News for the East Bay's diverse, working-class majority.

Brought to you by the Democratic Socialists of America, East Bay chapter.

East Bay DSA

August 29, 2019

We need social housing for all

By Nick French

The Bay Area boasts one of the richest cities in the world and is home to dozens of billionaires. The Bay is also the site of a staggering affordable housing crisis, which has left tens of thousands of people homeless and more and more people struggling to pay rent.

The housing crisis confronting the Bay Area’s working people is no accident. It’s an inevitable product of treating housing as a commodity, as something to be produced and distributed for profit. But we don’t have to settle for the dismal status quo. A better world is possible: a world of universally available, high-quality social housing, democratically controlled and permanently affordable.

The scale of the housing crisis

For working people, finding and holding onto decent housing in the Bay Area is incredibly difficult. Rents in San Francisco and Oakland are among the highest in the country, thanks in part to the tech boom and the thousands of new tech millionaires it’s creating. The population of the Bay Area has increased by over 600,000 people since 2010, worsening gentrification and mass displacement, as working people are forced to move farther and farther from the cities and their places of work (resulting in record commute times).

That’s not to say that working people have it easy if they find an affordable place in an outlying area. Landlords often refuse to maintain their properties, and they hike up the rent whenever they can. Tenants also face the threat of arbitrary eviction. And under broken rent control laws in places like Oakland — where landlords are not allowed to hike the rent until a tenant moves out — landlords have a strong incentive to evict tenants or push them out to make more money.

Of course, someone might try to escape the stressful life of a renter by buying their own home. But that prospect is increasingly remote for most working people: as home prices continue to rise, stagnant wages and mountains of student debt keep the dream of home ownership out of reach.

Housing and the logic of the market

Almost all the housing in the U.S. today is constructed and managed by private developers for selling or renting on the market. That means our entire housing system revolves around making more profits for developers and landlords, instead of making sure every person in the richest country in the world has a convenient, safe place to live. This focus on profit means a developer will only build a new property if they can sell it for more than it takes to construct, and a landlord will only rent a house or apartment if they can make more than it costs to buy and maintain the property. And the bigger the difference between construction and selling price, or between purchase price and rent, the better. If developers and big landlords stopped chasing profits, they would get run out of business by their competitors.

The results of this market logic are ugly. In the Bay Area, around 100,000 housing units sit empty while thousands of people sleep in tent camps. This situation is driven by a speculative housing market, where investors buy up properties the same way they gamble on the stock market — buying units just so they can sell them for a profit, if and when their value rises. Unfortunately for those of us who think of housing as shelter rather than a way for the wealthy to make more money, speculative real estate investment leads to higher rents for everyone else. A 2017 study found that, when speculators buy up 10 percent of a city’s housing, rents rise by roughly 20 percent.

Some argue that the way to address the housing crisis is through encouraging private construction of new affordable units. However, developers don’t make much money by building and selling apartments for ordinary people. They do make vast profits on luxury apartments, so that’s exactly what they build, almost exclusively.

Cities will sometimes require developers to make a percentage of new units in luxury buildings affordable, through a practice known as inclusionary zoning. This solution is deeply flawed, as Samuel Stein argues in Jacobin. First, it often results in construction of very few affordable units: according to Stein, from 2005 to 2013 in New York City, only 1.7 percent of new units built through inclusionary zoning were affordable. Second, “affordable” housing units are often affordable in name only — sometimes they are just as or more expensive than “non-affordable” apartments in the area. Third, building luxury units in a neighborhood raises the value of all properties in the surrounding area. This leads to an increase in rents, forcing lower-income residents (often people of color) to choose between forking over a higher portion of their paycheck to a landlord or leaving their neighborhood and community.

We need social housing for all

Our for-profit housing system turns what should be a basic human need into a source of ever-worsening anxiety and suffering for millions of working people. But there is an alternative.

Imagine a Bay Area with hundreds of thousands of units of high-quality, high-density, permanently affordable housing in urban areas, available to all. This social housing would be subject to public, democratic control, instead of control by a wealthy few. Social housing construction could be funded and planned at the city, state, or federal levels to meet the different needs of different regions and communities. And residents could collectively govern their housing units, through democratic election of leaders and community participation in decision making.

Social housing units would not be owned, rented, or sold by individuals. Residents of social housing wouldn’t have to deal with cruel and exploitative landlords. They would not have to fear sudden and arbitrary eviction or rent hikes. Repairs and upkeep would be made with generous public funding, keeping units safe and attractive. 

Perhaps most importantly, the development of social housing could be done in a rational way, guided by the goal of meeting human needs rather than the goal of making as much profit as possible for developers, corporations, and landlords.

This vision of mass social housing is radically at odds with current U.S. housing policy. But it is completely achievable. There are many examples of beautiful, high-quality social housing throughout the world, from London to Chile. One of the most striking examples is provided by “Red Vienna,” where 62 percent of residents live in social housing.

In the U.S., public housing is often associated with segregation, shoddy maintenance, and poor public safety. These problems were not necessary or unavoidable, though. Karen Narefsky, writing in Dissent, notes that the sorry state of public housing in the U.S. is the product of “the racism and disinvestment that would become endemic to government housing.” White residents of urban public housing, built starting in the 1930s through World War II, were lured out to single-family homes in the suburbs by low-interest mortgages. Black residents were largely excluded from these communities and remained in public housing. Racism and corruption led to underfunding and neglect of public housing, which is increasingly being sold off to private companies.

How could a new wave of social housing avoid these problems? Narefsky proposes that social housing be open to people of all income levels, in order to avoid the stigma associated with means-tested social programs, where benefits are only available to people who meet certain criteria (like a poverty-level income). This can be degrading for those applying for benefits and leads people who don’t make the cutoff to become resentful instead of supportive. 

Making social housing accessible to all is also a good way to avoid political attacks on means-tested programs: it’s harder for the government to cut universal social programs when people of all kinds benefit from them. We should also strive to make social housing as comfortable and physically attractive as possible, to ensure the wide public satisfaction the program needs to protect it from budget cuts.

How are we going to pay for social housing? The answer is simple: tax the rich. We can use the wealth of the billionaires, giant corporations, and predatory landlords who have created our housing crisis in order to solve it.

We do not need to settle for a world of constant displacement, out-of-control rents, and abusive landlords. We can have affordable and high-quality housing for all, publicly owned and democratically controlled.