San Francisco’s days as the top tech mecca in the US may be numbered. The tech industry is booming in “Silicon Seattle,” and it’s looking like the city may be more successful than San Francisco at supporting the influx of techies.
Case in point — Redfin, a real estate brokerage, recently tweeted a graph that shows Seattle is crushing San Francisco in terms of new construction home sales:
New construction home sales: Seattle vs. San Francisco pic.twitter.com/NjTnEO2Kau
— Redfin (@Redfin) July 6, 2016
The news is good for Seattle — while the San Francisco tech boom pushed housing prices higher as more and more workers with high salaries fought for homes, Seattle appears to be working to preemptively avoid that situation by increasing the amount of housing in the city. However, it also raises the question of why Seattle is seemingly more prepared to succeed than San Francisco was.
Part of it has to do with the fact that over 20 years ago Seattle set a goal of creating 2,400 new units every year, beginning in 2005. Meanwhile, San Francisco has expedited building new units only as recently as a few years ago. In 2012, only 1,279 new units were built, one for every 10.5 people who moved to the city.
Myriad other issues have also slowed new construction in San Francisco. For one thing, the city is denser and much smaller than Seattle, so there is literally less space to build. For another, community organizations have sued multiple developments for environmental and cultural reasons, preventing new buildings from going up. San Francisco is also unable to expand upward due to strict height restrictions.
Of course, Seattle’s high new construction homes sales don’t necessarily mean the city is prepared to entirely avoid the type of housing crunch now being seen in San Francisco. Though more news homes are being built in the city, demand remains elevated as well — the median value of a Seattle home has risen 17.6 percent in the last year, and Zillow sees it increasing 8.3 percent within the coming year.
Seattle renters are also facing pressure. Last month, rent for a one bedroom in the city was $1,740 per month, according to Zumper. That’s much lower than San Francisco’s $3,510 per month, but still the 10th highest in the US.
The upshot is that Seattle housing remains expensive and in high demand — characteristics that even increased new construction may not be able to alleviate entirely. However the situation plays out, maybe we’ll get another parody TV show à la “Silicon Valley” and “Portlandia,” this time featuring Seattle.