But because San Francisco (and the whole Bay Area) think that everyone should have a veto on what everyone else does with their property, rebuilding doesn't happen, demand continues to rise, and the city becomes affordable only by the rich.
This paints the problem in too-narrow terms. Sure, the owner converts a single-family dwelling to a 10-unit tower and 9 (or more) additional people move to San Francisco. And lets say this happens to single-family dwellings all over the City. Multiply those new residents by a thousand or more. See what I'm getting at?
Where will all the infrastructure to support these new residents come from? I'm assuming not everybody who lives in these new units will want the hassle of owning a car in a City that's all but openly hostile to them -- and if they did, the gridlock would be totally unworkable. But the 15, 30, and 45 buses across town are already choked wall-to-wall with people. You literally have to ram your way in. BART (the intercity light rail system) is in a shambles. My daily commute downtown (a total of five stops) is often a standing-room-only affair, and any light weather causes delays. On some of the higher-traffic commuter stations, you can regularly expect one or even all of the escalators to be out of service, leaving huge crowds to pile out of trains onto the platforms and march up a few flights of stairs. Some of the staircases are single-file, so the queue just to leave the station can be 30-40 people long.
And where will they shop? Stores in San Francisco -- I'm thinking of something like a Target (department store) or a Safeway (supermarket) -- are typically smaller than their counterparts in cities with more overall real estate. Expect long lines for food and sundries.
And don't forget taxes! Sure, a bigger population does increase the tax base. But will it increase it enough to afford to hire all the extra firefighters and the upgrades they'll need to their engines and equipment to accommodate all those new towers? Ditto the police you need to support the population increase? And when every vehicle on the road is a private corporate bus shuttling workers back and forth from Silicon Valley, who will pay to repair the roads (which are already crumbling)? And the transit systems are once again claiming they need to either float multibillion dollar bond measures or raise the ticket fees -- as they do every other year.
So in short, just adding new people to the population won't solve San Francisco's problems. What longtime San Francisco residents recognize is that you're not talking about solutions, you're just talking about more development -- something that would please the kleptocrats in City Hall greatly, but won't do a lick to correct the complete imbalance in living costs we're currently experiencing.
P.S. Another idea I hear is that San Francisco should just accept that it needs to become more like Manhattan, with the East Bay becoming more like the other boroughs. But the major difference between the Bay Area and New York is that the Five Boroughs constitute a single tax base, under a single city government. San Francisco and the nearest cities in the East Bay aren't even in the same counties.