> Scarcity caused by NIMBY land use policy is driving up housing costs. The fix is aggressive upzoning.
> Source: Help friends who work on affordable housing policy. This is common knowledge.
Affordable housing policy advocates are not an unbiased source for this "common knowledge".
There are piles of cash to be made in affordable housing, in the form of outright grants, tax credits, zoning variances, etc, all in exchange for the creation of a small percentage of permanent rental units that the developer will turn a profit on, indefinitely. Any loss is mitigated by increasing the price of non-affordable units.
This incentivizes government-backed arbitrage opportunities, e.g., by allowing developers to buy land for a lower price based on current zoning, and then (in partnership with the local housing authority) appeal to local planning authorities for variances.
This unsurprisingly a revolving door between government housing entities, local planning boards, development companies, affordable housing tax credit brokerages, and the lobbyists for the above.
Here, for example, the local housing authority is trying to push through a high-density upzoning variance, for a project represented by a former housing authority executive, financially backed by an out-of-state firm specializing in tax credit financing that is one of the primary lobbyists against tax credit reforms that would eliminate their value extracting brokerage position in Missouri:
Upzoning in high-demand areas increases land value. Period. This raises market entrance costs to a level in which only large development companies can build. They build rental units. The government provides them grants and variances that private home buyers could only dream of. Housing becomes less affordable, not more, and fewer people are able to build up equity.
I've met my share of wishful thinkers still pushing for set asides and subsidies. And we also have our share of cheaters. The irony is when those well intentioned set asides get perverted for profit.
But I like to think we're seeing a sea change on the topic. Better data. Broad coalitions. Commitment to finding win/win solutions.
Let's check back together in two years. See if my optimism was rewarded.
> Source: Help friends who work on affordable housing policy. This is common knowledge.
Affordable housing policy advocates are not an unbiased source for this "common knowledge".
There are piles of cash to be made in affordable housing, in the form of outright grants, tax credits, zoning variances, etc, all in exchange for the creation of a small percentage of permanent rental units that the developer will turn a profit on, indefinitely. Any loss is mitigated by increasing the price of non-affordable units.
This incentivizes government-backed arbitrage opportunities, e.g., by allowing developers to buy land for a lower price based on current zoning, and then (in partnership with the local housing authority) appeal to local planning authorities for variances.
This unsurprisingly a revolving door between government housing entities, local planning boards, development companies, affordable housing tax credit brokerages, and the lobbyists for the above.
Here, for example, the local housing authority is trying to push through a high-density upzoning variance, for a project represented by a former housing authority executive, financially backed by an out-of-state firm specializing in tax credit financing that is one of the primary lobbyists against tax credit reforms that would eliminate their value extracting brokerage position in Missouri:
http://www.stltoday.com/business/local/is-missouri-s-costly-...
Upzoning in high-demand areas increases land value. Period. This raises market entrance costs to a level in which only large development companies can build. They build rental units. The government provides them grants and variances that private home buyers could only dream of. Housing becomes less affordable, not more, and fewer people are able to build up equity.