New Report Shows More than 40,000 Vacant Homes in San Francisco, a 20% Increase since 2015

SAN FRANCISCO — More than 40,000 homes are sitting vacant – nearly one out of every ten residential units in San Francisco – according to a report published today by the city’s Budget and Legislative Analyst. Among the first efforts to quantify and analyze patterns in residential vacancies, the report adds a new dimension to the housing debate in San Francisco, going beyond a singular focus on what gets built, and focusing on how those built units are used.

“This report makes clear what we have long suspected – real estate speculators and wealthy people with second homes are holding thousands of units off the market,” said Supervisor Dean Preston, who commissioned the study. “At the same time, we now have the data showing that policy intervention could activate thousands of homes and generate tens of millions of dollars annually.”

Since 2015, the total number of vacant units in San Francisco has increased by about 20 percent, to 40,500 units in 2019. Vacant units were concentrated in SOMA, Downtown, and the Mission District, generally the same areas where new housing construction has been concentrated.

Compared to other U.S. cities, San Francisco has among the lowest vacancy rates for units on the rental market or for sale, the report found, but a higher overall vacancy rate, indicating that many units are being held off the market as either second homes or investment vehicles.

The report further breaks down vacancies by category, showing the most significant increases in the category of Sold, not occupied, which includes instances where a buyer is using property for investment purposes and doesn’t intend to live in it.

“With over forty thousand San Francisco housing units vacant at any one time, the damning data in this report is a reflection of both market failures and policy failures,” said Fernando Martí, Co-Director of the Council of Community Housing Organizations (CCHO). “Tackling the City's affordability crisis is not just about development, but as much about responsibly managing our existing housing stock. A housing market that artificially constrains supply by cannibalizing homes into pied-a-terres or cash havens, as this report seems to call out, warrants some kind of City policy intervention.”

The dramatic increase in residential vacancy rates has, in recent years, eclipsed the rate of new housing production. According to the report, the vacancy rate has increased from 8.5 percent in 2015 to 10 percent in 2019, compared to just a 4.2 percent increase of new housing units during that period.

The report also analyzed policy interventions taken by other cities to address the issue of rising residential vacancy, including Oakland and Vancouver. If San Francisco were to adopt a tax based on the Vancouver model, the city could see an activation of 4,460 units within two years, the equivalent of approximately 90 percent or more of the average annual number of new housing units added over the last five years. In addition, the report suggests the tax could raise between $12 million and $61 million.

“In a city with a long-standing housing affordability crisis, with thousands of people living on our streets, we cannot continue to allow thousands of homes to sit vacant for no good reason,” said Supervisor Preston. “It is immoral, and we must intervene to activate these homes.”

The report can be accessed here: https://avanan.url-protection.com/v1/url?o=https%3A//tinyurl.com/SF-Vacancy-Report&g=MWMxYzRiN2JhYzBlNjkxZA==&h=YzkyYjRjNmIxYWNmOTA1YzUzODRhNzEwNGRkMjM4NTdjZjllNTMwMGYzNmE4N2E0Nzc4NmM3ODlhZGVkNGFjMA==&p=YXAzOnNmZHQyOmE6bzpkM2EzNTUyYzhkZTkzMGFlNzZlZjBmY2EwZTc5ZTkxNDp2MTp0Ok4=

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