Record number of Ellis Act evictions in May

BeyondChron has a doom-n-gloom article on the number of housing units which were delivered eviction notices via the Ellis Act in May of 2005.

Last time I checked, Ted Gullickson of the San Francisco Tenant's Union wasn't an economist, but he's got an opinion just like everyone else... "A warning to short-term real estate speculators and tenancy in-common (TIC) buyers: Your housing bubble is due to burst." So predicts Ted Gullickson of the San Francisco Tenants Union. According to Gullickson, "the current boom of low interest rates coupled with the inflated real estate market is not going to last much longer. In fact, it soon will crash in the way that the stock market did in 1929. His caution comes after the San Francisco Rent Board reported for May of this year 80 Ellis Act evictions – the highest number on record." Gosh, Ted, thanks for the warning. I'll start packing my bags and selling my belongings right away.

Personally, I feel these evictions come out of buyer's frustration with the housing market and their need for a roof over their heads. Nobody 'wants' to evict someone in order to sell or purchase property. Remember, Ted, homeowners need homes, too. Many of those homeowners were your constituents at one time who got tired of fighting and decided to control their own destiny by purchasing. If you look anywhere but our little island, you'll see that homeowners have the right to decide who lives in their units and when they are vacant. When there are people that need assistance in obtaining or keeping housing, the local municipalities help to fund programs for this very cause. In San Francisco, it is the responsibility of the homeowner/landlord to subsidize housing.

I do not condone evictions of any type, but the reality is out there and since the Ellis Act is a state law, there hasn't been anything the Supervisors or Mr. Gullickson can do about it.

Here's an idea: BUILD MORE HOUSING! Stop fighting about what kind of housing is being built. Just build the housing, already! Give the developers INCENTIVES to build (do you hear that, Mr. Daly?). That will take pressure off of both the purchase and rental markets... I know it sounds easy, and it IS EASY. Just not with our current crop of supervisors...

If May saw a record number of evictions, just wait until individual TIC loans are offered commercially. That will take down the real barrier to entry for many buyers, and we will likely see an increase in TIC sales, which means more evictions in 3-7 unit buildings. The prices for TICs will also rise, but probably not quite to the levels of a fully-certified condo...

Gullickson continues his sage advice, ""Real estate prospectors don't get hurt because they're the least accountable; they end up owning the building for such a short time. The TIC buyers, however, are going to find that their million dollar apartments are worth only $500,000 after the bubble bursts." Uh huh.... Yeah... 50% price drops...

Stay tuned. I doubt any of this will sort itself out any time soon...