Another day, another story about how evil single-family zoning makes housing expensive. This one is from Seattle, whose urban-growth boundary was drawn more than 30 years ago and, as far as I know, has never been changed.
This article starts from the premise that someone said that families want single-family homes so turning single-family neighborhoods into multifamily housing is “anti-family.” The writer’s response is that most of the city’s new residents are single, not families. Of course that’s true: thanks to the urban-growth boundary, most families with children can’t afford to live in the city and so choose to live in the suburbs.
Another article, this one from Los Angeles, blames affordability problems on downzoning. Only the writer doesn’t mean downzoning of rural land to prevent urban development but downzoning that took place forty years ago that took existing neighborhoods of single-family homes that had been zoned for higher densities and rezoned them for the single-family uses that were there.
None of these writers ask what kind of housing people want. They assume that people will accept the housing that is available, and if planners create an artificial land shortage, that means more multifamily housing.
When smart-growth planners do ask what people want, they load the questions and ask something like: “Would you rather live in a house with a large yard and drive everywhere or live in a house with a tiny yard and walk to shops and transit?” A more-accurate question would be: “Would you rather pay $200,000 for a 2,200-square foot home on a large lot that is easy driving distance from shops or pay $400,000 for an 1,100-square-foot condo that is easy walking distance from shops and transit or pay $600,000 for a 1,500-square-foot house on a tiny lot that is within walking distance to transit but not many shops?”
Even Millennials don’t aspire to live their lives in dense cities. At least two-thirds say they prefer to live in suburbs.
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Answers to survey questions are less important than the choices people actually make, which is what economists call “revealed behavior.” And the vast majority of new households, regardless of age, are choosing suburb-like housing areas, not dense inner cities.
For reasons that have never made sense to the Antiplanner, urban planners want to change those choices. So they make a big deal of single-family zoning even though housing prices are determined more by what happens in undeveloped areas on the urban fringe than by existing developments.
The last time I brought up this subject, I wrote that “no city in the world has ever become more affordable by growing denser.” Someone pointed out a Wall Street Journal article saying that New York City has become more affordable thanks to a multifamily housing boom. American Community Survey data show that the ratio median home value to median family income in Manhattan declined from 10.6 in 2010 to 10.1 in 2016, while in Brooklyn it declined from 12.1 to 10.8 in the same years. That seems to support this idea.
As the Antiplanner has previously noted, however, growth management not only makes housing more expensive, it makes prices more volatile. So we can expect to see some small fluctuations in affordability over time. However, anywhere with a price-to-income ratio greater than 10 is far from affordable — I draw the line at a ratio of 3. To be accurate, I should say that “once made unaffordable due to growth management, no city in the world has ever become affordable by growing denser.”
The Antiplanner wrote: “no city in the world has ever become more affordable by growing denser.”
Simply drop the “more”:
no city has ever become affordable….
thanks
JK
asking people “would you prefer living…” is useless since the devil is deeply in the details of life, which is a moving target. my biggest gripe with city planners and builders is the extreme sameness of what they do. i wouldn’t expect good data since so few people have actually lived the details of the given options to really know which they might prefer.
The belief that detached housing is the best option for families is dated?—?and frankly, privileged.
Yes, but privileged people make the zoning code. Last decade there was a big push from local neighborhood groups to get property owners to voluntarily change their property from multifamily to single family. It wasn’t very successful but in the meantime the zoning code was changed to limit density by forcing any new residential units to have front-facing doors, which of course practically eliminates small apartment buildings. Prior to that density was limited by a minimum of number of parking spaces per unit (1.5). The new zoning is called Urban Row House and brings with it more height and bulk plane restrictions.
One result of restricting multi-family housing is the median value for a home in my neighborhood rose from $340K when the new zoning code was introduced to $640 today. The humorous part is the neighborhood association that drove those zoning changes has this as their motto (emphasis mine):
Congress Park is a traditional city neighborhood with a small-town atmosphere. Here, people of diverse cultures, ages, colors and economic backgrounds share a sense of community, value older homes and mature trees, and enjoy the convenience of city living amid the stability of a thriving neighborhood.
Just rich people live here now. Rich European-Americans and Asian-Americans. African-Americans and Hispanic-Americans have been almost completely driven out by the tripling of monthly rents.
Real estate bubbles affect densified areas first…..reason why California took a massive hit after the property bubble, Also the reason celebrities from all over are pretty much selling their once palatial estates for less than market value.
It may be true that housing is becoming more affordable in the aggregate, but that likely has more to do with the incomes of the people living there than with housing supply. Manhattan and Brooklyn have seen a continued influx of higher-income households (and a corresponding loss of low-income households) in the years cited — this is commonly derided as gentrification.
But if incomes are rising faster than housing prices — house prices don’t actually have to decline — then the income effect, combined with the “mix” effect (replacement of lower-income households) can lead to more affordable housing, as least as defined here and using the same ACS data.
MJ,
Good point. Between 2010 and 2016, Manhattan median home prices rose by 21 percent but median incomes rose by 26 percent. Brooklyn home prices rose by 18 percent but incomes rose by 33 percent. So the increase in multi-family housing didn’t reduce housing prices.
To be sure, I didn’t mean to suggest that housing supply had no effect on prices, but they are far from the whole story which the single-minded focus on downzoning seems to imply.
Manhattan and Brooklyn are both places where it is fairly difficult to add housing supply and more supply probably helps, but it is difficult to separate from the income effect on affordability, especially using aggregate data from the ACS. It just also struck me that these particular places probably have a lot of workers in the finance sector and other similar industries that have rebounded strongly since the recession, and hence seen strong income growth (which the data you cite seem to bear out).
Add in the fact that these boroughs have a lot of neighborhoods in transition, and you have a dense thicket of competing issues all under the umbrella of housing affordability.