Let's "curb" our enthusiasm for urban planning.
It has become fashionable to view the wealthy with suspicion. A pervasive theme among politicians is that the elite and wealthy are opposed to their constituency. To beat the system, one needs to beat back the elites. Yet for all the rhetoric centered around conflict, putting aside class differences can be helpful to achieving widely desirable goals.
Jimmy McMillan, satirical candidate for the ‘Rent Is Too Damn High’ party received more than 40,000 votes over frustration that the costs of renting in New York City is too expensive. He was onto something. A Brookings Institution study analyzed that by the middle of the 90s, low-wage workers were no longer moving to high-wage cities because of rent costs.
Rent and mortgage costs seem intractable when analyzing life as a competition between the rich and the poor. Yet, cooperation and pruning zoning regulations is something billionaires and low-income workers could unify on during the time of the Coronavirus. Cooperating on an issue can unify the wealthy and the poor and cut through class division.
The landscape for corporate real estate is changing quickly during the pandemic. As money is tight, and businesses are unable to utilize their offices, businesses have warmed to working from home as a permanent model for some industries. Being given access to the benefits of saving up to $11,000 dollars a year for each worker working remotely, cutting commuting costs, having access to a broader range of employees, while having most managers being satisfied with work quality proves to be a tempting offer. As leases expire, many corporations will not renew with as much space.
As corporations no longer want, or need as many offices, much space is going to be left unused. It may remain unusable if inflexible zoning laws prevent landowners from using their buildings for noncommercial uses. Currently, urban planners zone so that residential property isn’t near commercial property, but as commercial property becomes vacated, outdated regulations on how land is to be used will disadvantage the urban poor and the landowners.
Give landowners and developers the flexibility to make housing in commercial zones by easing regulations will benefit all.
As corporations vacate the real estate market, landowners will need to find other sources of revenue. Letting buildings rot as people remain homeless does not make moral or financial sense. Financially, refusing to accept payment for housing is risky, especially as city governments are grasping for money.
As a result, landowners will be incentivized to create housing that people will hope to move into. To entice renters, the housing created must be competitive in cost of living, and safety. As many lose or leave their jobs and look for less expensive living, landowners must provide inexpensive units to meet demand in order to make a profit.
While unconcerned with lining landowner’s pockets, affordable housing advocates have strong reasons to support the downsizing of urban planning. Affordable housing advocates are frustrated that the indigent and unfortunate do not have an inexpensive place to live. They’re right. The average family can’t afford to buy a home in 71 percent of the country. While in the past, they’ve argued for counterproductive measures like rent control and government run development, they can refocus on reducing regulation to better achieve their goals.
Here’s why: the total housing supply is the primary determinant for the price of rent. Increasing the total amount of housing- even if it’s not going to the poor- will increase competition for the buyer, driving down prices. Regardless of whether housing is “luxury” or “affordable,” housing costs go down overall. Economist Evan Mast examined the effect of new apartment buildings in low-income areas, and found that the inclusion of new market-rate buildings lower nearby rents to 7 percent.
Affordable housing advocates should want more housing to be built, regardless of whether its low income, or “luxury.” America does not have the ‘luxury’ of waiting for governments to produce a housing revolution. Instead, by freeing real estate from the boot of urban planners, let’s create the conditions that allow people to thrive!
Isadore Johnson is a campus free speech advocate, an economics and philosophy student, and regional coordinator for Students for Liberty.
Dec 26 2021 at 11:03am
Perhaps a bit of focus on profitable housing. An empty office with each 1,000 square feet divided into 10 individual rental rooms with a bathroom down the hall. A formerly homeless paying say $20.00 a night for a place with reasonable air conditioning and locks on the door might be a business model. Without subsidies as I see it. As opposed to an empty building anyway.
Of course it would be more desirable to convert offices into full price apartments to tenants with an ongoing income.
All this being if it were legal of course.
Dec 26 2021 at 9:45pm
Unfortunately, NIMBYism is a grass roots affair in many places. The boot is on the feet of mom-and-pop.
Though perhaps less so in the case of metropolitan commercial real estate.
Though for that, talking directly about homeless people doesn’t make much sense. They won’t move in. It’s all about ‘filtering’, ie the chain of house moves kicked off when a rich person moves from a nice home to an even nicer home, and someone else moves up the ladder into their old place, and so on.
Thomas Lee Hutcheson
Dec 27 2021 at 2:59pm
But it is the elites that are trying to liberalize urban restrictions on urban density.
Thomas Lee Hutcheson
Dec 28 2021 at 3:45am
Elite v non-elite does not get it. Developers and YIMBY’s are elites, too. NIMBY’s ae not all “elites.”
Gregory G Evangelatos
Dec 28 2021 at 11:56am
As a person who pursues project approval 2 things are clear. People come to hearings making unfounded and often malicious statements. And second politicians need a backbone. Stop placating mob rule. And yes augmenting supply will help control the increase in the cost of housing.
Dec 28 2021 at 3:27pm
In my experience most people simply don’t understand that high density residential housing is MORE profitable than luxury devolpment in a free er market.
Basically they see expensive housing, and they don’t seem to know about the regulation causing the problem in the first place…
There is more money in Wall mart than in Bloomingdale’s…
Dec 28 2021 at 4:50pm
Really? The report it’s based on seems naïve:
So I went digging for the actual report they’re quoting in the story, and found additional details:
Of course, they also have a report out Home Equity Abounds Across U.S. During Third Quarter As Home Values Hit New Highs, so the increase in home prices isn’t even all bad…
just a planner
Dec 29 2021 at 2:05pm
Actual urban planner here. I broadly agree with you on allowing more flexibility in uses in zoning regulations, and I’d hazard to guess most members of my profession today do too. A lot has changed in what’s considered good planning practice since the mid-20th century, and today (as Matthias mentions above) the “boot of urban planners” is in reality worn primarily by local NIMBYs. I’ve personally been in the position of advising communities to liberalize restrictions on new housing and getting intense pushback from community members and their elected officials.
A couple important nuances to your suggestion of allowing conversion of CBD commercial real estate to housing–which all basically boil down to “small-scale incentives matter”:
– Part of the reason municipalities zone exclusive commercial areas is that while housing has higher financial returns for developers today, commercial real estate is better for municipalities’ balance sheets. Offices don’t consume many city-provided services, while residents do–and they get very irate about raising property tax rates to make up the difference.
– Another facet of this challenge is the perception that the political economy of converting from commercial to residential is much easier than the opposite. If you build condos next to a bunch of office towers, the office owners and tenants largely benefit (more housing options for employees, larger base to support local amenities) and face few costs. If you try to do the opposite, residents will often scream about increased traffic, noise, blocking views, etc.
– Zoning is not the only constraint on property owners converting commercial buildings into housing. I’ve raised this suggestion to architect friends in the past and they’re quick to note that the costs of converting modern office space into homes that meet residential building codes are often higher than just tearing down and rebuilding. Now, it may be that some of those building code requirements don’t pass a cost/benefit test, and in the face of the housing crisis, we should worry more about getting people off the streets and into emergency housing, even if it’s substandard. I can sympathize with that argument, but woe betide the mayor who makes an emergency exception to building code requirements and then has to face the press after a fatal building fire or other accident.
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