Scott Alexander has a post where he discusses some flaws in the YIMBY arguments. The term ‘YIMBY’ means “yes in my backyard”, and refers to those who push back against the anti-development NIMBYs. While Alexander has some sympathy for the YIMBY perspective, he thinks they oversell their claims in several respects:
1. It is not always true that building more housing in a particular location will reduce housing costs in that location.
2. Many people find dense cities to be less pleasant places to live than less dense cities.
3. He also wonders if the advantages of “centralization” (or perhaps more accurately “agglomeration”) are oversold. I did not find this argument to be persuasive.
I agree with his first two points, but I don’t think they have the implications that he assumes. I also question some of his empirical claims. For instance, he has a chart showing that San Francisco has already been building housing at a fairly good clip:
Interestingly, his previous two graphs suggests that the 2008-15 growth rate in San Francisco is barely half the 1.1% growth rate reported in this graph, so I don’t know which of his graphs are inaccurate. In any case, the problem in the Bay Area is not just the city of San Francisco; it’s the entire region. Metro areas such as Houston and Dallas (with similar total populations) produce several times more housing units each year than the Bay Area, albeit mostly in their suburbs. Compare population growth in San Mateo County (just south of San Francisco) with Clark County, which includes Las Vegas:
Since 1970, Clark County has gone from having 1/2 of San Mateo’s population to having three times its population. San Mateo contains the heart of America’s biotech industry and is also important in other tech fields. Population growth in Marin County (just north of San Francisco) has been even slower.
Admittedly, the San Francisco area is a rather special place, with beautiful coastal areas that need to be preserved. But the same story applies to less scenic locations such as the East Bay, LA, San Diego, Boston, and New York. In cities with tight zoning rules, housing construction is much slower than in areas where zoning rules are less restrictive. And this keeps housing prices excessively high.
Alexander is correct that building more housing doesn’t always drive down housing prices. That’s because in a few rare cases the construction of more housing can actually increase the demand for housing. One possibility is that the new housing is of higher quality. Another possibility is that the new housing offers enlarged opportunities for gains from “agglomeration”, which refers to the efficiency gains from having many firms concentrate in a small area so that they can interact. (Think Hollywood, Wall Street, Silicon Valley, Broadway, Madison Avenue, etc.)
I’d respond as follows:
1. New housing construction lowers local housing costs in the vast majority of cases.
2. New housing construction always lowers national housing costs, ceteris paribus.
Thus from a housing cost perspective, YIMBYism is always in the national interest.
You might argue that I don’t understand the feelings of local residents. Actually I do, just as I understand the feelings of taxi drivers threatened by Uber, or retailers threatened by Amazon, or dairy farmers threatened by free trade. Of course I understand the feelings of local residents who don’t want to see more density, traffic, etc., in their community. They may have moved to Marin County because it’s a lovely, quiet place. Change is not good for everyone.
Alexander discusses some of the downside of living in San Francisco, with its traffic, crime, dirty streets, homeless people, etc. He also points to Manhattan, where they built a lot of housing and yet costs remain very high. Here we need to avoid “reasoning from a price change”; the extensive housing construction in Manhattan reflected the high demand in that region. Even more construction would have likely meant lower prices (and did before NYC zoning got tight.)
I’d like to present a vision of unrestrictive zoning that I believe is more plausible than Alexander’s vision. Let’s start with some facts:
1. America’s major metro areas are enormous, and mostly “suburban” in character. Most Americans have zero interest in living in Manhattan-type areas, even if the price were low. They like their backyard barbecues in Oklahoma City.
2. Manhattan itself is only 24 square miles. It’s also far and away the best thing NYC has going for it. If Manhattan (from Wall Street to 100th Street) had not been built, NYC would be a much more dreary place.
3. The West Coast would be a much more desirable place if it had a Manhattan, or perhaps two mini-Manhattans. You could imagine one in downtown LA, and another on the eastern side of San Francisco. If these were built (say 10 square miles each), then more than 99% of the LA metro area would remain just as suburban as it is now, indeed maybe even more suburban than if a mini-Manhattan were not built downtown. Thus there would be less pressure for 4 story apartment buildings out in the neighborhoods if developers could build dense housing downtown at low cost.
Think of it this way. Lots of parents don’t let their kids play outside by themselves, because other parents don’t let their kids play outside. If you choose to be the exception, then (unlike during the 1960s) your kid is the only one available for pedophiles to prey upon. Lots of the anti-NIMBY feeling comes from a false perception of what the real estate market would look like if complete laissez-faire were adopted, based on the current distorted market. Actually, the vast majority of America, even the vast majority of expensive metro areas, would look roughly the same. The current tight controls on development make developers anxious to build upwards on any scrap of land in the Bay Area where they can get permission to build. But there’s only so much demand. If they could build anywhere, they would not build everywhere. Next time you visit Manhattan, walk around some of the residential areas. You may visualize Manhattan as wall-to-wall high rises, but there are actually lots of neighborhoods with low-rise townhouses. Even in Manhattan, there wasn’t enough demand to make the entire island look like the Upper East Side.
Pressures at the margin in a highly distorted market are not evidence of what a completely free market would look like. As an analogy, the “free market” part of health care in the US or UK is nothing like what a truly free market health care system would look like in the US or UK.
Density advocates will never “win” in the sense of replacing most of our low density suburbs with dense metro areas, because there are nowhere near enough Americans to make density anything other than an exotic exception to the boring suburban rule.
4. New development can also make cities nicer. The recent construction of lots of housing in the inner parts of Boston and Cambridge (along with the removal of rent controls), has made those cities much nicer places to live (as compared to 1982, when I first moved to Boston.)
I live in a quiet Orange County suburb—does that make me a hypocrite? No, I support YIMBY policies in my own back yard. I would not be happy if a skyscraper were built next door, but I support the right of developers to do so. Of course a skyscraper next door would also make my property much more valuable. The main reason I’d be unhappy is that I’d have to take my profit and then face the hassle of moving. I get that, but progress always involves some inconveniences. The main point here is that suburban living in America is quite nice, and even with no zoning restrictions the vast majority of Americans would choose to live in quiet suburban neighborhoods. That’s not going to change. But those who want density deserve a few Manhattan-type neighborhoods to choose from, in NYC, Chicago, Miami, LA, San Francisco, and a few other places.
Earlier I said that I did not understand Alexander’s point about agglomeration. He seems to suggests that agglomerations such as Silicon Valley may reflect what Eliezer Yudkowsky calls “inadequate equilibria”, a scenario that society stumbles into, is not efficient, but is hard to get out of. But there are smaller tech hubs in lower cost areas like Austin, Seattle, and Raleigh. If the gains from agglomeration were not real, why would so many tech companies choose to locate in relatively high cost Silicon Valley? Alexander understands this point, and suggests that maybe agglomeration occurred in the wrong place:
First, it could be that centralization happened in the wrong place – that, if anyone had been able to centrally coordinate, the tech industry should have ended up in Austin or somewhere else that’s well-planned and has lots of geographical room to expand into. Second, it could be that centralization is just a game of keeping up with the Joneses. If there were no San Francisco, then some company would still end up employing the best programmer. But given that there is a San Francisco your company might have to move to San Francisco or have no chance of luring them away from all the companies that have.
But then what’s the plan? If YIMBY policies are bad because they are disruptive, then moving Silicon Valley to Austin would be ten times more disruptive, decimating the economy of the Bay Area and also destroying the tax base of California. You might respond, “How about moving part of the industry?” But then you’ve missed the entire point of agglomeration. You either have a major agglomeration (with its huge efficiency advantages), or you have a bunch of small, scattered tech hubs.
PS. Obviously I agree with Alexander that NIMBYists should not be accused of being racists who don’t care about the poor.
READER COMMENTS
David Henderson
Oct 2 2018 at 5:55pm
Really, really excellent piece, Scott. Thank you.
Benjamin Cole
Oct 2 2018 at 7:58pm
Great post.
Side note: in Asian cities where zoning laws one are much looser one sees different sorts of developments and attachments to property.
For example, for perhaps a wealthier homeowner, the walled compound becomes a norm. The owner anticipates future development is uncertain, and so creates a small paradise. Personally, I dislike this sort of development, but Scott Sumner points out what we personally like is not not always consistent with free markets.
The existence of property zoning, and the ability of government to manipulate zoning, is too often used by combines of property developers and lenders to ensure that development will be profitable. Moreover, such development is more profitable if there is obvious and continuing scarcity.
This aspect of property zoning is rarely discussed, but it is probably best exemplified by Hong Kong.
Rajat
Oct 2 2018 at 8:32pm
I have a couple of comments on your post, Scott.
First, Australia is having a similar debate in light of our high urban property prices and highly suburbanised cities. And millenials are of course actively involved in arguing for more density. But when our state government opened a new former industrial area for development near the existing downtown (admittedly, only 1.9 sqm, but Melbourne currently only has a population of 5 million) and imposed building height restrictions to ensure the new area was ‘livable’, very few millenials complained. The reason why is because they want to live in 3-5 storey medium density, European-style ‘roomy’ apartments in the characterful inner suburbs rather than cookie-cutter apartments in Asian-style high rises in new areas without established shops, cafes, bars, etc. But those sorts of places themselves only have value because of the restricted development that goes on in those areas. The fact that many in the YIMBY crowd are hypocrites plays into the hands of government planners who are typically former architects with utopian visions of modern lifestyles that want to limit high-rise developments in former industrial areas. It seems to be a no-brainer to me to use the new space to build 40 storey apartment buildings cheek-by-jowl, probably allowing a few hundred thousand people to live in an area within 1-2 miles of the existing CBD.
Second, the problem with a shift to easier planning restrictions is that it is not necessarily the case in a suburban area that a high-rise going up next door would make one’s own property more valuable. A sudden move to open-slather building would likely mean that having a high-rise go up next door would make it less attractive for the next development to be undertaken on my property. Rather, a developer might look up the street where their building would offer less encumbered views and less traffic congestion. Over many years, as more choice locations were developed, someone may want to build on my property. But for all the intervening years, both my amenity and property value would have suffered.
P Burgos
Oct 3 2018 at 10:28am
Have you looked at the Strong Towns website? Maybe Australian cities and suburbs need what Chuck Marohn calls “incremental zoning”, where any property can be redeveloped up to the next increment of density by right. So a single family home could be turned into a four-plex by right, a four-plex into a low rise apartment building, low-rise to mid-rise, mid-rise to high-rise.
Scott Sumner
Oct 2 2018 at 11:06pm
Thanks David.
Rajat, I believe that in the vast majority of cases, a piece of land next to a high rise building will be pretty valuable. You don’t build 30 or 40 story buildings unless land in the area is really expensive. Once the building is constructed, the residents or workers need places to each lunch, etc., so the land becomes very valuable for commercial development. I can’t say this is always true, but it’s true often enough to be the norm in big American cities.
I don’t really understand why Australia is having so much trouble fixing the problem. I do understand there are special interest groups, but all they need to do is look at Texas and they’ll see that their high real estate prices are completely self inflicted, and would go away if and when they decide they want affordable houses for the next generation. I get that existing homeowners don’t want to see capital losses, but the last thing they should be doing is wringing their hands over the situation like its some sort of act of God. Even worse, some blame immigration, which is just absurd.
Alex
Oct 3 2018 at 7:57am
On the Aussie problems with housing I’d say there are quite a few:
Tax advantages to home ownership – negative gearing on rental properties (on non-rental income), capital gains discounts when selling
Zoning and landbanking by developers as Rajat mentions
the 4 pillar banking – this (appears to) have had the unintended effect that Aus is a bit of a captive market for housing, and so our 4 pillars make a good deal of profit from housing (some of the most profitable in the world), and don’t really bother either with trading or business loans (relatively speaking).
Relatedly, having house prices fall would quite possibly expose our banks quite a bit given their reliance on HLs – yes we avoided the GFC reckoning, but this doesn’t mean our rules are super tight or anything, and interest only / 5% deposit are not uncommon (or weren’t – APRA has been moving to change this and reprice the risk a bit).
Light touch foreign ownership rules – mostly Chinese investors for awhile, though it seems this has lessened.
High immigration. I agree that immigrants aren’t to blame, but high immigration obviously adds to demand, especially in Syd/Mel.
More related to infrastructure development, but there is a bit of a mismatch between the Feds who reap the higher taxes from more people, and the states who need to provide all the infrastructure
Several of our main newspapers run real estate sections which are basically the only profitable section – this makes them very opposed to anything that would lower either turnover or prices
And of course Syd in particular is very important electorally (western ‘burbs especially), and it’s pretty rare for anyone to talk about reducing house prices. Even Labor with the capital gains / negative gearing changes has talked about ‘stabilising’ house prices.
I’m not sure how much of this is common to lots of places, and how much is our extra special Aussie dopeyness, but I’d say there are a lot of reasons this is very difficult to accomplish (and obviously some don’t *just* influence HPs and have other positive effects).
Scott Sumner
Oct 4 2018 at 6:56pm
House price stabilization is a reasonable pragmatic goal, if full liberalization is impossible. Liberalize building just enough to stabilize prices, without causing a crash. After a decade or so, prices will be more reasonable.
Remember that both of these cannot be true:
Immigrants push up house prices.
The pace of liberalization is constrained by the need to avoid a house price crash.
For any immigration level, there is a housing policy that keeps prices stable.
Floccina
Oct 5 2018 at 5:42pm
Yes an thing in San Fransisco CA is a sanctuary city that keeps housing supply so low that immigrants can’t move there.
Matthias Görgens
Oct 2 2018 at 11:28pm
Scott, keep in mind that Australia gives special tax incentives for land banking and keeping apartments empty.
(Look up negative hearing for details.)
nobody.really
Oct 3 2018 at 1:25am
So it doesn’t matter how racist or indifferent to the poor I become, I can evade social opprobrium simply by espousing NIMBY preferences? I fear this policy creates perverse incentives….
nobody.really
Oct 3 2018 at 1:35am
<blockquote> You may visualize Manhattan as wall-to-wall high rises, but there are actually lots of neighborhoods with low-rise townhouses. Even in Manhattan, there wasn’t enough demand to make the entire island look like the Upper East Side.</blockquote>
Demand may not be the sole factor explaining the location of high rises. <a href=”https://blog.epa.gov/blog/2015/07/the-manhattan-skyline-why-are-there-no-tall-skyscrapers-between-midtown-and-downtown/”>Bedrock may also have something to do with it.</a>
nobody.really
Oct 3 2018 at 1:38am
Demand may not be the sole factor explaining the location of high rises. Bedrock may have something to do with it.
Scott Sumner
Oct 3 2018 at 8:59am
Matthias, Yes, those are foolish policies.
Nobody, You said:
“So it doesn’t matter how racist or indifferent to the poor I become, I can evade social opprobrium simply by espousing NIMBY preferences?”
I don’t think anyone is saying that.
The Manhattan bedrock stuff is mostly a myth, based on what I’ve read. Skyscrapers can be built anywhere in Manhattan.
nobody.really
Oct 3 2018 at 10:28am
I’m joking! Yes, you DID say that–but, given the context, it seems clear you didn’t mean it.
I suspect you intended to say “We cannot conclude that someone is racist or indifferent to the poor merely because that person is a NIMBYist.” But, of course, the mere fact that someone is a NIMBYist does not preclude the possibility that someone is also racist and indifferent to the poor–and if someone had those qualities, then there’s no reason they should not be accused of it, regardless of their NIMBYist qualities.
…Hey, it was 1:30 in the morning, I was getting slap-happy….
Scott Sumner
Oct 3 2018 at 1:42pm
nobody, Ok, I see I worded that poorly. 🙂
James Devereaux
Oct 3 2018 at 9:21am
There is a great econtalk on the Manhattan skyline. The book looks great too, though I’ve yet to read it.
http://www.econtalk.org/jason-barr-on-building-the-skyline-and-the-economics-of-skyscrapers/
Amy Willis
Oct 4 2018 at 4:48am
Thanks, James! You beat me to it.. 🙂
bill
Oct 3 2018 at 9:44am
Houston is a good example of what you are describing.
And you can find funny examples of a house mixed in with three 20-story office buildings but they are rare.
James Devereaux
Oct 3 2018 at 9:46am
There was an excellent Econtalk on the Manhattan Skyline. The book, though I have not read it, looks rather interesting as well.
http://www.econtalk.org/jason-barr-on-building-the-skyline-and-the-economics-of-skyscrapers/
OneEyedMan
Oct 3 2018 at 10:25am
Given that construction costs in NYC are documented to be well below current prices, I don’t see how you could substantiate that “Even in Manhattan, there wasn’t enough demand to make the entire island look like the Upper East Side.”Glaeser, Gyourko, and Saks say that 60% of Manhattan apartments are priced above double their construction cost (and 20% above triple). The costs of real estate in the parts of NJ and NYC outside of Manhattan but close by are mostly above NYC construction prices. Rents are probably about 80% of Manhattan in these places (e.g. see Curbed: How rents for 1BRs in Manhattan and Brooklyn vary across neighborhoods).
My impression is that zoning and historical designation explain much of why some Manhattan neighborhoods remain low-rises and attached homes. Search for “Discover New York City Landmarks”, and you’ll see that a huge portion of NYC below 34th St is a designated property or neighborhood. Another big chunk is (relatively) under-served by the subway system (far west side in North Chelsea / South Hell’s Kitchen / East Village. We also know that something like 40% of Manhattan buildings could not be built under today’s zoning. In the absence of zoning and other building restrictions, Manhattan would be substantially more built up than it is today. So much so that virtually every neighborhood would have taller buildings in it unless geography or infrastructure constraints made this impossible.
Scott Sumner
Oct 3 2018 at 1:45pm
Good points. My understanding is that zoning was much weaker in the first half of the 20th century, when NYC reached roughly its current population of about 8 million. But those are good points, and you are undoubtedly correct that it would be somewhat denser without zoning. On the other hand, there are certainly not enough potential New Yorkers to make the other 4 boroughs look like Manhattan, except in a few areas like downtown Brooklyn.
Valiant Victor
Oct 3 2018 at 10:25am
The amount of high density housing that Chicago has been building in the post-recession years is exceptional. The current government has crafted a policy where developers can upzone properties if they agree to contribute substantial sums of money to a “Neighborhood Opportunity Fund” that funds projects in the poorer south and far west sides. Therefore, NIMBYs (many of which are supposedly “bleeding heart liberals” must not only appear anti-development, but also deny opportunity to the less fortunate neighborhoods.
The growth of the inner city has been overshadowed in the regional stats by people leaving the dismal south and west sides.
I am pretty sure the city planning commission will be considering adding more development at their next meeting than the city of SF does in an entire year:
https://chicago.curbed.com/2018/10/2/17927662/development-news-river-district-lakeshore-east-union-station-towers
James
Oct 3 2018 at 11:51am
I have a hard time understanding why “Americans prefer to live in single family homes” is a good argument against YIMBY in cities like San Fransisco. They love the single family homes so much that they’ve made it illegal to build anything but? That doesn’t make any sense.
Sure, most people prefer to live in single family homes, but at the margin, at certain price points, they may prefer rowhouses or courtyard apartment units closer to city amenities.
Scott, you got it exactly right. Allowing more density won’t create a large percentage change to the availability of single family homes in the suburbs. But considering how difficult zoning makes it to build anything but, it would make a great big difference for people who prefer density.
Alan Goldhammer
Oct 3 2018 at 1:21pm
Scott – great post!!!
We are experiencing YIMBY first hand right here in Bethesda. The downtown area which is about 1.5 miles from our 1955 split level house is slowly and sometimes even quickly being converted into a high rise community of some office buildings but mostly apartments and condominiums. A good friend and his wife just moved into one of the newer condos as he was tired of walking up and downstairs in their Chevy Chase colonial.
It’s great to have those options except…..everything being built is priced in the luxury range. The building our friends are in are priced from $700K for a small 1BR to $3million for a three bedroom and nice view from an upper floor. If we were to cash out of our house, it’s doubtful that we could afford a 2BR unit in Bethesda (the minimum for us) without having to dip into our investment portfolio. These new buildings are great for the high wealth individuals but for most of us, sadly out of reach.
YIMBY is good on paper and I certainly agree with the concept. Unfortunately, translating it to a pragmatic plan without some kind of control (an anathema for libertarians) is difficult. If any of the readers are in the Washington, DC area, hop on the Metro and see what Bethesda is turning into.
Thomas Sewell
Oct 4 2018 at 11:43pm
Alan,
Consider also that the people moving into the new, luxury apartments and condos are having to move from somewhere else, presumably not as desirable to them, or else why move. Others move into their former homes, and out of yet another set not as desirable to those people.
This chain of effects means that the building of new luxury locations actually increases the stock of available non-luxury locations as well.
See also https://www.econlib.org/archives/2018/01/we_should_focus.html
Scott Sumner
Oct 3 2018 at 1:49pm
Alan, You said:
“YIMBY is good on paper and I certainly agree with the concept. Unfortunately, translating it to a pragmatic plan without some kind of control (an anathema for libertarians) is difficult.”
Just the opposite. Those high prices you cite are caused by the “controls”. Chicago builds lots of high rise units at half the cost of coastal cities. We need fewer controls to boost affordable housing.
BTW, In an earlier post I explained why most new houses should be “unaffordable”.
Viking
Oct 3 2018 at 2:14pm
“Of course a skyscraper next door would also make my property much more valuable. The main reason I’d be unhappy is that I’d have to take my profit and then face the hassle of moving. ”
This argument assumes that there is a fairness doctrine in zoning. In reality, there could be a skyscraper next door, without your land automatically being upgraded to uses beyond a single family home, although there might be a trend that a larger area gets rezoned en masse.
Or the next door property gets converted to an 8-plex through a developer’s political connections, and this results in noise, and your visitors not finding parking. Tough luck cashing out on that.
Scott Sumner
Oct 4 2018 at 6:48pm
Viking, Yes, but that’s not what I’m advocating. That’s not a YIMBY policy.
DF
Oct 3 2018 at 2:21pm
Good post Scott, I mostly agree. However this point…
That’s a huge ceteris paribus though, there is a nearly inexhaustible pool of offshore capital waiting in the wings for new constructions in prime US locations. How do you feel about restrictions on foreign investors?
Scott Sumner
Oct 4 2018 at 6:51pm
DF, I oppose those restrictions. Everyone worries about our lack of exports, and a lack of jobs for blue collar Americans. If so, you should be thrilled when blue collar workers build houses that are sold to foreigners.
DF
Oct 5 2018 at 5:58am
Yes, but in this post we care about the price of housing. It’s not at all clear that if new construction in the US were exclusively limited to Midtown Manhattan, East SF, West LA and a few other prime locations that the national average price would fall because of foreign demand.
michael pettengill
Oct 3 2018 at 2:35pm
San Francisco is a 50 sq-mi portion of a 10,000 sq-mi CS just like Boston is a 50 sq-mi portion of a 10,000 sq-mi CSA.
Water and historic political boundaries constrain the growth in land area for what is seen as SF and Boston. Boston as the State capital loses land to government uses, but Summerville is effectively Boston, and has the same high density as SF, as do a few other small towns near by.
The population and demographic diversity are similar, the economy drivers of inequality.
Boston population growth is lower which has allowed investment in transportation to sort of catch up: the Big Dig is done, and it’s construction problems in the past, while the defining SF transportation investments are ongoing, with construction problems very much in the news.
The problems are 90% related to transportation problems, as the have always been. Boston was the city with the most advanced transportation strategy, until NYC passed it, a bit over a century ago. Electric trains running in tunnels was pioneered in Boston. That is what allowed big cities to become viable places to live.
In any case, transportation ends up in every case as a responsibility of government. LA sprawl is the result of real estate developers building trolley lines to their land, and then after selling off and developing all their land, ending funding for their trolley lines. The same was true in Florida, NYC, etc. Where private interests built toll roads, it was driven by development interests, and once their land was developed, they abandoned subsidizing the toll roads, throwing the cost to governments.
Building transportation to serve a growing population over an area of 10,000 sq-mi is a costly government enterprise.
But since circa 1980, economists have argued the high costs of paying workers to build massive transportation infrastructure kills jobs. That only by not paying workers, will lower costs create high growth in high wage jobs.
Hazel Meade
Oct 3 2018 at 5:03pm
The big city/suburban divide is one of those things that separates single adults from people with kids. If you are a single adult, cities are wonderful – lots of things to do, lots of social activities, plenty of potential friends and loves interests to choose from, access to bars and clubs and interesting subcultures. You can have the most fun.
But if you have kids, cities are horrible. The traffic levels pose a constant threat that kids will be run over, so you can’t let them play outside except in some fenced off crowded concrete playground. Facilites like public swimming pools are often run down and overcrowded. The schools are terrible, unless you can afford to put them in a private academy (most people can’t). And you generally don’t want your kids mixing with the single adults who want to party that populate the cities.
Often the things that make cities great places for young adults are the same things that make them terrible for children.
So when I see YIMBYs and NIMBYs arguing I tend to see essentially a generation gap – young adults not imagining what it’s like to have kids vs. adults with kids who are just focused on keeping what they’ve got instead of making room for the next generation.
Fortunately, I do think you have the right answer – a free market in housing would likely concentrate the young adults more in the city, which would mean less sprawl and MORE room for green suburbs with access to the city, not less.
P Burgos
Oct 4 2018 at 10:33am
I live in an auto-centric suburb, and I gotta say, I still am very worried about a car running over my daughter. Also, I grew up in a street-car era suburb, which is a lot denser and more walkable than the auto-centric suburb in which I currently live. The streetcar suburb was definitely a safer place for walking and biking, and not too different in terms of traffic (except that cars there travel at slower speeds due to their being less space on the road and more traffic lights and stop signs). Also, it was nicer being able to walk where you need to go (mostly), like to school or the grocery store.
Andrew
Oct 3 2018 at 6:00pm
Doesn’t Seattle have nearly as many tech workers as the Bay Area now?
https://techcrunch.com/2015/04/25/is-seattle-silicon-valleys-next-favorite-stop/
AMT
Oct 4 2018 at 8:50am
NIMBYs are like luddites or monopolists. They oppose socially beneficial changes that are to their immediate detriment. It’s easy to understand why they want to preserve their economic rents, but it is bad policy.
John Thacker
Oct 4 2018 at 12:46pm
Depends on how narrowly “local” is defined. If people are thinking “on this same block or neighborhood,” it might not. If local means “city,” then probably, and if it means “metro area,” then almost surely. E.g., DC is small enough compared to its surroundings that DC building a lot doesn’t decrease DC prices so long as Fairfax County and Montgomery County don’t build.
One thing is that most local governments only allow building in the currently cheapest neighborhoods, which does indeed tend to have the effect of raising prices hyperlocally, even as the supply increase goes a small way towards lowering prices citywide or regionwide. It is an argument in favor of dealing with land use at a state or region level, or limiting the ability of local governments to impose bureaucracy and ordinances restricting housing.
Scott Sumner
Oct 4 2018 at 7:00pm
John, Quality adjusted housing prices certainly fall.
John Thacker
Oct 4 2018 at 9:44pm
Quality-adjusted, perhaps, but people have heterogeneous preferences about some of the things that make for quality housing (e.g., certain types of expensive trendy retail and restaurants), and others simply prefer (or have) to save money and would prefer cheaper even if lower quality construction. I think it’s understandable why some people in poorer neighborhoods don’t want construction, and especially don’t want their neighborhood to be the only one getting construction. It’s certainly easier if people are allowed to build everywhere, you’ll get a diversity of housing types and density that way. Opening up just a few poor neighborhoods may lead to immediate delivery of luxury housing there, and displacement, not the diversity you would see with less regulation everywhere.
Scott Sumner
Oct 7 2018 at 12:08pm
Recall that California just voted down an initiative to reduce NIMBYism. The key is to make it impossible for local groups to stop these developments—that’s how you make it so all the burden doesn’t all fall on one neighborhood.
John Thacker
Oct 9 2018 at 4:53pm
Oh, I agree and I think that SB827 had some very good ideas (clearly, if you’re going to have mass transit, it makes sense to have lax zoning especially near there.) I think that there’s room for state action preventing local governments from restricting property rights too much through zoning, in the same way that restricting internal tariff barriers is a good thing, and maybe a modified version will come back next year.
To be clear, I think that there is an overall benefit to the community with new development even when displacement occurs because development isn’t being allowed everywhere, but it’s not a Pareto improvement (as few things are).
Comments are closed.