When It Comes to Housing, San Francisco Is Doing It Wrong, Seattle Is Doing It Right, Cont.

Remember Sonja Trauss? She's the SF-based "deeply eccentric city-government nerd" and housing activist Kathleen mentioned in this recent Slog post. Trauss is a rarity among housing activists: she's pro-development, she wants to see more construction, not less, because she takes the long view:

Here is how Trauss’s thinking goes: We need more housing units, and the market-rate units we build now will become tomorrow’s middle-income apartments. Her theory is based on her experience working for a neighborhood advisory committee in a rapidly gentrifying part of Philadelphia right before the mid-2000s housing bubble burst. “When the market crashed,” Trauss told me, “all those projects we had approved went on sale for a third of the price they would have, while all the projects we gummed up were never built. We lost the opportunity to create more units.”

Kathleen, who is from the Bay Area, argued that San Francisco, where few new housing units are under construction, is doing it wrong while Seattle is doing it right:

I just got back from spending two weeks in the Bay Area, and the thing that struck me the most was how little construction is going on compared to Seattle. I saw only a few cranes over San Francisco, and in Oakland, just a couple new multiunit housing structures being built. Considering the extreme housing crisis in the Bay Area, the amount of new housing is clearly inadequate. Although there has been lots of handwringing about all the new construction in Seattle, it's really one of our only hopes (besides rent control, which we also desperately need) for affordable housing.... [And] new housing projects in Seattle may not be all that affordable now, they will be eventually.

We somehow missed this piece, in the Puget Sound Business Journal, last November. It buttresses Trauss and Kathleen's point:

It's not demand that has Seattle apartment landlords worried. It's supply. More than 11,000 new units are expected to open this year in the region, and it's forecast that an equal number will open next year. For landlords this tsunami of new apartments comes at a terrible time with the market showing signs of weakness.

And while rents aren't falling yet—we'll need a market crash for that (and we may be getting one)—rents are rising more slowly in neighborhoods that have seen a lot of new construction:

The issue of slowing rents is most acute in Seattle neighborhoods that are experiencing an unprecedented amount of development, according to Dupre + Scott Apartment Advisors. The Seattle apartment tracking firm said that rents rose 5.6 percent region-wide from March through September, and were up 8.3 percent from a year prior. But in the core of Seattle, rents went up just 3.9 percent year-over-year in September. That's was down from 8.4 percent a year earlier. "We expect the rate of rent increases to slow further as more new units open over the next years," states the Dupre + Scott report.

So if you want to see rents come down, if you want apartments in the center of the city to become more affordable, then you should be delighted each time you see a new apartment building going up. The faster they build them, the more units come online, the cheaper they get.