In Kim-Mai Cutler article on the San Francisco housing crisis, she argues that there are a multitude of reasons that contribute to the astronomical housing prices in the bay area. One of the more significant reasons she focuses on is the regulatory practices we have in California. Compared to most other states in America, California has much less regulation on land use and residential construction. This leaves California cities to be essentially free to set their own rules, with little oversight from regional or state authorities. John M. Quigley, a professor of economics at California Berkeley, wrote a paper analyzing the effect of regulations on land use and residential construction in regards to housing prices in California. In Quigley’s
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In his research of regulatory practices within cities, Quigley found that explicit growth controls was one the reasons for less housing supply in California cities. These growth controls included urban service boundaries or growth moratoria, which reduces the amount of developable land and in turn, the ability of housing supply to adjust to changes in demand. This also directly relates to Cutler’s article as she explains homeowners have a strong incentive to allow these regulatory practices to increase housing prices because large portions of their investments lie within these rapidly growing markets. This leaves the rest of us, low-income individuals or families, at the expense of their desire to protect their investment, and we are in no position to chastise these individuals for protecting their investments. The chart on the right shows the number of additional units that California counties would have needed to build each year over the last three decades in order to keep housing prices similar to the nationwide average. If we take a look at the counties listed, five of the nine counties are located in the bay area, making that a total of 51,556 homes to …show more content…
John D. Landis, a professor of urban planning at University of Pennsylvania, wrote an article about the efficacy, price effects, and displacement associated with growth management strategies. In his research, Landis compared 7 mid-sized cities in California with similar non-controlled cities. He found that the principal effect of local controls on growth was simply evening out the rates of development over time. This ultimately allowed for reduced building rates during booming years and redistributed the growth to less-booming years. Landis also refers to a more recent study done on California cities which showed growth management groups had significantly reduced new housing construction within the city. This in turn, caused construction of multi-family housing on the outskirts of the city instead of near the center. This type of movement is the result of one of the more popular growth management strategies in California, annual housing caps. These housing caps were originally introduced in local communities to counteract the over burdening of public facilities towards the end of the twentieth century. Furthermore, these annual housing caps also helped to preserve open space and combat sprawl. More recent solutions include annual limitations on
In his research of regulatory practices within cities, Quigley found that explicit growth controls was one the reasons for less housing supply in California cities. These growth controls included urban service boundaries or growth moratoria, which reduces the amount of developable land and in turn, the ability of housing supply to adjust to changes in demand. This also directly relates to Cutler’s article as she explains homeowners have a strong incentive to allow these regulatory practices to increase housing prices because large portions of their investments lie within these rapidly growing markets. This leaves the rest of us, low-income individuals or families, at the expense of their desire to protect their investment, and we are in no position to chastise these individuals for protecting their investments. The chart on the right shows the number of additional units that California counties would have needed to build each year over the last three decades in order to keep housing prices similar to the nationwide average. If we take a look at the counties listed, five of the nine counties are located in the bay area, making that a total of 51,556 homes to …show more content…
John D. Landis, a professor of urban planning at University of Pennsylvania, wrote an article about the efficacy, price effects, and displacement associated with growth management strategies. In his research, Landis compared 7 mid-sized cities in California with similar non-controlled cities. He found that the principal effect of local controls on growth was simply evening out the rates of development over time. This ultimately allowed for reduced building rates during booming years and redistributed the growth to less-booming years. Landis also refers to a more recent study done on California cities which showed growth management groups had significantly reduced new housing construction within the city. This in turn, caused construction of multi-family housing on the outskirts of the city instead of near the center. This type of movement is the result of one of the more popular growth management strategies in California, annual housing caps. These housing caps were originally introduced in local communities to counteract the over burdening of public facilities towards the end of the twentieth century. Furthermore, these annual housing caps also helped to preserve open space and combat sprawl. More recent solutions include annual limitations on