​Google is Latest Tech Giant to Attempt to Ease Home Prices in San Fra

Housing affordability has been at the forefront of headlines for years now in San Francisco, the captivating and beautifully-situated bay city that has seen a crisis of sorts regarding affordable housing. This past December, Council of Community Housing Organizations head Peter Cohen expressed he thought it was the number one biggest problem of any type in the metro area. Even during the late 1970s, some on both the selling and developing end of real estate knew that there would be an unprecedented bubble here.

Several city supervisors had proposed that an unforeseen amount of money from property taxes should be used toward property acquisitions and generating more affordable housing options. Owner move-in conversions, as well as some loopholes found after carefully scrutinizing condo laws, are two factors that resulted in the loss of rent-controlled units.

“BMR”s or below-market-rate homes, came about around 2002 when the first tech boom was just about receding. In some San Francisco buildings sporting ten units or more, the inclusion of “affordable housing” was mandated as a need. Being a candidate for one of these properties had some pretty broad requirements, and you must have saved enough for a down payment and closing costs, but there is an income gap that varies from home to home.

During 2017, the Mayor's Office of Housing conducted 104 lotteries and there were a startling 85,000 applications for just 1,210 units. All things said and done, it's about a 1 in 70 chance, and in order to play the game, you have to schedule two hours of counseling, and an additional six hours of instruction. The fact that the city does require private developers to help house a handful of low-wage individuals is regarded, but the details have changed as of late.

New developments with 25 housing units or more are now required to either make 18 to 20 percent of their units affordable, make concessions to build affordable units at another location that equal 30 to 33 percent of the total units, or pay a fee that equals the cost of 30 to 33 percent of the units. As of this writing, said “fee” would be used to establish the building of affordable housing at another location.

This past week, Google made the official announcement that they would pledge $1 billion in land and financial capital to fulfill the task of building homes that would help to ease the crisis in the East Bay area. After careful speculation and research, it was estimated that this could potentially add nearly 20,000 desperately-needed dwellings in the city.

Apple, Facebook, Microsoft, and Google have headquarters in both the Seattle and San Francisco metro areas, where housing has been tight for some time now and prices have skyrocketed. The fact that available land in Silicon Valley and Seattle is in a dire shortage is simply not helping matters much either.

Earlier this year, Microsoft pledged that it, too, will be allocating $500 million in funds to help with affordable housing in the Seattle area, where its headquarters call home. Seattle is another metro that has seen a rampant rise in rental prices, with a seemingly “no end in sight” scenario.

Google says that they will secure partnerships with local government to allow developers to have the ability to create and sustain more affordable homes there. This fund could absolutely have the potential to help provide viable loans or make investments in projects that see an end goal of affordable housing and vitality for those choosing to move here. San Francisco has so much to offer in the way of scenery, vibrant culture, and opportunity but has absolutely witnessed inflation in the housing market that is typical of any cosmopolitan city with the allure of world-class tech.

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