After failed propositions, San Francisco housing crisis still festering

It was an election that symbolized the clash of San Francisco’s titans of technology with Bay Area residents who say they have been squeezed out of their city by the booming industry’s real estate appetites.

But in the David and Goliath match-up on Tuesday, with voters casting their ballots on a number of initiatives revolving around affordable housing, housing activists say Goliath prevailed.

The most prominent of the bunch was Proposition F, a measure that would have restricted the time that landlords could make their units available as short-term rentals through lodging websites like Airbnb. The measure’s backers say the phenomenon of short-term renting is contributing to the dearth of affordable housing in the city by taking rooms and apartments off the market for long-term residents. Still, the proposal failed resoundingly, 55 percent to 45 percent.

Proposition I, which would have halted the development of market-rate real estate in the popular and quickly gentrifying Mission District for 18 months while a plan was formulated to keep working-class residents in the neighborhood, was also rejected, with 57 percent voting against it. Meanwhile, the city’s tech-friendly Mayor Ed Lee, who opposed both measures, won re-election unambiguously.

Erin McElroy, a housing activist who runs the San Francisco Anti-Eviction Mapping Project, a data visualization initiative that illustrates how residents are being priced out of the city, said supporters of the measures were easily outgunned by moneyed tech interests. Airbnb, which is based in San Francisco, raised $8 million to defeat Prop F, papering the city with ads and billboards that touted the $12 million in tax revenue that it has generated for the city. Supporters managed to pull together only $800,000.

“Both of the initiatives lost largely … because the opposing sides have corporations and corporate interests backing them, which is a huge problem in politics,” she said. “It’s getting really outrageous.”

Housing rates have skyrocketed in San Francisco in recent years, propelled by the arrival of thousands of tech workers who are paid plush salaries and can keep up with rising rents. The median rent in the city crossed $4,200 per month earlier this year, according to Zillow, a real estate firm.  

Sara Shortt, the executive director of the Housing Rights Committee of San Francisco, a housing advocacy group, said Tuesday’s election results signaled a willingness by the city to accommodate its wealthiest residents, at great cost to its middle class.

“The priorities of the city right now [are] not to support middle-class people. It seems to support only millionaires,” she said. “I think that we could more easily accommodate working professionals and white-collar, middle-class families if we weren’t bending over backwards to accommodate those with enormous sums of money.”

There was, nevertheless, a silver lining for housing advocates. Aaron Peskin, a former member of San Francisco’s Board of Supervisors and a vocal critic of the mayor, reclaimed a seat on the board. And voters overwhelmingly approved a $310 million bond to build and preserve subsidized housing units.

Of course, not all Bay Area residents framed the election battles in the same way.

Enrico Moretti, a labor economist at the University of California at Berkeley, said that Prop F would not have altered the housing market in any meaningful way and that Prop I would have actually exacerbated the problem by driving down the supply of rental units. The real culprit driving the crisis, he said, was the slow process of developing housing.

“The No. 1 factor that’s responsible for the high increase in San Francisco is the land use process and the planning process. It’s the fact that it’s hard to add new units, and it’s been increasingly hard for 30 years,” he said. “All the academic evidence points to the fact that cities that are going through tech booms that have been more proactive in allowing new housing units tend to experience lower increases in rent.”

Moretti added that although the tech industry had been vilified by the “extreme left,” many residents appreciated its contributions to the city.

“There’s frustration at rising rents, but I think people also realize that having more jobs and higher-paying jobs tends to be a good thing for the local economy,” he said. “I think that tech is not as hated by residents as the media like to portray.”

Airbnb heralded the results as a victory for middle-class San Franciscans who are using the new home-sharing economy to pocket extra income to make their own rents.

“Tonight, voters stood up for middle-class families’ right to share their home and opposed an extreme, hotel-industry-backed measure,” Airbnb’s head of global policy said in a statement. “In this election, the Airbnb San Francisco home-sharing community became a movement, showing up at the polls in large numbers and voting overwhelmingly against an effort designed by the hotel industry that targeted the right of the middle class to use home sharing as an economic lifeline.”

Shortt said more was at stake if the city cannot find a way to alleviate the dire situation.

“San Francisco is no longer the crowning glory of the progressive movement … We have a lot of people still here fighting, certainly, but City Hall has become truly captive to Big Money interests over the needs of the people,” she said. “And the more that the not-uber-rich are displaced from this city, the more we will see the political patterns shift as well.”