San Francisco’s Housing Crisis

San Francisco, the city of innovation, technology, and architecture faces a severe housing crisis. It is the geography, tech industry, zoning laws, and all the social and economic challenges combined that have brought the city's housing into its current state. In this post, I will unpack the many layers of this crisis, and we will delve deep into the impacts of the housing crisis to evaluate potential solutions. 

The Roots of the Crisis

1. Limited Land and High Demand

San Francisco has basic geographical problems: the city is surrounded by water on three sides, and the city cannot expand outwards. Combine that scenario with the explosive demand for housing and rapid growth in the tech industry and you get a mix of tens of thousands of workers for companies such as Google, Facebook, and Salesforce spread across the Bay Area, but concentrated in San Francisco.

The housing supply in San Francisco, however, has not kept up with this demand. The California Department of Housing and Community Development concluded that San Francisco needed to add 82,000 new housing units between 2015 and 2023 to meet demand––as of today, the goal is below 5% met.

2. Restrictive Zoning Laws

Zoning laws have exacerbated the housing crisis, with much of San Francisco zoned for low-density plots; this reality makes apartment construction difficult. Efforts to upzone—allowing for taller, denser buildings—often face opposition from residents who fear deflating property values. Additionally, the “Not In My Backyard” rhetoric has not only stalled many proposed housing projects but also prevented change from occurring. Even when projects are approved, the permitting process, a long that developers are discouraged from pursuing them. Below is a map that shows San Francisco’s zoning, and there are huge swaths of land used for low-density development. 

SF Zoning Map

What are the Effects of this Crisis?

1. Rising Rents and Displacement

This housing crisis has made San Francisco among America’s most expensive cities for housing. San Francisco, San Jose, and Oakland, all Bay Area cities, were included in the list of the 15 most expensive cities in the nation. 

In San Francisco, the average rent consists of a $3,300+ monthly cost for a 730-square-foot apartment, well above the national average of $1,748 for a 900-square-foot apartment. These unaffordable rents lead to emigration out of the city, especially among lower- and middle-class people. 

2. Economic Inequality

The housing crisis has worsened economic inequality in San Francisco. The city has a Gini inequality index of 0.5172 (the recommendation is <0.4), making it one of the most unequal cities in the US. This duality is shown in billionaires living almost alongside residents who struggle to afford necessities. 

Efforts to Address the Crisis

1. Legislative Measures

Recently, Senate Bill 9 took effect in 2021, permitting homeowners to subdivide lots to create more units, increasing the density of housing. Similarly, Senate Bill 50 was intended to encourage far denser housing near public transportation but failed to make it through after facing staunch resistance.

Policies such as inclusionary zoning have been brought into effect within San Francisco to promote the mandatory requirement of affordable housing in a new residential project, which a certain percentage of its units must fit. Critics, however, say that such measures are, at best, mild attempts against the problem.

2. Innovative Housing Solutions

Some organizations are using creative solutions to the housing crisis. For instance, modular construction reduces building times and costs, with companies like Factory OS and Bay Modular offering their product in the greater Bay Area region.

San Francisco is planning to convert underutilized commercial buildings into residential buildings through the Downtown Adaptive Reuse Program. Many districts along The Embarcadero, Market, and Mission Street are eligible for this program.

Finally, as always, feel free to leave a comment or some constructive criticism—feedback will help improve my future posts!

Bibliography

Baldassari, Erin. "San Francisco Needs to Build 82,000 New Homes. Where Could They Go?" San Francisco Chronicle, 1 Dec. 2023, www.sfchronicle.com/sf/article/san-francisco-housing-goal-19946190.php. Accessed 4 Dec. 2024.

San Francisco Zoning Map. California YIMBY, Sept. 2023, cayimby.org/wp-content/uploads/2023/09/SF-Zoning-Map.jpg. Accessed 4 Dec. 2024.

15 U.S. Cities with the Highest Average Home Prices. Kiplinger, 2023, www.kiplinger.com/real-estate/603612/15-us-cities-with-the-highest-average-home-prices. Accessed 4 Dec. 2024.

Average Rent in San Francisco. RentCafe, 2024, www.rentcafe.com/average-rent-market-trends/us/ca/san-francisco/. Accessed 4 Dec. 2024.

Miller, Angela. "50 U.S. Cities with the Most Income Inequality." Yahoo Finance, 4 Dec. 2024, finance.yahoo.com/news/50-cities-most-income-inequality-120128560.html. Accessed 4 Dec. 2024.

Adaptive Reuse Eligibility Map. San Francisco Planning Department, 2024, sfplanning.org/sites/default/files/documents/citywide/adaptive-reuse/adaptive_reuse_eligibility_map.pdf. Accessed 4 Dec. 2024.

Downtown Adaptive Reuse Program. San Francisco Planning Department, 2024, sfplanning.org/project/downtown-adaptive-reuse-program. Accessed 4 Dec. 2024.