I worked in housing affordability for years and the one thing I wish people understood is that there is no such thing as "affordable housing" affordability is the conflux of the unique properties of the home, the income of the purchaser and the urban land market. So many people think there are "luxury" homes made for rich people and "affordable" homes for regular people. But house prices haven't risen because developers suddenly started building exclusively rich people housing for no reason. Land prices are the key to making housing affordable for regular people again, and that means upzoning and a lot of building.
Noah does a good job of setting the terms of the debate, and demolishes one side of it with theory supported with evidence. Hopefully this piece serves as something quick to link to in the future when the topic arises. I appreciate what Noah is doing here, as it’s easy to just not post yet another time about housing, but it’s basically always worth doing. Housing is so important, so the marginal housing blog post is still pretty important relative to a blog post about other issues.
However, there is some soul missing from this piece. Given that Noah’s argument is so obvious, it’s worth explaining why someone like Cook would think the opposite. Cook, like most people, likely has an anti-market bias. This bias makes people more likely to believe unconventional theories about economics, especially the economics of housing.
I submit that, since Noah’s argument was so strong, it would have been worth cutting down a bit and spending large portion of the essay delving into anti-market bias and why it features so heavily in these discussions. That is, I believe, the metaphorical Oz hiding behind the curtain in these conversations.
I'm not sure how you're really supposed to build "affordable" below market rate housing anyways. Crappy appliances and materials? Those can easily be replaced. Lower square footage? Just discourages families.
I really liked the Lamborghini/Honda example, but perhaps another analogy to really drive home the point, if a bit inexact, is the one that Bryan Caplan uses re: immigration; if you have a room full of tall people and a bunch of short people enter the room, the average height in the room will go down, but nobody in the room is made shorter.
Thanks for doing such a thorough job of explaining this issue. Now instead of explaining it over and over, I'll just start linking this piece. You did a good job breaking this concept down so most people should be able to understand unless their genuinely don't want to understand it. Not much you can do about those people.
I checked Google Maps this past week, and I see that western Geary Blvd remains undeveloped starting in Japantown.
I think YIMBYs should quit complaining about zoning in Pacific Heights — clearly that comes from class anger — and focus on solutions to the problem that will make EVERYONE happier.
I think they should direct all of their effort to upzoning Geary. Make it all six stories high, with shops on the first floor — including Japantown.
I suspect this would generate 50,000 new units in San Francisco.
With a dedicated express bus lane, residents could get downtown from Ocean Beach in twenty minutes.
Once this has been demonstrated, other boulevards can be targeted and improved.
On another note, SF needs Oakland to stop being a basket case.
Oakland is a 15-minute BART ride away. Lake Merritt and the Oakland Hills are delightful. The weather is better in Oakland than SF. The views of SF at sunset make East Bay residents fall in love every night.
Oakland needs functional police, 100,000 more apartments, and job training programs for those struggling there.
The Bay Area needs thousands of electricians to transition to all-electric appliances and vehicles, for example — not to mention carpenters to build all the needed homes. There should be opportunities to turn people’s lives around.
To be fair, there are (rare, but widely publicised) instances of developers here in Australia knocking down existing apartment blocks to replace with apartment blocks that contain fewer, but more luxurious apartments.
I don’t think this is common enough to be a substantive problem, but it is in some cases a PR problem for YIMBYism.
I've said this once on Twitter too: IMO, the activist class hates market rate housing in part because they don't want Yuppies who don't share their worldview and tastes in their cities.
They want themselves and their friends to be the 'trendsetters' of their cities and fear displacement from other yuppies.
I think the “market” calls to the minds of Leftists things like laissez-faire capitalism, pre-unionized labor markets, unregulated environmental pollution, etc.
If you want to help bring them around, explore these associations and separate them from your intention.
Thank you for writing this. I’ve been saying this on Twitter and NY Times comments sections for years. The fact that developers love building luxury dwellings is one of the main arguments liberals used against building more.
I'm surprised that anyone needs this explained to them, but thanks for doing so.
I worked in housing affordability for years and the one thing I wish people understood is that there is no such thing as "affordable housing" affordability is the conflux of the unique properties of the home, the income of the purchaser and the urban land market. So many people think there are "luxury" homes made for rich people and "affordable" homes for regular people. But house prices haven't risen because developers suddenly started building exclusively rich people housing for no reason. Land prices are the key to making housing affordable for regular people again, and that means upzoning and a lot of building.
Imagine being a housing activist who doesn't want to build houses.
Noah does a good job of setting the terms of the debate, and demolishes one side of it with theory supported with evidence. Hopefully this piece serves as something quick to link to in the future when the topic arises. I appreciate what Noah is doing here, as it’s easy to just not post yet another time about housing, but it’s basically always worth doing. Housing is so important, so the marginal housing blog post is still pretty important relative to a blog post about other issues.
However, there is some soul missing from this piece. Given that Noah’s argument is so obvious, it’s worth explaining why someone like Cook would think the opposite. Cook, like most people, likely has an anti-market bias. This bias makes people more likely to believe unconventional theories about economics, especially the economics of housing.
I submit that, since Noah’s argument was so strong, it would have been worth cutting down a bit and spending large portion of the essay delving into anti-market bias and why it features so heavily in these discussions. That is, I believe, the metaphorical Oz hiding behind the curtain in these conversations.
I'm not sure how you're really supposed to build "affordable" below market rate housing anyways. Crappy appliances and materials? Those can easily be replaced. Lower square footage? Just discourages families.
Build enough and it all gets more affordable.
I really liked the Lamborghini/Honda example, but perhaps another analogy to really drive home the point, if a bit inexact, is the one that Bryan Caplan uses re: immigration; if you have a room full of tall people and a bunch of short people enter the room, the average height in the room will go down, but nobody in the room is made shorter.
Thanks for doing such a thorough job of explaining this issue. Now instead of explaining it over and over, I'll just start linking this piece. You did a good job breaking this concept down so most people should be able to understand unless their genuinely don't want to understand it. Not much you can do about those people.
I checked Google Maps this past week, and I see that western Geary Blvd remains undeveloped starting in Japantown.
I think YIMBYs should quit complaining about zoning in Pacific Heights — clearly that comes from class anger — and focus on solutions to the problem that will make EVERYONE happier.
I think they should direct all of their effort to upzoning Geary. Make it all six stories high, with shops on the first floor — including Japantown.
I suspect this would generate 50,000 new units in San Francisco.
With a dedicated express bus lane, residents could get downtown from Ocean Beach in twenty minutes.
Once this has been demonstrated, other boulevards can be targeted and improved.
On another note, SF needs Oakland to stop being a basket case.
Oakland is a 15-minute BART ride away. Lake Merritt and the Oakland Hills are delightful. The weather is better in Oakland than SF. The views of SF at sunset make East Bay residents fall in love every night.
Oakland needs functional police, 100,000 more apartments, and job training programs for those struggling there.
The Bay Area needs thousands of electricians to transition to all-electric appliances and vehicles, for example — not to mention carpenters to build all the needed homes. There should be opportunities to turn people’s lives around.
To be fair, there are (rare, but widely publicised) instances of developers here in Australia knocking down existing apartment blocks to replace with apartment blocks that contain fewer, but more luxurious apartments.
I don’t think this is common enough to be a substantive problem, but it is in some cases a PR problem for YIMBYism.
I've said this once on Twitter too: IMO, the activist class hates market rate housing in part because they don't want Yuppies who don't share their worldview and tastes in their cities.
They want themselves and their friends to be the 'trendsetters' of their cities and fear displacement from other yuppies.
I think the “market” calls to the minds of Leftists things like laissez-faire capitalism, pre-unionized labor markets, unregulated environmental pollution, etc.
If you want to help bring them around, explore these associations and separate them from your intention.
The best line is the final line “ es, your city needs to build more market-rate housing in order to become more affordable. So build more of it.”
This recent post by Joseph Politano supports your case: https://www.apricitas.io/p/new-zealands-building-boomand-what
Thank you for writing this. I’ve been saying this on Twitter and NY Times comments sections for years. The fact that developers love building luxury dwellings is one of the main arguments liberals used against building more.
Could you get back on Threads? I’ve been off xitter for a few weeks and it’s made a refreshing difference