☆ Perspective: San Jose’s affordable housing panel—more of the same
John William Waterhouse: Echo and Narcissus, 1903. Public Domain
If the City is to bother holding housing panels, it should invite a diversity of opinions. So says Market Urbanist's Scott Beyer, as he surveys the invitee list at SJ HD's recent Housing Study Session—and finds a hopelessly one-sided grouping of Big Gov't, anti-market voices. Beyer offers an alternative in this Opp Now exclusive.
San Jose, like other U.S. cities with a home crisis, has pursued a number of interventionist strategies to increase the amount of affordable housing. What they haven’t tried is the one solution that’s been shown to cool home costs even in fast-growing areas: let the market rip, by allowing private developers to meet consumer demand.
This fact is reflected in the panel of speakers at an “Affordable Housing Study Session” held this September by the city’s housing department. It focused on increasing affordable units citywide. Among the guests was a rep of the California Rent Stabilization Network, which works to cap earnings that landlords can collect from properties. The San Francisco Foundation sent a panelist who specializes in diversity and inclusion. Other speakers represented advocacy groups and affordable housing developers.
The viewpoints on the panel, as different as they may have been, skew towards a top-town, centrally-planned, subsidy-happy approach to housing provision—in other words, the same one San Jose and California have tried for decades. The panel invites people who already have a say in the decision-making status quo.
The city should invite more diverse viewpoints—including those who call for the opposite approach. Various free-market thinkers have experience working such panels and would shake this one up. Here are three who would be useful:
The Yimbys: Missing from the panel is anyone involved with the Yimby (“yes in my back yard”) movement, despite its prominence in the Bay Area.
Yimbys argue that building housing as rapidly as possible would cause home prices to plummet. While their perspective varies (I consider myself a right–libertarian Yimby), they’re generally center–left. They support construction of public housing, renter subsidies, and in some cases, rent control, aligning with others on this panel. But they are also much more forthright about supplementing these subsidies with a “build baby build” mentality, attacking zoning, parking minimums and other restrictive land-use esoterica.
Above all, Yimbys are urbanists, supporting measures such as public transit and walkability expenditures. “Build more housing” complements this larger philosophy, while for them being a goal unto itself.
Sonja Trauss is the best known Bay Area Yimby, but other local activists have fairly high-level profiles, some of whom work for organizations like GrowSF and California YIMBY.
Randal O’Toole: Writing in many publications (including this one), the Thoreau Institute founder has been a long-time advocate of market approaches to building more housing. The self-described “antiplanner,” O’Toole advocates mainly for increasing suburban development patterns. O’Toole believes the main cause of unaffordability is anti-sprawl restrictions like urban growth boundaries (which San Jose has, and O’Toole has criticized).
He’s more skeptical about the benefits of relieving infill housing regulations; even if this produced more mid- and high-rise construction, that is not the typology that is typically affordable, he believes. Instead O’Toole is about single-family homes, and has even defended single-family zoning as a form of property rights. He believes autocentric transportation and development more accurately reflect consumer preference.
For this, O’Toole has clashed with Yimbys (myself included). But in a sense he is a Yimby—just one who prefers a different land-use pattern for housing abundance. O’Toole is provocative to boot, and would certainly rile up this panel.
Edward Glaeser: Now we’re getting closer to a true free-market commentator. Glaeser is a Harvard economist who has extensively studied urban policy and the impact of regulation on home prices. Like Yimbys, he argues that cities should move away from restrictive zoning, historic preservation overlays, and other government inertia that thwart the natural agglomeration process in cities (which he has also written about).
But he calls for something of a technocratic approach that allows for prioritizing affordable construction. He points to interventions that aim to increase supply, such as Massachusetts’ 40B regulation that preempts local zoning if a given community has overpriced housing.
Other leaders within academia and think tanks have similar views to Glaeser, including various ones at NYU, George Mason University, and Cal-Berkeley’s Terner Center. They’re worth inviting to panels precisely because they’re not political or economic actors within the affordable housing industry, and can give objective analysis.
Allow me, at the risk of sounding self-promotional, to offer a 4th option: “market urbanism.”
This perspective and movement, of which I’m a part, goes largely unheard at elite panels. Market Urbanists believe in completely removing land use regulations as they currently exist, and allowing construction of any development that does not cause physical harm by-right on any parcel. Instead of broad-based rules against perceived externalities, market urbanists call for nuisance codes to weed out specific externalities.
Market Urbanists argue that allowing housing growth to occur organically and based on consumer demand has the natural outcome of producing affordable units. Much like abundant new car production drives down the cost of used cars, rapid construction of newer, market-rate housing takes price pressure off older housing stock.
Market Urbanists are not big on subsidies, price controls, or government management of units (a la public housing). A Market Urbanist land use arrangement would certainly allow for nonprofit below-market-rate construction, but would not impose set-asides for it.
Market Urbanism is spoken in select components by Glaeser, O’Toole, and Yimby activists. But they don’t go as far in making the overt message that government is the main cause of high home prices, and needs removal from land-use decisions for the affordability problem to be solved.
This might not be a message the San Jose Housing Department, itself a government agency, wants to hear. But it should still be one that gets to compete against other ideas at this and future sessions. San Jose, one of America’s most expensive metros, should be open to as many potential solutions as possible.
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