Edinburgh has a lot going for it as a city, not least its World Heritage architecture, its strong cultural reputation, its status as a capital city and its stunning setting beside the Firth and peppered with hills. Property professionals prize location above all factors when valuing a property, helping to explain Edinburgh’s pricey reputation—and not just on Anne Street. And these prices are post the 2008 fiscal meltdown (damaging the key financial services sector from RBOS on down) and with oil currently a basket case.
So imagine how much more insanely unaffordable housing might be if both financial services and oil were both to come roaring back. Is there, therefore, an upside to this down trend? Well, there is at least a model that might be used as an example what NOT to do. San Francisco shares many characteristics with Edinburgh. Its hills and views are even more spectacular; its culture and arts are more varied; its architecture is more modern but equally unique and valued; the Golden Gate must be the most stunning harbour entrance on the planet, through which passes much of the massive US trade with Asia.
But, unlike Edinburgh, San Francisco is in boom times. Its resulting travails may have some lessons for a Scottish Government so keen to build houses just now that now side with developers to steamroller local plans and over-rule local planning decisions.
A recent New York Times article (NY is no fan of SF, with city rivalries there are as fierce as between Edinburgh & Glasgow) highlighted the housing pressures SF faces from the boom in internet companies like Google, Facebook, AirBnB, etc. These companies are based outside the city in Silicon Valley on the SF Peninsula. But unlike their predecessors of Intel, AMD, Sun, Oracle, Cisco, etc, their relatively young employees have chosen to live in the culturally vivid and exciting City, as opposed to the staid suburbs of the Peninsula.
Their stratospheric salaries and lack of conventional burdens (e.g. kids) means they have serious disposable income and so have driven the housing market haywire. This is despite rent control ordinances passed thirty years ago. As the NY Times reports:
“Two years ago, radicals began delaying and harassing Google and other tech companies’ shuttles as they threaded San Francisco’s narrow streets. Now — after the city officially gave the shuttles free rein to use public bus stops; after the tech elite were accused of trying to buy a crucial local election; after the home-rental company Airbnb spent a fortune to defeat a proposition that would have restricted its business — the discontent is mainstream.”
We saw something like this with oil in Aberdeen in the eighties or the euro-boom in Dublin in the noughties. But this dwarfs either. People who do not make their living from technology are being squeezed out as San Francisco booms, adding 10,000 people a year to a record 852,000 in 2014. A one-bedroom apartment goes for a median $3,500 a month (£2,433), which means SF has passed NY to boast the highest rents in the US.
This is being fought by activists like Aaron Peskin who got himself elected to the Board of Supervisors (= City Council) by arguing:
“Let’s take a stand to make San Francisco more affordable and livable.These billion-dollar companies should help ameliorate the impact they’re having, They can afford to do a lot more. So far, it’s only window-dressing. They can volunteer to be decent.”
But what might seem like a straightforward David-and-Goliath spar between evil property barons and landless peasants is a good deal more complex, as has been related to me by some long-time resident friends there who keep their fingers on the pulse.
They believe that those rent-controlled voters who had their rents frozen 30 years ago are actually exacerbating the problem as they hang on to their advantage. As a result, those few properties available rocket in price to make them largely unaffordable. As one said:
“The success-driven but otherwise quasi-autistic programmers which one used to see only in Silicon Valley now fill the cafés, but they’re not talking. All of them are on computers, and typically with earbuds for the music from their iPhones. This business about rents and the homeless is largely political rhetoric that grows from the fact that SF is a rent-controlled city with 80% of the voters being renters.
“I don’t think Peskin really believes a lot of the nonsense that he advocates. That’s just how the game is played here by politicians. That said, he’s better than his adversary, who was a total sell-out to the mayor, in turn a total sell-out to developers and Chinese power brokers.”
So, while the short-term solution for housing shortages in Edinburgh is under much less pressure and before concern for the vulnerable seizes on private rent control as a popular policy in any boom-to-come, it would help us evade SF’s current fate by:
- Rethinking the present any-houses-anywhere-at-all-costs stampede
- Getting much cleverer at linking jobs with housing to curb commuting
- A proper share of affordable public housing (the only type that stays affordable)
- Avoid letting good intentions build social wastelands, e.g. tower blocks; Easterhouse
Because, despite the gleeful chorus of unionists who appear to be celebrating the current economic hit Scotland has taken from the oil slump, I believe we have better days to come. And when they do, I don’t want clodhopping government fire-brigade policies capable of repeating our mistakes like Dumbiedykes and Saughtons and Wester Hailes and Piltons —and pleading homeless/substandard/deprivation as justification.
The spectacular and historic tenements of the High Street were once home to rich and poor alike. The servants once lived on the upper floors of all the genteel Georgian mansions of the New Town. The vast majority of residential San Francisco may be diverse but it is very livable. Time we started thinking of what this generation leaves for posterity that they will cherish similarly—and won’t want to knock down as unfortunate eyesores.