“Ray shared data showing that workers would need to make almost $30 an hour in order to rent a standard two-bedroom apartment in the Miami area without experiencing cost burdens. As of 2021, Miami’s median hourly wage was $18.59, creating a situation where many residents are forced to spend upward of 50 percent of their incomes on housing alone. The conventional financial wisdom is that households should spend no more than 30 percent of their incomes on rent.
Already in 2019, some were sounding the alarm about Miami’s rising housing prices. One study commissioned by the housing group Miami Houses for All in collaboration with city and county officials found that Miami was the third-most expensive metropolitan area in the entire country for housing costs. The same study found that over 50 percent of households in Miami were spending more than they could afford on rents and mortgage payments.”
“Rising rents are a very real phenomenon driven by a mismatch in many cities between the number of homes that are being built and the number of people who would like to live in them. The wedge between supply and demand is created by cities’ elaborate zoning codes, price regulations, and permitting processes that all combine to reduce housing availability and raise prices.
It should be no surprise that rents are high when a majority of land in major cities is off-limits to new development, it takes years to approve whatever new housing is allowed, and some of those new units have to be given away at below-market rates.
The details of these restrictions are a wonky topic, to be sure. One expects only so much depth or insight from a comedic explanation of it all. But even allowing for that handicap, Oliver’s treatment of the housing supply issue proves to be superficial, brief, and confused.
Oliver either misunderstands or fails to explore the link between government regulation, housing supply, and housing market outcomes. His perfunctory explanation of it serves only as a brief prelude to his attack on the real villains in his story: greedy private landlords with carte blanche to raise rents and evict tenants.
The solutions he puts forward, therefore, have little to do with eliminating needless, harmful regulatory barriers to new supply. Instead, he calls for legally constraining landlords’ ability to raise rents and evict tenants and declaring housing a federally funded, government-provided right.”
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“building new housing, even high-end housing, improves affordability for everyone by absorbing the demand of high-income renters, who are no longer bidding up the costs of older, naturally cheaper housing units. A growing body of empirical research shows this is a fact, not a free market fantasy.”
At surface level, zoning is an impossibly boring topic, even by the terms of public policy debate. The mere thought of a weeknight zoning hearing or a 700-page zoning ordinance is enough to make even the most enthusiastic policy wonk’s eyes glaze over. Until recently, zoning might have been blithely dismissed as a mere technical matter, simply a way of rationalizing our cities, a planning policy so obvious as to be beyond reproach.
But zoning is at once so much less and so much more. While occasionally used as a stand-in for city planning or building regulations more broadly, its scope is far more limited: At a basic level, all zoning does is segregate land uses and regulate densities. Your local zoning ordinance sets out various districts, each with detailed land use and density rules, while an associated local zoning map establishes where these rules apply. The bread and butter of what most people think of as city planning—such as street planning or building regulations—has almost nothing to do with zoning.
Yet from these seemingly innocuous zoning rules have emerged a set of endlessly detailed parameters controlling virtually every facet of American life. Arbitrary lines on zoning maps determine where you can live by way of allowing housing to be built here but not there. Through a dizzying array of confusing and pseudoscientific rules, from “floor area ratio” restrictions to setback mandates, zoning serves to heavily restrict the amount of housing that may be built in any given neighborhood and the form it may take. In most major cities, zoning restricts roughly three-quarters of the city to low-slung, single-family housing, banning apartments altogether.
The combined effect is that, in already built-out cities, zoning makes it prohibitively difficult to build more housing. As a result of the further tightening of zoning restrictions beginning in the 1970s, median housing prices have dramatically outpaced median incomes in many parts of the country over the past half-century, such that millions of Americans now struggle to make rent or pay their mortgage each month. That is if they have the luxury of having a stable home at all: In places where demand for new housing is especially high—as in cities like New York and Los Angeles—zoning restrictions have facilitated acute housing shortages, with attendant surges in displacement and homelessness. The COVID-19 pandemic has only expedited these trends, with home prices in 2020 rising at the fastest rate since 1979.
The arbitrary restrictions that zoning places on cities also show up in our capacity to grow and innovate as a nation. By severely limiting new housing production in a handful of our most productive cities—including San Jose and Boston—we have made moving to our most prosperous regions a dubious proposition. Your income might double if you were to move from Orlando to San Francisco, but your housing costs would quadruple. Should we be surprised that many people are turning down that deal? For the first time in history, Americans are systematically moving from high-productivity cities to low-productivity cities, in no small part because these are the only places where zoning allows housing to be built. According to the 2020 census, the population of California—one of our most productive and innovative states—is now basically stagnant, such that the Golden State will be losing a congressional seat for the first time in its 170-year history.
The downstream economic implications of this unprecedented reversal of historic trends are hard to overstate. After all, big cities make us more productive, in that they allow us to find a job perfectly suited to our talents and exchange ideas with colleagues working on the same issues. They provide a platform for individuals to experiment and innovate, nursing the young firms that go on to remake the American economy every few decades. To the extent that zoning has made it exponentially more difficult for Americans to move to these hubs of activity—for a software engineer to relocate to San Jose or for a medical researcher to relocate to Boston—we are all poorer as a result.”
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“zoning makes more environmentally friendly forms of urban growth effectively illegal. By banning developers from building up, zoning forces them to build out.”
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“zoning assumes universal car ownership and all the emissions and traffic violence this entails.”
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“zoning isn’t merely a good policy misapplied toward selfish ends. Zoning is a fundamentally flawed policy that deserves to be abolished. Set aside for a moment the debilitating local housing shortages, the stunted growth and innovation, the persistent racial and economic segregation, and the ever-expanding sprawl: The very concept of zoning—the idea that state planners can rationally separate land uses and efficiently allocate density—has repeatedly failed to materialize. Far from the fantastical device imagined by early 20th-century planners, zoning today has little to do with managing traditional externalities and works largely untethered from any guiding comprehensive plan.”
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“Cities found ways to separate noxious uses and manage growth for thousands of years before the arrival of zoning, and they can do the same after zoning. Indeed, some American cities—including Houston, America’s fourth-largest city—already make land use planning work without zoning. To the extent that zoning has failed to address even our most basic concerns about urban growth over the past century, it’s incumbent on our generation to rekindle this lost wisdom and undertake the project of building out a new way of planning the American city.”
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“the fact that zoning is only now turning 100 might speak to the fact that we shouldn’t take it for granted. A 100th anniversary is as good a time as any for a reevaluation”
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“Zoning is not only ineffective in achieving its stated goals—it’s also unnecessary. In our focus on drawing district boundaries or listing out permitted uses, we have lost touch with the innumerable ways that cities organize themselves, from the natural use separation helped along by land markets to the bottom-up agreements formed by neighbors. Where these institutions fail, a robust set of impact regulations for new development and a civil service committed to managing—rather than stalling—growth would do a far better job than zoning at keeping neighbors happy and quality of life up. Now is the time to rediscover these lost traditions and start planning for what comes after zoning.”
“The median home value in San Francisco in 2022 is above $1.5 million, according to the Zillow Home Value Index, which shows home values rising by more than 10 percent in the past year alone. In nearby San Jose, Redfin reports a median home price of $1.45 million—but home values have risen by a staggering 24 percent in the last year. Today’s Bay Area is simply unaffordable for most people, in part because California regulations hinder new construction and in part because natural geographical constraints reduce the total amount of buildable space; San Francisco has a huge housing supply shortage that shows no signs of being remedied soon.
Pair this with complaints that the city has failed to handle its homelessness problem, leading to open-air drug scenes and massive tent encampments in neighborhoods like the Tenderloin. One in every 100 San Franciscans is homeless, and California is a national outlier in terms of what proportion of the homeless population is actively “unsheltered,” as in, sleeping on the streets or under highway overpasses. In San Francisco, 73 percent of the city’s homeless population is considered unsheltered. That’s not normal, even for a big city: In New York City, the figure is about 3 percent.
And then there was the pandemic, which made many big tech offices obsolete: Twitter, Yelp, and Airbnb attempted to sublease their expensive Bay Area office spaces. Pinterest paid almost $90 million in the third quarter of 2020 to break the lease of their almost 500,000-square-foot office space. For many workers, the value of living in San Francisco dropped. Why pay a premium to live near an office you aren’t going to?
Finally, there was the broader sense, especially among high-value tech workers, that San Francisco and its neighbors were uninterested and unresponsive, focused only on extracting from their most productive citizens in the form of high taxes, which fund poor city services. In the last few years, many have simply grown tired of paying exorbitant taxes for the privilege of living in California—one that now bestows little in return.
Hence the Golden State exodus. In 2021, for the first time ever, California lost a congressional seat. The state didn’t technically lose population, but it didn’t have the same growth rate as the rest of the country.”
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“the shift also owes something to responsive governance. Leaders of other cities have actively courted the movers. In December 2020, venture capitalist Delian Asparouhov tweeted “ok guys hear me out, what if we move silicon valley to miami.” Miami Mayor Francis Suarez responded promptly, “How can I help?”
Yet as Bay Area tech workers depart, it remains an open question whether those new pastures will truly be greener. The city of Austin has faced rising housing costs, stemming in part from restrictions on development. Miami has struggled with corruption and policing problems. San Francisco’s urban competitors are cheaper, for now, but there are already worrying signs that the cities luring tech’s highly mobile, highly desirable workers are already poised to repeat many of the same mistakes that drove so many Californians away.”
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“In 2012, Austin city officials saw the writing on the wall and proactively tried to remedy these problems by moving toward a zoning code rewrite. The 30-year-old code had outlasted its usefulness, and with massive population growth, city planners needed to allow for much more density.
The city’s newly proposed zoning code was dubbed CodeNEXT, as part of a forward-looking urban revitalization plan, Imagine Austin. The new code aimed to reduce the strict separations between Austin’s residential and commercial corridors, allowing for more mixed-use buildings and more housing overall.
It would’ve scrapped single-family zoning restrictions in many areas, allowing for duplexes, triplexes, fourplexes, and apartment buildings to be built in their stead; it would’ve allowed for urban in-fill instead of forcing newcomers to gravitate toward far-flung suburbs; it would’ve reduced or eliminated minimum parking requirements in some places too. It wasn’t exactly an urbanist’s dream—some criticized it for not going far enough with regard to density—but it was a reasonable step toward that ideal.”
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“By 2018, the project was dead in the water, having been met with fierce opposition primarily from neighborhood preservationists and homeowners, who had seen their homes double in price over the last five or 10 years.”
“The preliminary results of St. Paul, Minnesota’s, strictest-in-the-nation rent control law have not been good. Developers have fled, while applications for new building permits and property values have both collapsed. Now, a pair of landlords are suing the city, claiming the law is unconstitutional.”
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“The ordinance, written by local activists and passed by voters in November 2021, capped rent increases in the city at 3 percent per year, with none of the typical allowances or exemptions for inflation, vacant units, and new construction.
The policy is far stricter than basically every other rent control law in the country. Oregon’s 2019 state rent control law, for instance, allows for property owners to raise rents by 7 percent plus inflation and exempts buildings less than 15 years old from these price caps.
While the St. Paul ordinance did allow landlords to obtain exemptions to that 3 percent cap if it threatens their ability to earn a “reasonable return” on their investment, what would count as a reasonable return and how to secure an exemption were left up to the city to hash out. St. Paul came out with proposed rules for implementing the ordinance, including the exemption process, in early April 2022. These were finalized later that month, and everything went into effect on May 1. The final rules allow landlords to “self-certify” exemptions if they’re trying to raise the rent by no more than 8 percent, which involves filling out a short form and submitting it to the city.
Landlords are also permitted to raise the rent up to 15 percent. Doing so requires vetting from city staff and the completion of a 22-page worksheet that asks the applicant to provide exhaustive detail about changes in their expenses that might justify a rent increase. Because all exemptions can be appealed and subjected to a city audit, even landlords who can self-certify increases of up to 8 percent are encouraged (but not required) to fill out that 22-page worksheet as well.
It’s a daunting prospect for many of St. Paul’s smaller landlords.”
“Nearly 1 million people are evicted in the US each year, mostly for nonpayment of rent. Between 2000 and 2016, according to the Eviction Lab at Princeton University, one in 40 American renter households was evicted, and more than twice that share were threatened with it. The experience of losing one’s home to eviction has been linked to all sorts of adverse consequences, including higher job loss, debt, suicide, and reduced credit access.
Many evicted families are forced to relocate to lower-quality homes in neighborhoods with more crime. Evicted children experience higher food insecurity and lower academic achievement than other low-income kids living in rental housing, partly as a result of having to shuffle between schools and their parents’ declining mental health.”
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“Claudia Aiken, a policy researcher at the University of Pennsylvania, has already found clear results from Philadelphia. Receiving emergency rental assistance was associated with a lower likelihood of incurring debt, a lower share of tenants reporting that they worried frequently, and a significant decrease in the amount of rent owed among those behind on payments. Other studies on preliminary impacts in Atlanta and Baltimore have found receiving rental aid is associated with reduced risk of homelessness and lower debt.”
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“As states and cities cobbled together their rental assistance programs, policymakers quickly ran into several issues. Landlords weren’t always eager to participate because accepting the money sometimes came with requirements to forgive past penalties, interest, and court costs; or because participating barred landlords from chasing payments for anything outstanding in the months they received aid. Some states capped available rental assistance so low that many landlords saw accepting it as consenting to de facto rent cancellation while they were dealing with their own cash flow problems.
Some programs tried to grease the wheels to induce more participation. A Pennsylvania rental assistance program in place before ERAP launched had a monthly cap of $750, regardless of what rent was owed. But only 44 percent of landlords participated, so Philadelphia policymakers decided to pair state aid with CARES money to offer landlords up to $1,500 per month. This boosted Philadelphia participation to 63 percent.
Still, many landlords just wouldn’t bite. In a national survey of rental assistance programs conducted in spring 2021, 44 percent of program administrators said landlord responsiveness was a challenge. That number rose to 67 percent in summer 2021, and 74 percent in late 2021. As one ERAP administrator explained, “many landlords are not looking to keep unreliable tenants; some refuse to work with us; [and] others are not willing to renew leases.”
Landlord resistance is nothing new in federal housing policy. But to address the issue, Treasury took an unprecedented step. It said that programs must send money directly to tenants when their landlords don’t cooperate, and clarified that programs can even provide direct assistance to tenants before trying to engage the landlord. Not all programs embraced the idea, but many did.”
“Housing production is up, and rents do indeed appear to be falling. But the effects of Minneapolis’ particular means of eliminating single-family-only zoning, and allowing up to triplexes on residential land citywide, have been exceedingly modest.
Newly legal triplexes and duplexes make up a tiny fraction of new homes being built. Other less headline-grabbing reforms appear to be doing the Lord’s work of boosting housing production.”
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“Wittenberg credits the city’s elimination of parking minimums—which had typically required one parking spot per housing unit—with facilitating increased construction of smaller apartment buildings.
The city has been chipping away at residential parking minimums since 2009. The Minneapolis 2040 plan eliminated them entirely. (The city has also adopted some rather un-free market parking policies, including parking maximums in some areas and bike parking minimums.)
Data culled by Wittenberg, and shared with Reason, shows that 19 major projects have been approved by Minneapolis’ Planning Commission since parking minimums were eliminated. The median project provided .42 residential parking spaces per unit, with smaller apartment buildings typically including even less parking.
“For site constraint reasons and economic reasons, it would have been hard to park those buildings at one parking space per unit,” he says. “We’re pretty clearly seeing that is making a significant difference.”
In January 2021, Minneapolis also implemented additional parts of the 2040 Minneapolis comprehensive plan that allows for larger, denser apartment buildings in more of the city, particularly along commercial corridors and near public transit stops. That’s also helped facilitate more development, says Wittenberg.
Flisrand, on Twitter, argues that the fight over eliminating single-family-zoning sucked up most of the attention in the Minneapolis 2040 debate, thus paving the way for more impactful policies like parking minimum elimination and commercial corridor upzoning.”
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“One also doesn’t want to learn the wrong lesson that eliminating single-family zoning is the only supply increasing reform cities need to adopt.
There’s a certain current of thought on the political left—represented most prominently by Rep. Alexandria Ocasio-Cortez (D–N.Y.)—that supports eliminating single-family zoning in wealthy neighborhoods while also expressing extreme skepticism of denser private, market-rate development elsewhere in the city
But legalizing the latter type of development, at least in Minneapolis’s experience, appears to go a lot farther in actually producing more housing units and holding down rents.
More and more jurisdictions across the country are catching on to the fact that their zoning laws are strangling housing production and driving up housing costs, and moving to make changes.”
“Pittsburgh is expanding on a remarkably straightforward approach to creating new affordable housing: Force private developers to build it.
On Tuesday, the Pittsburgh City Council unanimously passed an ordinance expanding preexisting requirements that developers include below-market-rate units in their projects to more areas of the city. Now, builders of 20 or more units in Pittsburgh’s Polish Hill and Bloomfield neighborhoods must offer at least 10 percent of those new units at affordable rates to lower-income buyers and renters.
These types of “inclusionary zoning” policies are common across New Jersey, California, and the Washington, D.C., metro area. Supporters argue they ensure that existing residents see some benefit from new, luxury developments going up in their neighborhoods.
“There are imminent developments that could reshape our neighborhood, and we want to be able to preserve a balanced approach to development that ensures people of all income levels can find a home,” said John Rhoades of the Polish Hill Community Association to TribLIVE earlier this month.
Critics of inclusionary zoning say that even the best-designed policies have a poor record of creating new housing while raising overall housing costs. The theory is that developers raise rents on market-rate units to cover the lost revenue from the discounted, affordable apartments they’re required to build.
“It effectively becomes taxation on housing,” says Jim Eichenlaub, executive director of the Builders Association of Metropolitan Pittsburgh, to Reason. “You’re taxing those other units to pay for the subsidy.” Eichenlaub adds that if the market couldn’t support those higher rents, then the project probably wouldn’t have been built in the first place.”
“The nation’s affordable housing crisis has gotten some semblance of attention — with journalists writing stories on the rising cost of rent, the scarce supply of new housing, the looming threat of eviction — but one aspect of the crisis has gone consistently overlooked. On top of the severe housing shortage that currently exists, nearly 6 million homes nationwide have moderate to serious home health hazards. They require repairs that, if left ignored, will make them uninhabitable, and eventually they’ll disappear from the market altogether.
The National Low Income Housing Coalition, a research and advocacy group, estimates a shortage of 7 million affordable housing units for low-income renters, but those figures don’t account for all the existing affordable units that stand at risk of demolition.
Issues like lead paint, leaky roofs, and knob-and-tube wiring don’t just leave tenants and homeowners in substandard, unsafe housing. They also leave families — mostly poor families — shut out from energy efficiency programs the federal government already funds to upgrade homes. Due to inflexible program restrictions, homes with outstanding repairs aren’t eligible for existing weatherization subsidies, despite those families arguably needing them the most. Addressing this problem could help solve both the affordable housing and the climate crisis at once.”
“Pruitt-Igoe represented complete racial and economic segregation. The building was dominated by single mother households that symbolized the collateral damage of public assistance. This was described by sociologist Lee Rainwater, in his book Behind Ghetto Walls: Life in a Federally-Subsidized Slum, “Only those Negroes who are desperate for housing are willing to live in Pruitt-Igoe.” When imploded, the buildings weren’t even two decades old.
The problems that toppled Pruitt-Igoe do not go nearly far enough to capture the deeply mistaken assumptions about government housing policy whose bad ideas continue today.
After clearing seedy areas, housing reformers who pushed for Pruitt-Igoe assumed that the neighborhoods they replaced were irredeemably bad and required what Architectural Forum magazine called, in 1957, “slum surgery.” In reality, the DeSoto-Carr neighborhood—like Chicago’s Bronzeville, Detroit’s Black Bottom, and New York’s East Harlem—contained small businesses, community institutions (such as a St. Louis hospital financed by African-American philanthropy) manufacturing, and, most notably, owner-occupied homes. Of the housing units cleared, according to the Census Bureau, 21 percent of the properties had “nonwhite owners.” What’s more, an additional 25 percent of those included rental units. It offered, in other words, a path to wealth accumulation through property ownership—a path wiped out by public housing.
Implicit in that heedless clearance was the idea that the private market inevitably fails to produce housing for those of modest means. In her landmark 1934 book Modern Housing, housing reformer, Catherine Bauer, wrote “The premises underlying the most successful forward-pointing housing developments are not the premises of capitalism [or] inviolate private property.” It was no coincidence that Bauer also included photographs of government-owned apartments in Soviet Moscow.
The design of Pruitt-Igoe’s modernist garden of towers would, instead, reflect the reformer’s hubris that planners, financed by government, could build a better neighborhood.”