Tag Archives: housing

Obama on housing

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The Obama administration has come out with a “housing development toolkit“. I think they have this about right. Of course, the federal government has very little control over local land use. Maybe some local politicians will take the trouble to try to understand this stuff and support policies that help people and the economy rather than policies that just kind of sound good but are ultimately counterproductive.

Over the past three decades, local barriers to housing development have intensified, particularly in the high-growth metropolitan areas increasingly fueling the national economy. The accumulation of such barriers – including zoning, other land use regulations, and lengthy development approval processes – has reduced the ability of many housing markets to respond to growing demand. The growing severity of undersupplied housing markets is jeopardizing housing affordability for working families, increasing income inequality by reducing less-skilled workers’ access to high-wage labor markets, and stifling GDP growth by driving labor migration away from the most productive regions. By modernizing their approaches to housing development regulation, states and localities can restrain unchecked housing cost growth, protect homeowners, and strengthen their economies.

Locally-constructed barriers to new housing development include beneficial environmental protections, but also laws plainly designed to exclude multifamily or affordable housing. Local policies acting as barriers to housing supply include land use restrictions that make developable land much more costly than it is inherently, zoning restrictions, off-street parking requirements, arbitrary or antiquated preservation regulations, residential conversion restrictions, and unnecessarily slow permitting processes. The accumulation of these barriers has reduced the ability of many housing markets to respond to growing demand.

This toolkit highlights actions that states and local jurisdictions have taken to promote healthy, responsive, affordable, high-opportunity housing markets, including:

  • Establishing by-right development
  • Taxing vacant land or donate it to non-profit developers
  • Streamlining or shortening permitting processes and timelines
  • Eliminate off-street parking requirements
  • Allowing accessory dwelling units
  • Establishing density bonuses
  • Enacting high-density and multifamily zoning
  • Employing inclusionary zoning
  • Establishing development tax or value capture incentives
  • Using property tax abatements

hidden parking costs

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Hidden parking costs drive up the cost of rent in U.S. metropolitan areas by an average of 17% according this article. The implication is that people are paying for housing and parking together, and don’t realize it. By separating the two, the cost of housing would be reduced, and people would be free to choose to pay for parking, or use the money saved on other transportation options.

Hidden Costs and Deadweight Losses: Bundled Parking and Residential Rents in the Metropolitan United States

There is a major housing affordability crisis in many American metropolitan areas, particularly for renters. Minimum parking requirements in municipal zoning codes drive up the price of housing, and thus represent an important potential for reform for local policymakers. The relationship between parking and housing prices, however, remains poorly understood. We use national American Housing Survey data and hedonic regression techniques to investigate this relationship. We find that the cost of garage parking to renter households is approximately $1,700 per year, or an additional 17% of a housing unit’s rent. In addition to the magnitude of this transport cost burden being effectively hidden in housing prices, the lack of rental housing without bundled parking imposes a steep cost on carless renters—commonly the lowest income households—who may be paying for parking that they do not need or want. We estimate the direct deadweight loss for carless renters to be $440 million annually. We conclude by suggesting cities reduce or eliminate minimum parking requirements, and allow and encourage landlords to unbundle parking costs from housing costs.

City Observer’s Weekly Roundup

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City Observer has a nice weekly roundup with way more stuff than I could actually hope to read in a week. This example covers everything from car “demonization” to affordable housing to real estate capital gains.

I’ve been in the process of trying to form opinions on these issues for many years. On cars, I think they are demons. At least, private cars and all the waste and environmental and social hell they have unleased on the entire world. We should design cities and connections between them so we almost never need them. Then we can keep a few share cars and taxis around. On affordable housing, I don’t have the answers that have alluded everyone else forever, but in general I like focusing on the idea of supporting well-functioning markets that are able to set appropriate prices. When you distort prices with large subsidization schemes in a world of finite resources, you end up with distorted systems and unintended consequences. Better to find ways to remove hidden distortions, subsidies, and discrimination, constrain supply less, help people get around efficiently, and generally help them make an income and build assets so they can afford what housing costs. In the U.S., all the tax deductions and exceptions for homeowners and subsidization of inefficient low-density infrastructure are forms of distortion that maybe should be phased out. But please don’t take away my personal subsidies all at once, because I was counting on them when I made my last round of housing and financial decisions.

Philadelphia rowhouses

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I didn’t realize just how unusual the Philadelphia rowhouse is. Baltimore is really the only city that has something similar on a similar scale, with D.C. a distant third. I didn’t grow up here and was skeptical at first, but now I am living in my third one and I am completely sold. They are high density, yet low rise and to me, don’t feel as cramped as high rise apartments would. They are pretty social – people sit on their front stoops and get to know their neighbors, especially in good weather. They have back yards big enough to enjoy but small enough to be low maintenance. They are not conducive to driving and parking (a source of frustration to many), and are extremely walkable as a result. People walk to their jobs and shopping. Kids walk to school. There isn’t a whole lot of open space, I admit, but a few good parks and trails within easy walking distance make up for that.

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