Cost of building subsidized housing in California reaching stratospheric levels: $900,000 per unit in San Francisco

[stellarfun]

The $900,000 per unit in San Francisco

https://www.sfexaminer.com/news/supes-question-890k-per-unit-cost-for-sunnydale-hope-sf-rebuild/?te=1&nl=california-today&emc=edit_ca_20191107?campaign_id=49&instance_id=13676&segment_id=18599&user_id=da580a4cd1e82ea0128214184976a2ac&regi_id=10059472

From a NY Times reporter who writes on economic matters from California.

...

Readers wanted to know how those costs got so high and what is behind it. The details are complicated, but the answer is pretty straightforward: Everything is behind it. Material costs are going up, land costs are going up, labor costs are going up. Add that to all the regulatory hurdles and developer impact fees — which in California are about three times the national average ...the building sector is about as efficient today as it was 50 years ago. To combat this, a number of developers are trying — with mixed success — to build modular housing that can be stacked like Legos, figuring that if they can move a large chunk of the construction process indoors to an assembly line, they can drastically lower the cost.

You can’t talk about costs without getting into politics. Environmental rules, union wages, fees that help fund schools: These are the sorts of priorities that any attempt to reduce construction costs will run into.

The more it costs to build, the more subsidy it requires to make units affordable. The more subsidy it requires, the fewer people are served by it.

^^^ There is no article, per se; this is more of a blog-type entry in a daily NY Times section on California.

 

[stick n move]

They have the answer tucked in there...

“the building sector is about as efficient today as it was 50 years ago. To combat this, a number of developers are trying — with mixed success — to build modular housing”

Modular housing that is built off site, trucked in, and quickly assembled on site by people that dont need many high skills is going to be key towards bringing down costs. This is why I wish instead of mars Musk or Bezos were trying to tackle modular housing, because we need innovation here. Its getting a little bit better, but there really needs to be a push.

The free market always dictates and money always wins, so if they can bring down costs associated with modular housing to the point where people can make a lot of money by building affordable housing, then the shift will happen. Until then its going to have to be mandated out of luxury devs.