Microcosm of S.F. housing plight: 2,595 applications for 18 units

As his father, James, opens the door, James Ceballos, 3, rings the doorbell at their unit in the residential building at 1180 Fourth St. in San Francisco on Nov. 3, 2014. As his father, James, opens the door, James Ceballos, 3, rings the doorbell at their unit in the residential building at 1180 Fourth St. in San Francisco on Nov. 3, 2014. Photo: Scott Strazzante / The Chronicle Photo: Scott Strazzante / The Chronicle Image 1 of / 17 Caption Close Microcosm of S.F. housing plight: 2,595 applications for 18 units 1 / 17 Back to Gallery

When real estate developer Forest City began construction on a new apartment complex at 2175 Market St., it announced that it would build more affordable units than required by the city — 20 percent instead of 12.

The response was overwhelming. Forest City put a booth in the lobby of The Chronicle building — chosen because it is centrally located, near public transit and well-recognized — and handed out more than 6,800 applications.

For 18 apartments.

Despite the odds, 2,595 individuals and families completed and returned the eight-page application. Their names were put in a lottery to draw 400 finalists.

Four hundred names for 18 apartments, 11 of them one-bedrooms.

And yet, more than 100 people turned up at a small auditorium in The Chronicle building, where the drawing was held. A gold cylinder on a table held thousands of red tickets. The wheel was turned, a ticket was picked and a number and name read out.

“It’s like they are auctioning off hope,” said Amy Anderson, who said she has been looking for a place since she moved back to San Francisco in January and was attending her third housing lottery.

Depressing to watch

The odds lengthened as they watched, because potential residents were given priority in the order in which they were drawn. By the time No. 295 came up everyone could do the math. Even if you were the next name called, you’d be in line behind almost 300 others. Some left. Some slumped in their seats. A toddler fussed. A man began aimlessly banging his fist on his thigh.

For all the momentum of the economic boom, and the political good intentions, these people — families with children, seniors, young couples — can’t find a place to live, even if they have jobs and a steady income.

It is important to point out that these are not people looking for free public housing. Anderson, who says she once rented an apartment on Russian Hill for $1,200 a month before leaving the city, said she could afford to pay as much as $1,500 a month.

“Which is not that unreasonable in most places,” she said. “But I think of housing like it is an elevator that just keeps going up and off. If you ever get off you can’t get back on.”

To qualify for an affordable rental an applicant’s income must be at or below 50 percent of the city’s annual median income. In the booming San Francisco economy that works out to $48,550 for a family of four — the number rises as the family size increases.

So a couple with three children could make as much as $52,450 and still be at half the median income. More important, even at that income, they’d probably still be shut out of housing they could afford.

'Low income’ is relative

“These are working families,” says Sarah Dennis-Phillips of the city’s Office of Economic and Workforce Development. “A family that is making $20,000 a year is considered low income. But in many cases so is a family making $48,000.”

The Mayor’s Office of Housing has put together a list of sample incomes to make the point. For instance, cashiers typically make about $27,000 a year, construction laborers $48,000 and elementary schoolteachers are at $61,000.

The problem, as the Forest City lottery makes clear, is a crippling shortage of affordable units.

Doug Shoemaker, president of the California branch of Mercy Housing, an affordable housing nonprofit, says this is the worst market he’s ever seen. Mercy just opened a 100-until affordable housing building for families at Fourth and Channel Streets. There were 2,995 applications.

“The demand is just intense,” he said. “It was a horrifying reminder of just how hard it is. I’ve been in this field for 20 years and for people looking for apartments this is the most depressing market I have ever seen. It is painful to watch any of it, but what horrifies us most is the homeless families.”

Sara Osaba, a single parent, can’t get over the irony. A former UC Berkeley student, she moved back to San Francisco from Vermont, where she was working for nonprofits, helping low-income immigrants.

“I’ve worked 30 years helping immigrant families find housing,” she said. “Now I’m one of those families. I’ve gone from being a contributing member of society to being essentially homeless.”

Osaba came to San Francisco because her 14-year-old daughter, Sarina, was invited to train with the San Francisco Ballet. They moved with $5,000 in savings for first and last months’ rent and hopes of finding a two-bedroom place for around $1,800.

A hard lesson

That was in September. By now she’s learned there are no two-bedroom apartments for $1,800. Or one bedrooms. Or available housing. The $5,000 is gone. They’ve slept in the car, couch surfed and even spent a night in a homeless shelter.

“Never again,” Sarina told her mother after the shelter. “I’d rather sleep in the car.”

Sara went to Compass, a local nonprofit that helps families find housing, but if the housing stock isn’t there, the outlook is bleak.

“They said that I just need to continue to do what I’m doing, signing up for lotteries and looking on Craigslist,” she said. “The overall message was pretty dismal.”

It isn’t as if no one has noticed. Mention the shortage of affordable housing to any of Mayor Ed Lee’s people, and you get a barrage of data.

Goal is 6 years away

“The mayor has committed to building 30,000 units by 2020,” said spokeswoman Christine Falvey. “Half of those will be in reach of low and middle incomes.”

Still, that’s a goal, and six years away. What about now?

Dennis-Phillips says progress has been modest.

“As of the end of September there have been 3,508 units built in San Francisco this year, 951 of which are affordable,” she said. But when thousands show up to apply for a new project, that barely makes a dent in the demand, even when a developer exceeds the mandated limit.

Reflect city’s diversity

In a statement, Forest City Vice President Alexa Arena said the company made 20 percent of the units affordable “because we believe they should reflect the diversity of the city and contribute to the supply and affordability of housing.” Frankly, it is not unreasonable to think it’s also good PR for developers, who aren’t that popular with housing advocates.

So full-speed ahead with the development, right? Because the more developers build, the more affordable units there will be.

That’s both true and not completely helpful, Phillips says. Although developers are required to include affordable units (or pay a fee or build them elsewhere), of the more than 900 apartments created this year, just 294 are from developers. Housing nonprofits have built the rest.

“The percentage of units in market-rate housing is not going to fix this problem,” she said. “We need more affordable housing than the developers can touch.”

Although the Mayor’s Office of Housing says there are 21,499 affordable units in the city, that’s clearly not enough, especially now, during an economic surge. Mercy’s Shoemaker says the city is only now realizing the scope of the problem.

“For too long we have felt that it was OK to grow jobs, but not provide enough housing to support them,” he said. “Now the chickens are coming home to roost.”

And finding that there is no place to live.