Why carping about the Ellis Act won’t solve San Francisco’s housing problem.
San Francisco magazine
January 20, 2014
On October 22, an elderly married couple and their developmentally disabled 48-year-old daughter left their home of 34 years for the last time. Poon Heung Lee and Gum Gee Lee told the Chronicle that they had expected to live in their $778-per-month two-bedroom apartment on Larkin at Jackson until their dying day. And they weren’t being evicted for any of the common reasons— breach of the rental agreement, failure to pay rent, and so on. Instead, their ouster was permitted by the Ellis Act, a 1986 state law that allows landlords to exit the rental business by evicting their tenants in exchange for paying them a sizable relocation fee (in this case, $22,000).
At a moment when rental market anxiety has reached a fever pitch in San Francisco, it didn’t take long before this semi-obscure law became a flash point in the ongoing, ever-escalating housing affordability debate, and the Lees its poster children. Media-savvy activists seized upon the story, gathering at eviction sites throughout the fall and winter, carrying signs with slogans like “Evict greed from your heart.” Newspapers ran front-page stories about the growing Ellis epidemic; the Bay Guardian even went so far as to declare 2013 “the year of evictions.” Politicians of all stripes scrambled to take a stand, either with proposals to make the evictions harder to carry out or with vows to ban them entirely.
The narrative was a straightforward one: Because the Bay Area has seen an influx of people—largely young, white, and working in tech—who need housing (and can pay for it), greedy landlords, many of them out-of-town speculators, are throwing longtime San Franciscans into the streets and turning the city over to gentrification. It looked cut-and-dried.
It’s not. In fact, Ellis Act evictions represent only a small proportion of the city’s total evictions—and they’re not even historically high to begin with. In the 12-month period ending on February 28, 2013, the total number of Ellis Act evictions was 116—an almost twofold increase over the previous year, but a nearly 70 percent decrease since 2000, when such evictions hit an all-time high of 384. All told, the Ellis Act was behind less than 7 percent of the 1,716 total evictions in the city between February 2012 and February 2013. “Isn’t it far more likely,” asks Karen Chapple, a professor of city planning at UC Berkeley, “that more units are being lost [from the market] through Airbnb?”
Laying the blame on nefarious Rich Uncle Pennybags types isn’t exactly right either. A recent report commissioned by Supervisor David Campos is clear on that point: The increase in Ellis Act evictions, it found, “occurred simultaneously with significant increases in San Francisco housing prices.” In other words, the problem isn’t speculators. It’s the market. The city simply doesn’t have enough housing to keep up with job growth. And as real estate values rise, the incentive for a property owner to sell grows considerably. No villainy. Just economics.
And economics—specifically, increased demand for housing paired with roughly stagnant supply—are a much more trenchant and dangerous problem. “[Ellis evictions] are heart wrenching,” says Assemblymember Phil Ting, a moderate who represents the west side of the city. “But it’s only a piece. We could solve it, and rents wouldn’t come down.”
That doesn’t mean, though, that politicians and protesters won’t continue to beat the Ellis drum. As David Latterman, a consultant for moderate campaigns and a political science lecturer at the University of San Francisco, puts it, “Ellis is an easy visceral target. It’s sort of a shock eviction.... Politicians love it since they can say, ‘Elect me or you’ll be evicted. Only I can protect you.’” In other words, it’s a fail-safe political scapegoat.
For progressives like Campos, Ellis Act evictions are a dog whistle: a euphemistic way to raise concerns about gentrification without alienating a powerful and growing segment of the voting population—the gentrifiers themselves. For moderates like Mayor Ed Lee, appearing to get tough on the Ellis Act is an easy way to address voter discontent about affordability without having to wade into more controversial issues like housing density and planning reform. Lee, in fact, has the most incentive to act: Any indication that this onetime affordable housing advocate turned pro-business mayor is unmoved by the plight of tenants looks like treason. So, while no one can agree on what should be done, almost every side has a reason to be (or at least appear to be) outraged.
Whether anyone will dislodge the policy status quo is a more muddled question. Because Ellis is state law, Sacramento, not City Hall, will have to sign off on any changes. Mark Leno—an avowed foe of the law—has had only limited success reforming it in the past, managing to exempt SROs from Ellis invocations. The problem for Leno and his allies? Moderate Democrats from California districts with a majority of homeowners tend to look at the Ellis Act as a defense of property rights, not an attack on renters. It has survived numerous attempts at reform in its 27 years.
Even if incremental changes happen, San Francisco’s affordability problem will likely continue almost unabated. Ellis Act evictions are, in Chapple’s words, not a cause of the housing crisis, but rather “a symptom. Fixing it is like using a Band-Aid for brain cancer."