How zoning drives away jobsThe Reason Foundation has a new commentary article reinforcing our prescient wisdom of no-zoning in Houston. It opens with a discussion of skyrocketing housing costs across the country, then addresses one of the core causes of the supply-demand imbalance:
It has been noted that much of the townhome densification of Houston's core would be banned under most of the nation's zoning codes, making us semi-unique with that development pattern. Many city planning boards and zoning codes also tend to be hostile to high-density apartment and condo complexes, which are relatively common in Houston's open market. These provide affordable options to Houstonians when they burn out on their daily commute and are ready to move into the core closer to work. Most cities' zoning codes resist this densification (and zoning changes are political landmines that are fought fiercely by homeowners), which means demand outruns supply and drives up home prices in the core way beyond the reach of the average citizen. Those frustrated employees, in turn, put pressure on their employers to move out to the cheaper suburbs so they can afford to live near work with a reasonable commute, leading to an inexorable hollowing out of the commercial tax base and economic vitality of the inner city.
Across the country, zoning laws consistently prevent new homes from going up in many locations and often unnecessarily block the transformation of neighborhoods that could provide affordable housing. After all, only about 6 percent of the nation is developed. Two-thirds of New Jersey, the nation's most developed state, is open space. We have plenty of land to build homes - if politicians let them be built.
Restrictive zoning hits the housing market it two ways: It increases costs by adding to delays in approvals, and it reduces the number of homes built to satisfy demand. Economists Christopher Mayer and Tsueriel Somerville found that adding just three months of delay to the approval process could reduce new housing construction by 45 percent. But zoning and conventional land-use planning has an even more destructive impact. They prevent communities from changing to naturally meet new needs and community concerns.
Today's zoning codes aren't adaptable or flexible. They are intended to be bureaucratic instruments that control the behavior of local residents and businesses. The views of neighbors aren't important, nor are economic benefits or aesthetics. The only thing that matters is the letter of the law and whether the law can be applied universally throughout the community.
A critical key to keeping housing affordable will be loosening up the bureaucratic straight jacket of zoning to allow more homes of all types be built that meet demand. Without this flexibility, the ongoing mismatch between supply and demand will keep home prices higher than they need to be and keep the stability of homeownership beyond the grasp of too many Americans.
Let's pause for a moment and be thankful that Houston wisely avoided this fate.