☆ SCCLP's Brian Holtz: SJ's affordable housing mandate should be 0%
The latest kerfuffle at SJ City Council about interim vs. permanently subsidized housing revealed not just competing ideologies, but also a competing sense of what housing metrics SJ should monitor. SCC Libertarian Party secretary Brian Holtz suggests that removing SJ's affordable housing mandates will accelerate new construction (who knew the free market works better than constrictive laws?): allowing the City to prioritize more valuable metrics like supply, cost, and population change. An Opp Now exclusive.
San Jose has a political arena with two conflicting visions of how to address homelessness:
The mayor wants to build temporary prefabricated shelter to move homeless people out of encampments, so that before the next election he can say the homeless are now sleeping inside instead of outside.
His progressive critics would prefer that anti-homelessness funds go toward permanent “affordable” housing. They imagine that homelessness can be solved if only the government will provide enough free or subsidized permanent housing.
These competing visions willfully ignore both the underlying causes of homelessness (which are numerous and individualized) and the common-sense solution to one of those causes.
This week, San Francisco leaders announced a proposal to give developers there a break. Mayor Breed’s press release cited the controller’s revealing analysis that “the current inclusionary housing levels set in 2017 make the construction of new housing infeasible.”
Hear that? Big Government’s attempt to compel affordability of housing has instead, ironically, brought new housing creation to a screeching halt. Such schemes don’t demonstrate compassion; a dwelling that isn’t being built is unaffordable to all.
Ten years earlier, three SJSU economics professors, including then-future Mountain View Mayor Tom Means, pointed out that such mandates “decrease the supply of new housing and increase prices, which exacerbates the affordability problem,” and “lead to decreased construction and increased prices.” They concluded that, “over a ten-year period, cities that imposed [an inclusionary] housing mandate on average ended up with 10 percent fewer homes and 20 percent higher prices.”*
San Francisco plans to back-pedal on their 2017 blunder, by mandating a lower number of “affordable” (that is, subsidized) units. Where they currently mandate them for a whopping 22–33 percent of a development, they propose to instead mandate 12–16 percent—but the relief will only be temporary.
San Jose can do better than S.F., by implementing a Libertarian solution: drop mandates to zero percent—for good. City leaders can then monitor these important metrics:
how many developers clamor to build here;
housing units’ availability and pricing; and
population retention or loss—along with the proportion that have found a home.
We’ll see which Bay Area city’s housing supply will burgeon faster over the next 10 years.
* Independent Policy Report: “Below-Market Housing Mandates as Takings: Measuring their Impact”; Tom Means, Edward Stringham, and Edward Lopez; Nov. 2007.
Read more from Brian Holtz here and here.
Follow Opportunity Now on Twitter @svopportunity
Image by Wikimedia Commons