The Impact of Zoning on Housing Affordability

[archerships]

Edward L. Glaeser and Joseph Gyourko
March 2002
Harvard University

"...As a whole, this paper concludes that America does not uniformly face a housing affordability crisis. In the majority of places, land costs are low (or at least reasonable) and housing prices are close to (or below) the costs of new construction. In the places where housing is quite expensive, zoning restrictions appear to have created these high prices...."

http://post.economics.harvard.edu/hier/2002papers/HIER1948.pdf

Comments

[rillifane.livejournal.com]

Its an interesting article, I'm not in the mood to give it the attention it deserves but I get an immediate impression that there are sufficient conditionals ("we looked and this but ignored that") that the results they get have to be read very carefully to see what real value there is in them.

What was your impression?

[crasch.livejournal.com]

I haven't read the paper in detail either. However, it seems plausible to me that artificially restricting supply, in the face of constant or increasing demand, would result in more expensive housing.

[rillifane.livejournal.com]

I thought they were not arguing restriction of supply so much as saying that the regulation itself imposed compliance costs.

[twaj.livejournal.com]

I think that the myth of an affordable housing crisis is perpetuated by banks (in NYC, Washington Mutual even sponsored an affordable housing march) who want to be able to loan to some of these yahoos at rates that are government subsidized. I mean, Freddie Mac already does that sort of thing, but why not squeeze more money out of the feds while there are still people that aren't in debt? The affordable housing crisis in New Jersey is the result of zoning laws - the only thing the state has accomplished by (get this) REQUIRING every community to provide affordable housing has been to ensure that even the smallest cities (Morristown, New Brunswick, Hoboken) have really nasty looking housing projects. In New York they just let little old ladies pay 200 bucks to live in 3 bedroom apartments on the Upper West while my niggaz are stuck paying 1300 for one bedroom 5th floor walk-ups.