San Francisco itself is a counterpoint. It's still the densest area of the US outside of Manhattan, despite decades of anti-development NIMBY housing policy. Both the population and the average rent are rising every year.

The old Victorians you see on postcards were built as single-family houses. Most of them are now subdivided into multiple apartments. Many houses in the city have illegally built inlaw apartments in the basement. People live with multiple roommates into their 40s and 50s.

It is true that eventually housing prices become so high they outstrip the ability of the local economy to provide salaries. In the meantime, it massively increases the costs of doing business, the capital requirements necessary to operate any business in the city. So far, venture capitalists have been willing to provide that capital, but that can't last forever. Last time (1999), it ended in a big economic crash.

Further complicating the analysis is rent control: most existing residents aren't forced to leave, because they are legally shielded from rising property values and rents. They are given the reverse, an incentive to stay in place no matter what, because they enjoy an artificially low rent that they cannot possibly replicate in any comparable dwelling. This causes market rents to skyrocket as maintenance costs and profit are shifted by landlords to the few open units they have, subsidizing the long term residents. It's a wealth transfer from "people who have moved recently" to "people who have not moved recently."

Finally, there are tons of people living in tents in San Francisco, which has become a major political issue lately. This is arguably partly due to homeless people from outside the city moving in to take advantage of its extremely generous social welfare programs for the homeless, but it is at least in part due to high housing costs.

> It's still the densest area of the US outside of Manhattan Do you have a source for that? Wikipedia (https://en.m.wikipedia.org/wiki/List_of_United_States_cities...) seems to suggest the incorporated city is the second densest major city after New York, but not that San Francisco is the most sense place in the us after Manhattan. It's often cited that Brooklyn is twice as dense as SF for instance. Cambridge Massachusetts is more dense than San Francisco.

This. My apartment in the south bay is a perfect microcosm of this phenomenon: it is obviously a former single-family home, which has been subdivided and built upon, so that it now houses about 4 two-bedroom apartments. Although I live alone, I had to compete for it with two couples, who wanted to share it. So, you could have what was once a one-family home easily housing eight families.

> Sure it does. People aren't living in tents (generally speaking). Population can't grow unless the housing supply does.

Population can grow even if the housing supply does not, if the existing population becomes concentrated into fewer dwellings.

Bay Area residents who used to have their own apartments or houses are now renting rooms and sharing apartments or houses with others.

The people moving here are generally wealthier or higher paid than the existing residents, and will not be deterred from moving here until the number of high-paying job openings decreases.

Regarding living in tents, there has been a noticeable increase in the homeless population in recent years. It's not clear if they were displaced from housing or came here from somewhere else, but there is no denying the increase.

71% of the homeless population in SF (who are now living in tent cities) used to live in a home in SF: http://www.sfchronicle.com/bayarea/article/What-San-Francisc...

Please bear in mind that the wording on the question means that someone in a homeless shelter or city-funded SRO for a month "used to live in a home in SF". Which is to say that the number is meaningful, but needs to be taken with a substantial grain of salt.