Thursday, August 11, 2005

'Surreal Estate'

An editorial from the San Francisco Chronicle references that Center for Housing Policy study that we've all be talking about. The editorial hits on how high the cost of housing has gotten in San Francisco:
What is shocking is the prices. According to the report, an income of $223,576 was needed to buy a median-priced home in the city, which now costs $705,000. Just two years ago, the median price of a house in San Francisco was $567,000. The soaring housing prices are fashioning a new term -- "surreal estate."

One of the key factors is that the Bay Area doesn't produce enough housing, and demand far outstrips supply. San Francisco has been a leading culprit in this trend. According to the Association of Bay Area Governments, the city needs to build 3,000 new units per year to keep pace with the growth but it has barely been producing half that amount in recent years. This year, the estimate is close to 500 units.

— The Boy in the Big Housing Bubble