Opinion: Gov't subsidies much costlier than loosening repressive housing laws
Vincent Van Gogh: Houses at Auvers
The American Enterprise Institute's Edward Pinto sn't a fan of “ill-conceived” housing assistance policies that are mere Band-Aid fixes for surging construction costs. Instead of having taxpayers fund more subsidies, local gov'ts like San Jose's should take the more affordable option: Remove regulatory burdens to housing supply, like density/parking, building code, and zoning requirements.
[Housing tax credit programs] are the most recent in a long history of ill-conceived policies that increase housing demand but do nothing about supply. The result: higher home prices and rents, particularly for low-income and minority households, the very ones these initiatives profess to help.
Market-based solutions are the only way to bring home prices and rents back in line with median incomes and improve accessibility.
First, bend the cost curve to Increase the supply of market rate, economical housing that largely serves service, light manufacturing and entry-level workers. Such housing is economical by design, making it naturally affordable, not expensive housing made affordable by subsidy.
Local and state governments could help address this problem by (i) explicitly stating that increasing the supply of new, refurbished, and repurposed, market rate, economical housing is in the public interest, (ii) replacing static density and parking requirements, height maximums, and size minimums with equalized ones, taking into consideration the smaller size and parking needs of economical housing, (iii) authorizing expedited permitting and “just-in-time” building inspections, (iv) identify building code requirements and interpretations so to reduce cost impact, (v) establishing “good enough” [1]” and “substantial equivalence”[2] standards for code compliance, and (vi) adjusting impact and permitting fees to reflect any reduced impact of economical housing.
If Congress wants to help fix this problem, it could begin by withholding federal infrastructure funds from states and localities that fail to implement land use policies that equalize treatment of and promote market rate, economical housing.
These policy changes would encourage designers and builders to implement innovative and economical techniques for design, construction, and management of economical housing.
This article originally appeared in the American Enterprise Institute. Read the whole thing here.
Follow Opportunity Now on Twitter @svopportunity
Opp Now enthusiastically welcomes smart, thoughtful, fair-minded, well-written comments from our readers. But be advised: we have zero interest in posting rants, ad hominems, poorly-argued screeds, transparently partisan yack, or the hateful name-calling often seen on other local websites. So if you've got a great idea that will add to the conversation, please send it in. If you're trolling or shilling for a candidate or initiative, forget it.