
Software was eating the world – now landlords are eating everything - Reedx
https://medium.com/@sbuss/software-was-eating-the-world-now-landlords-are-eating-everything-e21ba6802f54
======
thorwasdfasdf
This is a very good point that I wish would get more attention: "Politics is
an organizational problem, not a technological one.", "If we want to lower the
cost of living, the cost of housing, the cost of doing business in the Bay
Area, tech must get involved in politics."

People don't realize how conservative SF is: "The most innovative solutions
don’t matter when your government has been captured by interests that want to
freeze the city in amber" SF won't even allow companies to put more buses on
the road (something that would benefit everyone!)

This was news to me: "Support for More HOMES in San Francisco was even
stronger, at 74%. Despite this popular support, every member of the San
Francisco Board of Supervisors voted to oppose More HOMES, except for Asha
Safai and Vallie Brown " It seems that politics in SF doesn't represent the
majority view.

This is part of a much larger set of problems. As we continue into the future
all the tech problems get solved or already have been solved. What we're left
with is all the problems that can't be solved: those are all political. There
will come a day when instead of starting software companies, we'll be starting
companies that solve political problems.

~~~
ditonal
The engineer personality profile is basically allergic to organizing. Too
passive and introverted, or delusionally individualistic. Silicon Valley
engineers see themselves as temporarily embarrassed hotshot entrepreneurs. The
funny thing is to the extent engineers do organize it’s usually leftist
organization for the lower wage workers (tech workers coalition), which is
noble but doesn’t advance engineer goals. Police, teachers, doctors, all have
political organization and therefore voice but tech workers cede that voice to
their execs. I fantasize about changing that but I’ve come to accept the
personality profiles of engineers make it an impossible problem.

~~~
rexpop
I have goals. They pay me six figures, but I'm not on track to own a home
within biking distance of the office, and as an individual, I can't move the
office.

I don't get to control who owns my tech company, which means I don't get to
decide what our superordinate goals are. I don't get to decide who our
customers are. I don't get to decide the extent to which we participate in the
Military-Industrial Complex, or the Prison-Industrial Complex, each of which
threatened to destroy people like me.

Due to the constraints of office hours, my social development and creative
passions are extruded through a meager four hours before sleep—most of which
must be spent on trains, due to housing and transit limitations.

If you don't think tech workers are alienated, you're fooling yourself. It's
industry-standars to "burn out" every 3 years, and flee toxic, stagnant
positions for a fresh workplace. This tells me that firms are unaccommodating,
and foist the risk of personal development on us as individuals. That refusal
to accommodate us is precisely the inhumane factor fomenting alienation.

What you've "come to accept" is your own vitality's truncation.

Edit: people are downvoting me for saying "I can't afford to live near my work
or my friends"? Or because they're in denial of Tech's complicity in Military-
and Prison-Industrial atrocities?

~~~
nradov
I didn't downvote you for being dissatisfied with your circumstances. I
downvoted you for whining whine refusing to take responsibility for your
actions or take steps to improve the situation. There are cheaper places to
live and work.

The harsh reality is that we need a military and prisons, and there's nothing
inherently wrong with tech companies selling to those industries. While there
are occasional excesses and even criminal acts, those are best dealt with
through governmental channels.

~~~
rexpop
These are mere justifications of the steps I'm taking.

You don't know what steps I'm taking.

You assume I'm taking none, but actually I am taking drastic, radical steps in
light of these circumstances.

~~~
tempest345
So domestic terrorism then?

~~~
rexpop
No.

Edit: if you think worker-organizing to establish vehicles for collective
bargaining is domestic terrorism, then: yes.

------
paulsutter
"Choosing San Francisco in 2020 is like choosing Java in 2010... Proven, but
makes it harder to do simple things and doesn’t give you an advantage over
incumbents"\- Balaji S. Srinivasan

[https://twitter.com/balajis/status/1149073637325979648](https://twitter.com/balajis/status/1149073637325979648)

~~~
buboard
Interestingly , he lives and works there.

~~~
nostrademons
Also interesting what he suggests as the alternative - blockchain
incorporation, configurable nation states, and fully-remote teams.

~~~
buboard
I am also a fan of his YC talk
[https://m.youtube.com/watch?v=cOubCHLXT6A](https://m.youtube.com/watch?v=cOubCHLXT6A)

------
bayarearefugee
As someone who lived in the Bay Area and worked in SF for a while but moved
out because I didn't like the mono-culture forming from being surrounded by
virtually nothing but my own kind -- cry me a river VCs and early-stage
startups.

Maybe spread-out beyond SF & the Valley? There's a whole big world out here.

I'm not a huge fan of excessive NIBMYism, but the industry's inability to take
advantage of the entire rest of the world seems like a much easier problem to
solve on all fronts, and yet everyone takes it as a first principle that
everything must be done in this one place.

~~~
stjohnswarts
That's why I like living in Houston. Sure it's Texas but it's so much more
diverse here than most cities. And the food is wonderful.

------
pgreenwood
If the problem is that too much capital is flowing from productive
investments, like tech, to unproductive land speculation then perhaps part of
the solution is to capture part of that windfall gain through a land value tax
[1], i.e. a tax on just the land and not the buildings, thereby reducing the
speculative component from housing investment without reducing incentive to
develop more housing stock.

[1]
[https://en.m.wikipedia.org/wiki/Land_value_tax](https://en.m.wikipedia.org/wiki/Land_value_tax)

~~~
buss
You're right that a LVT would help, but the existing regulations prevent
people from actually redeveloping their land into more productive uses. When
it's illegal to build apartments in over 70% of San Francisco, that's the
first and lowest hanging fruit to pick.

~~~
pgreenwood
I agree restrictive regulation are a major part of the problem. But LVT would
have the effect of reducing prices even if stock were not increased, leaving
rents unaffected.

~~~
qwhelan
LVT is illegal in California due to Prop 13, so you'd need a constitutional
amendment to even consider it.

~~~
rcpt
Well let's get one then. Is it really that hard to put it on the ballot every
2 years? Only needs to pass once to undo 40 years of damage.

~~~
acdha
I was born around the time prop 13 passed and it wasn’t until I was in my
twenties that I realized _why_ everything had been obviously built like an
affluent society but crumbling due to lack of maintenance for as long as I’d
been aware of it.

One memory in particular was when the San Diego Union Tribune ran a picture of
new computers from one of those supermarket programs, sitting under a hole in
the roof because the district had been underfunded on maintenance for three
decades.

~~~
wasdfff
Building maintenace is the most readily glaring, but by far the worst aspect
of prop 13 passing is how much school districts were and still are defunded.
Untold damage to 40 years of students.

~~~
acdha
I’m also curious how it’ll work for hiring new teachers: they’re usually
offered worse wages than the retiring boomers saw at the same point in their
careers and the housing market is much worse.

~~~
Decade
It’s working poorly.

All the school districts near me have chronic teacher shortages, and there’s
tremendous teacher turnover. Occasionally a teacher will go homeless before
leaving for a district with lower cost of living.

A prominent neighborhood activist has switched from NIMBY to YIMBY because his
wife was recruited on an emergency basis to teach high school English without
a teaching certificate, and has been teaching for the past several years.

All the teachers I know of my age are living either with parents or with their
parents’ financial assistance.

The one mitigating factor is that young parents are having difficulty
affording this region, so schools are starting to close and not need any
teachers anymore.

------
dreamcompiler
The United States has over nine million square kilometers of land area. Why is
the most portable industry in the world (software) being held hostage by a few
square kilometers along the coast of northern California?

~~~
gumby
This topic has been discussed endlessly over the last 40 years (both by local
social scientists and people trying to reproduce Silicon Valley elsewhere).
The short answer is “it’s a just so story commingling schools, openness,
military boom...”.

One thing to notice is that plenty of industries have followed this pattern
until they became mature (cars, breakfast cereals, aircraft to some degree).
And you see this in software: the pressure discussed is at the frothy end of
the market.

~~~
iso-8859-1
I couldn't parse:

> it’s a just so story commingling

Explanations:

In science and philosophy, a just-so story is an unverifiable narrative
explanation for a cultural practice, a biological trait, or behavior of humans
or other animals. The pejorative nature of the expression is an implicit
criticism that reminds the hearer of the essentially fictional and unprovable
nature of such an explanation.

com·min·gle: mix; blend

~~~
noneeeed
Thank you. I couldn't parse that comment at all. This is where a few quotation
marks (or hyphenation) help, so either just-so-story, or "just so story".

------
Mikeb85
And Thomas Piketty was right...

Also, this isn't exactly a revelation for those who are in businesses that
hinge on physical location (retail, restaurants, etc...). Landlords provide
little of value, in most cases did nothing to earn their money (around here
the landlords in downtown business districts are the descendants of those who
owned that property 100+ years ago) and merely act as parasites.

In the case of those who own residential properties, they merely bought at the
right time, and due to the scarcity of land are earning far more than whatever
value they're providing.

~~~
nf8nnfufuu
If it is such an easy way to make money, why doesn't everybody simply buy some
land. You can pool resources if as an individual you can't afford it.

~~~
nikanj
The returns are 1% of capital invested, if you invest the $50 million needed
to buy a well-located lot today.

If your grandfather bought the same lot for $600 in 1922, the returns today
are quite something.

It’s very hard to become a large-scale land owner today, unless you happen to
own a time machine.

~~~
nf8nnfufuu
You don't have to be large scale to earn rent.

And why not buy something today that can be worth millions for your
grandchildren?

Because it is not so easy, after all.

So you think it is unfair that somebodies grandfather bought land, and it
appreciated? Do you think ownership in general is unfair, or what exactly is
the unfair part?

~~~
wasdfff
I think its unfair that the source of these gross profits is due to limiting
supply to the market and avoiding as much tax burden as possible. Fair would
be if anyone could build anything anywhere however high and were taxed
according to todays value. Real estate is not a free market, demand is massive
and building supply is continually opposed to keep prices high.

~~~
nf8nnfufuu
Nevertheless, if the rules were known in advance, it seems the game is fair.

For example if you ponder buying a plot of land, presumably the rules there
would factor into your decision. If there was already a rule of "no
skyscrapers", then everybody could have factored that into their decision.

It would likewise be unfair to change rules after the fact, because it would
devalue people's investments.

As for tax rules, I can't comment. But that is a fault of the government, not
of the landlords.

~~~
nikanj
[https://www.nytimes.com/interactive/2016/05/19/upshot/forty-...](https://www.nytimes.com/interactive/2016/05/19/upshot/forty-
percent-of-manhattans-buildings-could-not-be-built-today.html)

Alas, mostly the rules have changed quite a bit to favour the incumbetents and
the grandfathered-ins

~~~
nf8nnfufuu
and who gets to change the laws? If it is the current residents at the time,
maybe that is fair, too?

------
buss
Hey all, I wrote this! Feel free to email me at steven.buss@gmail.com with any
questions or comments. Also if you have a few bucks to spare for my campaign,
please donate at [https://buss2020.org/donate](https://buss2020.org/donate)

~~~
dredmorbius
Steve, thanks for tackling this and popping up.

This past January, the Commonwealth featured a panel on Bay Area housing
crisis, featuring Pastor Paul Bains, Fred Blackwell, Priscilla Chan, Janet
Liang, Jennifer Martinez, and Erika Aguilar -- an impressive, intelligent, and
motivated group of experts.

[https://www.commonwealthclub.org/events/2019-01-24/bays-
futu...](https://www.commonwealthclub.org/events/2019-01-24/bays-future-new-
solutions-housing-crisis)

What floored me, and several friends I shared this with, though, was the
collective response that there was no single silver bullet, no way to throw
money at the problem to solve it. Which betrays an immense ignorance or denail
of San Francisco history.

Henry George's Land Value Tax is not only a concept that was developed in (and
concerning) San Francisco, but literally _raises money from the crux of the
problem_ at the same time it solves it, by creating an effective incentive to
increase density. Very simply put, San Francisco and the rest of the Bay Area
_must_ grow their way out of this mess, and if they don't, other areas will,
and are.

And it's not just about outsiders -- it's SF and Bay Area natives who are and
have been priced out and forced out of the area, and present residents who
will find themselves and their families -- elderly parents, young children --
facing similar fates.

And yes, I'm aware that Proposition 13 is political kryptonite, but it's also
increasingly _economic_ kryptonite, killing off what once made California an
attractive and viable place to be. Though I've known of the initiative for
decades, it's only in recent years I've realised just how toxic it truly is.

I've also become increasingly aware of the economic toxicity of the tendency
toward and incentives for asset inflation, most especially of real productive
and essential assets -- land, housing, education, healthcare, essential
utilities. Some of the most interesting research on this was conducted in the
1930s and 40s by Bernhard J. Stern, for example "Resistances to the adoption
of Technological Innovations" (1937). He traces the practice across numerous
innovations, from printing and transport to energy and, yes, housing, naming
some very familiar names and tactics. (The post-WWII suburban boom broke the
logjam for a time. Oh, and you may have heard of his research assistant, a
student named Isaac Asimov.)

[https://archive.org/details/technologicaltre1937unitrich/pag...](https://archive.org/details/technologicaltre1937unitrich/page/39)

Markdown/text:
[https://pastebin.com/raw/fZajYSGa](https://pastebin.com/raw/fZajYSGa)

You're absolutely correct that this isn't a technological problem. It _is_ an
organisational one, and a political one, and pits families and the working
class against homeowners, banks, investors, and landlords. And it will destroy
California, if it hasn't already.

~~~
buss
You're right about everything. A LVT would go a long way to solving our
problems, but it must also be paired with dramatic zoning reform to actually
allow land to be redeveloped into a higher use. Doing that is illegal in the
vast majority of San Francisco and the Bay Area at large.

Opposition to Prop 13 is building, and I think we will see meaningful reform
within 10 years. Hopefully full repeal within 20. But this is an even bigger
political lift than fixing our broken Bay Area governments.

If you haven't already, check out
[http://thecommonssf.org/](http://thecommonssf.org/), an org based in SF
that's centered around LVT.

~~~
dredmorbius
The trick with LVT may be to find an alternate form of it that skirts Prop-13
restrictions, in the meantime.

As for zoning, that's likely a chicken-egg issue, but once holding
nonproductive land becomes nonviable, reversing restrictive zoning may become
far more tractable.

Alternatively, cracking the nut _outside_ SF (and yes, I realise you're in the
City) might be an option, where if a sufficient alternate jobs-and-housing
magnet were formed, SF would be forced to follow suit. Not my first choice,
but I'd take it.

Tackling this as a strategic "having defined our point B, how do we get there
from A" question, and finding the least-cost path seems the right approach.
Finding examples of other areas which have successfully tackled the problem is
another.

~~~
deepakhj
We also need to find a way to crack the nut in the city. Soma is the only
place with any movement.

~~~
dredmorbius
The challenge I see is that tackling the asset-protecting interests head on
may be too great a challenge.

As a comparison, California in the 1950s represented an alternative to
challenging development-averse and innovation-averse practices in points East
-- New York, Boston, Chicago, Detroit, and other established centres of
population and industrial power.

Rather than fight on home turf, innovation packed up and headed West. A
classic example being RAND Corporation, which literally loaded a train with
researchers and families and headed to the (then cheap) locale of Santa
Monica, CA.

The history of research and academic centres as being _adjacent_ but _removed
from_ centres of commerce and power is a long one, dating back to Plato's
Academy, an eponymous grove about a 30 minutes' walk outside Athens, then
centre of the Western world.

I've been diving a bit into the history of major research laboratories, such a
DuPont, Kodak, AT&T, IBM, Xerox, and others. Similar trends. The Manhattan
Project is an extreme case, with additional constraints (secrecy, not
disturbing the neighbours).

------
tinco
If you think paying $1 for every $8 in funding for housing is too much, just
move to a different city? Apparently San Francisco is worth it, if it wasn't
VC's would have stopped funding startups in SF a long time ago.

There's a bunch of graphs showing rents increase, but no real reason for why
that's a bad thing. The big number that's supposed to sway us is the rent
increasing by 30%, as funding increases by 300%. Maybe there's better numbers
somewhere else, but this just tells me rents are not really a problem, at
least for the tech industry.

And the solution? It's just build more houses, so the rents go down (a
little). Do you really want more houses? The NIMBY people don't seem to.
Infinite high density cities aren't all necessarily the best thing. Maybe if
you think too much money is disappearing in these wealthy people's vaults,
raise taxes?

~~~
cortesoft
I don't think it is necessarily as simple as just, "build more housing".

Rent costs are complicated. A big part of the reason that SF housing is so
expensive is that it is so desirable to live and work there. Companies want to
be there because that is where the talent and capital is, and talent wants to
be there because that is where companies and capital is, and capital wants to
be there because that is where the companies and talent are. High cost is what
keeps some companies/talent/capital away DESPITE the benefits of being in the
area... but if we lower real property costs, MORE companies/talent/capital
will want to be there and the cost saving won't persist. There is latent
demand ready to fill up any extra housing you build.

There have also been studies that ask this same question, and they have found
that opening up housing development in high rent areas just means developers
build more luxury living places, and costs don't go down.

[https://www.citylab.com/equity/2019/05/housing-supply-
home-p...](https://www.citylab.com/equity/2019/05/housing-supply-home-prices-
economic-inequality-cities/588997/)

~~~
closeparen
San Francisco's desirability is not skyrocketing the way its property values
are. The views and weather were there in 2011 too, when things were at half
their current level. And of course making it cheaper means making it
accessible to more people; that's the point.

~~~
nf8nnfufuu
If desirability is not skyrocketing, why are people prepared to pay the
property prices?

It is not views and weather, it is access to the startup environment, venture
capital, tech talent and so on.

~~~
rficcaglia
And some speculation. I see first hand a lot of high end apartments bought
that sit vacant. Maybe the owners live in Asia or EU 9 months of the year, I
dunno. But in some of the swanky towers downtown there are entire floors with
at most one owner present year round.

~~~
nf8nnfufuu
In a normal market, I suppose speculation would help increase supply - by
driving prices up, it would become more attractive to build. Of course if no
building is possible, that won't work.

Nevertheless, there has to be a ceiling to the prices. If no space for living
is available, eventually the tech companies won't be able to grow further
because they can't hire more people.

------
blunte
Do we honestly believe that the landlords eating everything are not related to
the VCs?

No VC worth their salt would be ignoring the enormous potential that lies in
investment property... especially if their own VC funds can feed back to them
as rental income.

And in the extremely unlikely case that financiers aren't also the
landlords... well nevermind. They are smart people; there's no way they are
ignoring this opportunity.

------
diogenescynic
So end zoning restrictions and build more. It’s just a supply issue. We
haven’t sufficient housing for decades as demand has increased, pushing up
prices. I think locals know exactly what they’re doing and are fine with it
since their homes are likely a significant portion of their net worth.

------
mikhailfranco
See my old comments:

 _" Startups are ways of exploiting geeks to work hard chanelling money from
VCs to local landlords."_

[https://news.ycombinator.com/item?id=18863824](https://news.ycombinator.com/item?id=18863824)

Do not feed the landlords.

Just don't live there.

------
rogerkirkness
Very tall buildings are technology. People don't like them, but they are the
only way to make cost of living cheaper in terms of housing and offices. In
cities where lots of very tall buildings are going up, rent is going up much
slower or not at all. In cities where that isn't the case, it's increasing as
population and wealth grow. Building vertically is the only way to prevent if
from being zero sum.

~~~
Retric
You can get high density without very tall buildings. On street parking for
example has a huge impact on density. As do wide streets, parks etc.

~~~
rewgs
A city that starts getting rid of parks is a city I’m not moving to.

------
afinlayson
At some point the bay area will have to become a 1 giant city, instead of a
bunch of little nimbism towns.

Soon, we'll all live in Bay City!

~~~
klipt
Turns out the reason this hasn't already happened is because the CA
constitution forbids cities crossing county borders:
[https://hoodline.com/2017/03/that-time-san-francisco-
tried-t...](https://hoodline.com/2017/03/that-time-san-francisco-tried-to-
annex-oakland-berkeley-and-most-of-the-bay-area)

~~~
afinlayson
That's fascinating, Maybe there can be a megacity that spans multiple cities
or something like that.

Oakland and SF makes less sense than SF and SJ imo, because there's no space
between them. At least Oakland has the bay.

------
stjohnswarts
Politics in SF are so corrupt that it's laughable. The city is going to have
to start rezoning soon or something is going to snap and companies will move
away or the best people will decide it's not worth the hastle and go to other
parts of the country and start their own startups.

------
paulddraper
It took a minute before I realize this was a San Francisco article; all the
numbers and discussion are specific to that one area. (I'd suggest reflecting
this in the title.)

There must be some truly special about SF to be so hated...and yet apparently
so loved.

~~~
cm2187
You can make the very same argument about London

~~~
sremani
do not worry, London will be its own shell 5 years after BREXIT.

------
Apes
Not a major deal, but the $1 in $8 calculation is a bit off, since it doesn't
take inflation into account. The math still holds for the most part.

Adjusting for inflation and rerunning the same calculations:

* $2,600 -> $2,902.47 -> 2011 median rent adjust to 2018 dollars

* $3650 - $2900 = $750 / month increase in rent.

* $750 / .69 = $1086 / month increase (pretax)

* $52000 -> Increased yearly burn for a 4 man startup.

* $208000 -> 4 year pre-tax burn

* $208000 * .69 = $143520 -> 4 year amount to land owners

* $500,000 -> $558,166.51 -> Average seed round in 2011 adjusted to 2018 dollars

* $2.1M - $558K = $1.5M -> Increase in venture funding

So $143K / $1500K goes to Landowners, which is $1 in $11, not $1 in $8, or 30%
less than originally calculated.

~~~
jurassic
Few landlords are paying full marginal income tax on their rental income
because of the numerous tax advantages of property ownership (mortgage
interest, depreciation, etc) that reduce their tax liability. Variation in the
tax situation of different landlords makes it a pretty misleading thing to
include in the analysis. Besides, how the landlord and the government divvy up
the rent money doesn't make any difference to the startup that needs to pony
up $208,000 more dollars. Whether rental income is taxed at 0% or 100%, the
cost to renters and startups is a large and growing problem.

------
glangdale
So - I'm broadly supportive of the whole YIMBY thing, but I have to ask this:
given how dysfunctional state and local governments have been here, are they
capable of managing the giant influx of people that would result from a
massive rebalancing of policy towards adding more homes?

Here in Sydney we've had _absolutely no problem_ managing to flood the market
with apartments, but there's been a substantial disconnect in terms of funding
and regulation to provide transport, education, healthcare and green space for
all those new people.

~~~
foobar1962
I'm glad this angle has been brought up. (I'm in Sydney too, not that that
really matters.) Its one thing increasing housing density; it's another
providing services (particularly basic ones like water and sewer) and
maintaining a quality of living.

It's like, you could fill your bedroom with 4 or six beds, but there won't be
enough bathrooms, living rooms, the house internet speed will degrade... it
won't be a nice pace to live.

At some point it's sensible to go somewhere else.

Now, about Sydney in particular and Australia in general: we are dry, don't
get much rain, most of the continent except for the costal strip is arid and
infertile, and that's where something like 80% of the population live.
Sydney's water supply is limited and there are only so many people the water
resources can supply reliably (we nearly ran out several years ago, and we
currently have level 1 water restrictions in force now). That population is
much smaller than the number of people that can be housed on the land in high
density developments.

------
xster
I think this might have been shared in HN at some point in the past but

[https://www.collectorsweekly.com/articles/demolishing-the-
ca...](https://www.collectorsweekly.com/articles/demolishing-the-california-
dream/)

was a super fascinating article depicting local zoning as a social shaping
tool all the way back to the 1800s.

------
JDiculous
This is honestly one of the reasons why I left NYC. It's not that I couldn't
afford to live there, I'm just against paying exorbitant rents in principle,
supporting an aristocracy class receiving money for doing nothing.

Same thing with student loans. Feels like the mafia is taking $1.2k/month of
my paycheck. I figured I'd rather just opt out than participate in this
extortion.

It's funny how tech, by definition the most technologically industry, is so
backwards when it comes to things like remote work. But VCs by definition are
so wealthy that they have more money than they know what to do with, so
there's no real incentive for them to change the status quo until it's
disrupted underneath their feet. It's like the whole "nobody ever got fired
for IBM" trope.

------
dustfinger
What is the origin of the meme "X is eating the world?" I seem to see these
titles posted fairly regularly now.

~~~
traek
Marc Andreessen's famous "Why Software Is Eating The World" article in the
WSJ.

[https://www.wsj.com/articles/SB10001424053111903480904576512...](https://www.wsj.com/articles/SB10001424053111903480904576512250915629460)

~~~
dustfinger
Thank you!

------
kazinator
Funny; a sentence bemoaning "unearned rent" immediately following one ending
in "capital investment".

~~~
buss
I mean... investment in productive activity is the opposite of rentier
capitalism.

~~~
kazinator
The productive activity itself is clearly that opposite.

------
vgetr
I agree with the problem (“wanting to freeze the city in amber”), but not the
solution, at least as the author wants to implement it. The solution would be
to deregulate housing (rent control, etc) and let scarcity take over. Yes
it’ll be painful for a couple of years, but when all the people who can’t
afford to work at the Starbucks leave the city, people are going to start to
notice. Wages and home building would shoot up to meet the demand, and things
would ultimately level off. This will never happen in SF (the quasi-regulated
NIMBYism the author describes seems par for the course), but we’d see some
fast results if it did.

~~~
memmcgee
Except the supply here is necessarily constrained by the amount of land
available to build on. You're treating this like microeconomics 101, which is
a fundamentally flawed way to look at the problem.

~~~
bhupy
That's not true at all.

Nearly 75% of land in San Francisco alone is zoned for low density single-
family or duplex homes. 37% of it is just for single-family homes alone. [1]

Nearly 98%(!!) of land in San Jose is zoned for single-family homes. [2]

Replacing every ~10 single family homes with even a 6-7 story apartment
building can easily increase the supply necessary to reach equilibrium, and
that's ignoring the fact that you can build affordable apartments that are >20
stories (see: Long Island City, New York).

[1] [https://www.latimes.com/politics/la-pol-ca-single-family-
zon...](https://www.latimes.com/politics/la-pol-ca-single-family-zoning-
changes-senate-bill-50-legislation-20190513-story.html)

[2] [https://haasinstitute.berkeley.edu/single-family-zoning-
san-...](https://haasinstitute.berkeley.edu/single-family-zoning-san-
francisco-bay-area)

~~~
DrScump

      Nearly 98%(!!) of land in San Jose is zoned for single-family homes
    

You misquote your source (it says that NYT says that it is 94%, but that's
hogwash given that far less than that is zoned for _any_ form of housing). The
referenced NYT article doesn't annotate a source.

More likely, the data says that 94% of _precincts_ have at least one single
family home.

 _Well_ over 10% of _land_ is rights of way (e.g. streets, watersheds, etc.),
easements, or is public property.

~~~
muzz
The link seems to indicate 94% _of residential land_ in San Jose is zoned for
SFH.

But even that could be misleading, since San Jose has massive city boundaries
that includes hills and other places that really couldn't be built on
regardless of what they were zoned for.

------
timwaagh
One out of eight money units sounds pretty reasonable. I think I capture more
than that from the college students who rent with me. But actually property
developers do have the option to go outside the law, just like uber. Or maybe
not them, but people do anyways. The only way to force political action is
actually by ignoring the rules. Building dwellings where they should not
exist, using non residential space inappropriately, etc. Build your own slum.
People will become homeless if government evacuates them and finding these is
hard. so government doesn't like to and cannot do very much.

~~~
Decade
People tried. The regulators catch up and fine away all the profits and force
the owner to revert the property back to what the law allows.
[https://www.sfgate.com/bayarea/article/SF-sues-landlord-
over...](https://www.sfgate.com/bayarea/article/SF-sues-landlord-over-state-
of-housing-for-9196374.php) [https://www.sfexaminer.com/news/planning-
commission-supervis...](https://www.sfexaminer.com/news/planning-commission-
supervisors-condemn-landlord-for-unpermitted-student-housing/)

I get the impression that a lot of the innovation that tech companies have
been able to create were because the regulators didn’t know what they were
doing. No such luck in real estate.

------
buboard
Tech companies create software. Software does not require an office. All tech
companies could be remote. VCs may have their reasons to make landorlds rich.
Software will still be eating the world.

~~~
muzz
Software does not require an office, but the people who create do. And
ironically, they work best and most collaboratively in the same place at the
same time. This is why cubicles were replaced by open office desks, why
companies hire in the expensive Bay Area, and bus their employees to central
locations.

------
everyone
So, San Francisco = the world? That is pretty amazingly blinkered.

------
slang800
> We’ve shifted the Overton window.

That is hyperbolic. Housing development was never outside the realm of
acceptable public discourse, it was just less popular.

~~~
buss
It absolutely has been outside the realm of acceptable political discourse.
Jane Kim, who ran for mayor in 2018, said "The only way to make San Francisco
more affordable is not by building a lot more market rate housing as possible,
it’s by building as much Affordable and middle-income housing as possible."
[https://medium.com/@sbuss/no-on-
kim-58ef07cf459a#1379](https://medium.com/@sbuss/no-on-kim-58ef07cf459a#1379)

We still have electeds who say it's not a shortage, but an affordability
problem. They literally do not believe that building more market rate housing
will help.

We almost passed a development moratorium in the Mission in 2015. Public
opinion has swung fast in our direction.

------
foobar_
This is actually called rentier capitalism. There is no glorious competition
that happens here. You sit on some asset and generate perpetual revenue from
it. Patent trolls blatantly abuse this.

Money is just data if you think about it. How does it flow? What is the
government but a gloried issue tracker to deal with the tragedy of the
commons?

~~~
nf8nnfufuu
So buy some land, if it is so easy.

------
karmakaze
...in SF

This issue is localized and not comparable to the pervasiveness of software.
Other cities' startup economies will continue to grow and this will be less of
a hotspot problem. [Funny in the context of distributed systems, SF is a hot
DynamoDB shard and paying the excessive scaling fees.]

------
Grakel
I think this is all missing the real issue by a mile: greater density would
change the city. Those who don't want that have enough power to stop it.
Prices start dropping the day after tech companies realize there are other
cities that would love to have them.

------
beefcake
Here's a disruptive thought: Why not relocate?

~~~
muzz
Have market participants somehow not considered this?

------
newshorts
It would seem for every new house you build, you would convert a YIMBY to a
NIMBY.

------
HillaryBriss
the YIMBYism, the pro-tech business mentality, the emphasis on growth, the
anti regulation perspective -- all these things make me think a little bit of
Houston Texas or Ronald Reagan or the Chamber of Commerce or something.

------
smikhanov
The rent is just too damn high!

------
im3w1l
> tl;dr: Landlords are taking $1 of every $8 in venture capital investments

That's lower than I expected. Wouldn't be surprised if that's sustainable.

------
echan00
Welcome to Hong Kong

------
Hnrobert42
Move.

------
WheelsAtLarge
This is a social problem. Tech will only get in the way. Remote work is
available now but it has not put a dent on the problem. The solution falls on
policy change, city planning and politics.

Tech is a tool towards a solution not the solution.

~~~
etjossem
By "tech" is meant "the community." You can't get policy change without enough
people getting involved and supporting that change. Do you want to fix this?

Join YIMBY Action. Support pro-housing candidates at the polls. Tell your
friends.

~~~
WheelsAtLarge
We in tech or the tech community live in a world where everything has a solid
yes or no answer there are very few grays. The rest of the world is not like
that. It's full of grays and they change constantly. If I can pick between a
great politician or a great Techie to lead a community I will always pick the
politician. They can lead a group of people. Techies can come up with the
right answer given solid facts but that's not the real world.

