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Creating great communities for all

It now costs up to $1.2 million to build an affordable house in San Francisco

By Lauren Hepler, San Francisco Chronicle, September 23, 2022

“Though exorbitant building costs have long been a Bay Area norm, housing researchers say the trend has been compounded by increasingly acute worker shortages, pandemic-era inflation and familiar political issues like long and unpredictable approval processes.

“The new 359-page San Francisco application for California Department of Housing and Community Development funds focuses on three proposed all-affordable projects[.]

“Developer the Tenderloin Neighborhood Development Corporation (TNDC) pegs total per-unit development costs for the project slated to break ground in spring 2024 at around $1.17 million[.]

“Most new affordable housing in California ‘does not cost nearly as much’ as these projects or a handful of high-profile, seven-figure projects in San Francisco, San Jose and Oakland in recent years, according to previous research by [UC Berkeley’s Terner Center].

“Costs were estimated at around $383,000 per unit, for example, to build 145 supportive housing units at 833 Bryant St., thanks to factors including faster approvals, a mix of public and private funding and off-site construction.

“ ‘Not all projects are a million dollars a door, but these outliers are notable because these could be the status quo in maybe a decade,’ [Terner Center researcher Muhammad] Alameldin said. ‘And that’s the fear — when this becomes the norm, the political barriers that must be overcome to finance this kind of housing become much bigger.’ ” 

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