Current Events > Landlords Get in the Way of San Francisco Offering 90% of Its Homeless Shelter

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Humble_Novice
10/22/23 12:05:22 PM
#1:


https://www.yahoo.com/finance/news/san-francisco-could-90-homeless-090000070.html

Most cities have homeless problems and lots of vacant housing units, but everything is magnified in San Francisco. Last year, there were 7,700 people living in shelters or on the street in the city by the bay, according to city figures. Meanwhile, there were more than 60,000 vacant units at the end of 2021, according to a policy analysis from last fall, although that figure included newly built apartments and those awaiting sale. Enter the vacant home tax.

This week, San Francisco formalized a voter-approved law, also known as Proposition M, to crack down on owners of multifamily units that let them sit vacant. The law, which goes into effect in January, could push as many as 7,000 units on the market, according to city estimatesthat would be literally 90% of the city's homeless getting housed, based on the above data. Problem solved?

This could be a big deal for a city of less than a million that has become the face of modern fears of a 1970s-style doom loop given its endemic homelessness, ever-present cost-of-living crisis, and famously dysfunctional housing market. But real-estate interests are already fighting the law in state court, claiming their right to not rent their property is enshrined in the Constitution.

The primary purpose of the law is to fill empty homes, supervisor Dean Preston, the laws chief backer, told Fortune Friday. Holding housing off the market for a long time, when there are people who need housing, is bad for our city, he said. Our hope is that [the tax] is enough to change the decision making of the real-estate speculator or the owner of the property.

Sometimes, developers have a strategy of buying buildings, removing longtime tenants, and then reselling at a profit, Preston said. More recently, some new constructions have failed to sell units amid a market slump, creating zombie buildings, the San Francisco Chronicle reported last month.
We have a situation where we have thousands of people living on the streets homeless, and tens of thousands of units being held off the market, Preston told Fortune. We have buildings in my district that have been empty for years.

The tax, which is rather narrow, would apply to between 4,400 and 7,300 units, according to an estimate from the citys budget analyst. Also known as Proposition M, it exempts single-family homes, duplexes, short-term rentals, nonprofit and institutional housing, such as nursing homes, as well as any apartment used as a primary residence. It also allows for additional time for new buildings awaiting an occupancy certificate or that are rendered uninhabitable by natural disasters.

While a handful of cities, including neighboring Oakland, Washington, D.C., and Vancouver, have passed some form of vacancy taxes, Preston believes San Franciscos is the most aggressive in the country. And several groups representing landlords, including the San Francisco Apartment Association, Small Property Owners of San Francisco Institute and the San Francisco Association of Realtors sued the city in February, claiming the law violated their constitutional rights.

The United States Supreme Court has repeatedly held that property-owners power to exclude [others from the property] has traditionally been considered one of the most treasured strands in an owners bundle of property rights, the lawsuit argues, quoting from a 1982 decision. San Francisco's property owners are already overburdened with legal, administrative, practical and economic impediments to renting, the suit claims, naming rent-control laws, property registration requirements, and the difficulty in evicting tenants.

In other cases, apartments may sit empty because of high crime or few jobs in the area, but their owners may be loath to drop their asking rent for fear that rent control laws wouldnt let them raise it in the future, the suit says. Still others may wish to keep a condo to live in a few months out of the year, or live alone in a four-unit building because they dont want to deal with the hassle of renting to tenants, the suit says, naming situations that apply to two of the plaintiffs.

Under the vacancy tax, owners would be on the hook for $2,500 to $5,000 per empty unit, depending on its sizean amount that increases every year its left unoccupied. An empty building of 10 mid-sized apartments (1,000 to 2,000 square feet) would incur a tax of $140,000 by its third year, and the amount would then be indexed to the federal Consumer Price Index.

The tax is directed to fund affordable-housing programs, Preston said, but added that raising money is not the primary purpose of this measure.
If 10,000 units get filled in the next few years, well be happy even if there's little to no tax revenue, he said.

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codey
10/22/23 12:10:46 PM
#2:


Unfortunately I don't see just placing more multifamily units on the market as a solution to end homelessness, because those units are still going to be unaffordable to persons experiencing homelessness. The units will instead be filled by people that actually afford to live in SF.

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Notti
10/22/23 12:13:42 PM
#3:


Landlords would rather people be homeless if it increases their other properties value.

Hoardin their land.

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Humble_Novice
10/22/23 12:14:46 PM
#4:


Fortunately, there's at least one person trying to make things right in San Francisco: https://finance.yahoo.com/news/san-francisco-housing-market-broken-090000573.html

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AnsestralRecall
10/22/23 12:15:25 PM
#5:


fuck whoever voted 'the homeless'
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Humble_Novice
10/22/23 12:16:54 PM
#6:


AnsestralRecall posted...
fuck whoever voted 'the homeless'
It's probably some MAGA cultist who voted for that while lurking in the board.

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ClayGuida
10/22/23 12:26:19 PM
#7:


My solution to this is charge people higher taxes on properties they own.

1 property, you pay a standard property tax. 2 properties, you pay double. 3 properties triple.

Make it unprofitable for them to let these properties sit empty, or even owning more than a couple.

And those that want to pay those higher tax margins, so be it. If you want to own 10 properties and pay 10x the normal tax rate per property, so be it.

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Blue_Dream87
10/22/23 12:33:58 PM
#8:


Fuck it, seize the houses and let the homeless live there rent free. Half-ass attempts won't do shit but benefit the government and NIMBYs.

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Tom_Joad
10/22/23 12:37:34 PM
#9:


Just use imminent domain and pay a 'fair market value'. Then hire a housing management company to maintain them.

Finally, move the homeless in.

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willythemailboy
10/22/23 12:37:51 PM
#10:


codey posted...
Unfortunately I don't see just placing more multifamily units on the market as a solution to end homelessness, because those units are still going to be unaffordable to persons experiencing homelessness. The units will instead be filled by people that actually afford to live in SF.
More likely there will be straw renters - one landlord renting another's units so they're "occupied" in return for the other landlord doing the same in return. They'll lose money on taxes and such but less than this tax would amount to.

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justaguy3492
10/22/23 12:43:19 PM
#11:


Seems very misleading. This begins to address the financial concerns of some people experiencing homelessness, but does nothing to address mental health causes of homelessness.

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#12
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ClayGuida
10/22/23 12:56:32 PM
#13:


justaguy3492 posted...
Seems very misleading. This begins to address the financial concerns of some people experiencing homelessness, but does nothing to address mental health causes of homelessness.
Not everyone experiencing homelessness suffers from mental problems.

Something is better than nothing.

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BB_mofo
10/22/23 12:59:14 PM
#14:


Notti posted...
Landlords would rather people be homeless if it increases their other properties value.

A number of these landlords don't exist. If you try to contact them you find that their home address is a PO Box and their phone number leads to voicemail. They are names on paper that the true owners of the building use to shield themselves from inquiries and complaints by renters and the legal system.

justaguy3492 posted...
Seems very misleading. This begins to address the financial concerns of some people experiencing homelessness, but does nothing to address mental health causes of homelessness.

Newsom just passed a controversial new law that forces the homeless who are addicts and mentally ill into rehabilitation facilities with release being contingent on getting a clean bill of health from a licensed physician.

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CoyoteTheGreat
10/22/23 12:59:24 PM
#15:


justaguy3492 posted...
Seems very misleading. This begins to address the financial concerns of some people experiencing homelessness, but does nothing to address mental health causes of homelessness.

They are two discrete problems. There are entire families living out of cars in San Fransisco just because they don't make enough money.

Like, California's solution is about as good as it gets. They are sending them to hotels and monitoring them. From there, the problem can be determined at least. The root cause of homelessness is different for different people.

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Tyranthraxus
10/22/23 1:02:47 PM
#16:


BB_mofo posted...
A number of these landlords don't exist. If you try to contact them you find that their home address is a PO Box and their phone number leads to voicemail. They are names on paper that the true owners of the building use to shield themselves from inquiries and complaints by renters and the legal system.
It's the same with a lot of habitual litigators.

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UnfairRepresent
10/22/23 1:07:04 PM
#17:


BB_mofo posted...


Newsom just passed a controversial new law that forces the homeless who are addicts and mentally ill into rehabilitation facilities with release being contingent on getting a clean bill of health from a licensed physician.
This effectively just means a ton of homeless vulnrable people won't get help

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emblem-man
10/22/23 1:08:47 PM
#18:


justaguy3492 posted...
Seems very misleading. This begins to address the financial concerns of some people experiencing homelessness, but does nothing to address mental health causes of homelessness.

Majority of people experiencing homelessness is due to cost of housing. In California at least.


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ClayGuida
10/22/23 1:14:08 PM
#19:


BB_mofo posted...
A number of these landlords don't exist. If you try to contact them you find that their home address is a PO Box and their phone number leads to voicemail. They are names on paper that the true owners of the building use to shield themselves from inquiries and complaints by renters and the legal system.
Feel like this is something they could legislate out too then.

This is basically what unchecked capitalism gets you.

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IceCreamOnStero
10/22/23 1:15:02 PM
#20:


justaguy3492 posted...
Seems very misleading. This begins to address the financial concerns of some people experiencing homelessness, but does nothing to address mental health causes of homelessness.

Mental health issues are significantly easier to deal with when you aren't on the street.

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VeesMcGees
10/22/23 1:20:43 PM
#21:


I wanted to make a joke about what the kids say, but Id probably get modded. The phrase involves Mao.

Anyway, odds are these buildings are owned by big corps who have the money to stall and fight versus small time schmucks?

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potdnewb
10/22/23 1:20:53 PM
#22:


i did not read any of the posts above this one
but it makes no sense to buy a house and leave it vacant so why is there a law to prevent something that only those throwing money do

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IceCreamOnStero
10/22/23 1:22:15 PM
#23:


potdnewb posted...
i did not read any of the posts above this one
but it makes no sense to buy a house and leave it vacant so why is there a law to prevent something that only those throwing money do
The sense is simple restriction of supply.

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potdnewb
10/22/23 1:27:05 PM
#24:


IceCreamOnStero posted...
The sense is simple restriction of supply.
they will have to pay mortgage and taxes on the property even if nobody lives in it so it makes no sense to leave it empty

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Xenogears15
10/22/23 1:29:44 PM
#25:


Landlords are in the wrong.

But they'll win any legal challenge because property rights are supreme in common law.

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IceCreamOnStero
10/22/23 1:29:50 PM
#26:


potdnewb posted...
they will have to pay mortgage and taxes on the property even if nobody lives in it so it makes no sense to leave it empty
Again, the sense is to restrict housing supply.

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Tyranthraxus
10/22/23 1:29:52 PM
#27:


potdnewb posted...
they will have to pay mortgage and taxes on the property even if nobody lives in it so it makes no sense to leave it empty
The problem is the taxes aren't enough. We need to make primary residence tax free and tax all other residences at 500% what we're taxing now. Over time that will naturally trend towards back into home ownership.

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LeoRavus
10/22/23 1:31:12 PM
#28:


I'm trying to understand this. If the homes are vacant, how are the owners landlords?

The law, which goes into effect in January, could push as many as 7,000 units on the market, according to city estimatesthat would be literally 90% of the city's homeless getting housed

So the government's just gonna take people's million $ properties in the Bay area and put homeless in them?

Time to become homeless in SF so I can get a free house nicer than mine.

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HylianFox
10/22/23 1:31:15 PM
#29:


IceCreamOnStero posted...
The sense is simple restriction of supply.
Grapes of wrath

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potdnewb
10/22/23 1:31:39 PM
#30:


IceCreamOnStero posted...
Again, the sense is to restrict housing supply.
and pay the mortgage and taxes themselves
thats illogical

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Alteres
10/22/23 1:41:10 PM
#31:


You are missing the rent control piece of the article in your arguments

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ClayGuida
10/22/23 1:58:22 PM
#32:


LeoRavus posted...
I'm trying to understand this. If the homes are vacant, how are the owners landlords?

The law, which goes into effect in January, could push as many as 7,000 units on the market, according to city estimatesthat would be literally 90% of the city's homeless getting housed

So the government's just gonna take people's million $ properties in the Bay area and put homeless in them?

Time to become homeless in SF so I can get a free house nicer than mine.
Go do that, see how it works out for you. Give us updates.

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willythemailboy
10/22/23 2:59:21 PM
#33:


Alteres posted...
You are missing the rent control piece of the article in your arguments
Yep. If they lower rent to get the units occupied they can't then raise rent when market conditions improve. If they cut rent in half now to get someone in the unit it would take literally 20 years to get the rent back up to today's market rate - by which time market rate will have doubled again (at least). It turns an asset into a permanently money-losing liability.

LeoRavus posted...
So the government's just gonna take people's million $ properties in the Bay area and put homeless in them?
Doesn't apply to single family houses.

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Unsuprised_Pika
10/22/23 3:03:29 PM
#34:


"Sometimes, developers have a strategy of buying buildings, removing longtime tenants, and then reselling at a profit, Preston said."

It should unironically be a capitol crime to do this

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rexcrk
10/22/23 3:13:36 PM
#35:




I wonder how the results would look if we could see who voted for what


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[deleted]
10/22/23 4:03:01 PM
#40:


[deleted]
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IceCreamOnStero
10/22/23 5:42:48 PM
#36:


willythemailboy posted...
It turns an asset into a permanently money-losing liability.

Good, house ownership shouldn't be a commodity.

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pnut027
10/22/23 5:47:23 PM
#37:


Homelessness in America is mostly a drug and mental health issue than it is an affordability issue. Now the ramifications of drug use and the challenges of mental illness make keeping a job difficult, causing affordability issues, but the distinction must be made.

Making housing affordable will not solve the root causes of homelessness. But it would serve some unfortunate individuals.

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IceCreamOnStero
10/22/23 6:07:02 PM
#38:


"Its a mental health/drug issue" is still disingenous, because homelessness, a poor financial situation and drug/mental health issue are a vicious cycle that feed into each other. It is far far far easier to deal with mental health problems if you aren't living homeless

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Skankhair
10/22/23 6:12:47 PM
#39:


justaguy3492 posted...
Seems very misleading. This begins to address the financial concerns of some people experiencing homelessness, but does nothing to address mental health causes of homelessness.

What a terrible and fallacious take.

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pnut027
10/22/23 6:36:08 PM
#41:


IceCreamOnStero posted...
"Its a mental health/drug issue" is still disingenous, because homelessness, a poor financial situation and drug/mental health issue are a vicious cycle that feed into each other. It is far far far easier to deal with mental health problems if you aren't living homeless


pnut027 posted...
Homelessness in America is mostly a drug and mental health issue than it is an affordability issue. Now the ramifications of drug use and the challenges of mental illness make keeping a job difficult, causing affordability issues, but the distinction must be made.

Making housing affordable will not solve the root causes of homelessness. But it would serve some unfortunate individuals.


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Antifar
10/22/23 6:48:37 PM
#42:


pnut027 posted...
Homelessness in America is mostly a drug and mental health issue than it is an affordability issue.
This is exactly backwards
https://www.skeptic.com/reading_room/critical-analysis-of-americas-homeless-crisis/
Counterfactual reasoning can be a useful tool for determining causality. You think A causes B. Remove A. If B still happens, then A was not the cause. (The rooster crows and the sun rises, in David Humes famous example, but no one thinks the rooster causes the sun to rise, which is easily testable by silencing the rooster and noting that the sun still rises.) Employing counterfactual reasoning here, if drug use were a driver of homelessness in aggregate, we would expect states with higher rates of drug abuse to also have higher rates of homelessness. In fact, no such relation exists between the data on drug addiction and those on homelessness: West Virginia, which leads the nation in drug overdose deaths,7 has one of the lowest rates of homelessness in the country.8 Californias overdose death rate is about one-quarter of West Virginias!9
Nor can state-level variation in rates of mental illness explain variation in rates of homelessness. Mental illness can be difficult to quantify, but Mental Illness America estimates that Californias rate of adult mental illness is about the same as the national average.
...
As in the above summary of differing hypotheses, Colburn and Page Aldern tested different explanations for homelessness by looking at regional variations in homelessness rates. However, they analyzed more finely-grained data, relying on city-by-city comparisons instead of state-by-state ones. After investigating a number of non-housing explanations for large-scale homelessness including climate, generous welfare benefits, mental illness, and substance use disorder they concluded there was no evidence that these factors can explain why some U.S. cities have significantly higher rates of homelessness than others.
Instead, they write: Vulnerable households live in every city of the country; the differences in rates of homelessness can be attributed to structural factors associated with the housing market. Homelessness is most severe in the metropolitan areas where housing costs are highest, because the pricier that housing becomes, the greater the risk that people with low incomes or other serious challenges will be locked out of whatever homes are available.
This is not a new finding. In fact, it is the consensus among most serious researchers of this problem. In their definitive book on homelessness, In the Midst of Plenty, Marybeth Shinn and Jill Khadduri note that homelessness is essentially a lack of access to affordable housing. Similarly, an influential 2018 study by Zillow (a leading online housing information and analysis site) found that rates of homelessness increase fastest in cities where, on average, rents exceed one-third of income.
It follows, then, that the cities with the most severe homelessness problems also have sky-high rents. The most recent Consumer Affairs ranking of U.S. cities by housing costs looks a lot like a list of places bearing the brunt of mass homelessness: San Jose, San Francisco, San Diego, Los Angeles, Seattle, New York, and Portland all make it into the top ten.

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willythemailboy
10/23/23 12:51:19 AM
#43:


IceCreamOnStero posted...
Good, house ownership shouldn't be a commodity.

Also known as Proposition M, it exempts single-family homes, duplexes, short-term rentals, nonprofit and institutional housing, such as nursing homes, as well as any apartment used as a primary residence.

You really are incapable of reading, aren't you? The law is about apartment buildings.

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Ubergeneral3
10/23/23 2:26:27 AM
#44:


landlords are a parasite and should be illegal.

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CountCorvinus
10/23/23 2:28:25 AM
#45:


Don't even have to read the thread.

Landlords.

Landlords are always wrong.

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badjay
10/23/23 2:43:07 AM
#46:


codey posted...
Unfortunately I don't see just placing more multifamily units on the market as a solution to end homelessness, because those units are still going to be unaffordable to persons experiencing homelessness. The units will instead be filled by people that actually afford to live in SF.
It does force prices down. If you can't rent out those units AND you're getting smashed by taxes you WILL be forced to lower the rent or be forced to sell to stay out of debt. Once it sells the next person then has to experience the same crap of getting smashed by taxes until they rent out the unit. If crime rates prevent you from renting a unit then you will HAVE to lower rent until somebody does. If nobody does and you keep paying taxes on an empty unit, guess what? You're forced into selling it to someone. Once someone recognizes a pattern that these units never get rented out because the area sucks. MAYBE just MAYBE the unit will sell at a fair price that people CAN afford.

The law is quite roundabout but it's a way of controlling the price and fixing the homeless situation.

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Notti
10/26/23 5:35:34 AM
#47:


Unsuprised_Pika posted...
"Sometimes, developers have a strategy of buying buildings, removing longtime tenants, and then reselling at a profit, Preston said."

It should unironically be a capitol crime to do this


Sending landlords to private prisons would be fitting.

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