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This comes up a lot. Here's the thing - if you own a SFH in San Francisco, and suddenly you had the right to tear it down and a build a 3 unit apartment building, would that increase or decrease the value of your property? I'm not sure, but I lean toward increase, because you do own the land beneath your house. If you were the only one who did this, then I'd say yes, almost certainly. However, if everyone did this, supply would increase, so the question is, would that result in a decrease in prices, offsetting the value of converting a single family residence into three units? Personally, I doubt it. In my neighborhood in SF, nice 3br flats sell for about 85% of the cost of a 3br house. There's a lot of slack here to make up for the reduction in prices that could result from more units, and honestly, I'm not eve sure that increasing density in SF would lower prices in the first place. I know that last one may seem counter-intuitive, but keep in mind, Manhattan generally has housing costs than SF, so greater density certainly doesn't necessarily mean lower housing costs. A lot of people have pointed out that SF's high housing prices may be impeding further economic growth in the region. It's entirely possible that greater density would attract even more high paying workers to the region, with even greater economies of scale, higher levels of economic activity, and so forth. It's not out of the question that greater density could result in higher, not lower, housing costs. I'm not convinced that SF nimby-ism is driven by a desire to maximize the dollar value of real estate assets. I'm also not really convinced that it's unique to San Francisco. My guess is that most medium-density neighborhoods that have been in a steady-state for 75+ years are resistant to change, regardless of whether they're located in SF or elsewhere. |