Blogger and programmer Eric Fischer has an excellent post up on his site where he looks at: “Employment, construction, and the cost of San Francisco apartments.” It’s worth a good solid read.
What he did was dig deep into whatever data he could find – the data goes back to the beginning of the 20th century in some cases – to try and figure out a solution to San Francisco’s housing affordability problem.
Many (including myself) have argued that, at least part of the solution, is to build more, not less, housing. However, others, such as Tim Redmond of 48 Hills, have argued that building more market-rate housing would simply exacerbate the current situation.
In Eric’s analysis, he looked at everything from median rents and new housing units constructed (above graph) to annual wage growth and income inequality. I particularly liked his summary of the city’s various building booms.
In the end, here’s the conclusion that he came to:
“In the long run, San Francisco’s CPI-adjusted average income is growing by 1.72% per year, and the number of employed people is growing by 0.326% per year, which together (if you believe the first model) will raise CPI-adjusted housing costs by 3.8% per year. Therefore, if price stability is the goal, the city and its citizens should try to increase the housing supply by an average of 1.5% per year (which is about 3.75 times the general rate since 1975, and with the current inventory would mean 5700 units per year). If visual stability is the goal instead, prices will probably continue to rise uncontrollably.”
By visual stability, he is referring to maintaining the current urban fabric of San Francisco just the way it is. In other words, he is making the link between preservation and affordability in a prosperous and growing city.
Intuitively, this makes sense to me. It’s unrealistic to think that you can maintaining some level of housing affordability without allowing supply to increase alongside demand.
At the same time, I do not believe that preservation needs to equate to no changes whatsoever. Urban preservation, to me, should be about dutifully respecting the past while still looking firmly towards the future. And that’s how I believe successful should be approaching this problem.
The folks over at City Observatory have recently developed something called The Storefront Index.
It is a mapping of “clustered” consumer-facing storefront businesses across the 51 largest cities in the United States and within a 3-mile radius of their CBD. (Their definition of cluster is that the business is located within 100m of another business.)
At the top of this list is New York (no surprise here) with 9,905 storefronts and at the bottom of this list is Detroit (probably no surprise here either) with 411 storefronts. On average, they found that the “typical” city has about 900 storefronts within this 3-mile radius.
Here’s a screenshot of New York:
Blogger and programmer Eric Fischer has an excellent post up on his site where he looks at: “Employment, construction, and the cost of San Francisco apartments.” It’s worth a good solid read.
What he did was dig deep into whatever data he could find – the data goes back to the beginning of the 20th century in some cases – to try and figure out a solution to San Francisco’s housing affordability problem.
Many (including myself) have argued that, at least part of the solution, is to build more, not less, housing. However, others, such as Tim Redmond of 48 Hills, have argued that building more market-rate housing would simply exacerbate the current situation.
In Eric’s analysis, he looked at everything from median rents and new housing units constructed (above graph) to annual wage growth and income inequality. I particularly liked his summary of the city’s various building booms.
In the end, here’s the conclusion that he came to:
“In the long run, San Francisco’s CPI-adjusted average income is growing by 1.72% per year, and the number of employed people is growing by 0.326% per year, which together (if you believe the first model) will raise CPI-adjusted housing costs by 3.8% per year. Therefore, if price stability is the goal, the city and its citizens should try to increase the housing supply by an average of 1.5% per year (which is about 3.75 times the general rate since 1975, and with the current inventory would mean 5700 units per year). If visual stability is the goal instead, prices will probably continue to rise uncontrollably.”
By visual stability, he is referring to maintaining the current urban fabric of San Francisco just the way it is. In other words, he is making the link between preservation and affordability in a prosperous and growing city.
Intuitively, this makes sense to me. It’s unrealistic to think that you can maintaining some level of housing affordability without allowing supply to increase alongside demand.
At the same time, I do not believe that preservation needs to equate to no changes whatsoever. Urban preservation, to me, should be about dutifully respecting the past while still looking firmly towards the future. And that’s how I believe successful should be approaching this problem.
The folks over at City Observatory have recently developed something called The Storefront Index.
It is a mapping of “clustered” consumer-facing storefront businesses across the 51 largest cities in the United States and within a 3-mile radius of their CBD. (Their definition of cluster is that the business is located within 100m of another business.)
At the top of this list is New York (no surprise here) with 9,905 storefronts and at the bottom of this list is Detroit (probably no surprise here either) with 411 storefronts. On average, they found that the “typical” city has about 900 storefronts within this 3-mile radius.
Here’s a screenshot of New York:
The idea is that this would replace various other social programs. But unlike traditional welfare, people would be allowed to work. If you happened to be making less than 2,500 Swiss francs per month, then you would simply get topped up to ensure you hit this minimum income level.
Supporters believe that a dramatic rethink of income redistribution is needed in our current information economy where income inequality is rising and productivity gains don’t seem to be getting applied evenly.
There is also an argument that a basic income guarantee could encourage more entrepreneurship. If we didn’t need to work, would more of us start a company and/or pursue our passions?
Personally, I’m not sure about an income guarantee. It’s difficult to predict the broader impacts. But it’s worth exploring and many people – are various ends of the political spectrum – are doing just that. (Additional reading material can be found here, here, and here.)
I haven’t made up my mind on this topic, so I would be curious to hear your thoughts in the comments below.
Image: CNN Money
And here’s a screenshot of Detroit:
They should be at the same scale.
If you’d like to read their Storefront Index Report, you can do that here. And if you’d like to explore their interactive maps, you can do that here. City Observatory has made all of this available as a free tool for city builders – which is really great to see. (You can even download their shapefiles if you’re into that sort of thing.)
The idea is that this would replace various other social programs. But unlike traditional welfare, people would be allowed to work. If you happened to be making less than 2,500 Swiss francs per month, then you would simply get topped up to ensure you hit this minimum income level.
Supporters believe that a dramatic rethink of income redistribution is needed in our current information economy where income inequality is rising and productivity gains don’t seem to be getting applied evenly.
There is also an argument that a basic income guarantee could encourage more entrepreneurship. If we didn’t need to work, would more of us start a company and/or pursue our passions?
Personally, I’m not sure about an income guarantee. It’s difficult to predict the broader impacts. But it’s worth exploring and many people – are various ends of the political spectrum – are doing just that. (Additional reading material can be found here, here, and here.)
I haven’t made up my mind on this topic, so I would be curious to hear your thoughts in the comments below.
Image: CNN Money
And here’s a screenshot of Detroit:
They should be at the same scale.
If you’d like to read their Storefront Index Report, you can do that here. And if you’d like to explore their interactive maps, you can do that here. City Observatory has made all of this available as a free tool for city builders – which is really great to see. (You can even download their shapefiles if you’re into that sort of thing.)
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