The California legislature is getting some push back on S.B. 827, which proposes to eliminate zoning in most of San Francisco, Oakland, and other “transit-rich” cities. So legislators have announced a new proposal, A.B. 2923, which would allow the Bay Area Rapid Transit District (BART) to build whatever it wants on land it owns, most of which is presumably near BART stations.
Home sweet $2 million home. Photo from Google streetview.
There’s no doubt that Bay Area housing is too expensive. An 848-square-foot home in Sunnyvale just sold for $2 million (a $550,000 premium over the asking price), or $2,358 per square foot. Increasing numbers of people are buying homes sight unseen. For some, commuting from Bend, Oregon is a viable option because the cost of flying is less than the cost of housing in the Bay Area.
Yet there is plenty of doubt that building denser housing is the solution. The Bay Area’s biggest problem is the price of land, and land prices are high solely because of the region’s urban-growth boundaries. In most of the Bay Area, builders would have to cram in hundreds of units per acre to make the land cost per unit comparable to that in less-regulated regions.
The second problem is that dense housing costs 50 to 68 percent more, per square foot, than single-family housing. That’s because buildings more than three stories tall require a lot of steel, concrete, and other high-cost materials.
Compared to these two problems, the NIMBYism that S.B. 827 and A.B. 2923 would counter is relatively unimportant. If Bay Area cities had no zoning at all but the lands outside of their urban-growth boundaries were still unavailable for development, housing would still not be affordable. On the other hand, if the urban-growth boundaries were abolished but city zoning was left in place, housing throughout the region would soon be as affordable as in, say, Dallas and Atlanta.