Lurie wanted San Francisco to bounce back. Now he’s got an affordability crisis 42%
By Hannah Wiley25%
7/23/2026, 1:00:00 PM
BS Summary: This article contains 33 faulty reasoning types, including Appeal to Authority, Optimism Bias, and Hasty Generalization, with Negativity Bias as the most egregious example at 10.2% saturation with 168 hits. Analysis detected 2,192 faulty-reasoning hits from 1,645 analyzed words, generating a BS Score of 46.2% and a BS Rank of 42% (12,353 of 21,176 articles). This article is better (less manipulative) than 58.30% of the article peer group.
For years, the overwhelming perception of San Francisco was that of a crime-ridden liberal hellhole from which residents were desperate to escape.
Now it feels like the hottest city in the country.
The reversal comes as AI money pours in, with companies filling long-empty downtown offices, and their high-income workers driving a red-hot housing and rental market.
Mayor Daniel Lurie, who rose to power in 2024 on a campaign promise to focus on public safety, has prioritized reselling San Francisco as a city on the rise — one Instagram reel at a time.
It’s a remarkable turnaround for a city that spent years trying to convince residents, employers, and investors that its best days weren’t behind it.
Now, as that recovery takes hold, it is reshaping Lurie’s governing agenda.
The boom that is reversing the doom-loop trend has also revived San Francisco’s oldest challenge: affordability.
Lurie, who spent his first 18 months in office cleaning up San Francisco’s streets, is discovering that he has a more pernicious problem to solve.
“I am the first one to say we are not where we want to be,” the mayor said this week in an interview with The Standard at his City Hall office about his proposals to mitigate the high cost of living.
“We have to make this city more affordable, so that families can stay here and thrive here.”
That San Francisco is expensive is not breaking news.
But if living costs were pricey before, there’s no adequate adjective to describe current conditions.
The typical home value was about $1.4 million in June, according to Zillow, which city economists reference for their data analyses, a 9.5% increase from the year before.
The median monthly rent has surged 19% over the last year to $3,558, according to Apartment List’s July report.
Those numbers illustrate the paradox facing City Hall.
The economic recovery that has made San Francisco one of the country’s most attractive real estate markets is also making it harder for many people to afford living here.
“It has been the fastest increase that I’ve ever seen in one single season,” Compass agent Ruth Krishnan said.
Before you ask: “Yes, AI is definitely part of what is increasing the price, and it’s probably going to increase it more,” she said.
“Now these companies are going to go public, and there is going to be even more money.”
Ted Egan, San Francisco’s chief economist, said the eye-popping prices come after a “major adjustment” during COVID, when tens of thousands fled the city, according to state population estimates, chilling the housing market.
During that time, San Francisco went from being extremely expensive compared with most cities to just expensive, Egan said.
Rents that were once three times the national average are now a little more than double.
Even so, “our rents are growing much faster than in other places, and AI is the big reason for that,” said Egan, who made the choice to relocate to Davis after seeing how much further his money could go in the Sacramento suburb.
But the consequences extend well beyond the housing market.
Rising prices are forcing City Hall to confront a broader question: Who can still afford to live in San Francisco if the recovery continues at this pace?
San Francisco prices long ago pushed out a good chunk of the working-class population.
But the appealing new image means that even some high-earning workers can’t afford to stay — fueling the fear that the city is becoming a haven solely for high-earning AI and tech workers.
“This is not an issue that is unique to lower-income workers versus middle-class versus even tech workers,” said Supervisor Bilal Mahmood, who recently clashed with the mayor over grocery affordability legislation.
“Every single person I represent in District 5 has said it is too expensive to live here.”
Lurie told The Standard it shouldn’t be — and can’t remain that way if the recovery is to last.
“I want families working in every industry to be able to stay and afford to live here,” he said, adding that San Francisco’s economic recovery is dependent on a diverse workforce outside the tech sector.
Lurie is acutely aware that San Francisco has ridden a series of tech booms and busts over the past three decades.
While AI is fueling the latest resurgence, the city can’t afford to become overly dependent on a single industry again, he said: “It cannot be one industry, and that’s why we’re talking to business leaders of all backgrounds, saying, ‘We want you here.’”
Part of that strategy is recruiting universities downtown, including Vanderbilt, which Lurie hopes will create a more stable mix of jobs and activity beyond the AI sector.
He said the city is talking to universities focused not just on technology but on arts, culture, and manufacturing.
“We have focused on how we attract universities.
Not one, but multiple universities downtown.
How do we get more professors and teachers, and how do we have more life in our downtown core?”
Diversifying the workforce, however, will require far more housing.
Lurie pointed to his signature Family Zoning Plan, which he said will pave the way for tens of thousands more housing units over the next five years.
He is also working with Supervisor Myrna Melgar to shore up funds for affordable housing through the city’s Housing Trust Fund.
“We need to build more housing.
For decades, we in this very progressive city have said no to new neighbors,” Lurie said.
But affordability is about more than housing, he pointed out.
He has also zeroed in on two of the biggest recurring expenses for families: childcare and transportation.
He noted that San Francisco is “the first city in the country to provide access to free early childhood care” for certain families with children up to age 5.
“I’ve had many parents say, ‘You’re saving me $36,000 a year per child,’” Lurie said, emphasizing that San Francisco is the first city to offer such a robust program.
( Take that, Mamdani .)
“If they have two, that’s $72,000.
It’s made a big difference for some families.”
Lurie has also worked to qualify a local parcel tax for the November ballot that is expected to generate around $150 million annually for Muni, plus another $10 million to strengthen transit services.
“I want people to be able to get around our city so they don’t have to use rideshare, they don’t have to buy a car, they don’t have to have car insurance, they don’t have to pay for monthly parking.”
Cyrus Hall, a transportation advocate, said Lurie’s support is a major boost.
“The fact that he is popular and the fact that he is willing to spend political capital on this is great,” Hall said.
A thriving transportation system is critical for working-class families who can’t afford car expenses and rely on an affordable public transit system to get around town, Hall said.
But Lurie admits that some of his efforts will take time — long after he leaves office — before families feel the broader financial impact.
“The unfortunate part is it’s not going to be solved overnight,” Lurie said.
“When you have 30-plus years of not building enough housing, it’s going to take us years and years to get there, if not longer.”
Critics say that’s exactly the problem.
Whether the Family Zoning Plan will make a meaningful difference is debatable.
San Francisco faces a state mandate to plan for more than 80,000 new homes by 2031.
The city completed 2,832 units in 2025, with roughly half designated as 100% affordable, according to the Department of Building Inspection.
So far this year, 413 units have been completed, 276 of them affordable.
“The problem with affordability in San Francisco is we are always working on the thing that we should have been working on 10 years ago,” said Mahmood, who is a renter.
“The city is doing the bare minimum to comply with state laws, rather than thinking about how to fundamentally solve the problem.”
Laura Foote, executive director of YIMBY Action, said San Francisco is “at best treading water” on solving the housing crisis.
She argues that the city should pursue more aggressive short-term measures while waiting for new housing to be built.
More immediate action to lower costs, Foote said, could include declaring a housing emergency to streamline production, waiving all impact fees, or proposing “single-stair reform,” which would allow certain apartment buildings to have one exit stairway instead of the required two.
“I’m not saying they are doing nothing,” Foote said.
“But there are bolder actions they are not taking that would have an impact today.”
Advocates worry that without immediate action, San Franciscans across the socioeconomic spectrum will continue to leave.
They range from hospital workers and police officers who were born in the city to young parents who hoped to raise first-generation San Franciscans but are giving up on that dream because it feels unattainable.
Kim Tavaglione, executive director of the San Francisco Labor Council, warned of a future in which restaurant, hotel, and construction workers can’t live in the city they serve, and first responders are forced to turn down jobs because commuting to a San Francisco hospital isn’t possible.
“There is nowhere for them to go,” said Tavaglione.
She worries that Lurie, an heir to the Levi Strauss family fortune, is relying on “corporations and the billionaires, the millionaires,” to rebuild San Francisco, “but without a plan on where people are going to live.”
“Working people are the only ones who keep neighborhoods vibrant,” she said.
“So losing working people will destroy neighborhoods.”
Whether San Francisco’s comeback becomes a broad-based recovery — or a boom that benefits primarily those who can already afford it — may be the question that defines Lurie’s mayoralty.
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