I disagree. The federal government invests enormous resources into subsidizing home ownership. Everything from Fannie Mae guaranteeing mortgages to not taxing home owners on the imputed value of rent.
And I think that's all well and good, home ownership has many positive externalities. But there's zero point subsidizing demand for something when supply in inelastic. In those cases subsidies don't result in expanded supply, only increased prices. For example even if diamonds are good, it wouldn't make sense for the government to match first time diamond buyers payment, because the supply of diamonds is inherently limited. All it would do is drive up prices.
Modest proposal: the federal government should revoke all of its housing subsidies in any municipality that restricts the supply of housing. San Francisco would be more than free to continue to block development. But if it chooses to do so, then San Francisco home owners should no longer be eligible for Fannie/Freddie mortgages, no longer be able to tax deduct mortgage interest, and should have to pay income tax on the imputed rental value of their home.
FM does not guarantee most mortgages, only certain govt types like FHA and VA loans, which the govt decided to back in order to help low income people get loans (otherwise the rates would be even higher for them).
FM buys up a lot of mortgages and sells them to investors, then turns around and puts the money back into productive use.
>taxing home owners on the imputed value of rent
What does this mean? You want to tax homeowners as if they paid themselves rent? (Which even then is net zero, so no tax...)
If you want people to pay income tax on the imputed rental value (which is likely not even legal - they are not getting an income from ownership - and courts have held income tax must be on sources of income), then you will increase the cost of home ownership, putting even further out of reach for most people.
>In those cases subsidies don't result in expanded supply, only increased prices.
Yet many places subsidies do result in new housing.....
Yes, I said as much. The OP claimed they guaranteed mortgages, which they do not.
I'm decently aware of the MBS market - I developed MBS pricing algorithms in the late 90s/early 00s for putting houses in tranches after a friend at a mortgage company asked for help with algorithms. Turns out the problem was NP-hard (a lattice based linear programming problem if I recall), but good heuristics from the literature and some special sauce outperformed their current (at that time) pricing.
Around the time the whole market blew up I was considering going to hedge funds, and was working out details of how all the math, science, and computer algos work to prepare for interviewing. After the market crash, I moved on more into scientific and R&D computing. But I still read papers in the area out of curiosity.
But the fact is the market is not "guaranteed" in any sense - which is likely good as 2008 showed.
> At Fannie Mae, we provide liquidity to the single-family market by purchasing and guaranteeing mortgage loans made by lenders and issuing debt securities and mortgage-backed securities that attract global investors to finance U.S. housing.
https://www.fanniemae.com/about-us/what-we-do#:~:text=At%20F....
They do guarantee some loans, as I wrote above. The marketing blurb you copies cleverly does not state they will guarantee any mortgage loan.
If they did, the housing crisis would not have been such a crisis - the crisis happened when so many investors realized the loans they bought could crash and cause them massive losses - precisely because FM does NOT guarantee all loans.
They guarantee certain loans (conforming loans), and charge a fee to investors for this when they purchase MBS from Fannie Mae. Conforming loans make up under 40% of all mortgage loans. Of all conforming loans made, Freddie and Fannie end up purchasing about 60% of those.
It may be that they stopped buying loans they deem too risky, but that didn't use to be the case.
> FM does not guarantee most mortgages, only certain govt types like FHA and VA loans, which the govt decided to back in order to help low income people get loans (otherwise the rates would be even higher for them).
And this.
> The OP claimed they guaranteed mortgages, which they do not.
So it read to me like they don't guarantee mortgages save for the "special" mortgages for underserved groups (FHA/VA). In fact, they do. They guarantee all the loans they buy, as far as I know. They only buy conforming loans. Conforming loans are another way of saying, loans that they will buy (and guarantee). Of course they don't guarantee loans they don't buy.
I used to work at a mortgage originator, and we sold the majority of our loans to Fannie and Freddie.
> Of all conforming loans made, Freddie and Fannie end up purchasing about 60% of those.
This is true, because private investors pay more than Freddie and Fannie for conforming loans.
(And I ignored that FM is not the Federal Govt for now...)
From the stats of conforming mortgages being 40% of mortgages and the FM only buying 60% of those, FM is at most guaranteeing (to investors, for a fee) around 24% of mortgages. That's well under 51%, right?
So FM not guaranteeing most mortgages is true, and it's not even close.
What? Of course Fannie and Freddie guarantee the MBS they issue. Which is an implicitly a guarantee from the US government. Otherwise they'd trade at much wider credit spreads, which would in turn lead to higher rates for home buyers. You don't have to take my word for it, here's the New York Fed's own words:
For agency MBS, the GSEs and Ginnie Mae promise full and timely payment of principal and interest, a guarantee that is either explicitly or implicitly backed by the federal government[1]
> You want to tax homeowners as if they paid themselves rent?
Alice, who has a 20% income tax rate, owns a house and rents it to Bob for $25k/year. Bob also has a 20% income tax rate, owns an identical house and rents it to Alice for $25k/year.
In total the government collects $10k/year in tax revenue from Alice and Bob from their rental income. Now let's say Alice and Bob swap houses and move back into their owner-occupied properties. This is an economically identical situation (remember the houses are identical). Both still own one home. Both are still consuming housing that's worth $25k/yr to them. Yet the government collects no tax revenue. Exempting the implicit value of rent is a subsidy favoring owner occupied housing.
> imputed rental value (which is likely not even legal)
The IRS already taxes tons of benefits based on the imputed income, even if no cash changes hand. For example, if your employer provides you life insurance, you have to pay income tax on the actuarial value of the policy even if you don't die during the coverage period.[2]
> then you will increase the cost of home ownership,
Not if the supply of housing is completely inelastic. Any increase in housing taxes will result in a commensurate fall in the sticker price that matches the tax increase. Economists have known this since Henry George.
[1]https://www.newyorkfed.org/medialibrary/media/research/staff...
[2]https://www.duq.edu/assets/Documents/benefits/_pdf/Imputed%2...
>What? Of course Fannie and Freddie guarantee the MBS they issue
Yes, they guarantee the MBS they issue, which is on a minority of all loans. The fact remains they do NOT guarantee most mortgages. They guarantee conforming loans, which are around 40% of all mortgage loans. And of all conforming loans, they only end up buying ~60% of them. So they at most guarantee around 24% of all mortgages, which is certainly not most mortgages.
>Alice, who ....
Ignoring the other side where landlords write stuff off and renters get tax breaks. On the ownership side, you're also missing lots of tax changes.
So not identical.
Also, the govt has an interest in property ownership as they have solid evidence that people owning property in a region make them less more stable. So there's very good reason to provide tax incentives for policy reasons. It's been shown that tax incentives, dollar for dollar, are pretty good incentives compared to most other forms of government spending to affect policy.
>The IRS already taxes tons of benefits based on the imputed income, even if no cash changes hand.
And they have tons the other way too - all because they desire to affect outcomes. So that they can do it is not really strong evidence to if they should do it, unless you address all the reasons they desire to do it.
>Not if the supply of housing is completely inelastic.
Which it is not [1]. "most areas that are widely regarded as supply-inelastic are, in fact, severely land-constrained by their topography" which is not most of the country.
[1] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1193422
Why stop at rent? Alice cooks at home? Tax implicit cost of dining out.
Alice goes shopping? Tax implicit delivery cost.
Alice conceives a child? Tax implicit IVF cost.
Alice gives birth? Tax implicit adoption cost.
Alice dies? Tax implicit execution cost.
When I go kayaking it costs me $35/hr for renting the kayak, which is income for the rental store and (presumably) they pay income tax on that.
Except I don't really pay because I bought my own kayak so I get to go for free whenever.
Your proposal amounts to abolishing the whole concept of property ownership.
Agree, but that also means cutting those subsidies will not affect supply either. Minimal impact and politically difficult...
People are not natural economists and will basically dig in to support the status quo until that status quo changes, at which point they'll support the new one. Americans, for example, buy new cars at an average new price of $40k and for most of my life accepted uncritically that the value of those cars would plummet the second they were driven off the lot. They did not lobby for supply restrictions that would prevent it. They didn't ask their politicians to prop up "car values." They didn't try to avoid it, at all. They just accepted it.
They would do the same with housing, if they weren't already conditioned not to.
There's a legitimate reason why a car immediately loses its value. People are more likely to sell cars that have something wrong with them. The market price for a car that you just drove off the lot is not the market price for an average car of that age, it's the market price for the subset of cars of that age that people want to sell. Because a car in that subset is more likely to have something wrong with it, its value is lower. Even if you personally are not selling the car because there's something wrong with it, it's hard for the buyer to know this.
If people had magic X-ray eyes that could tell that the car you just drove off the lot doesn't have more problems than an average new car, then its sale price would be similar to a new car. But they don't.
* You get to option the car with exactly the features/colors you want.
* People will pay a premium for something brand new.
* Financing for used cars usually carries a slightly higher interest rate.
* The actual cost at the dealership can vary significantly depending on the make/model/dealership
In fact the only reason why I bought new in the first place was because even a 10 year old tacoma is worth the better part of a new one. Guess it depends on your market but the premium for new looks pretty tiny or negative to me.
I too have seen this phenomenon, and I think it’s pretty common recently because the used car market is really out of whack. In my case, last year I bought a lightly used Sonata for about $30k with 12k miles, and today I could still trade it for about the same price with 31k miles on it.
Where you’re wrong is that this phenomenon doesn’t apply in general to the used car market but only in the last few years because of the chip shortage shrinking the supply of new cars. Short supply in turn increased demand for used cars, raising the prices.
I almost wonder if people overbought into the "new car must be more expensive" paradigm so they forgot new cars were competing against used cars, and the prices of used cars became irrationally high.
That's a pretty unrealistic comparison, housing doesn't hold its value (or go up) because people are conditioned, there are real reasons.
There is an effectively infinite supply of new cars, as factories can much more easily ramp up production if there's more demand. (Sure, recent supply chain issues have made that problematic, but in normal times.)
Second, cars do inherently depreciate faster. A ten year old house is basically brand new whereas a ten year old car is probably mechanically sound but cosmetically often looking its age and a lot of people like new and shiny.
Housing is only "scarce" in desirable places, and that's simply tautological. The sum of unfulfilled desires is the contrapositive of scarcity.
Housing is a market in which a very tiny percentage of goods are up for sale at any particular time, and the projected prices of those goods are heavily shared among a huge network of people who profit when the prices are high. The owners of those goods are often heavily leveraged, and can't afford to lower the price significantly, and the transaction and mortgage costs push them to raise the price to cover those costs at the next place they buy.
> They can only extract so much wealth from housing before people move for alternatives.
No such alternative, which is why the market is as lucrative to exploit as health care. Finding an "alternative" to health care is just to find another type of health care, and if you find an alternative to being housed, you've just found a new kind of house.
There's a lot of truth in that, but it's also an oversimplification.
There is plenty of cheap land in California, here, have a quarter acre lot for $15K:
https://www.redfin.com/CA/California-City/Princeton-Ave-9350...
Of course it's cheap since nobody wants to live there. If everyone wants to live in San Francisco, it's going to be much more expensive. Building more helps but in the end there's only so much that can realistically be built in 50 square miles. Some people will always be left out so there will always be some unmet demand, so it'll never be dirt-cheap.
So yes policy obstruction is a thing, but there are also inherent reasons why popular places will never be cheap.
I guarantee you're not talking about homeless people here, but people who live in a home that they are renting, reasonably near the place they work.
edit: also, somehow these so-called poors are always wealthy programmers trying to buy million-dollar houses.
Many people do not want to own a home, they would rather rent. Someone has to be the landlord for all those people, and to all those someones, the home is an investment. You can only get rid of homes as investments if you get rid of renting.
I hate to go all "citation needed" on you, but I'm not sure this is true.
Do I want to pay for upkeep of a property? Probably not. But since renting is basically equivalent to burning money in our economy, any responsible renter will eventually feel a pull towards ownership if only to stop the bleeding.
I think we need a society where renting isn't so expensive AND owning a property isn't so heavily subsidized by tax breaks. The entire housing market is a massive bubble because of investors and speculation. At some point, that bubble prices people out, leading to homelessness and missed opportunities because people aren't willing or able to move.
Much like freedom of car-free movement, housing ought to be a fundamental human right. Not a business or a place to hide your money.
Given the number of people that rent in large cities all over the world for their entire lives, I don't know why you would find my claim doubtful. Many people seem to want to live in large, densely populated areas, and for most people that is always going to mean renting.
> Much like freedom of car-free movement, housing ought to be a fundamental human right
I disagree with this as a blanket statement; neither car-free movement nor housing as a basic right will ever work in areas that are not densely populated. And many people (including me) want to live in areas that are not densely populated. We are quite willing to pay the costs of doing that and don't need handouts.
However, in densely populated areas, I think many people would agree with your statement--but I think they would also say that "housing as a human right", for them, means availability of affordable rentals, not home ownership.
The "for most people that is always going to mean renting" is that part that we could change through large scale collective policy. That's what Singapore has done for example. No one doubts whether people want to live in cities. We are asking whether the model of private landlords is the best way to manage large quantities of housing in cites. Look at Singapore:
"Eighty-two percent of Singapore’s residents live in HDB-built (Housing Development Board) apartments, of which there are more than 900,000. In contrast to both New York and Vienna, HDB encourages public housing residents to purchase their apartments. Nine out of ten HDB residents own their homes. The 50,000 rental units are, according to the HDB website, 'for the truly needy who have no other viable housing options.'" [1]
So yes, people want to live in dense cities. It does NOT automatically follow that they will have to rent. This is a policy choice.
[1] https://charterforcompassion.org/shareable-community-ideas/p...
"Hellscapes" is uncalled for. Many people like living in single family homes. The goal of housing should not be to enforce a single cookie cutter configuration on everybody. It should be to enable a free market in housing so that all of the different preferences people have for housing can have a reasonable chance of being met. I agree zoning laws should not favor single family homes to the detriment of other types, but equally they should not disfavor single family homes.
This can easily go too far in the other direction though, carving up a single family sized living space into 5 tiny 400 sqft apartments. There have to be incentives for mixed sized living spaces.
And yet there are plenty of single family homes and 2500+ sqft apartments if you want that. Just in the USA, if you want to live small - the government forcibly tells you that you’re not welcome here.
To me, it's a scenario of pick your poison - continue to be unaffordable because society is not willing to accept the consequences of its failures, or eat the consequences for a brighter future. In cities like SF, I don't see a world where it will ever get affordable if they insist that everyone needs to live in 1000+ sqft apartments, unless you plan to pack it to the gills with ultra-tall skyscrapers (never happening) or it becomes so undesirable to live there that people just stop moving there (unlikely, but given the rampant human rights violations it commits everyday to its denizens... well maybe that's the most likely scenario).
Aside, Americans don't know what small apartments even mean. The presence of super tiny Tokyo apartments is a great thing IMO, it means that people can still live centrally even if they aren't rich. I think a lot of people would happily accept a well-designed 200 sqft apartment over a 2-hour commute, if society gave them that option, since Tokyo residents do that en masse everyday.
Have you somehow inherited into a rent-controlled apartment still paying the same $5 rent from 1800?
Yes most of the city is rent controlled, this is a ten year old rental contract. Rent is about 600€ and apartment I estimate would be 500-600k. Could also be more though, I'm not exactly up to date.
How many could afford to buy though?
That said, renting in the short term is still something people will want to do. Some people will even want to do it longer term, if they want no responsibilities at all for repair and upkeep or freedom to leave with no strings attached at the end of the lease.
The number of people that end up never owning or wanting to own a home is likely small. But there is a very real case for non-ownership depending on what stage of life people are in and how they want to live their lives.
For someone moving every 6-12 months, spending a month or even two per year on buying properties and ensuring the previous owners aren't hiding issues isn't worth it. If a landlord hides something this type of tenant will only have to deal with it for a year at most, but if a seller hid something they would lose a lot of money on the move.
Moving every 6-12 months isn't the default, but it's relatively common for college students and recent graduates who haven't established roots yet. Next year it's a new city for a different job or a different school. For example, for many fields in the US going to the same university for grad and undergrad is highly discouraged.
(Not disagreeing with any of your other points.)
I think there's nothing wrong with renting, and for folks who just want shelter with a known cost up-front, it's a great solution. The problem is rental costs that creep up and up and up and housing policies that reward the haves (of housing) but indirectly penalize the have-nots (renters) because they miss out on massive tax writeoffs.
I don't have a paper to link to, but reading all the housing threads on HN for years there are always many people who sing the praises of renting for all kinds of reasons that make sense to them.
https://www.huduser.gov/portal/pdredge/pdr_edge_featd_articl...
And then in Singapore they have very high home ownership rates, so we could also be dramatically reducing the number of people who actually need to rent, reducing the need for private investment:
https://charterforcompassion.org/shareable-community-ideas/p...
Plus your single example of being satisfied with your landlord is not evidence that we should accept landlords across the board. My own landlord sucks at repairing things that need repair, and I find it very frustrating.
https://charterforcompassion.org/shareable-community-ideas/p...
Owning a home, even if its value is deprecating, is fundamentally still more attractive than renting. You get to recoup at least some of your investment, and you don't have property management invading your personal life.
Most people simply can't afford to buy homes in the first place.
Making ownership more accessible would attract a lot of prospective buyers, and getting rid of the landlord role and land investment would likely have that effect.
Investors buy around 10-20% (depending on quarter) of all new properties (and likely because they paid to build most of that share).
That's a far cry from 100%.
A tax was established, yes, but was it reasonable to do so (was it reasonable to expect that it will do much) and did it do anything? It seems the answers are no to both those questions.
I think it's a good signaling tax though. (I'm 50-50 on the extra tax for foreign buyers. Ethically there shouldn't be any difference based on where one's passport is from, but practically of course there is.)
Anyway, the real problem is constrained supply. Vancouver is still a fucking suburb compared to dense cities.
https://www.youtube.com/watch?v=evYOhpjMql0
https://www.statista.com/statistics/960174/vacancy-rates-res...
https://www.cbre.nl/-/media/cbre/countrycanada/images/insigh...
https://vancouversun.com/business/real-estate/three-years-in...
This motivation is backwards. Getting zoning restrictions around your house removed multiplies the value of that house. NIMBYism comes from places where people live. YIMBYism maximizes property values, although there's an element of blockbusting because overbuilding and a change in neighborhood character can make a neighborhood so unpleasant to live in that holdouts will end up selling cheap.
It's pretty difficult to fit a massive apartment building on a house sized plot between two massive apartment buildings. The prices you will be offered are not what your neighbors were offered. There will also be pressure on you to sell because your neighborhood is now shit. Your house prices may still, all that being considered, have massively risen since you bought the house. The property taxes also rose proportionally, sucking away your equity.
Any reply to this other than vague sarcasm?
And the hypothetical boxed-in holdout scenario is simply not representative of what's happening in high demand areas in the US. We're preserving laundromats and parking lots in San Francisco and Manhattan. No one is trying to build towers in the middle of suburbia.
I'm not sure a lot of NIMBYism comes from the notion of protecting home values.
If a home were to be upzoned for apartments the underlying land value would rise significantly, and this would be a significant financial windfall for the home owner. They should want to see their land be upzoned for apts but that's not what we see.
I think NIMBYism derives from the desire for exclusivity. When ones home and surrounding homes are ultra low density you are guaranteed to have few neighbours. This is what is eliminated when homes are rezoned for apartments.
Generally when we see upzoning advocacy it's neighbourhood wide if not city wide.
Housing was never an investment before recent decades, with an emphasis on the housing bubble. Housing tracked inflation for 400 years.
https://thegoldobserver.substack.com/p/amsterdam-real-housin...
edit: the history of US house prices is that they strictly tracked inflation, then with government subsidy right after WWII, housing prices jumped up, then stayed flat at that new level for the next 50 years, then the turn of the millennium happens and housing becomes an investment (after a stock market crash.)
https://www.frbsf.org/wp-content/uploads/sites/4/wp2017-25.p...
Why wouldn't you consider an investment something that has a relatively stable value in real terms - at least over a long enough period - and also provides a yield?
- you buy the property that you personally will live in
- you buy some other property and let it out to tenants or businesses
- you are a pension fund, mutual fund, hedge fund, day trader, bank, HFT etc which trades in derivatives based on mortgages
The first two have been going on for centuries at some level. The third only really got going at the point house prices completely disconnected from inflation.
(Btw, not sure if it was implied but the "you" in "you buy some other property and let it out to tenants or businesses" is often a pension fund or mutual fund.)
Not only has it been true historically - there's a real reason to allow it: it incentivizes owners to maintain and improve their properties. Further... maintenance of that property requires investment, both in time and labor. If you make it so that owners have no reward or incentive for improving their properties, they WON'T DO IT.
Why invest money into fixing your place if the price of the house is capped anyways? Trying to prevent this style of investment has almost always failed, and generally makes neighborhoods that are nice/attractive places to live much less nice and attractive - because people stop maintaining and improving them.
I think the real question right now that needs to be answered is: Why are we not able to create new urban areas in low cost areas? What has changed so that we no longer create towns?
Because frankly - right now the issue isn't housing, it's housing in areas where economic opportunities exist. Why are economic opportunities so exclusive to high population centers? What can we do to change that?
Governments love home owners. They are typically stable citizens in the work-force, law-abiding, reliable, etc. They have a high time preference and have every interest in maintaining the status quo, safety, anything that makes society pleasant.
If you have the money to outright buy a rural property and build a house there, it's not a bad place to live. But you don't want to have to depend on the limited job market with an expensive mortgage and limited buyer pool.
That's if there are available builders. It took my mother the better part of a year to get her roof replaced, because there was no one available to do the job. I'd also argue that the place she lives in rural VA is pretty awful in most respects other than having space and she's not all that far from a town.
My hunch is that the housing crisis is simple supply and demand. People want to live in cities because of the better access to entertainment, amenities, and services. There aren’t enough houses to fill that demand. There’s no great city on earth that has a glut of housing. If there were, people would flock to that city to fill the housing. I think that’s the very nature of a city. In some sense, the more people that want to live in a city, the higher the quality of the city. That’s also directly correlated with housing cost, sadly.
Only when feudal societies developed you had landlords and serfs and that's hardly something to be proud about.
Sooo... the last thousand some years, given that feudalism was widespread by the 11th century (and housing was absolutely an investment before that). Basically - half of recorded history (~400bc for Europe), and longer than the United States has existed.
I don't understand what you think this comment means...
> and housing was absolutely an investment before that
..and don't make absurd generalizations. Humanity is way older that the middle ages, and hundreds of different cultures existed around the world even during the middle ages.
Very few had the concept of investment and the idea a house has a monetary value that grows significantly over time was simply unheard.
> longer than the United States has existed.
Imperial units are bad but measuring history in united-states is even worse. The US is not even 250 years old.
> I don't understand what you think this comment means...
I can see that.
- Widespread (in Europe)
- Half of recorded (European) history
An exclusively European phenomenon, the bulk of which came and went while it was a backwater region with limited effect on the rest of the world.
Weird that it had limited effect on the rest of the world, since basically history from now back to about the 15th century represents a European hegemony, now a US hegemony that extends European Western philosophy to the world.
Seems that "limited effect" is pretty big. So much so that we're /literally discussing it now in 2022/.
- The last thousand some years (in Europe)
- Widespread (in Europe)
- Half of recorded (European) history
You may have misread my original comment, the “limited effect” was to describe Europe’s influence at that particular point in time, not feudalism/Europe’s influence since then.
Of course.
The profit from selling a leveraged investment is based on the delta between what you pay to borrow the money and how quickly the asset goes up. Doesn't matter it that's a house, a stock, bonds, whatever.
Housing is particularly attractive for these bets, because it's so easy to qualify for a big loan and because the rates have been so low.
Once mortgage rates exceed about six percent, the incentive to invest in real estate will be much lower.
I don't believe this is the case as since 2008 the U.S. construction industry has not even built enough units to keep up with population growth. I believe this is a supply problem which is two-fold.
1) Restrictive zoning and permitting which really took off around the 70s
2) A boom and bust construction cycle which has convinced many to not risk it any longer and find other work (this which has been going on for decades but truly inflected after 2008).
A counterargument to this is that population growth has not been very high in the past few decades: https://fred.stlouisfed.org/graph/?g=SUL3
You certainly have valid points, especially in San Francisco. Nevertheless, looking at the broader market, outside of California, the market appears to be working: builders find a way to build what will sell and maximize their profits. Last week, I drove around a planned community in a middle-America state. Developers started building houses around ~2010 and are still building out the area. These developers had no problem building thousands of homes that were selling well until very recently.
https://www.cnbc.com/2021/09/14/america-is-short-more-than-5...
The only parts which are speculative are why. There is consistently lower workforce participation in construction though, that is also a fact.
https://finance.yahoo.com/news/construction-industry-after-r...
I'm glad the builders in your area have been able to work consistently. I would guess that they are likely riding a trend of a decreasing number of builders who are increasingly professionalized and technologized their operations. Regardless, that is an anecdote and the statistics paint a pretty clear picture.
surprise - this has already been signed in California; and amended, and further amended..
https://www.capradio.org/articles/2017/09/29/brown-brings-ho...
I don't know how this came to be such an obviously true common wisdom answer here at Hacker news. It's an extremely incomplete account of what causes NIMBYism. I'm sure at least some of it is purely a desire to maintain land value appreciation, but as others have already pointed out, in plenty of cases, conversion from single-family to multi-family zoning increases land value and the land owners still don't want that.
The basic cause of NIMBYism is these are people's homes you're talking about. They live there. They may have lived there for decades, possibly even for generations. They chose the place for the character and culture it had at the time of choosing, and they don't want that to change. If they enjoy a relatively quiet life with space, they don't want to see their home changed into a traffic jam with nowhere to park. They don't want to be perpetually surrounded by nonstop construction.
I'm not trying to say anyone who feels this way is inherently right. At some point, change is inevitable. I'm sure the original inhabitants didn't like it when European colonists spread strange diseases across the land and then wiped out the stragglers with superior firepower. I'm sure the ranchers of the west didn't like seeing their ranches turned into suburbs. And the suburbanites don't want to see multi-family housing in their once-quiet and relatively secluded homesteads.
Without making value judgments either way, though, I think you have to acknowledge there are far more basic instincts at play here than simple financial incentives. It's fair to say we at some point have no choice, and if the result is we can solve housing unavailability and especially homelessness, and the cost is a few or even a large number of people are left with the neighborhoods they grew up in changed drastically into places they no longer want to live, that may be worth it. But you should understand the full range of motivations for people who want stability in their homes and communities and not act like it's purely about financial gain and greed. Remember also that a fair number of communities in which concerns about gentrification are the greatest and people really oppose redevelopment are neighborhoods that these people were historically forced to live in because they were ostracized if not killed when they tried to live anywhere else. That community in its specific current form is what they see themselves as being a part of, far more than the larger city, state, or country that never wanted them in the first place. This is far more complex than you're making it sound.
You hit the nail on the head!
I'm often confused by how the vibe here is that thinking of housing as an investment is bad, and yet simultaneously consider that all housing-related decisions are strictly financially driven!
Reality from everyone I know is that housing is primarily about being a home. A nice place to live. A stable place for the kids to grow up. That's the primary motivation.
Investment? Sure, it's nice if it goes up over a lifetime, but that's not a driver in any decisions.
Also it certainly is not true for all homeowners btw, lots of municipalities have fairly minimal zoning laws.
You know how we got into this problem? Decades ago we used taxation and law to try and incentivize the development we wanted and disincentivize or prohibit what we didn't. And today the efficacy of that endeavor is obvious to even the most casual observer.
There is no compelling reason doing the exact same thing will work better for different values of "development we want" and "development we don't". Have you seen what gets developed when you incentivize mixed development? It's lifeless crap compared to the places that were built up prior to the advent of widespread usage restrictions on land where development happened organically without the input or prior approval of local government (i.e. people were basically free to do whatever within the permissive limits of the time).
How about we just get the government out of the business of telling people what and where they can and can't build. Let people develop what they think there is demand for. A few inappropriate industrial sites is a small price to pay for allowing pent up demand for residential and commercial construction to be satiated.
It's not possible to remove zoning completely. That's severe hubris, thinking that we introduced zoning to begin with for no legitimate reason. That's not true - it's necessary to plan city infrastructure and that requires zoning. Removing zoning altogether would be an unmitigated disaster.
There is no easy clean solution like "remove all the rules". You can't get government out of the business of city planning and basic infrastructure, and that's in more words what you mean.
There is a difference between good policy and bad policy. We need good policy. The only solution is that local governments somehow make better choices.
States are going to have to step in and override cities that aren't being effective, this cannot be solved from the federal level. They are going to have to say, these permitting processes are too restrictive, homeowners can add backyard units or convert their homes to duplexes/etc, and make it easy for apartment builders to buy a few homes to make small apartment complexes even if the neighborhood hates it or the city has been stalling on that kind of development.