California state senator Scott Wiener, who represents San Francisco, has introduced Senate Bill 827, which would effectively void all local zoning rules in “transit-rich” areas, meaning areas within a half mile of a rail station or a quarter mile of a stop on a frequent bus route. Wiener’s goal is to allow the construction of high-density housing in those transit-rich areas, thus simultaneously providing more affordable housing and encouraging more people to ride transit.
This bill would severely disrupt neighborhoods throughout San Francisco, Oakland, Berkeley, and many other cities that currently have frequent transit service, as maps reveal that it would virtually eliminate zoning in most of the land area of those cities. While some people consider zoning to be an unfair (and possibly unconstitutional) restriction of property rights, most people who live in zoned urban neighborhoods appreciate the benefits of such zoning. By limiting the maximum density of housing, zoning minimizes traffic congestion, noise, and other problems.
Moreover, neighborhoods are built with streets, water, sewer, and other infrastructure to serve the needs of the density at which the neighborhoods were built. Major increases in density would require expensive improvements to water and sewer infrastructure–far more expensive than building new infrastructure on greenfields–and streets probably could not be redesigned to accommodate the density increases in any case.
Besides, city zoning isn’t the cause of high housing prices, nor will densification make housing more affordable. With the exception of Houston, every major city in the country has maximum-density zoning, but housing prices are unaffordable only in cities that also restrict development of rural areas around the urban fringes.
Residents who oppose densification of their neighborhoods are often accused of being NIMBYs who are borderline racists getting in the way of market demand. But the urban-growth boundaries and other restrictions on rural development have so distorted California and other housing markets that any demand for density is totally artificial.
Without those rural restrictions, housing would be affordable to almost everyone regardless of race or incomes. The fact that homeownership rates in Brazil and Mexico are far higher than in the United States shows that homeownership is limited more by government regulation than by incomes.
The Portland building mentioned here a few days ago demonstrates why denser housing isn’t more affordable. Where low-rise housing in areas without growth management sells for around $100 a square foot, a supposedly affordable high-rise tower in Portland is expected to cost more than $320 a square foot. A Portland affordable housing study found that mid-rise housing costs 52 percent more and high-rise housing costs 68 percent more per square foot than low-rise housing.
On top of construction costs, land costs in urban areas that have been forced to grow dense by urban-growth boundaries are so high that it is nearly impossible to build enough density to make housing affordable. A buildable lot in Portland is at least 25 times more expensive than one in Dallas or San Antonio, and one in San Francisco is hundreds of times more expensive.
For these reasons, regions that have grown denser due to growth boundaries have become less affordable, not more. Since 1970, the population densities of the San Francisco-Oakland and San Jose urban areas have each grown by about 50 percent, yet their median home prices relative to median family income–a standard measure of affordability–have each tripled.
The Antiplanner is not a great fan of zoning, which tends to be too rigid to respond to changes in tastes and market demand. Most housing, and all new housing, in Houston and other places with no zoning is sold with protective covenants that serve the same purpose as zoning, since developers have learned that such covenants make properties more valuable without increasing their cost. Houston also has a process to allow homeowners in neighborhoods without such covenants to petition their neighbors and, if 75 percent agree, to write covenants. These covenants are flexible because homeowners can vote to change them and developers have been known to persuade homeowner associations to change them to meet new market demand.
California could solve the problem of housing affordability without disrupting existing neighborhoods by banning urban-growth boundaries. If desired, the state could also get rid of urban zoning but give property owners the opportunity to replace zoning with covenants. Since not every neighborhood would do so, developers could meet market demand for any density either on the urban fringe or in neighborhoods whose existing residents are willing to live with new development. Without those changes, S.B. 827 will do far more harm than good to California cities.