Uptown Planners Election – Tonight, 3/1, 6 PM

If you live in, own a business in, or own property in Uptown you are eligible to vote tonight at 6 PM for the board of Uptown Planners. Show up at 3900 Vermont St., San Diego, CA 92103 to make your voice heard and have a say in the future of Uptown!  Please consider supporting the slate of candidates noted below.


 

Tonight, Tuesday March 1, the community planning group for the neighborhoods of Uptown, Uptown Planners, will hold a board election.  Groups like Uptown Planners, give input to the city about development, park space, and other important issues.  Per the city websiteCommunity planning groups (CPG) provide citizens with an opportunity for involvement in advising the City Council, the Planning Commission, and other decision-makers on development projects, general or community plan amendments, rezonings and public facilities. The recommendations of the planning groups are integral components of the planning process, and are highly regarded by the City Council and by staff.

For an idea of the topics that Uptown Planners you can view the agenda for the meeting tonight following the election.

Being a part of a planning group is a significant commitment of time and dedication to a community.  It is also a very important part of how things get built in San Diego.  This applies to buildings, sidewalks, bike lanes, housing, dog parks, and much more.

Please see the below graphic for a slate of candidates that has stepped up and organized to run for Uptown Planners. I support this group of candidates and hope you will too.  Paul Jamason at SD Urban has a thorough write up of the major issues at stake and why it is important to support these candidates.

“Let’s move beyond the priorities of traffic, parking and home value appreciation, to the more important challenges of climate change and housing affordability. We can do this by supporting Uptown Planners candidates who will work to implement San Diego’s Climate Action Plan and transit-oriented development in our neighborhoods.”

Uptown Planners election

Following is a message from Bike San Diego that has endorsed two of the above slate of candidates for this election.

Tomorrow is the Uptown Planners Board Election – Tuesday, March 1st, 20166:00-7:00 p.m.

BikeSD is pleased to announce our endorsements of Ms. Maya Rosas and Mr. Joshua Clark, for the Uptown Planners Board election this coming Tuesday, March 1st. It’s time to get out the vote!
Uptown Planners is a key community planning group in the City of San Diego’s urban core and includes the neighborhoods of Bankers Hill/Park West, Hillcrest, Mission Hills, University Heights, Five Points/Middletown, and the Medical Complex. As the official planning advisory board to the City, it’s key that forward-thinking members with an eye toward fostering smart urban growth focused on active transportation, be elected to the Board. Maya and Josh are running on a slate of candidates who fit the bill. BikeSD recommends that you arrive early enough on Tuesday, March 1st (tomorrow), to meet Maya and Josh, as well as hear their recommendations for the remaining slate of candidates. A voter may vote for up to seven candidates!

Last year, our endorsement helped elect Michael Brennan and Kyle Heiskala to the Uptown Planners board, and their influence on the board cannot be understated. It was through Heiskala’s patience and willingness to educate his fellow board members that Uptown Planners voted to support protected bike lanes along all of University Avenue at their 2015 December meeting, something that could happen through city efforts regardless of SANDAG’s own project. This development was a huge departure from Uptown Planners of the past and it is only because of Heiskala and Brennan than this change was possible. So this being election year, don’t discount your voice. Opposition to safe streets and in favor of maintaining the status quo is still strong – so come out next Tuesday and VOTE!

Details of the election are below:

What: Uptown Planners Board Election
When: Tuesday, March 1st, 2016 – 6:00-7:00 p.m.
Where: Joyce Beers Center, 3900 Vermont St., San Diego, CA 92103 (between Aladdin Restaurant & Panera Bread)

**To vote, an individual must present identification proving either residency, property ownership, or business ownership in Uptown. (See map of Uptown boundaries here.) Identification may include a driver’s license, utility bill, tax bill, business license, or rent receipt – any document that has the voter’s name and street address. Photocopies of documents are acceptable.**

Don’t live or own property in Uptown? If you have friends or family who live there (Bankers Hill/Park West, Hillcrest, Mission Hills, University Heights, Five Points/Middletown, and the Medical Complex), give them a call and tell them to come out.

 

“Nuisance complaint” (Code 415N) police calls in San Diego

Awhile back I received a data set of all the Code 415N calls to San Diego Police Department for all properties in San Diego for a one-year period, 10/1/2014 – 9/30/2015.  I believe 415N is the police department code for Disturbing The Peace.  The data is for all property types, not only short-term rental properties.  During the short-term rental debates there has been quite a bit of discussion about the crime and safety impacts that short-term rentals have on communities so it would seem a decent place to look for elevated impacts in areas with more short-term rental units.

I took the information and did some high level analysis of the complaint calls – the data file is included here and the notes / calculations I added are  at the top right of attached file.

[Note: I didn’t have the TOT addresses to match to the 415N info (and the 415N info doesn’t have zip so I’m not sure how you match it unless they use the exact same address typing for both sets of data.  I didn’t take a stab at it since it’s above my skill level to break that down.  I’m also unsure of the completeness of TOT addresses since Airbnb now handles those remittances for hosts, so many are likely not registered with the City Treasurer.]

Some points I thought might be relevant to the ongoing discussion:

  • Total calls in past year = 13,869. With city population of 1.381 million that comes out to 1% of the population making 1 call per year.  I don’t know what a “good” nuisance reporting rate is, but if 1 of 100 people are calling once per year that seems pretty low.
  • Average calls per district – with 9 districts the total number of complaints comes out to 4.22 calls per day.  When thinking about enforcement needs, this seems a relevant point.  I would think 1 hire per district could handle 4.22 calls per day, maybe 10 or 20 (I don’t know).  At least a good point for talking about what resources are needed to handle complaint volume.
Police beat areas with most 415N calls
Police beat areas with most 415N calls
  • Complaints by neighborhood – the data doesn’t match to exact addresses, but is useful in seeing where complaints are from by beat area and how that matches to the neighborhoods cited as being short-term rental problem spots.  In the top 5 by % of complaints are: Pacific Beach (6.51%), North Park (5.78%), Ocean Beach (3.99%), East Village (3.14%), and Logan Heights (3.12%).  Pacific Beach & Ocean Beach have had a lot of anti short-term rental sentiment, but not the other 3, maybe North Park if you include Burlingame.  By address would be better to be more precise, but if you look at the Excel the neighborhoods that receive the most calls don’t correspond much to anti short-term rental sentiment, and I would guess correspond mostly to total population (which makes sense in general) than to perceived / actual short-term rental caused issues.

    Wanted to share this information in case of interest to others.  It seems a good touch point in the overall conversation so I thought worth posting.

Below is the Excel data set for download / use.

Some Market Thoughts on Short-Term Rentals in San Diego

The topic of short-term rentals in San Diego continues to be debated and potential rules / changes to rules will be a hot topic in 2016.  After ending 2015 with a well attended Planning Commission meeting in December it looks like the next official meeting / hearing will be in late February or March at the City Council.  It is sure to be a long hearing, with hundreds of San Diegans attending and providing commentary both for and against short-term accommodations in San Diego neighborhoods.

In the meantime, I wanted to jot down some thoughts about short-term rentals in San Diego from a market economy perspective, which follow.

Serving unmet demand – Short-term rentals in San Diego (and many places globally) have grown briskly in the past 5 years.  Airbnb was founded in August 2008 and is the largest short-term rental platform today although it was preceeded by Craigslist, Vacation Rental by Owner, and many other “more traditional” short-term rental uses like bed and breakfasts, room-letting, and others.  Today Airbnb has more than 2 million listings worldwide in more than 190 countries and 34,000 cities.  On New Year’s Eve 2015 the site was expected to host more than 1 million guests in a single night, up from 550,000 a year previous – nearly 100% growth in a year.

In San Diego the total number of short-term rental units in the city was estimated at 6,116 in a National University System Institute for Policy Research (NUSIPR) study released in October 2015.  This report was paid for by Airbnb and the San Diego Vacation Rental Managers Alliance which has lead some to believe it is biased. (The Union-Tribune article linked to states that the Short-Term Rental Alliance of San Diego (STRASD) paid for the study as well – I am part of STRASD and our organization paid for a not a cent of the study, just to clarify.)  With vested parties paying for the study this may be true although NUSIPR does studies on a number of topics in San Diego and is a credible research organiation.  Regardless of intent or paying party, this study remains the most comprehensive, and I believe only, one on the subject in San Diego.

In the study a few figures stick out:

  • Hotels have increased their occupancy rate and nightly room rate consistently over the past 5 years despite the growth in short-term rentals.  Occupancy increased from 68.4% in 2010 to 76.7% in 2015. Over the same period revenue per available room, a figure that measures both occupancy rates and average room rates, increased from $84.72 in 2010 to $103.52 in 2014.  It would seem short-term rentals are not hurting hotel business and are a complementary offering, at least to date.

    airbnb - hotel rates in sd
    Image from NUSIPR study, click for link.
  • Total short-term rentals now comprise a maximum of approx. 1.1% of total housing stock in San Diego.  This is based on a total of 6,116 short-term rentals per the NUSIPR study and a total housing stock of 518,300 per the American Community Survey 5-year estimate (2010-2014) for housing information, Table DP04.  This estimate treats all short-term rentals as whole unit rentals although many are a room in a unit or the use of a primary home on a part-time basis.  I’ m using the total number to be conservative and over-estimate the total impact on housing stock.  6,000 units is not a small number, although it is much smaller than the number of vacant units in San Diego.  Per the same ACS study there are 39,221 vacant units in San Diego – approx. 1.6% of homeowner occupied units and 4.2% of rental units.  A similar question could be posed regarding vacation homes or second homes owned in San Diego, I do not know the figure for such property holdings here.
  • Short-term rentals are blunting the ability of hotels to increase room rates during high-demand special events.  The Economist recently wrote about the impact of increased short-term rental supply around large special events like the Olympics or the annual Berkshire Hathaway shareholder meeting.  Traditionally, hotels have been able to greatly increase rates during high-demand events but more recently the higher prices have incentivized property owners to add to the existing short-term rental stock.  In San Diego this can be seen in the increase of short-term rentals around Comic-Con.  Interestingly, as reported by Voice of San Diego, “It turns out getting Comic-Con to stay in town for 2017 and 2018 is more about discounted hotel rooms than the size of San Diego’s Convention Center.”  Spending millions of dollars to expand or renovate the Convention Center gets much press and attention when perhaps we could secure the future of Comic-Con by simply encouraging local homeowners to house attendees or take a full paid vacation to Hawaii for the weekend.
An Airbnb listing in Barrio Logan.
An Airbnb listing in Barrio Logan.
  • Short-term rentals keep more money in local pockets. Per the same Economist article, “more room rentals should also mean that more money flows directly to residents every time small cities stage a tourist-magnet event. (Airbnb passes on around 85% of guests’ total payments to hosts, whereas hotels spend just 30-35% on labour.)”  The NUSIPR study put the total rental revenue to property owners at $110M and the total economic impact, including government tax receipts, restaurant spending, etc. at $285M.  If spread evenly across the total number of short-term rentals that means an economic impact of $46,599 per short-term rental property in San Diego, with $17,985 going to the property owner in direct rental payments.
  • San Diego is an expensive place to live. This is due to many factors and not a new phenomenon.  For example, in the Morena Boulevard area a recent plan to add units (read: increase population density in a manner consistent with housing patterns in an urban portion of a major city rather than suburban land use) would have added 4,800 units to a blighted area near I-5.  It was widely panned by local residents and scrapped.  San Diego does not have to build more housing at all, but if we do not it is not logical or reasonable to think that housing prices will not increase.  San Diego is a very desirable place to live and priced at a discount to other California hubs like San Francisco.  Static housing stock and increased demand and/or population will yield increasing housing prices and rent costs.  Short-term rentals with a total of 6,116 units in the city pale in comparison to the anti-build / anti-growth / anti-height / anti-density sentiment common in many areas of the city.
  • Relative to income levels, the costs of rent in San Diego have fluctuated both up and down in recent years.  Per an October 2015 article in the Union-Tribune 55% of San Diego renters are “cost-burdened”, spending a third or more of income on rent.  As shown in the image below, this ratio is about the same as in 2007 – before Airbnb existed and prior to the rapid growth in the number of short-term rentals. The ratio has been both higher and lower than the 2015 figure in recent years.  Interesting sidenote from the article: “In Miami, 66 percent of residents are paying a third or more on rent. In Detroit, because of low incomes, more than 65 percent of renters are cost-burdened”.  Both low income levels and high housing prices can result in a high percentage of income going to rent.
    Data and image from Union-Tribune (click for full article)
    Data and image from Union-Tribune (click for full article)

    There is a finite demand for short-term rentals.  Although short-term rentals are not new in San Diego and have existed for many decades in some areas of the city – particularly beach areas like Mission Beach – the recent growth has been fueled by new techonology and trends.  Ubiquitous smart phones, social media and the internet connecting the world market, and increasing global travel are all major causes.  At the onset of a new trend growth can be explosive but will decline over time.  At some point the supply will meet, or exceed, demand.  It is hard to predict what the total demand for short-term rentals is.  Per the NUSIPR study, short-term rental room nights totaled 456,000 in 2014-15 compared to 11,300,000 total room nights for hotels and motels.  Short-term rentals were an estimated 4% of the hotel total night stays.  Perhaps this ratio could reach 10%, maybe even 25% – it’s hard to predict but seems unlikely that short-term rentals would entirely replace hotels, or even rise to an equivalent level.  My best estimate is we are relatively close to meeting demand – 5% or perhaps 10% of total hotel nights would be my estimate.  This is based on discussions with other short-term rental owners / hosts and I have not found a study or formal estimate of this.  Especially over the past few months I’ve spoken to many hosts / owners that have seen a large drop in occupancy and/or reduced nightly rates.  This is partly due to the slower winter season but likely also due to increased competition as the number of short-term rental units have increased.  Given the low vacancy rate and rising rent levels for rental units in San Diego and the reduced labor hours, taxes, and hassle to operate a long-term rental vs. a short-term rental I would not be surprised to see some short-term rentals being converted to long-term rentals.  It may not be a trend today, but whenever the demand is met (or approached) each unit entering the short-term rental pool will reduce the revenue per unit for the short-term rental market.

The future for short-term rentals in San Diego is cloudy and could go any number of ways – we’ll have to wait and see.  To date, short-term rentals have provided a meaningful economic opportunity for many property owners in San Diego.  For the reasons above and many others, I hope to see this opportunity continued.

At the same time, non-economic factors remain important and seem the cause of the bulk of the disagreements between those supporting and opposing short-term rentals.  The OB Rag has written most about this topic and I think best presents the major issue dividing people – that of community character.  Community character is hard to define and it is difficult to measure social impacts or make comparative examples.  That doesn’t make it unimportant – the “feel”, personality, or culture of a place is often the most enduring and compelling attribute it can possess.  I’m sure that qualitative factors will continue to play an important role and I hope the prominent one.  Economically and quantitively I see short-term rentals as very much to the good of individuals (hosts and guests / owners and customers) and the region at large.  The impact of short-term rentals on our communities is less clear and should be well considered.

Temescal Creek – 374 Acres Of Beautiful San Diego Back Country

I was very happy to be included in an invitation to view and explore a new acquisition by the San Diego River Park Foundation just outside of Julian, California on Saturday, December 5.  Below are a number of photos of the 374 acres that the Foundation is in the process of buying from the current owners.  This acreage surrounds Temescal Creek, a coldwater creek that is part of the San Diego River watershed.  This acquisition will ensure the land is preserved for future generations and remains a wildlife corridor preserve for mountain lions, deer, turkey, hawks, and many other animals.  Executive Director Rob Hutsel noted that the vision is for this space to be open to the public and to host youth for overnight trips to explore and participate in science-focused lessons in nature.

Each September I organize a weekend bicycle ride, Ride For The River Park, from Ocean Beach to Julian and back to promote and support the idea of a continuous path for the entirety of the San Diego River.  2016 will be the 5th year for the event and if you’d like to join we’d love to have you.  My goal is to see this path be a reality by the 10th year of the event – by September of 2021.  The idea and the work is not mine, it is that of the River Park Foundation, I simply want to support and spur on the work they are doing.  At the event on Saturday, a mile marker post was debuted showing the start / end of the San Diego River Trail.  What a beautiful sight to see.

2015-12-05 11.52.16
Much work to be done, but a goal to strive towards.

In the same vein of supporting the vision of a full River Trail, 2015 is the first year for which I am donating 1% of my Airbnb income to charitable causes.  For this year that money is going to the San Diego River Park Foundation.  I got the idea from the 1% For the Planet movement, in which “Members donate at least 1% of sales to nonprofit partners we’ve vetted for participation in the 1% for the Planet network.”  I’m just a single person so after further research it doesn’t seem the 1% For the Planet program is a good fit for my giving.

Instead, I’m working with Airbnb for a roll-out to San Diego of their Charity Donation Tool which currently allows hosts in Portland to opt-in to donate a portion of their revenue to a local charity.  I’m hopeful that this will soon be an option for hosts in San Diego to automatically and regularly support great local charities like the River Park Foundation.  If you’re a host in San Diego and would like to help make this a reality please contact me.  In the meantime, I hope you’ll consider a voluntarily donation to the charity of your choice from your Airbnb (or VRBO or other platform) earnings.

The acreage surrounding Temescal Creek features many mature oaks, ravines, and all sorts of native plants thriving.  A beautiful, peaceful place to enjoy and savor the natural splendor of San Diego and a reminder that without support it will not endure.  It takes the efforts of many to protect and preserve our natural bounty.

[The Temescal Creek property is located at 5030 Eagle Peak Road, Julian, CA 92036 but is not currently open to the public.]

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San Diego County Spends $36M To Give Employees Free Parking

The San Diego County Board of Supervisors recently cut the ribbon to officially open a new $36,000,000 parking garage at Cedar and Kettner in Little Italy.  The garage has 640 spaces, built at a cost of $56,250 per space.  The garage will primarily be used for free parking for county employees and will also be available for paid public parking use on nights and weekends.

Here’s a laudatory video from the ribbon-cutting:

Supervisor Diane Jacobs noted “this truly is the best looking parking garage in the entire region and the most needed parking garage”.  The “stalls are a little wider than you’ll find in most commercial parking structures”.

The Little Italy neighborhood is home to many of San Diego’s most highly regarded restaurants including Bracero, Buon Appetito, Monello, Ironside, Davanti Enoteca, Juniper and Ivy, and many others.  Most of the restaurants have little, or zero, private parking provided.  The area has also seen tremendous growth in the number of residential units in recent years.  The result has been a thriving neighborhood that is among the most vibrant places in the entire county.  A large part of the enjoyment of Little Italy stems from the many people and attractive buildings present – I doubt India Street would be improved by the addition of a massive parking garage.  In recent years the need for parking of unused vehicles has been further reduced due to the explosive growth of taxi-hailing apps like Lyft and Uber.

The new county parking garage is the second portion of the “Waterfront Park project” that created a 12-acre park across Harbor Drive from San Diego Bay, replacing 8 acres of surface level parking lots adjacent the County Administration Building.  That project cost $49.4 million dollars after an initial project cost estimate of $44.2M with $19.7M for building the park, $18.5M for building underground parking, and $6M for design and administration costs.

In total, between the two projects $54.5M was spent on moving parking spaces and $18.5M was spent on the actual park that people enjoy.  This is excluding the $5.2M of difference from the original estimate to the actual construction costs and the $6M of design and administration costs.  Those cost breakdowns yield a result of 75% of funds used to move spots for empty cars and 25% of funds used to build a park.  For purposes of this article let’s assume the admin and cost over-run figures split on the same lines.  The vast majority of the funds used for these joint projects was for moving parking spaces, not for building a park.

locations
This is how far the parking spots moved, for more than $50 million.
before pic
Here is the before photo – this is how San Diego uses prime bayfront real estate. Shake your head.

This project was sold as a project to build a great park – it would seem fitting if most of the funds were actually used to build a great park.  Instead we spent 75% of the funds to relocate parking spaces, not creating new spaces but moving existing parking spaces.  251 spaces moved approximately 15 feet, they were undergrounded in the same location as the previous surface level lots.

To boot, the county demolished an historic building in Little Italy to make room for the large new parking garage.  The Star Builders Supply Company building was built in 1911 and added to the county list of historic buildings in 1991.  County supervisors unanimously voted to demolish the building.  It’s now gone but you can enjoy the below video of the beautiful piece of San Diego history that has now been erased like so many others.

From the total 891 parking spots that were moved, 71.8% were moved about 1-2 blocks east from their previous location.  28.2% were moved about 15 feet underground.  To accomplish this feat, county taxpayers spent $54.5 million dollars.  As enjoyable as the the new park is and a huge improvement to the ugly surface parking lots perhaps it would have been better to save that money or spend it on a better use.  To move so many parked cars such a small distance seems a pyrrhic victory.  A small consolation might be that the total number of parking spots went from 1,200 in the surface lots to 891 in the new underground and multi-level parking garages, a net reduction of 25.75%.  We could have spent even more money if we moved all of them!  A legitimate question would be if the previous 1,200 spots or the new 891 spots are actually needed or not. But as so often happens when it comes to accommodating automobiles, too much is never enough and no cost is too high.  More lanes on I-5 for $6 billion? Of course!  More parking lots in Balboa Park? Of course!  Analysis of the actual demand and cost comes far behind the populist appeal of free goodies for motor vehicles.  The environmental impacts of our car culture is even further down the priority list than our dollars.

Enjoy the Waterfront Park (aka Parking Lot Relocation Park); it’s a great place.  Building beautiful things is something a great city does.  I’m proud that San Diego built it.  In total, though, this project was a massive use of taxpayer dollars to move parking spots a small distance – not to build a great public park.  They are distinct items and taxpayers did not need to spend tens of millions to provide a tax-free employment perk that most employees, government-employed or not, do not enjoy.  We also did not need to use prime real estate to do so.  Taxpayers must demand better stewardship of public funds and assets.

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Many thanks to Streetsblog, San Diego Free Press, Bike San Diego, and Voice of San Diego Morning Report for sharing this article!

Good Reading – The New Rules of Real Estate

I recently read Zillow Talk: The New Rules of Real Estate by Spencer Rascoff and Stan Humphries.  It’s a book in the “Zillow Talk” series and the authors are the CEO and Chief Economist, respectively, at Zillow, an online platform for housing data.  Zillow and Redfin are the biggest players in the space for MLS listings accessible to the public.

Austin is a really cool town and they have houses there! [Zillow screenshot]
Austin is a really cool town and they have houses there! [Zillow screenshot]
The book is a quick read – 258 pages – but is entertaining and has some interesting anecdotes and insights.  If you’re interested in real estate or work in the industry I’d definitely recommend checking it out.  Some of the items I most enjoyed learning about were:

  • Breakeven Horizon – A tool that Zillow has put together to estimate the number of years it would take for renting a residence vs. buying to even out when considering tax benefits, expected appreciation of real estate, etc.  In San Diego County the breakeven is 3.8 years so if you expected to live here for 5 years it would probably make more sense to buy rather than rent.  At the end of 2014 that national breakeven horizon was 1.9 years, there’s a lot of variation among markets.  Interesting tool to check out if you’re considering whether to buy or rent.
  • Words Matter – The book takes a look at how words affect home values in a variety of ways.  Which street suffixes are most valuable? Way, Place, and Court.  Which are least valuable? Street, Road, and Avenue.  The less valuable suffixes are the more common ones.  The book also looks at named streets vs. numbered streets (named streets are much more valuable – 33.5% more valuable in Dallas!).  Which words to use in a listing  to maximize price is also discussed – granite and stainless are great to use but cosmetic and TLC should be avoided.  More words in a listing also help quite a bit.
  • Timing (and Pricing) Matters Too – When is the best or worst time to sell or buy a home? It varies during the year, and in different ways in different markets.  December is a great time to buy generally and March/April is a great time to sell.  Having your listing price end in a 9 is a great idea but ending in a 4 is a bad one.  8 is also a great ending digit if you’re in an area with lots of Chinese residents.

Fun read and lots of interesting trivia and tidbits to absorb.  Well worth a couple of hours if you’re buying, selling, or potentially doing either in the future.  Enjoy!

The book is better than my photo skills. :)
The book is better than my photo skills. 🙂

Thinking About Housing Affordability

San Diego real estate is pretty expensive – the median home price in September 2015 was $460,000.  There are many places where real estate is more expensive – New York and San Francisco are prominent examples. Close to San Diego, in September 2015 neighboring Orange County had a median price of $615,000 (33.7% higher) and Los Angeles had a median price of $490,000 (6.5% higher).  The cost of housing in San Diego is a common topic of conversation.  I’ve been thinking about housing affordability and just wanted to jot down my thoughts on the basic causes as I think and read more about the subject.

There are two primary factors at play in pricing an item – supply and demand.  For housing this basically means:

  1. Supply – number of housing units
  2. Demand – number of people (and dollars they have)

To lower the price / value for housing either supply needs to increase or demand (population and dollars) needs to decrease.  There are a variety of ways to impact either of these

Increase supply

  • Increase number of units – build more housing (homes, condos, apartments, etc.)
  • Increase number of people per unit – Increasing the amount of persons per unit (more per room or more per total unit) makes more units available
  • Small units – Replace large units with smaller units to increase overall supply.  Example would be to replace one 3 bedroom home with 4 townhomes.
  • Build higher – At surface level, the square footage can be used only once.  Building upwards allows the same amount of land to support more units.
  • Build farther out (sprawl) – Expand the footprint of the developed area of the town / county to increase the amount of units.
  • Convert land to residential use – Repurpose commercial land, roadways, agricultural land, etc. to residential use.  Increasing the land available for residential use supports creation of more units.
  • Add units not on land – Utilize water (bay, ocean) to add housing units.

Decrease demand

  • Decrease desirability – Reduction in safety, outdoor amenities, pollution levels, etc. decreases demand as people will be less likely to elect to live in unsafe or undesirable location.
  • Decrease purchasing power – A downturn in the economy or weakness in job market will reduce the amount of money available for property purchases or rent, bringing down the price level.
  • Decrease population – Probably not feasible in a variety of ways but could indirectly be impacted by stopping creation of new units (which would counteract impact by reducing supply)
  • Increase other costs – An increase in the cost of other items – electricity, food, taxes, etc. – would leave less money available for housing, potentially reducing demand
  • Reduce buyer pool – Limit pool of parties that can purchase property.  Could add surcharges or taxes to non-owner occupied properties or potentially exclude buyers unless they plan to occupy.

I’ll likely add to this but before getting into the more intricate issues involved with housing and property cost I wanted to lay out thoughts on the underlying basics.  Have some thoughts to add? I’d love to hear them.

Many people desire to live by the ocean. Get rid of the ocean, reduce demand.
Many people desire to live by the ocean. Get rid of the ocean, reduce demand.

Neighbors Lying About Neighbors – The STR Debate Continues

Below is a Facebook post from an Airbnb host that was shared last night after the Community Planners Committee meeting on the issue of short-term rentals.  I plan to meet with the commenter to get additional details but see little reason to doubt the story below given the amount of details included and don’t see a reason for that person to lie.

I wanted to share this today because it seems that in the debate in San Diego there is much scorn being placed on those hosting via platforms like Airbnb and VRBO.  Few are questioning the validity of complaints about noise, trash, and parties – they are taken at word.  The few times I’ve had to call the police or a towing company they have arrived and addressed the issue promptly and completely.  I find it hard to believe that in the wealthier parts of town (where many of the complaints and anti-STR groups are centered) this would not be the case.

In the below instance you can see the power that this default trust gives to complainants.  I’ve removed specific names from the below post but everything else is verbatim from the host being accused of bad behavior.

I need to know who to write to in order to speak my voice. Three of the speakers lied. I have proof because I’m the big corporation with a water park in my back yard. I’m a mom of 3 whose son has brain cancer so make a wish gave him his wish to have a small waterslide added to the pool already there and I’m called a water park. I rented it out for the summer to pay bills and they knew that but adopted the “not in my neighborhood” signs, harassed me and my family (yes I was the one who broke down in tears talking about it at the PB mtg). All before a single guest arrived. C. harassed every renter and at 2pm in the afternoon when a family came out back and she saw they were not white she left voicemails which I kept with her displeasure. I could go on and on about her C. C. who said he is native and moved here from Texas a few years ago and doesn’t live on the street,etc. Their complaints that they put in writing was a baby cried and one renter dared to have food delivered. I have proof all my renters were families and not parties. I drove by day and night just to make sure. Sorry I had to get that out.

There remains much to be discussed in the STR debate in San Diego but hopefully we can step away from name calling and outright falsities to impugn those we disagree with.

Airbnb Not Typically Allowed in Apartments

As the Airbnb debate continues in San Diego, I found it interesting to receive a warning letter from my previous apartment manager, Torrey Pines Property Management this week informing tenants that using sites like Airbnb is not allowed in the buildings they manage.  I contacted Torrey Pines and was informed that this is a proactive measure to avoid issues in future, not in response to issues that have occurred.  Good for them for taking a proactive, informative approach to the issue.

I wanted to share this since there are likely many San Diegans that would like to utilize sites like Airbnb to rent a spare room, or their apartment while they are out of town.  If you rent a property, or live in a building or community with an HOA it is important to check the terms or covenants, conditions, and restrictions before trying to host a guest on these platforms.  Note that this may also be the case even if you’re not receiving money by using a site like HomeExchange or Couchsurfing.

In addition to issues with your landlord, renting a room in your apartment or home is currently illegal in the City of San Diego and you may be liable for tens of thousands of dollars in fines as a woman in Burlingame has found out.  To date, this is the only penalty of this sort in San Diego but the Code Enforcement Division will be responding to complaints about this sort of use in the future and I assume pursuing violators with the same vigor as the Burlingame case.  Per conversations with Code Enforcement any enforcement will be complaint-driven – they won’t be using the publicly accessible information on sites like Airbnb and VRBO to identify potential violations.

If your lease doesn’t allow you to host on Airbnb but you think it would be beneficial try talking to your landlord.  Some landlords are willing to allow the use if you agree to take liability for any issues caused or may be willing to allow it for an increase in your rent payments.  I know a couple of people personally using this approach, and in San Francisco it worked out for a couple as well.

From SFGate:

Kelsey and Mike Sheofsky achieved that balance. The couple travel frequently for Shelter Co., their luxury-camping business. They had dabbled with the idea of listing their Mission District house on Airbnb. Then their landlord approached them.

“She said, ‘What do you think about Airbnb-ing your place when you’re gone?’ ” Kelsey Sheofsky said. “I thought, ‘Perfect, we’re ready to go.’ Now we do it, and we give her a 20 percent cut of any money we make after cleaning expenses. Some months we give her an extra 600 bucks.”

Your landlord may or may not be open to Airbnb – make sure you are informed and if you have a question make sure to ask.

2015-07-05 06.10.36
Our most recent Airbnb stay was in Budapest adjacent the Opera House.

Below is the letter from Torrey Pines in full.


Dear Resident(s):

The increasingly popular site airbnb.com where individuals can post short-term, vacation rentals is a growing concern for Landlords in San Diego due to the noise, strain on resources, and lack of regard for the property that comes from using any residence as a “Hotel” or “Bed and Breakfast”.

We would like to take this opportunity to remind our valued Residents that posting your apartment on this, or a similar site is considered a breach of contract and could result in legal action including eviction from the premises.

We take this matter very seriously and will be moving forward with legal action should your unit be located on a listing site for the purpose of subletting without our expressed written consent. Please contact your Property Manager if you have any questions or wish to report suspect or known violations.

Sincerely,

Torrey Pines Property Managment, Inc.
(858) 454-4200
www.torreypinespm.com

I love trees. I love huge free trees even more.

I love plants.  Trees, shrubs, and especially in San Diego native species like manzanita, oak, sage, and pine.  I am frequently in the yard trying to find more 2015-06-06 08.37.39space to add additional plants or replacing ones that have died.  (My approach to plants is mostly trial-and-error and learning as I go about what thrives in San Diego so there have been some poorly picked casualties along the way.)

However, plants cost money – especially big trees.  Recently I’ve recently reading a lot of books and articles about personal finance and philosophy like the Mr. Money Mustache website and the book Early Retirement Extreme.  These readings, and others like them, are focused on thinking about priorities and lifestyle, not penny-pinching though the names may suggest otherwise.  In regard to my quest for trees for my property it led me to think about other methods than buying trees at a nursery to get some nice specimens.

I started with calling a number of nurseries to comparison shop and get an idea of the price for 3 good-sized trees (24 inch planting box or larger).  After calling around the best price I could find was $680 for 2 Palo Verde trees and one New Zealand Christmas tree.  That’s a good amount of money but plants are something I feel ok spending money on since you can’t make up the years it takes to establish a tree.

I talked about making this purchase with my wife and we decided to wait a couple of months and think about it.  As with many purchases, delaying for a bit is a good way to step back and contemplate to see if it’s really a legitimate desire/need or just a short-term itch wanting to be scratched.

During the “waiting period” I decided to search on Craigslist for free trees since I had gotten some plants and trees on the site in the past.  In San Diego most of the free trees are palms which I wasn’t interested in but a quick search for “tree” or “trees” in the morning took less than two minutes and I thought worth doing for a week or two to see if something more attractive might appear.

Was I in luck!  In less than a week I had found some large, gorgeous trees – an Australian Flame tree and a few African Sumac trees that were 100% free and within 10 miles of my house.  Since I care for two young kids most days, I scheduled a Saturday morning to go get them.  I arrived to the first tree, in Coronado, with a spade and my mini-van.  It was advertised as 12-15 feet but was easily 20 feet tall.  Undeterred, I spent the next two hours digging out the root ball and calling for a UHaul truck and a friend to help me carry the tree.

I headed home after the tree was out of the ground for lunch, the UHaul, and a good and willing friend.  We returned and loaded up the tree in short order then dropped it off at my house before heading to East Village for the other two2015-06-06 14.31.43
trees which were thankfully already in boxes.  24 inch boxes were advertised but this ad overdelivered as well and we found three 36 inch boxes awaiting us, along with two 60 inch boxes.  The three remaining trees are in the Pocket Park at J Street and 13th behind Mission if anyone is interested.

We proceeded to use a dolly, which broke, to move the trees into the UHaul.  With the dolly broken we slowly shimmied the trees up the ramp and then headed home.

2015-06-06 17.23.09
Flame Tree planted in yard – beautiful

That evening and the next day I dug 3 large holes – 36 inches cubed – to fit the trees.  All told, I spent about 12 solid hours digging and moving plus about 6 hours of time from my friend and wife.  18 hours plus a total of $92 ($76 for the UHaul rental and $16 for celebration beers) for three amazing trees.  My original budget was $680 so this seemed like a great deal.  Then I priced the trees that I did get – $450 per for the Sumacs and $1150 or likely more for the Flame.  Awesome!  Not only had I saved 86% from my original budget but I’d received far larger and more valuable trees as well.  Based on the nursery prices, I’d paid 4.48% of the value of the trees I ended up with.  Better yet, I’d potentially saved 3 gorgeous trees that may have ended up in the trash.  Someone else may have taken the trees, but if not they likely would have been chopped down.

If you’re looking to add some trees to your yard, take a look at Craigslist and save some major money.  It’s also a fantastic place to get free or discounted furniture and other goods.  (And also a great way to get rid of items you don’t need anymore.)

If you live in San Diego you can even get free street trees that come planted for you!  It’s a great program and you can even apply online.  I received a Hong Kong Orchid tree under this program that has done great and has beautiful flowers.