Why does tax policy need to directly influence the mix of 1bdr and 3bdr apartments? Renters who need 3bdr apartments have enormous influence over the market already.

If tax policy is not designed with these considerations in mind, then it will incentivize an improper mix and deteriorate the livability of the city. For instance, where I live the city core has been abandoned by families because no family-sized units have been built in something like 40 years. So families move out of the cities and then commute which causes all sorts of traffic problems, wastes their time in these commutes, creates more pollution and carbon emissions, and so on.

Why is that necessarily the case? The market has much better information about the demand for 3bdr apartments than cities and counties do. Mostly we have the opposite problem: top-down policy from local governments impedes the construction of 3bdr apartments.

It's a mistake to assume that builders are responding to demand. All actors in a market have only partial information. To take my city as an example, the housing market started heating up, so builders started constructing condos and tried to pack as many units into their building as possible, thus improving supply. This created a vibrant urban centre for young people who live on their own in modest apartments and drove up demand among that cohort even further, thus incentivising further construction of those same units, creating a self-reinforcing cycle.

But young people aren't the only ones who need to be downtown, as I said, and families were driven out to the suburbs for suitable housing. They have to commute instead, which has caused all sorts of gridlock and the usual problems with urban sprawl.

If the right incentives existed for mixed housing, tax incentives included, then this wouldn't happen, and people of all ages could afford to live closer to where they work, thus alleviating many of those issues and creating more livable cities.

Here in Canada we already do this in one sense by mixing government housing among more affluent neighbourhoods. This has prevented the formation of ghettos, but this same approach hasn't been applied to create an appropriate mix of housing for all different living arrangements.

So given a land value tax incentivises certain kinds of land use, my question is whether it would incentivise using land to make urban centres more livable for all types of people, rather than only certain kinds of people or lifestyles.

The premise of a market is that everybody is acting with partial information, and the market aggregates and allocates over time. I'm no anti-government squish, but there is no evidence, and a lot of countervailing evidence, that local governments can effectively (or even non-harmfully) make policy to influence the housing mix.

When it comes to housing construction and tax incentives, what they need to do is (1) set tax incentives to discourage egregious misuse and encourage density, and (2) get out of the way.

As someone living in the middle of one of these debates right now, the idea that we need to carefully control the mix of 1bdr apartments vs 3bdr apartments is... risible? The frontline of this issue is SFZ, not what kind of apartments we build.

> I'm no anti-government squish, but there is no evidence, and a lot of countervailing evidence, that local governments can effectively (or even non-harmfully) make policy to influence the housing mix.

I disagree. No planning has lead to many ghettos. The planning we've done here has avoided ghettos. I think the data is very clear on that.

> When it comes to housing construction and tax incentives, what they need to do is (1) set tax incentives to discourage egregious misuse and encourage density, and (2) get out of the way.

Except as I've been saying, if you encourage too much density your cities become unlivable for families, and you encourage urban sprawl and all of it's subsequent problems.

> the idea that we need to carefully control the mix of 1bdr apartments vs 3bdr apartments is... risible?

Who said anything about "carefully controlling" anything? Certainly not me.

I see no evidence at all that increased density is a livability problem for families, and plenty of --- in fact, overwhelming --- that inadequate density is a bar for access to communities in the first place. So, no, I reject this argument outright.

The evidence is that people would rather drive 2 hours each way so their family can have less density where they live. They vote with their time and wallet. This isn't some theory, it's true all over the US

They can do that. But people who live 15 minutes from downtown also want to have less density where they live --- most homeowners would! --- and that is a problem.

You just said increased density isn't a problem for families and then describe people wanting less density a problem. If it's a problem for society that families want less density, then it's a problem for families if society want more density.

I don't believe it is a problem, but people can have preferences for things that don't rise to the level of public policy problems, and if they'd prefer to live out in the country, God bless them.

A lack of density closer to cities is a real problem: it makes living close to where you work prohibitively expensive, and promotes sprawl.

As the other poster said, the urban sprawl and ridiculous commutes that you see in every city are overwhelming evidence. The lack of family-suitable housing in urban centres is to blame, and the prioritization along single metrics, like obsessing over "density-only" because it generates more returns on investment, shares a lot of the blame. Density is not the only metric to consider.

No, they're not. Urban sprawl is the result of deficient density. People who want low density can commute. For any fixed population, decreasing density must, obviously, increase commute times and sprawl. This isn't complicated, though appeals to "return on investment" cloud the issue.

Of course, part of the subtext of these discussions is that proponents of SFZ and owner-occupancy tend also to believe that their favorite cities should have controlled population growth. It's just not a good look to say that out loud.

> No, they're not. Urban sprawl is the result of deficient density.

That's one cause. The other cause that you seem to refuse to understand is creating the wrong kind of density. An urban centre full of 1 bedroom apartments is still going to create urban sprawl because families just can't live there, thus driving them out of the city centre even though they still work there. I just don't get why you refuse to understand this very obvious point.

Because it's not a real problem, but rather one you've invented, and in the real world we have the exact opposite problem, of huge swathes of desirable residential land all SFZ'd, so you can't even build town homes on a parcel.

It's amazing you keep saying this when I've said multiple times now that I'm living in exactly that kind of city (a large North American city), and it's not the only one with this exact problem. But sure, keep ignoring the data for your simplistic solution.

I live in Chicago. You can look us up on the Internet. It's pretty big.

> I disagree. No planning has lead to many ghettos. The planning we've done here has avoided ghettos. I think the data is very clear on that.

Citation? Where is that? Where I live the planning regime was famously ineffectual in the '50s and '60s, and as a result it's far more livable than big cities that had more planning: https://www.economist.com/special-report/2021/12/07/the-big-...

I don't think it's housing that's driving families to the suburbs. A normal 2 or 3 bedroom apartment shared by roommates could just as well house a family. Imho it's more about safety, schools and amenities. American inner cities have a reputation of being unsafe, both in terms of road safety as well as violent crime. With schools being locally funded many families choose to move to less diverse and more affluent suburbs for the school district. Lastly, many places in inner cities don't have parks and playgrounds within walking distance and thus no proper replacement for the suburban backyard.

Can you say more about the influence of renters?

It seems to me to be the opposite. The mortgage interest tax deduction is a massive regressive government subsidy for homeowners, and penalizes younger people who rent or cannot afford to buy a home.

So I’m curious what suggests to you that renters have political power. To me it seems the opposite - tax policy massively prefers owners over renters.

Renters are overwhelmingly living in properties that have mortgages against them and commercial loans are always deductible. The deduction for mortgages on owner-occupied property serves to put prospective owners (including current renters) on a more equal footing when bidding against landlords for property.

It is an immense giveway to the top income quintiles, which receive between 70-80% of the benefit, and giving "prospective owners" preference over "landlords" practically by definition reduces density and thus affordability.

It's not about giving preference to owner-occupants; it's about neutralizing the preference to landlords that would otherwise result.

Again, that is inherently a policy decision that reduces density and affordability; by definition, "landlords" are people that own and operate multi-family dwellings. You could just as easily ask "why not give more of a preference to landlords?"

It's probably useful for you to understand my, uh, priors? about this, which include the fact that I live in an overwhelmingly SFZ community that actively works to prevent the construction of multi-family dwellings, often with appeals to the evil of "landlords".

There's plenty of landlords who own SFRs as well. Building for building, I don't think tax policy should favor landlords over owner-occupants.

How zoning should work is an orthogonal question in my view.

Most owner-occupants own SFZ lots. Every owner of a multi-family dwelling is a landlord.

I'd prefer that an owner-occupant be able to write off the interest on N/N units on a parcel, just the same as a landlord is able to write off the interest on N/N units.

That's true for N=1 (SFR), N=2 (duplex, half-occupied by the owner), N=3 (triple-decker with owner living in one), or N=50.

I agree with you about the mortgage interest deduction. I'm not saying renters have outsized political power; they have, more likely, undersized political power. I'm saying very narrowly that in the market for multifamily building construction, people that need more bedrooms are an important market force, one the market has to pay attention to.

The whole 1bdr vs. 3bdr thing is a total sideshow; the actual issue, again, is SFZ.

The only thing land value tax incentives is raising the building value to land value ratio. It says nothing about what kind of building is optimal.

It doesn't explicitly say anything no, but what does an LVT entail given how humans tend to value property? For instance, in NYC would it incentivize building a bunch of shoeboxes or actual livable space?

It would incentivize building a comparatively more expensive building that maximizes the developers profit. Whether that means shoeboxes or livable space depends on how much those things cost to build and how much people are willing to pay for them.

If you just want single family homes with a big lawn you probably shouldn’t be living in Manhattan, which is the point of lvt.

> It would incentivize building a comparatively more expensive building that maximizes the developers profit. Whether that means shoeboxes or livable space depends on how much those things cost to build and how much people are willing to pay for them.

Yes, exactly. And my point is that a city shouldn't optimize along one direction like this, because families work in urban centres too. There should be a mix of housing for single people and families in the same urban areas, or you drive the families out of the city and encourage commuting and urban sprawl.

The LVT is meant to stay neutral and let the market figure it out. That would probably mean more density compared to today (where lots of traditional houses take up massive amounts of space while paying artificially low tax), but if people are willing to pay a fair price for a big place then that's what will get built.

What "let the market figure it out" with LVT means is what I'm asking about. As I've explained elsewhere, if that means packing as many tiny units together in an urban core rather than a mix of bachelor pads and family-suitable living spaces, than that drives families out of urban centers and encourages urban sprawl, which creates terrible commutes and traffic and all subsequent problems.

> What "let the market figure it out" with LVT means is what I'm asking about.

Part of the point is to very deliberately say: we don't know, we'll let each neighbourhood build what works for that neighbourhood rather than trying to figure out ahead of time.

> As I've explained elsewhere, if that means packing as many tiny units together in an urban core rather than a mix of bachelor pads and family-suitable living spaces, than that drives families out of urban centers and encourages urban sprawl, which creates terrible commutes and traffic and all subsequent problems.

How do you figure that? For a fixed population, the larger the proportion of workers in the center, the shorter the average commute and the less bad the traffic. So 4 bachelors in the urban core and 1 family in the suburbs is much better than vice versa.

(Now of course what tends to happen is if you make the city better then you attract a bigger population. But that shouldn't be seen as a failure. Fixing traffic or commute times is essentially impossible, because as soon as you add capacity more people will move to the area or commute from further away. But what you can do is, for a given sane commute time, maximise the number of people and jobs within that range)

This could have extremely negative side effects. A really expensive house on cheap land in some exurb would be comparatively cheap, thus encouraging sprawl. Old, cheap high density housing in desirable cities would all of a sudden become really expensive, hence massively acceleration gentrification.

It doesn't, the only thing it does is remove the tax per apartment which means building more apartments on the same lot becomes cheaper per apartment.

It doesn't what? Yes it becomes cheaper per apartment, but as I've explained elsewhere, you don't want an incentive for only one sized apartment because urban centers need a diverse set of living spaces suitable for families and bachelors alike. They all work in the city after all.