The fundamental flaws in Mayor Lee’s housing plan

By Calvin Welch : 48hills – excerpt

Click your heels three times, trust in the magic of the free market, and  you get a lot less affordable housing that the city needs

SEPTEMBER 11, 2015 — On September 8, Mayor Lee, embracing the “magic of the market place” one more time, announced a plan that he claims will “meet” (“or exceed,” he seems unclear) “10,000 permanently affordable homes” by 2020.  This is second time Mayor Lee has committed to a specific number of affordable housing units to be built by 2020. The first was in his 2014 State of the City speech in January, 2014. While the final number of units has remained consistent — some 10,000 affordable units of 30,000 to be built — the income levels to which they are affordable has shifted upwards…

In the State of the City speech, he said that the 10,000 would be affordable to “low and moderate income families,” which is an insiders phrase that means 20%  to 120% of Area Median Income — or from $16,000 to $85,000 for the average two- person San Francisco household.

The September 8 speech included a new category — “special middle income” — which was not defined. Some 5,000 of the mayor’s 10,000 units were to be in this new category. Assuming that this is a price point above 120% of median, his announcement was actually a 20% REDUCTION in the affordable housing goal set in his 2014 State of the City speech, a fine point missed by press reports. 

Moreover, those can be built only with city money — neither the state nor the federal government will financially assist housing above 120% AMI — making them the most expensive subsidized housing in the city’s inventory

Newly constructed housing makes up only about one third of the total number of residential properties sold a year in San Francisco.  The other two thirds are existing homes.  Believing you can affect price with only one third of the market is why this naive (or cynical) belief is not rational.  About 14 square miles of San Francisco is zoned for residential development, and it’s all been developed.  New construction often means either demolition and/or  displacement of existing residents…

A more rational basis upon which to rest a truly effective affordable housing policy takes them both into account.  It is not based on the trickle-down-magic-market-place nonsense of granting a “density bonus” to developers to build housing that is two-thirds market-rate and one-third “special middle income.” Instead, a rational approach is based on policies that actually seek, through local ordinances, to preserve existing housing and developable sites, at current San Francisco densities (this is the second-most dense city in the United States).

Three measures on the November ballot seek to do exactly that: Proposition I, the Mission moratorium and affordable housing plan; Proposition F, the affordable-housing preservation regulation of short term rentals conversions, and Proposition K, the requirement that city-owned land be earmarked for 50% affordable housing if declared surplus and sold for housing development…

The “magic” in Lee’s embrace of market-rate housing development is how it produces political contributions to him and his allies.  For the rest of us, it’s evictions and displacement.  It’s the way the new San Francisco rolls… (more)

Very good description of what we feel is going on and why the Mayor’s housing plan is flawed. Thanks Calvin.

For anyone who wants to know what happened with the property height limits voted in under Prop M we have posted some explanations by the authors of Prop M and the attorney who ultimately lost on appeal at the California Supreme Court. There are a series of clips here: https://metermadness.wordpress…


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