Is New Orleans the new
San Francisco?

I am an avid subscriber to a lot of magazines, and one of my favorites is New York Magazine.

There are a lot of interesting news pieces in it, written very thoughtfully. I’m just now getting around to reading the “Best of New York” issue from a few weeks ago—it’s busy around here—and I read the piece called “Is San Francisco New York?” with a lot of interest, and see some parallels in the way New Orleans is blowing up these days economically, especially in real estate.

This article details why some people are decamping New York and moving to San Francisco, with “its wealth more impressive, its infatuation with power and status more blinding.”

San Francisco is the city hub for booming tech sector, awash in start-ups that sell for billions after barely being in business for six months. Both New York and San Francisco have always been enormously expensive place to live, but now, it’s ridiculous.

And what has happened there is that if you’re a normal person who isn’t part of a tech-booming company making six figures (even in an entry-level position)—well, you may be out of luck. I fail to see how anyone who works, let’s say as a secretary, or in a restaurant, can possibly make enough money to live in either of these cities.

I had a long conversation with a local musician/engineer/producer yesterday. He bought a house uptown in 2006, and scrimped and saved his money to build his own recording studio behind his house.

It’s only eight years later, and it would be totally impossible for him to do that now.

New Orleans is touting itself as a “tech heaven” and attracting people like crazy to the city. Can’t be a bad thing, since we had a relatively low cost of living, affordable housing and rentals, and of course, a lifestyle and culture to die for. How many techies are decamping to NOLA?

But boy, is that changing. Being a real estate junkie, I’m constantly looking at properties around the city, renovating them in my mind. Last week, I noticed a small house just around the corner from us was on the market for $419,000. Now, it’s only 1700 square feet, it’s a nice renovation, and it’s in Central City.

Priced over $400K?? My jaw dropped.

Obviously from a property owner’s standpoint, having nearby property blow up in a sales price sounds pretty good: that  means that our property is theoretically going to be worth more. But does that now mean that Central City is eventually going to become the next Bywater—with prices so expensive no one but rich people can live there?

One of the most charming and livable things about New Orleans is that there’s a real mix of social classes: middle class and poor people living in the vicinity of the more affluent. It’s always been that way. This is where our culture comes from. This is where our joie de vivre comes from. It’s where our social lack of inhibition—and friendliness—comes from.  Our willingness to share.

We don’t want to turn into a city of rich and super-rich people who think their money gives them privileges and power that they don’t deserve, just because they have money. We don’t want to be New York or San Francisco.

Today I read the latest about the neighborhood association (always trouble) on Newcomb Boulevard that put up a fence in 2006 to create a cul-de-sac to prevent others from using the street as a short cut from St. Charles Avenue to Freret Street. Ostensibly, to “keep their children safe.” Now they want to not only keep the fence; they are offering to buy the street.  Instant gated community! So far the city is opposed, but they are continuing to fight for their “right” to buy the street.

All it takes is enough money, people, and you too can run out neighbors who have lived there for generations, buy a street so you can keep your children safe and keep all that traffic and parking away, and finally turn New Orleans into the Disneyland all the naysayers have been predicting for years.

You wanna live here? Educate people. Support the culture. Live next door to people poorer than you and befriend them. This is what makes New Orleans real and true and authentic.

Gated communities have no place in a big city. Neither does money that ends up destroying the fabric of our culture through snobbery and elitism.

 

  • Barry McCormick

    Thanks for the great article. Not only have housing prices risen, but in my opinion, the entire cost of living in N O has risen in recent years to an extreme extent. As a native New Orleanian and recently semi-retired, my wife and I are finding it difficult to live in and enjoy the various activities…. food, music, cocktails… which make this culture so rich. Property taxes, S&WB fees, Entergy fees, restaurant prices, and the ridiculous so called Security District taxes, all impact our daily living expenses. No wonder everyone is moving to the outer parishes and commuting in to enjoy the city. Jefferson will soon be the new New Orleans.

    • NOLA1718

      I totally disagree. Jefferson Parish has become worse while Orleans has improved. The crime in Jefferson is on an uptick, while Orleans is on a downward trend. People are finally moving back into the city and willing to pay taxes. We need that tax revenue to improve the city, decrease crime, and most importantly…improve flood protection. Without willing taxpayers, we can’t do those things. So please, move to Jefferson, but understand it will never be the new New Orleans. New Orleans is becoming stronger than ever before and every metric out there agrees. I’ll take the higher prices if it means a better city.

  • Billy C

    Thanks Jan. As an SF Bay Area resident who loves N O, its culture and lifestyle, you do not want to see New Orleans turn into another San Francisco. Over the last 10 years, the fabric of one SF neighborhood after another has been destroyed by young techheads, hipsters and wannabes who give nothing back to the cultural richness and traditions of the area. Fight and keep fighting to stop this from happening in your great city.

    • Cleophus

      Well said, Jan and Billy C. I am also an SF resident (and native) and I frequently travel to New Orleans. I have seen changes in SF that really dishearten me, and in the last 7 or so years, I have been seeing changes in New Orleans that also dishearten me. We all want to be open to newcomers and ‘outsiders’… but keep your guard up!

    • NOLA1718

      There’s nothing you can do to stop it though. Gentrification is a natural process that happens when there is a demand to live in a city. New Orleans is improving and with those improvements come higher demand to live here. This demand increases prices.

  • Tim

    I would not necessarily want my property value to increase so dramatically. It only helps if you move somewhere else cheaper, and your property taxes go through the roof. Steady small increases? Yes. Doubling every 4-6 years? No.

  • daybreaker

    Thank you for saying what I have been trying to tell people for the last year.

    Everyone touts New Orleans for its lower cost of living, and cheap housing, and pays lower salaries accordingly. But housing is only “cheap” because the average is skewed by terrible blighted housing no one would live in.

    Critics of this mindset often come back with “But it’s still cheaper than SF”. Well no duh. I wish people would stop using SF and NYC as cop outs to justify this. Yes, those places are ridiculously expensive. They always will be, and other places wont get close to them.

    Instead we should be comparing ourselves to other similar cities. Austin, Dallas, Denver, St. Louis. If you cut off the low end of housing that people obviously wont live in if they moved here from somewhere else to take a tech job, Our cost of living is probably exactly the same as most other intermediate-sized cities.

    And yet salaries stay lower because of “the low cost of living”. This low cost of living excuse is a mirage though. And I wish people would realize it before the tech bubble collapses due to IT people leaving the city in droves because theyre tired of paying $200/sqft for decent housing here when they can get $80/sqft in Austin *and* $20k more per year.

    • NOLA1718

      I disagree. Austin, Dallas, and Denver are not small cities. St. Louis is though.

      You clearly don’t understand cost of living. It also factors in our grocery prices, taxes, gas, and energy costs which are lower than most cities. My friend lives in Denver and pays a shit ton more in taxes and gas than I do. You probably can afford a house in New Orleans. All the cities you compared New Orleans to have more available houses.

      TL;DR – Unfair comparison by someone who doesn’t understand cost of living…

      • bytenik

        NOLA native here, have lived in STL since 2000.

        St. Louis (the City proper) is a “small city” in geographic size only. It covers approximately 37% of the area of New Orleans, yet has over 86% of the population.

        Moreover, if you look at the cities mentioned in terms of their Metropolitan Statistical Areas, St. Louis is second only to Dallas in terms of population. In fact, St. Louis is over twice as large (i.e. populous) as New Orleans.

        But back to the point “daybreaker” was making regarding the cost-of-living. Housing is the typically the SINGLE LARGEST personal expense, and as such influences the overall cost-of-living much more so than any other contributor such as grocery prices, taxes, or utilities.

        You clearly don’t understand cost-of-living. =)

        As someone who is considering relocating to a less snow-prone locale, I can confirm that housing in New Orleans is considerably more expensive than in Dallas or St. Louis. Hell, according to Sperling, Philadelphia is cheaper than New Orleans!

        I very much suspect you are correct that this is a result of supply and demand. However, until that equation is better balanced, the cost of housing in the Crescent City will continue to unfairly skew the cost-of-living there.

  • Max Schreiber

    I was born and raised in San Francisco, and have watched it go from a cultural melting pot to a rich people playground, where plants and bushes are politically more important than people.
    I love New Orleans. Lived there for a couple years, and sensed the same omens that befell San Francisco, recently.
    Stand strong, f#$k noise complaints.