This interview originally appeared on .
Robert Joseph, senior program officer at Tipping Point, recently sat down with Gabriel Metcalf, SPUR鈥檚 president and CEO. Robert, who serves on the 黑料传送门Board of Directors, asked Gabriel for his insight of how the housing market came to be what it is, what we can do to fix it, and how policy change differs from direct service.
Robert Joseph: What are some of the historical factors that led to the limited housing affordability we see today in the Bay Area?
Gabriel Metcalf: In most places, people living in poverty have a hard time finding housing they can afford. But in the Bay Area, even people with middle-class jobs face an affordability crisis. The reason is simple: We stopped building housing. We have supply and demand out of whack. But the reasons behind that fact are complicated. The value change that happened in our society between the post-war, pro-growth boosterism of the 1950s and 鈥60s and the NIMBYism (鈥淣ot in My Back Yard鈥) of the 1970s was a profound cultural transformation that I don鈥檛 think we fully understand yet.
At least some of it stems from the reality that city leaders in the post-war era did some terrible things with their power. Urban renewal and urban highways were national programs鈥; there was an almost universal assumption that tearing down the old city meant progress. You also had cities losing population every single year after World War II. There was this deeply held belief that urban life was to be escaped from, so all the cities that are really expensive today were emptying out then. The low point in population was 1980, according to census numbers. For those who stayed, change came to be equated with destruction. For all of these reasons, there was a backlash against development.
Down-zonings didn鈥檛 cause housing supply problems for a long time, because the population loss meant few demand pressures. You could downzone without triggering displacement in the 1970s. You could save historical buildings without any negative impact on housing supply.
But then the whole world changed and cities started growing again. The problem is that we have locked in place the rules and culture from these early 鈥70s preservation movements that today make it really difficult to add housing.
RJ: What repercussions does this have for the lowest-income bracket in a place like San Francisco?
GM: If the is correct that 800,000 households in California either live in subsidized units or receive vouchers, that鈥檚 about 6 percent of all households statewide. It鈥檚 taken us since the 1930s to get this much. We had the New Deal, the Great Society, redevelopment in California 鈥娾 鈥奱ll ambitious government programs that created affordable housing 鈥 but the overall yield has been small. What鈥檚 more, over the last 10 years, California has lost most of its funding for affordable housing as both federal dollars and state redevelopment dollars have gone away.
This means that most people 鈥娾 鈥妋ost middle-class people and most poor people鈥 鈥 鈥妛ill live in housing found within the market. So if we want to talk about a solution that actually scales up, we have to talk about fixing the housing market itself.
What are poor people doing, de facto? Some are homeless, some are moving back in with their parents or relatives, a lot are living in garages or doubling up. Many people are driving long distances to live where there are more affordable options 鈥娾 鈥妏laces like Antioch, Pittsburg, Vallejo, Stockton. And others are leaving the state, as housing refugees all over America.
There is a demand cascade in the housing market. If there is a shortage of luxury high-rise apartments with views, then you move to the top of Russian Hill. But if you can鈥檛 afford Russian Hill, then you move to North Beach. If you can鈥檛 North Beach, then you move to Duboce Triangle. If you wanted to be in Duboce, but you can鈥檛 afford it, then you go to Bernal. Then you go to the Excelsior, then Oakland, then Daly City. It鈥檚 this demand cascade that pushes every rung down. You have families in single-room occupancy units in the Tenderloin now, and whoever used to be in the Tenderloin is now homeless.
I believe that there is no conflict between maximizing production of market-rate housing and maximizing production of affordable housing. We must do both.
RJ: San Francisco may be an extreme case, but I imagine this issue is playing out across a number of cities and regions in the U.S. Do you have examples of other places where the housing market functions better?
GM: I think Seattle is a really interesting comparison. It鈥檚 similar鈥: huge tech boom, water-constrained, an old city that people love. But Seattle has made a different set of choices, namely to accept more development, more physical change. Over the past 20 years they have produced two to three times as much housing as we have, per capita. As a result, it鈥檚 a bit cheaper. It鈥檚 not utopia, but their land use politics are virtually the opposite of ours.
Portland is another interesting example, because Oregon has regionalized land use decisions. The region produces plans and every city鈥檚 zoning and permitting plan must be consistent with it. They鈥檝e taken away the ability of cities to say 鈥渘o鈥 to housing. You can keep your local control over land use as long as you鈥檙e building as much as the state says you need to build. If you don鈥檛 hit those housing targets, then you don鈥檛 have control any more.
RJ: It seems unlikely that public agencies alone will resolve the homelessness issue in San Francisco. How might philanthropy, with greater agility and targeted investment, contribute to a solution?
GM: There is so much that funders can do on a systems level. First of all, we don鈥檛 have a unified, by-name database of homeless people. People have been trying for years to have this. Many other cities have one. It鈥檚 solvable. I don鈥檛 want to trivialize how hard that is. If it wasn鈥檛 hard, it already would have been done, but it鈥檚 an area that I could see Tipping Point getting involved in. It鈥檚 to the point where we don鈥檛 know if programs like former mayor Gavin Newsom鈥檚 Care Not Cash was successful 鈥 or we can鈥檛 pull down federal dollars allocated to specific populations like veterans, because we simply don鈥檛 have the information we need.
Then there is this theory of a housing ladder that several Tipping Point grantees follow. If you are homeless and you enter the Navigation Center on 16th and Mission, you work with a case manager, and when a slot opens up, you enter an organization like Community Housing Partnership or Catholic Charities. The idea is to support people to get off the streets and provide certain services, then gradually they will rely less and less on that support, until they are fully self-sufficient and can find housing in the market.
In order for this theory to scale, we need to be moving people out of the subsidized units into the un-subsidized portion of the market and be disciplined in tracking and testing. We need to know what happens between stages and what the patterns of exits are: What does it take for somebody to get to the next stage and the stage after that? How do we hold organizations accountable and how many outcomes they can achieve at each level? It鈥檚 an empirical question, and Tipping Point can be the owner of that knowledge.
We can鈥檛 be content with crossing our fingers that clients鈥 readiness and available housing supply will both grow over time. Policy change can fix the housing market and make housing less expensive鈥 鈥 鈥妕hat鈥檚 totally within our control at the city level. We need funders to help with those efforts and continue to grow the resources on the subsidized side. This system will take time to understand and refine, and organizations that work in the housing and homelessness space should be upfront about that. If you can鈥檛 deal with a longer timeline, you shouldn鈥檛 give to the systems-change work.