An Ongoing, Nationwide Housing Crisis: A Story of Paper Millionaires, Zoning, and Not Enough Housing

[Brainonska511]

In light of housing arguments spilling into so many threads (because it is integral to many parts of the economy and politics), I figured I'd start this one. Today, the Boston Globe's Spotlight team published a new article on the ongoing crisis in the Boston region. Instead of metro regions rising to meet the housing demand, we've had a tiny trickle of housing built that is either ultra-luxury single-family dwellings or a few higher end condos/rentals (but at least the latter are cheaper than the SFHs), and this is a story that plays out in many metro areas within the US.

Link: https://apps.bostonglobe.com/2023/1...ght-boston-housing/milton-restrictive-zoning/ [you might need a subscription of "NoScript" or some other form of paywall removal to read]


Some choice quotes to illustrate the issue how restrictive zoning/building codes/etc, often brought on by racism and anti-immigrant fervor, combine with rampant NIMBYism to kill housing production for decades, driving supply into the floor and prices through the roof:

Massachusetts home builders have been warning about the stifling effect of local building restrictions for 60 years. Home construction fell off a cliff in the 1990s, the least productive decade for new homes in the state since the 1920s, when free spirits danced the Charleston at speakeasies and the state’s population was little more than half what it is now.

Ostensibly [The Tenement Act was] a building code, the act provided rules for things such as ventilation and sanitation in apartment houses. But its most consequential paragraphs targeted apartment structures made of wood, prohibiting kitchens above the second floor and occupancy by more than two families. That killed the triple-decker.

It was no coincidence that the Tenement Act so directly targeted housing affordable for immigrants. The act was championed by a group called the Massachusetts Civic League, according to state records. The founder and main financial backer of the group was Joseph Lee, a wealthy Boston philanthropist, School Committee member, and anti-immigrant crusader.

Nearly 20 years after 40B passed, in a major rezoning in 1988, Milton increased minimum lot sizes in large areas of town to two acres, according to the planning office.

Over the decades, these building restrictions have reduced the variety of housing in Milton. “The housing we have allowed under our zoning is big and definitionally expensive,” Czerwienski said. Developers generally don’t build starter homes on two-acre lots. In addition to pricing out people who want to move to town, expensive real estate traps Milton residents who want to downsize their homes without leaving the community they love.

It was Czerwienski who fielded the eye-popping question about avoiding the rezoning by getting rid of the trains, to which he answered mildly, “That would not be my advice to the town of Milton.”

Edit:
It's a series of articles, so here are some more relevant links (to be updated as more get published):

Read the report from the Spotlight Team: Beyond the Gilded Gate

The Boston Globe Spotlight Team takes on the housing crisis in Boston.

apps.bostonglobe.com

MBTA Communities law: See how it affects your town

Use our interactive map to see your town's obligation to rezone under the MBTA Communities Act.

apps.bostonglobe.com

 

[MrSquished]

In light of housing arguments spilling into so many threads (because it is integral to many parts of the economy and politics), I figured I'd start this one. Today, the Boston Globe's Spotlight team published a new article on the ongoing crisis in the Boston region. Instead of metro regions rising to meet the housing demand, we've had a tiny trickle of housing built that is either ultra-luxury single-family dwellings or a few higher end condos/rentals (but at least the latter are cheaper than the SFHs), and this is a story that plays out in many metro areas within the US.

Link: https://apps.bostonglobe.com/2023/1...ght-boston-housing/milton-restrictive-zoning/ [you might need a subscription of "NoScript" or some other form of paywall removal to read]


Some choice quotes to illustrate the issue how restrictive zoning/building codes/etc, often brought on by racism and anti-immigrant fervor, combine with rampant NIMBYism to kill housing production for decades, driving supply into the floor and prices through the roof:

Is there a gift article link you can post?

 

[Brainonska511]

Is there a gift article link you can post?

No gift link for them, sadly. Often times, these will get posted on r/Boston, so I can see if someone dumps an unpaywalled link.

 

[Fenixgoon]

I imagine you could copy and paste this for...basically anywhere in America that is facing housing issues.

In my little town and the surrounding area, a fair amount of new construction seems to be townhomes and SFH. At least the townhomes offer a bit more density.

 

[Brainonska511]

Is there a gift article link you can post?

Here is an unpaywalled link you can try:

12ft

12ft.io

 

[skyking]

There's a definite ebb and flow to the zoning games. The city that I'm moving to is desperate to increase density because of the infrastructure costs.
Everybody wants an acre and a barn, and still get hooked up the city sewer. It just doesn't pencil out for the city.
I purchased 4.2 acres and it's zoned R8. I can have a maximum lot size of 13,500 square feet, but they really looking for 8000 ft lots.

My saving grace is the remainder lot rule. I can split off about eight lots and keep about a 1.5 or so acre lot around my house as long as it could be subdivided in the future.
Just so long as that future doesn't include me!

 

[Brainonska511]

There's a definite ebb and flow to the zoning games. The city that I'm moving to is desperate to increase density because of the infrastructure costs.
Everybody wants an acre and a barn, and still get hooked up the city sewer. It just doesn't pencil out for the city.
I purchased 4.2 acres and it's zoned R8. I can have a maximum lot size of 13,500 square feet, but they really looking for 8000 ft lots.

My saving grace is the remainder lot rule. I can split off about eight lots and keep about a 1.5 or so acre lot around my house as long as it could be subdivided in the future.
Just so long as that future doesn't include me!

The fun thing about zoning is that you could still choose to build a SFH on a lot zoned for more, if that's what you want.

 

[skyking]

yes but I can't sell my friend a lot larger than 13,500 SF, so my 4.2 acres can only be split up certain ways.

 

[fskimospy]

If you want to unlock massive prosperity for America the only thing you need to do is stop banning housing construction.

This is the cause of our time - it is inflicting mass human misery.

 

[GodisanAtheist]

If Republicans would only pull their heads out of their asses, excessive code/regs/permitting/red-tape is a legitimate issue with a lot of construction nowadays and cutting back on those is an issue I tend to align better with Pubs on.

There needs to be a smart reduction in the supply side costs combined with some legislative pressure to push housing as a place for people to live rather than an investment for the wealthy.

 

[Brainonska511]

If Republicans would only pull their heads out of their asses, excessive code/regs/permitting/red-tape is a legitimate issue with a lot of construction nowadays and cutting back on those is an issue I tend to align better with Pubs on.

There needs to be a smart reduction in the supply side costs combined with some legislative pressure to push housing as a place for people to live rather than an investment for the wealthy.

NIMBYism knows no party.

As for supply, if anything, we need a smart increase in supply. In the places with expensive housing, the problem is not enough supply. Vacancy rates show us that most are occupied.

 

[fskimospy]

NIMBYism knows no party.

As for supply, if anything, we need a smart increase in supply. In the places with expensive housing, the problem is not enough supply. Vacancy rates show us that most are occupied.

While I agree it knows no party you would think Republicans would be the people who would be most aware of the costs of excessive government regulation.

 

[brycejones]

The truth is nationally we just haven't been building enough housing since 2008.

 

[Brainonska511]

While I agree it knows no party you would think Republicans would be the people who would be most aware of the costs of excessive government regulation.

Yes, you would think that, but then they remember that they like economic and racial segregation, so they don't want to allow their neighbors to even consider building even a lowly duplex, lest someone they view as being part of a slightly lower economic status move in.

 

[MrSquished]

NIMBYism knows no party.

As for supply, if anything, we need a smart increase in supply. In the places with expensive housing, the problem is not enough supply. Vacancy rates show us that most are occupied.

I think in expensive areas, they should eliminate a bunch of zoning laws, but also mandate a 10% affordable housing quota. Also the local and state governments HAVE to tie this in with mass transit and other infrastructure boosts.

 

[Brainonska511]

I think in expensive areas, they should eliminate a bunch of zoning laws, but also mandate a 10% affordable housing quota. Also the local and state governments HAVE to tie this in with mass transit and other infrastructure boosts.

Affordable housing mandates and impact fees need to be carefully tailored because they can kill projects before they get off the ground. Make the % too high, and the projects don't pencil out. Impact fees just get passed onto the buyers or renters, and functionally, municipalities use them to avoid taxing their own residents for the upkeep of their sprawling infrastructure.

At the end of the day, if a SFH sells for $1.2 million, and someone comes along and splits the property into even a 2-3 family building with units selling for $7-800k/each, that is still a net affordability win.

Infrastructure can and should be upgraded or built out with the additional tax revenue brought in via new residents (both property and sales taxes). And for some infrastructure needs, I would bet certain density increases would impact existing infrastructure minimally (ie, SFH becoming a duplex).

 

[uclaLabrat]

While I agree it knows no party you would think Republicans would be the people who would be most aware of the costs of excessive government regulation.

They're only for smaller government that allows tax break to enrich their donors, otherwise thei small government claims are full of shit (see fights against abortion and birth control and anything "woke").

Deflating asset prices doesnt benefit the investor class.

 

[fskimospy]

Affordable housing mandates and impact fees need to be carefully tailored because they can kill projects before they get off the ground. Make the % too high, and the projects don't pencil out. Impact fees just get passed onto the buyers or renters, and functionally, municipalities use them to avoid taxing their own residents for the upkeep of their sprawling infrastructure.

At the end of the day, if a SFH sells for $1.2 million, and someone comes along and splits the property into even a 2-3 family building with units selling for $7-800k/each, that is still a net affordability win.

Infrastructure can and should be upgraded or built out with the additional tax revenue brought in via new residents (both property and sales taxes). And for some infrastructure needs, I would bet certain density increases would impact existing infrastructure minimally (ie, SFH becoming a duplex).

I agree that affordability quotas are a bad idea. It’s basically a lottery, just for cheap housing. I think the best way to do it is simply through market rate housing construction all the way, with no affordable units. Then you take the extra tax money from all the rich assholes moving into those new places and you use it for housing subsidies for people who can’t afford housing on their own.

Most of the destructive housing policies in NYC like rent control and such stem simply from the fact that we refuse to build anything. If we just built adequate housing we wouldn’t need rent control because the market would control rents.

 

[[DHT]Osiris]

The truth is nationally we just haven't been building enough housing since 2008.

Anecdotally, I'm seeing stuff built nonstop around where I live. I wonder what the housing state would look like if rent-seeking were tamped down some. I'd be curious on accurate numbers regarding number of rented vs number of families who'd buy if the homes were % cheaper.

 

[Brainonska511]

Anecdotally, I'm seeing stuff built nonstop around where I live. I wonder what the housing state would look like if rent-seeking were tamped down some. I'd be curious on accurate numbers regarding number of rented vs number of families who'd buy if the homes were % cheaper.

Just find the local vacancy rates to get an idea of occupancy. It doesn't really matter if it is rented or owner occupied. Renting isn't inherently bad, and some people don't want to own.

If we wanted to cut down on speculators and landlord profits, just increase the supply so that they have to compete for buyers or tenants.

 

[fskimospy]

Just find the local vacancy rates to get an idea of occupancy. It doesn't really matter if it is rented or owner occupied. Renting isn't inherently bad, and some people don't want to own.

If we wanted to cut down on speculators and landlord profits, just increase the supply so that they have to compete for buyers or tenants.

I wish more people got this. You want to screw over speculators buying up all the housing? Build so much it tanks their investment.

If you read the prospectus for real estate investment groups they are very up front with the idea that they will make money because they don’t expect housing to be built.

 

[MrSquished]

I agree that affordability quotas are a bad idea. It’s basically a lottery, just for cheap housing. I think the best way to do it is simply through market rate housing construction all the way, with no affordable units. Then you take the extra tax money from all the rich assholes moving into those new places and you use it for housing subsidies for people who can’t afford housing on their own.

Most of the destructive housing policies in NYC like rent control and such stem simply from the fact that we refuse to build anything. If we just built adequate housing we wouldn’t need rent control because the market would control rents.

well that is dumb. developers will make plenty of profit selling 90% market rate properties, but at least with 10% affordable housing some other people get to stay in their neighborhoods. to build enough housing at pure market rate to equalize supply demand is going to take a very long time, and push out everyone but the wealthier. you can't just fuck over the middle and lower classes that entire time. that's just ridiculous.

if you don't think developers can handle just a 10% affordable housing quota, then that's too bad for them. they can only buy one yacht instead of two, cry me a river. i mean your POV lacks any humanity.

 

[Brainonska511]

well that is dumb. developers will make plenty of profit selling 90% market rate properties, but at least with 10% affordable housing some other people get to stay in their neighborhoods. to build enough housing at pure market rate to equalize supply demand is going to take a very long time, and push out everyone but the wealthier. you can't just fuck over the middle and lower classes that entire time. that's just ridiculous.

if you don't think developers can handle just a 10% affordable housing quota, then that's too bad for them. they can only buy one yacht instead of two, cry me a river. i mean your POV lacks any humanity.

The research shows that new development generally does not drive displacement, and in some cases can actually lower costs of immediately adjacent housing.

And that 10% reduction in units isn't being borne by the developer, it's an indirect tax on incoming buyers or tenants.

 

[fskimospy]

The research shows that new development generally does not drive displacement, and in some cases can actually lower costs of immediately adjacent housing.

And that 10% reduction in units isn't being borne by the developer, it's an indirect tax on incoming buyers or tenants.

Yes, the idea that development causes displacement is a common idea among people who don’t understand how housing works.

In addition people don’t seem to realize that development often happens in poorer neighborhoods precisely because it’s banned in wealthier ones. In NYC for example the effects of eliminating zoning restrictions would lead to a construction boom in Park Slope where I live, not East New York.

 

[MrSquished]

The research shows that new development generally does not drive displacement, and in some cases can actually lower costs of immediately adjacent housing.

And that 10% reduction in units isn't being borne by the developer, it's an indirect tax on incoming buyers or tenants.

considering I work in real estate and cover some areas over the past decade that have become highly desirable very quickly, with lots and LOTS of development, except ALL at the top end price points, this is a load of horseshit. the lack of diversity in areas I used to live and hang out a lot, and still frequent, is completely different now. I am familiar with all the price points in these areas, people are getting displaced left and right.

I wonder who did those studies? Any link?