Tech Broke Real Estate In San Francisco. Can Tech Help Fix It?
A common critique of Silicon Valley says that the startups it funds overwhelmingly fixate on solving the problems — or “problems” — of the young, affluent and highly-educated — ie. the sort of people who work in Silicon Valley and launch startups.
Increasingly, the biggest problem those people face is one of their own collective creation: the skyrocketing cost of renting or buying a home in San Francisco. To be sure, it’s an even bigger problem for people who work in jobs other than tech, a field where even interns often make in excess of $75,000. The online real estate brokerage Redfin recently calculated that there are zero homes in San Francisco that would be affordable on the income of a public-school teacher, and only one home that a firefighter could buy without spending a third or more of his salary on mortgage payments.
Thanks to the corporate shuttle buses that make it easy to commute to the campuses of Google, Apple, Facebook et al, more and more tech workers are choosing to live in the city, exerting ever more pressure on prices. In the Times, Nick Bilton shows how the owners of a three-bedroom fixer-upper were able to flip it for 60% more than their asking price, mainly because it happened to be a block away from a bus pickup.
No wonder recent months have seen an explosion in the number of startups that, like Redfin, promise to restore some sanity to the process of finding a home in ultra-competitive markets like San Francisco. (One of them, Zumper, just raised $6.5 million from Kleiner Perkins and other investors.) But can they?
I got a glimpse of the answer recently when I moved from Brooklyn to San Francisco. Before setting out on our weeklong apartment-hunting trip, my fiancée and I heard all kinds of warnings from our friends and the Bay Area about the madness in store for us. Partly because of that, we came forearmed with everything a prospective landlord could possibly ask for, including references, letters of employment, bank statements and even mini-bios of each of us. We also downloaded Lovely, a mobile app for apartment hunters and landlords.