The High Cost of Unaffordable Housing

Joel Kotkin argues that planners too often ignore "the most critical issue" in housing.

The unusual volatility of the housing market over the past few years has left many planners and members of the media focused on "extremes," says Kotkin, with ultra high-end properties and concentrations of exurban foreclosures dominating the conversation. Instead, he argues, planners should focus on how to make home ownership more affordable.

Kotkin argues that high home prices do not necessarily signal the "attractiveness" of a region, as some urbanists posit, but are more often the result of overly stringent regulations like smart growth policies. As a result, he writes, many college-educated people are leaving "overpriced" markets like New York and Los Angeles for more affordable cities in the South, such as Houston and Austin.

Kotkin says:

"How could this be, if everyone with an above-a-room-temperature IQ supposedly favors hip, cool, dense cities? Perhaps it's because of factors often too small or mundane for urban pundits to acknowledge. Most people, particularly as they enter their 30s, aspire to a middle-class lifestyle - and being able to afford a house constitutes a large part of that."

Full Story: Why Affordable Housing Matters



Why move to Houston?

Certainly it can't be because Houston is where jobs are. Warm winters can't play a role either. No, people move to Houston simply because housing is cheaper there.

Kotkin's reply (I've read

Kotkin's reply (I've read quite a bit of his stuff) would be that the jobs are there, because the houses are cheap. Or rather they are both a product of deregulation. And also, nobody moves to Houston because of the weather. The warm winters (actually can get pretty cold), are followed by the torrential down pours of spring, the sweltering summers with mosquitoes), and the two weeks in September/October where is comfortable to eat outside.

Same old story, who cares about the environment after all?...

Two things bother me about the drum beat of anti-regulation that comes from Joel Kotkin, and his colleague Wendell Cox (he is Demographia). The first is that Prof. Kotkin constantly calls out regions with smart growth controls without acknowledging that these regions have environmental characteristics worth preserving. The environmental movement in these regions put in the hard work in the 70s and 80s to achieve a regional consensus that hillsides, ocean front properties, waterways, and natural habitats are worth preserving, and have a cost. In other words its not that the regulations have driven up the costs of housing arbitrarily, its that developing sensitively in these areas is more expensive. These regulations do not impose an man made cost of doing business, they internalize the external costs of doing business here.

The non-regulated regions often don't have physical impediments to growth i.e. Houston and Phoenix. However those places have had run ins with water supply issues, and congestion, and lack of planning will be exacerbating those issues in the future. Houston suffers from terrible congestion, and due to disbursement of both jobs and housing they are creating a structural issue that no transportation system will be able to solve.

The other problem I have is that he is careful to cite studies for many of his points then leaves this one hanging there: :most surveys show an overwhelming preference for less dense, single-family houses in most major markets across the English-speaking world." Really. If there are so many studies where are they? And what about the changing face of household formation in the future? Chris Leinberger has studied this as well and determined that there is enough suburban single family housing to meet the future needs of our population, and we are lacking in the denser housing that a large minority of future 20 yr olds, and retirees are going to be looking for.

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