Our CEO Kiai Kim recently showed me an article about a mansion in New Jersey that was initially listed at $39 million but sold at just $4.6 million eight years later – an 88% discount! From 2013 to 2021, the price dropped from $39 million to $25 million and went through more than five rounds of re-adjustments to the current price of $4.6 million. I thought to myself, “Why even wait that long? How can a homeowner have the patience to deal with the upkeep for eight years? And what a massive waste of space to leave a huge house like that empty?”
In San Francisco’s ritzy Cow Hollow neighborhood, a luxury Italian-style mansion sold earlier this year after sitting idle on the market since 2008. The initial asking price was $29.5 million and sold for $17.5 million. The price drop wasn’t as drastic, but the fact that the owner was willing to let the house sit empty for 13 years is just another example of sellers’ unwillingness to compromise.
The issues of the super-rich are far removed from those of us working-class folks, but I think in these extreme cases, we can also see to some extent what perpetuates the high Bay Area housing prices – the desire to make the highest profit even if it takes years and years to sell. And in the case of the New Jersey mansion (and probably many other homes owned by the uber-wealthy), the house was not even occupied. When sellers are unwilling to budge on the high sale price, it means houses remain unaffordable for that much longer.
The strategy of waiting years hoping that a desirable offer will appear doesn’t always pan out. The New Jersey mansion had earlier been offered a price higher than the final selling price but had refused it, later to realize that they wouldn’t get an offer that high again. Unfortunately, these lessons aren’t apparent until the end – sometimes many years later.
We at Care Association have been trying to stay on top of issues concerning affordable housing for lower and middle-class Bay Area residents. We worry about the psychological cost of high rents and the growing rates of homelessness. At the same time, we are also actively participating in the discussion around innovative ways to bring down the costs of new structures.
One of the developments we have been following is the growing interest in cob as a (much!) cheaper alternative to lumber in North America. Cob is a mix of clay-soil, straw, water, and sand, used to build walls that alone are strong enough to support a roof. Cob was used for thousands of years in ancient times throughout Asia, Africa, Europe, South America, and the Middle East. Here in Northern California, the stringent codes regulating seismic strength, fire resistance, and insulation have made cob a tough sell.
Cob’s growing visibility
The soaring housing costs led Bay Area architect John Fordice to revisit cob in the late ’90s to see if he could address those deficiencies. He set up The Cob Research Institute (CRI) in 2008 to ramp up visibility and research efforts into the viability of this cheap and clean alternative. The CRI began working with local university engineering labs to build cob wall prototypes and develop solutions to address its structural weaknesses. They compiled the results of their years of research into a guideline to help others overcome the common hurdles that past cob projects have faced when trying to get approval from their local planning departments.
We are delighted to share that this guideline has been formally approved for inclusion into the International Residential Code (IRC) just this year! It is now accessible to any interested builder as Appendix U, the Cob Construction Appendix, in the 2021 IRC. We were also excited to hear that the appendix was accepted by an overwhelming 93 to 6 majority. A lot of people are as excited about cob as we are!
Remaining obstacles to cob-based housing
Inclusion into the IRC is not a green light to start building cob housing for human habitation, but speeds up the permit process for other types of buildings, like storage units. Nevertheless, it is a very encouraging sign that we are getting closer to the possibility of cob-based homes. Other types of earthen building solutions, such as strawbale and light straw hay, also started as appendices in the IRC and were gradually adopted into local building codes. “Then why hasn’t Care Association started promoting strawbale or light straw hay?” you may ask. Strawbale will result in a sturdy home, but the walls will need to be 2 feet thick to meet the insulation requirements. If we are looking to build at volume, the area requirements will be prohibitive. Cob, we believe, can be as narrow as 12-16 inches with proper insulation. Straw is also difficult to find locally, and there is concern that straw is environmentally unclean.
Cob will result in thinner walls, but we don’t know how thick or thin the final product will be. Cob alone can not pass the requirement for an insulation R-value of 13 in Northern California. In layman’s terms, a cob wall is not “breathable” enough; vapor needs to be able to pass through the wall with some quantifiable measure of ease. The CRI and other organizations are working on this problem. They are researching possible solutions, such as replacing the heavy components of the cob mixture with lighter substitutes, adding more straw/hemp, or wrapping the outside of the cob wall with less dense mixes of clay or straw/hemp. Our CEO, Kiai Kim, has also been attending cob workshops to stay up to date on the latest research and help pose some solutions.
Because cob is heavy, the labor costs to build cob structures will be high. If cob gets adopted into Bay Area building codes, our initial vision is to use a volunteer force of builders to provide labor. Luckily, building with cob is easy to learn. The savings from volunteer labor and the cheaper materials will offer an affordable housing solution for those in immediate need.
There are a lot of people rooting for cob. It is non-toxic, can be molded into beautiful shapes, environmentally friendly, and so fire-resistant that some make ovens out of cob. This is a great advantage in this new era of yearly wildfires. (Imagine fleeing a wildfire and returning to see your walls fully intact!) At Care Association, we are thrilled with cob’s newfound recognition and have great hopes for its future adoption, especially with lumber’s skyrocketing costs. With 21st-century engineering advances, perhaps the cob structures that housed our distant ancestors can also provide safe, warm, and affordable places for us to sleep as well.
In all honesty, I didn’t give much thought to the issue of affordable Bay Area housing until my brother Ted became homeless. He had received a diagnosis of obsessive-compulsive disorder (OCD), anxiety, and schizophrenia but refused to take his medication. After a particularly bad fight with my mother, he left the mobile home in which they lived, saying that she always opposed anything he wanted to do and felt that the relationship was toxic.
The next few years were very stressful. We would plead with Ted to come back, but he always refused. I was constantly wondering where he was, whether he ate lunch, whether he found a place to sleep away from the cold in the winter, and whether he was able to escape the baking heat in the summer. Another question I grappled with was whether I should move out of the Bay Area. If I could afford a tiny studio for him, then we would worry a lot less. But I already had to pay a mortgage on my current home, and at today’s prices, even a tiny Bay Area studio would be twice more than what we paid for the house in the early 2000s.
Fortunately, Ted didn’t go completely silent. Once a month, he would call back and allow us to take him to dinner. I asked him so many questions over these dinners and learned a bit about how the homeless get their basic needs met. Before Ted left home, I always thought that homeless people could just go to shelters and get food, showers, and safe places to sleep. This is true, but only if they can get a bed at all. The shelter that Ted attended most often would allow people to assemble starting at 3 pm, hold a random lottery at 4 pm, and then let the winners in at 5 pm. Unfortunately, the number of those seeking refuge increases in the winter, so the chances of getting a bed become slim. In San Francisco, the number of homeless without beds is around 6,800, but officials say the estimate is closer to 18,000 (!) as the pandemic has incurred heavy job losses.
My brother often slept on bus 22, a 24-hour bus route in Santa Clara County nicknamed “Hotel 22” because of the large numbers of homeless people that use it as overnight housing. Unfortunately, like the shelter, this option became less reliable in the winter. So every afternoon became a race to find a place to sleep for the night. Many nights he ended up sneaking back into an empty bedroom in my mother’s house through an open window and then climbing back out in the morning. He was fortunate to have this option, but many homeless don’t.
As if the homeless don’t have enough to worry about already, there is also a high incidence of theft. It is not uncommon to fall asleep only to find that what little you have is gone. This is an issue on the bus as well as in the shelters. We once had to replace Ted’s entire suitcase with fresh clothes, toiletries, and cash. We also had to replace his phone five times.
We finally got Ted to move in after trying many things, including having my mother move back in with me. But I believe what ultimately worked was installing a new treadmill in the garage. Ted’s biggest fear is getting cancer or diabetes, so he runs every day for an hour. After his gym canceled his membership and stopped letting him enter (because his disheveled state was disturbing customers), I purchased a treadmill. He started to come over more and more often until he decided it was more trouble to leave than to stay.
I am beyond relieved that he is back home, but it troubles me that he couldn’t get proper support. Shouldn’t Ted have been able to find a place to sleep if he wanted? Returning home is not an option for many of the homeless. So many are evicted, some children, and many leave toxic situations or families that cannot properly care for them. And with the Bay Area housing prices skyrocketing, the problem will only worsen as a growing number of homeless compete for a fixed number of beds. Nobody should have to battle through a frigid night … not even once.
The shelter-in-place mandates introduced during the pandemic have strained many individuals who find themselves with a lot less personal space at home than they enjoyed before Covid. As a result, we have seen a disturbing increase in domestic violence, so much so that some local domestic violence shelters have had to turn people away for lack of space. However, this is not a new story for many Bay Area families; we have seen this phenomenon for years caused by another culprit: Bay Area housing prices. We have heard the painful accounts of those forced to stay with abusive partners and divorcees forced to live with their exes because they cannot afford to rent or buy another residence.
One demographic that has been particularly affected by the high rents is young adults, often nicknamed the “Boomerang Generation” because of the large percentage of them who have returned home to live with parents. This arrangement can be beneficial, with children saving on rent while also contributing to the family’s finances. In healthy families, parents continue to foster independence in their adult children, respecting their privacy and choices. Parents that do not respect boundaries, on the other hand, can psychologically cripple their children for years to come.
Helicopter parents may not stop their controlling ways when adult children move home. Early-career adult children suddenly find themselves with a lot more freedom and many more choices to make, particularly regarding their future careers and family. For example, they may need to try various jobs before finding their fit. They may need to meet a lot of the “wrong” type of guy or girl before they meet the “right” one. Trial-and-error is necessary and healthy. Living at home means that parents will be privy to their children’s choices, and the overprotective ones will nag, maybe harass, and even physically assault their children into choosing what they think is best. Children in such situations become demoralized, lose self-confidence, and harbor long-term resentment against their parents. They are also victims of a type of domestic violence for which there is no shelter.
Bay Area home prices have imprisoned many within the same walls as their abusers. Even though the cost of a San Francisco studio has dropped to $1,895 during the pandemic, that is still too much for many young adults who barely make above minimum wage. And for those who have no recourse but to return home to controlling parents, the only solution is to find a way to set clear boundaries (which is often easier said than done) or stand to suffer. It is a sad situation. Every individual should have the right to get out of harm’s way.
It is well known that San Francisco’s housing prices are consistently higher than those of other cities across the United States. There are many reasons for this phenomenon. Many well-known technology companies and high-tech talent converge here. However, people with low-income can’t afford the high rental rates.
Let’s first take a brief look at the current state of San Francisco rentals. We have to admit that the overall rental prices in San Francisco have dropped this year because of the pandemic. According to the statistics, the price of studio has dropped from $2,596 last year to $1,895, down 27%, and the price of one-bedroom has also dropped to $2,600, down 25% compared to last year.
The above is the current situation of rental prices in San Francisco. Due to the impact of the pandemic, many companies are working from home. Many people are starting to move out of the Bay Area to cheaper places to live. However, are these rental prices acceptable for people who cannot move further away?
I think it is not. For someone making $15 an hour, rent at $1,895 takes up 78% of his salary. The rest of the money is also not enough to support his other expenses for a month. Even though the price of renting in San Francisco has decreased significantly compared to last year, it is still unaffordable for people earning lower income.
This also shows the need for truly affordable housing, not housing for which people spend more than half their income. We expect the rent for an affordable home to be nore more than $780 per month per household earning $15 an hour. This rate is extremely below the current rent rates in San Francisco.
Currently, our country is facing one of the worst affordable housing crises in its history. Without a doubt, those living in poverty are the most severely impacted.
In spite of the challenges of 2020, in the middle of lockdown this spring we succeeded in helping a single mom and her young son rent a home. Thanks to the support of donors who gave just after the holidays of 2019, we were able to provide the Black family with the security deposit needed for the family to move in. Though the rent is still too high for Ms. Black to work a single full-time job (she has two jobs), the rate was a little lower than it was a year before.
Still, a Lack of Affordable Housing
Sadly, rent rates are not coming down fast enough, and though many households have been moving and taking advantage of lower rents, other households are still unable to afford the lowest rents of the San Francisco Bay Area, relying on the kindness of friends and neighbors to house them in rooms.
Construction costs are even worse, and they keep the prices of housing high. While other parts of the country are able to build homes at $150 a square foot, even with increased costs for materials, general contractors in counties of the Bay Area quote estimates at $1,500 per square foot. How can it cost 10 times more? Part of the problem is that contractors must pay their workers fair wages in order to afford living in the homes they build. It’s a chicken and egg problem.
Our Next Step
Plans are brewing for making truly affordable housing in the Bay Area—and the rest of the country—a reality. But to make this happen, we need funds. More on this to come.
I am writing to encourage you to promote opening up more locations in the state where Tiny Homes are approved. I am an active senior/still-working artist in Oakland who is going to need a new place to live in the near future. I am currently living in the house of a wonderful, elderly landlady, who may decide/need to move to easier housing at any time. To be honest, after this space is no longer available, there is no way I could afford to stay in my neighborhood and keep all the resources that I have come to know. I have applied to several subsidized senior apartments, but know that actually getting a place can require a long wait, if they manifest at all.
I could afford to acquire a simple live-in studio on wheels, or a trailer, but do not know where I would be able to park. Especially with the amount of homelessness and now complications from COVID-19, I don’t understand why Tiny Homes are not seen as a potential solution for so many people who are struggling and suffering.
I know the limitations for ADU’s are opening up, but this does not help the person who does not own the property, as they are mostly required to have a foundation, rather than be on a trailer.
Please do what you can in this regard, and let me know who I should speak to locally in the Oakland/Berkeley area. Thank you for all you are doing to keep California safe during this tragic time.
Since deciding to change our focus from tech to real property, we have become extremely busy. Our organization has grown in less than a year from two active volunteers to 11. And we continue to grow.
Affordable Housing in the San Francisco Bay Area
In November 2018, Sonoma County enabled an innovative provision allowing the construction of multiple cottages on lots zoned for single-family houses. After much research, we decided to pursue building 16 tiny houses on foundations ranging from 300 square feet to 800 square feet each. Some houses will be single story. Some will have lofts for extra space. All will be manageable and affordable.
Sonoma County has taken an important step for making affordable housing viable. The cost to build an “affordable” unit in San Francisco is estimated at more than $600,000. The smallest “affordable” SF apartment tends to be around 450 square feet. In the meantime, people are living in RVs and cars. But the Cottage Housing Development provision takes into account that very few people are able to take advantage of conventional affordable units. The provision allows for the construction of tiny houses as homes. They may be small, but they’re bigger than vans. And they cost much less than $600,000 — 85% less.
Truly Affordable Homes
To add insult to injury, the rent rate of San Francisco’s so-called affordable units is still unaffordable for a minimum-wage worker. And they are allowing people to pay 50% of their incomes for these units. But our plans will enable someone making $11 an hour to live comfortably on no more than 30% of their income.
Our goal is to build in Petaluma where there is a SMART (Sonoma-Marin Area Rail Transit) station that enables people to reach San Francisco without a car. The cottage provision can be used anywhere in the county where there is access to city services including sewage treatment.
Help Us Reach Our Goal
By the end of 2020 we hope to complete construction of 16 houses in Sonoma County for up to 41 people. And then we want to build more. But to begin, we need to raise $850,000. To achieve this, we need all the help we can get. How can you help?
A very common trick scammers use is to copy a legitimate ad and lower the price to lure unsuspecting victims. Especially in the San Francisco Bay Area where high rents is a major issue, it takes perseverance to find a home in the area. Unfortunately, there are scammers taking advantage of innocent people looking for a roof over their heads. Thus, you always need diligence especially if it involves large sums of money.
Here are some ways to spot fake Craigslist rental ads.
They refuse to meet you in person
One of the biggest signs of a scam is the seller refuses to directly meet you for some odd reason. Whether it’s because they’re out of the country, vacation, or elsewhere, if you can’t meet in person, it’s a red flag.
Photos look better than other listings
Photos are very important in regard to housing. What is tricky is if the photos are legitimate or not. Often scammers will download photos from the internet posing as legitimate photos. Luckily there are ways to counter this scam tactic. The first method is to Google search the images or see if it contains any watermarks. Second, check for the small inconsistencies in the ad especially in regards to the photos.
How to verify photos through Google Images
1. For most browsers, simply right-click on an image in the Craigslist ad and choose “Copy image address.”
2. Open images.google.com and click the camera icon. Mousing over the icon, it says “Search by image.” Paste the address you copied from step 2.
3. Look at two part of the Google image results page that says “visually similar images” and “Pages that include matching images.”
4. If the image matches any of the results, it’s with high certainty that it could be a stolen image. If the image from the other source comes from a webpage advertising a higher cost, then the ad is a scam.
Back to the list…
Asking to wire money
When you are asked to pay through a third party like Western Union, MoneyGram, etc, rather than cash/check, it’s a red flag, especially if they ask for money before you even see the property yourself. Scammers are trying to avoid dealing with you directly. Also, to cover their tracks as well.
Suspicious sense of urgency
Ads or listings that create a false sense of urgency. What I mean is essentially anything that forces you to make an irrational decision without giving yourself the time to think things through is a scam. If they say you have to make a decision today to buy it or lose it forever or anything like that, it’s a red flag. For anything involving houses, it’s ultimately a research game, not an emotional one.
Too Good to be true
If the deal is too good to be true, it’s a red flag. Why such a low price in an area where the rent is a lot more? Note that the ad above includes “cats are OK,” “dogs are OK,” and “attached garage” among other amenities.
If a listing has a sob story, it’s most likely a scam. Serious lessors are unlikely to mention their personal problems in a listing. If they do include a sob story, they may be scammers trying to bait you with emotions to trick you in giving your hard-earned cash away.
Typos and grammar errors
Typos and grammar errors are common among all types of scams. Fake listings are no exceptions. Scammers for some reason or another do not take the time to ensure their fake listings are typo-and grammar-error-free.
Lack of information
Scams may give a lack of very important information. If it’s just a paragraph of scant info, it’s potentially a scam. However, scams could give lots of important information in which you need to rely on other signals to tell if it’s a scam or not.
Protect yourself from fraud, especially from the internet. Even with the efforts of moderators, there is no excuse for not being diligent in looking for a place to live.
Right now, rents around the country are elevating at a unstoppable pace. The ongoing battle between supply and demand is agonizing the economic upheaval. Now that employment, wages, and population are increasing landlords and property owners believe it is acceptable to uncontrollably raise rent prices. It may be the case, however, with speculative rent policies, and high perception of gentrification discriminating lower income residents to affluent municipalities makes this process intangible for equality. One side is getting the favor while the other is grappling to survive the consequences. It is indefinitely hurting the crisis and bringing injustice to existence within laws of the housing market.
Why Property Owners Require Rent
Most people may believe that rent is the occurrence to satisfy the landlord or property owner. It is, but it also reflects back to help the landlord contribute to the promises committed on the rental agreement for maintenance, mortgage, and paying “property taxes to the government” (Eberlin, 2018). These rules apply even if the landlord doesn’t live on site but is acquainted by the property owner. Does this mean they should charge higher prices? Yes, but only to limited cities that can afford it without hassle. Without a doubt this is highly obtainable for property owners to utilize, but the effect it is has on long-term renters could be devastating to survive random rent inflation without explanation. Economists and other researchers have noticed a change in rent prices during certain times of the year for long-term and short-term due to “landlords risking foreclosure” (Landes, 2012). In general, this is true because of how vacations are timed and planned throughout the year for all people.
Jerry X, a economy entrepreneur for AirBnb, drastically proves this by explaining how short-term prices and occupancy constantly “fluctuate throughout the year due to demand shifts.” Meaning, if the landlord needs more funds once school session starts to maintain the building units, prices will increase, and short-term rent availability will dwindle. It’s as if this is one of the main reasons why most communities enable uptight rent laws due to short-term renters harming “property value by not maintaining their house as well as homeowners” (Pindell, 2009, p.72).
Does Increasing Housing Rates Help or Hurt The Economy?
Throughout the rental crisis, most of the economists have agreed that the increase of housing rates is what is causing most of the affordability hardships among many citizens. This is true because of the structure of employment income being stereotyped, and renting laws not being monitored so they could target low-income families. Not only renters but also “preventing workers from moving to areas with growing job opportunities.” (Been, Ellen, O’Regan, 2017, pg.1). An example could be the rate of construction jobs being added to the economy. Yet, with housing and rental policies being subjective it automatically qualifies wealthier cities to have higher quality than deprived ones. As a result, more houses are being built while the wealthy get richer and the poor struggle more to make ends meet with little to no income support. Does this mean they should lower prices? Yes, to some extent. There needs to be a balance with supply and demand towards employment and homeownership. However, unparalleled housing properties and stagnant interest rates make this process harder to accomplish without segregation being present in municipalities.
What’s Holding Back Bringing Rates Down From Landlords?
Overall, the economic crisis would be a time for lowering rent, but not from the landlord’s perspective. Many of them believe that once the prices dwindle, they would lose on competitiveness, and welcoming lower income residents. This may be true, however, it may attract a negative belief of gentrification to prevent diversity populating in high-class cities. Should landlords consider this a reason to lower it? It depends on many factors among tenants, rent policies, and the economy. Some researchers consider raising prices economic growth due to higher consumer spending in GDP, but unaware of how this unequal trend caused a traumatic effect in segregation within the housing market.
Been, V., Ellen, I. G., & O’Regan, K. (2017). Supply Skepticism: Housing Supply and Affordability. Housing Policy Debate, 1-22. doi:10.1080/10511482.2018.1476899
Eberlin, E. (2018, November 21). 7 Safety and Maintenance Responsibilities of a Landlord. Retrieved from https://www.thebalancesmb.com/landlord-rental-property-responsibilities-2124989
Hegewish, Arianne, et al. “The Gender Wage Gap by Occupation 2017 and by Race and Ethnicity.” Institute for Women’s Policy Research, 9, Apr. 2018, iwpr.org/publications/gender-wage-gap-occupation-2017-race-ethnicity/.
Landes, L. (2012, August 07). Earning a Living With Rental Properties: Should You Be a Landlord? Retrieved from https://www.forbes.com/sites/moneybuilder/2012/08/06/earning-a-living-with-rental-properties-should-you-be-a-landlord/
Pindell, N. (2009). Home Sweet Home? The Efficacy of Rental Restrictions to Promote Neighborhood Stability, 29, 42-84. Retrieved March 5, 2019.
* Tables were used from citydata.com and iwpr.gov.