco-ification.
Forget about Manhattanization or Miamification; San Francisco’s powerful NIMBY forces have settled for Monaco-ification.
Writing in Governing, Steven Greenhut questions why, despite some major pro-development legislative and regulatory moves in recent years, the state’s housing production is still inadequate: “The California numbers certainly paint a dismal picture. Over the last decade, median statewide home prices have nearly doubled, from $476,000 to $877,000, as housing production has fallen short of projected needs by an average of 100,000 units each year.” In that case, “inadequate” is far too subtle. California is failing on housing production, and there are many culprits.
The libertarian Steven Greenhut points his finger at CEQA (the California Environmental Quality Act), which is used as a stalking horse by anti-development groups to delay, add cost, and even stop new housing. Gov. Gavin Newsom, who has only been in office for seven years, faults state government agencies and systems and says he has a plan for it. My former colleague at Affordable Housing Finance magazine, Donna Kimura, reports on a new study that shows that impact fees lard on almost $20,000 per unit to the costs of affordable housing development in the state; the fees could have instead funded an additional 5,000 affordable units but instead went to whatever the city agencies decided to spend it on.
High costs, virulent local opposition, built-in systemic tools for slowing down development — this has all helped create the failure of California housing. Former U.S. Representative and current gubernatorial candidate Katie Porter recently told Los Angeles KABC Eyewitness News “If California would build housing at the same speed that our competitor states do, we could take almost 20 percent off the cost of housing.”
Despite seemingly endless legislative and executive announcements claiming the state has turned the corner, it isn’t happening. Just as regulatory agencies get captured by the businesses they are supposed to regulate, California’s housing policy — which is supposed to ensure that Californians are able to live in decent housing in the state — has been captured by activists and grumpy old homeowners who don’t want change. “[F]or all the bill-signing hoopla, the state has witnessed too few new developments,” Greenhut wrote. “We’ve seen improvements around the edges, as San Francisco’s permit approval times have dropped, but overall the state’s housing market is as stubborn as ever. The Dallas-Fort Worth metroplex permits more housing than the entire state of California.”
You’re not going to let yourself get beaten by Dallas again, are you?