Griffen Wolfe
Despite being one of the world’s most developed countries and among the first to pioneer formalized public housing, the extent and quality of the United States’ public housing lags behind that of other high-income countries. In many of America’s largest cities, including San Francisco, public housing is underutilized as a means of abating skyrocketing housing costs. This is attributable to several factors, including deteriorated stock, lack of mobility, and harmful stereotypes surrounding public housing stemming from segregatory zoning.
Among housing scholars, Singapore is widely recognized for having one of the most robust public housing systems, which today houses roughly 80% of the city-state’s 5.7 million residents (Hirschmann, 2021). The system is governed by a central body, the Housing Development Board, akin to local housing authorities that govern public housing in major US cities. Underpinning many of the successes of Singapore’s system are a collection of regulations guiding the resale of public housing that help maintain high living standards in housing developments and enable greater social mobility for low and middle-income residents who use housing as both a public good and a financial asset.
With a January ’22 median home listing price of 1.2 million, San Francisco’s housing market is widely regarded as one of the least affordable in the world (Realtor.com, 2022). As a result, many of its low-income residents are entirely priced out of private sector options and thus opt for public or other socialized housing as a more affordable alternative. However, the city’s current public housing stock has deteriorated due to a lack of upkeep, with many residents of San Francisco’s public housing citing “dangerous living conditions” (Bay City News Service, 2021). The city’s wealth inequality also exacerbates constraints on low-income residents by decreasing their social mobility, which public housing has largely failed to combat. Furthermore, research suggests that cities with higher income inequality invest less in the human capital of their low-income residents, decreasing their upward mobility (Kearney and Levine, 2014). Considering these facts, San Francisco should draw upon the Singaporean model by implementing more progressive resale regulations for its public housing to increase living standards and social mobility among the parts of its population in most need.
Current resale regulations guiding the sale of BMR (below market rate) homes in San Francisco lack the “teeth” necessary to make public housing desirable for low-income residents. For example, regarding building quality, capital improvements are left entirely in the hands of residents, who must undertake upgrading projects through third parties and can only make claims on improvements made 10 years after the original occupation of the building. Additionally, claims for upgrades can be refused based on cost or not meeting timeframe requirements and can be excluded from the resale value even if the improvements were already made. These restrictions place undue pressure on residents, most of whom live paycheck-to-paycheck, to choose between making home improvements that run the risk of not getting reimbursed, and neglecting infrastructural issues that could pose an immediate safety risk.
Progressive resale regulations may seem tangential to improving living conditions at first glance. However, in Singapore, policy surrounding the resale of public flats dictates that flats are frequently maintained through living standards updated regularly based on residents’ feedback. Upgrades are entirely funded through various improvement schemes that address everything from elevator maintenance, to plumbing, to interior and exterior aesthetics. San Francisco could adopt a similar policy to shift the onus for keeping buildings maintained from the residents to the housing authority. This measure would alleviate financial pressures on residents and reduce the lag time for improvements. It would also help increase social cohesion by collectively involving residents in the upgrading process.
Another facet of Singapore’s resale policy that San Francisco should consider in tandem with upgrading standards is a Minimum Occupation Period (MOP). In Singapore, public housing residents are required to physically occupy their flat for 5+ years before the residence can be put up for resale. Should San Francisco adopt the progressive maintenance requirements on public housing resale, property values and overall demand for public housing would likely see progressive gains, making it an enticing investment opportunity for investors looking to turn a quick profit. A MOP would help curtail this kind of speculation while making public housing in San Francisco a more equitable and secure living option, as well as a financial asset to low-income residents.
While not necessarily the most glamorous of policy reforms, more progressive resale regulations could transform San Francisco’s public housing for the better. By implementing maintenance requirements and a MOP, public housing, which was once a symbol of higher-up neglect of low-income groups, could become a vessel that increases living standards and financial outcomes for some of San Francisco’s most vulnerable residents.
About the Author: Griffen Wolfe is a second year, Economics student, with a minor in Public Affairs and Environmental Systems and Society at the University of California, Los Angeles.
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