Tomorrow, the Cato Institute publishes a report titled “How Urban Planners Caused the Housing Bubble.” Faithful readers of the Antiplanner can download a preview copy today.
This report will probably not change the minds of any Antiplanner readers, but there are still lots of people who think that the United States as a whole suffered a housing bubble in the last several years. As the report shows, there were clear bubbles in fewer than 20 states, most of which had some form of growth-management planning (see table 1 on pp. 12 and 13).
Those who claim the bubble was caused by low interest rates, easy credit, or similar national causes have to explain why fast-growing states like Georgia, North Carolina, and Texas did not have a bubble. Remarkably, according to data published by the Federal Housing Finance Agency, housing prices never declined in such major (and relatively unregulated) metropolitan areas as Houston and Dallas. If there was a national housing bubble caused by the Federal Reserve Bank or some other central authority, this could hardly be the case.