Good afternoon, Master Planners of Whitewater! I’m sure that you’re busy today, designing a new interstate highway system, Lincoln Tunnel, Hoover Dam, etc., but I thought I’d write with comments on a fine book: Zoning, Rent Control, and Affordable Housing.
As you’ve heard, our city administration has declared housing Whitewater’s biggest problem. William Tucker’s work is from the Cato Institute, was published in the early 1990s, with principles that are still applicable to this very day.
Here’s my summary of Chapter 1.
In 1987, William Tucker, contributing of Forbes magazine and author, sought an answer to the question: what contributes to homelessness, to a lack of affordable housing? In the Introduction to Zoning, Rent Control, and Affordable Housing, Tucker sets out a goal:
In 1987, in search of an answer, I compiled figures on per capita homelessness in 50 cities, using mostly a 1984 report to the secretary of housing and urban development on homelessness and temporary shelters. Using multiple regression analysis, I sought correlations between high rates of homelessness and a dozen factors that have been suggested as contributing to the problem.
Citations omitted.
Possible causes included median home price, rent control, rental vacancy rate, minority population [sometimes more disadvantaged or vulnerable to unlawful housing discrimination], median rent, poverty rate, average annual temperature, public housing per capita, unemployment rate, size of city, percentage growth over last 15 years, average annual rainfall [a surely false cause].
Of the possible correlations that Tucker considers, two showed almost absolute statistical certainty: median home price and the presence of rent control.
This is, of course, contrary the reasoning behind conventional, government-sponsored solutions: Tucker notes that “poverty, unemployment, and lack of public housing” are typically identified as the causes of homelessness.
He sees, however, something different — that it’s the supply of private housing that affects homelessness, rather than the presence of aid programs (public housing) or even economic conditions (unemployment).
Tucker asks:
The significant correlation between the median price of homes and the rate of homelessness also reinforces the suggestion that the private market is the key to understanding homelessness. What has pushed up the price of homes in certain metropolitan regions but not others? Is it a high demand for housing? Is it a lack of supply? And if supplies are at fault, what is causing the lack thereof? Zoning efforts and “growth controls” are obvious suspects.
Tucker continues:
In a market characterized by high home prices, however, young people may not be able to move up to homeownership. They are forced to remain in the rental market where they compete with people poorer than themselves, thereby driving up rents. That would not necessarily cause a housing shortage, since the pressure on rents would cause developers to build more housing, bringing rents down again. But what if a city doesn’t let that happen? What if it imposes rent controls or growth-control measures?
Tomorrow: Chapter 2 — California [or, the overly-restrictive housing hell that all America may sadly become].