The San Francisco Rental Market
Angelika Michael went to the trouble of putting together a shopping basket for you. At first, you might have thought that the price of $2000 for a two-bedroom apartment in our neighborhood was a typo. If only it were! Unfortunately, the dizzyingly high rents are a harsh reality in San Francisco.
Many of you already know that we pay "only" $1100 for our two-bedroom apartment. This is solely due to the fact that there is something from the socialist textbook called "rent control" San Francisco, which is quite unusual in capitalist America. Generally, the market strictly dictates prices here: if demand is high, prices are correspondingly high. Rent control in San Francisco simply means that the rent can only be increased by a certain percentage each year. This percentage is determined annually by an authority called the San Francisco Rent Board. For the year 2000, the landlord can therefore increase the rent by 2.9%.
However, there is a significant catch to the matter: Rent control only applies to buildings constructed before June 1979 (thankfully, our building is older) and generally only to apartments that are not used commercially. This means that our corner newsstand cannot hope for "rent control." Additionally, the landlord is allowed to accumulate increases, meaning if they do not raise the rent in one year, they can increase it by not only the percentage valid for the current year but also add the percentage from the previous year.
However, in San Francisco, all bets are off when a tenant moves out, then the landlord can charge as much as they want. Since the housing market in San Francisco has changed so dramatically in recent years, it is common for rent increases of 200%-300% or more to occur when a tenant who has lived in the same apartment for a long time moves out. For example, our neighbor lives in an apartment that is exactly the same size as ours. She pays $400, we already pay $1100, and the next person to move in would have to shell out at least $2000 for the apartment.
This housing policy naturally leads to landlords being interested in getting long-term tenants with lower rents to move out if possible. In San Francisco, there are increasing reports of landlords letting apartments fall into disrepair to force tenants to leave, which was also very popular in New York City in the eighties. Yes, New York City also knows "Rent Control" -- but that's just a side note. I also know quite a few people who have had to leave their apartments because the buildings they lived in were sold and the new owner claimed personal use. This particularly affects tenants living in the very typical two-family houses in San Francisco. Sadly, many are forced to move away from San Francisco. For shops and restaurants, this means that more and more chains are entering San Francisco's typical neighborhoods, as only they can afford the high rents. The climate in the city has changed significantly. Tourists might not notice it as much, but San Francisco has acquired some ugly scars.
Don't get me wrong, we still think it's one of the most beautiful cities in the world, but precisely because we love the city so much, it really hurts to see what's happening right now. Ironically, the booming internet industry, which should actually promise prosperity and tax revenue that should benefit a city, is responsible for the whole misery. The problem is that housing is limited, and more and more companies want to settle in San Francisco and Silicon Valley. And when company are hiring, their employees also need a place to live. Most internet companies are quite financially strong, so they can offer their employees good salaries, which in turn allows them to pay absurdly high rents to secure housing in a scarce market.
The companies, in turn, are now settling in neighborhoods where traditionally artists had had found their niche. These are usually unattractive residential areas with old factory buildings that the artists had converted into studios and were affordable until now. The problem is that internet companies are willing to pay much higher rents, thereby driving the artists out of these neighborhoods. To make you believe this, here's a small example: My photography teacher, along with another photographer, had rented a photo studio of about 120 square meters in an older company building. They paid $2000 in rent per month. But from now on, the studio will be an office for a computer company and will cost $12000 in rent per month. This month, the only two photo labs in San Francisco where you could do your own color developments also had to close. The rent increased to the point where the owners could no longer operate profitably. All the renowned photographers of San Francisco developed and enlarged their own color photos there, as you can't just set up a color darkroom in your garage or basement.
In the meantime, the first protests are stirring, and citizen groups are forming to stop the trend--a good sign. Incidentally, "Dotcom" has now become a derogatory term in San Francisco. Here, "Dotcom" generally refers to internet companies because they usually have a ".com" in their web address, such as yahoo.com. "Dot" (English for point) simply means the dot that precedes the "com." A "Dotcommer" works for an internet company, is a 25-year-old upstart fresh out of college, earns a lot of money, drives a fancy car, is always on the phone, and lives in San Francisco because it's currently hip.
And since I'm already dealing with negative developments, I must express our dismay that right-wing radical violence against foreigners and the homeless is spreading like a cancer in Germany, and no one seems to be doing anything about it. As foreigners living in a foreign country ourselves, these reports always leave us with a lump in our throats. The argument that the perpetrators are just individual radical lunatics doesn't hold for me given the frequency of these cases. We have the general impression that an extremely xenophobic atmosphere is spreading in Germany. It would be great if you could share your opinions and impressions on this. We rely on German newspapers and the Tagesschau over the internet, but of course, we are very interested in your personal experiences.
So, please drop us a note!
Angelika und Michael
