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Clever reforms can reduce the power of NIMBYs and cut housing costs

economist.com

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Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#11

Post by jvm »

PeterStuer wrote: post #10

The article seems to have it arse backwards. Yes, a lot of times this is a situation of "Distributed Costs and Concentrated Benefits", but with the benefits going to the property developer, and the costs to the impacted community. NIMBY is the catchy phrase constructed by marketing to discredit serious concerns people have when they are on the receiving end of someone's 'unacounted externality'. Technology has made i…

I completely agree that development creates negative externalities which are legitimate complaints for neighbors. However, restrictions on development create a regressive tax in the form of high rents, which is, as the article describes, distributed broadly. What's needed is some sort of cost-benefit balance between the two.

For example, I rent a 400 sq foot apartment in SF for $3k. The operating and capital cost of the physical apartment is probably on the order of $1000 (I have rented similar places in Montreal, which has ample housing, for Those restrictions have value in the form of reducing community impacts, so the question becomes, should the community as a whole pay a 100% "tax" on its rents to avoid additional development? The policy also closes off market rate housing in the city to any who can't afford the rents, which could be a feature or a bug depending on your outlook.

I believe there is a goldilocks regime between the two extremes that we should strive for, but our current system doesn't provide a mechanism for us as a society to make a balanced cost/benefit tradeoff.

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#12

Post by AnthonyMouse »

Gibbon1 wrote: post #8
dingaling wrote: post #7

Earlier quoted context omitted.

I think the objective is to wash-out the casually-opposed with the bribe of reduced property taxes, leaving the smaller hard-core opposition to be tackled. However they don't offer any novel ideas to address the often-genuine concerns of that hard-core of 'NIMBYs'. Those are the ones opposed on principles or personal experience. For example in my neighbourhood the building of new developments had resulted in hugely i…

That's a good example of where orthodox economics breaks down; Money doesn't substitute for a quiet garden.

The problem is more that it could, but necessary amount of money isn't feasible to pay.

Though on the other hand, that sort of problem is solved by building taller buildings, because then if you don't want to hear the traffic you can live on the 20th floor.

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#13

Post by tomohawk »

We have planning at the county level. All that does is place power in the hands of the powerful realtor/developer group.

As a result, local imbalances abound. If you live in an area where those sorts of folks also live, it's really nice. If not, you get prison, dumps, subsidized housing, etc built right next to you.

I can only imagine what this would look like if this was done at the state level. Our state is solidly one party...

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#14

Post by ghaff »

PeterStuer wrote: post #10

The article seems to have it arse backwards. Yes, a lot of times this is a situation of "Distributed Costs and Concentrated Benefits", but with the benefits going to the property developer, and the costs to the impacted community. NIMBY is the catchy phrase constructed by marketing to discredit serious concerns people have when they are on the receiving end of someone's 'unacounted externality'. Technology has made i…

"NIMBY" has become like "PC" and other catchy terms of its ilk. On the one hand, they refer to principles/values that can often be legitimately criticized--at least up to a point. On the other hand, they've become these reflexively applied dismissive labels that imply nothing about the opposing side's arguments have any legitimacy whatsoever because NIMBY or because PC.

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#15

Post by DavidHm »

tomohawk wrote: post #13

We have planning at the county level. All that does is place power in the hands of the powerful realtor/developer group. As a result, local imbalances abound. If you live in an area where those sorts of folks also live, it's really nice. If not, you get prison, dumps, subsidized housing, etc built right next to you. I can only imagine what this would look like if this was done at the state level. Our state is solidly…

To some extent I believe that clustering of good (and bad) things is inevitable when there is a central decision marker (or decision making body).

What I mena to say is once an area is nice (or has been designated as the next "growth" area), then nice properties/malls/services etc are going to go there. Industry buildings will cluster somewhere else, office buildings will cluster in a 3rd area.

Of course, it sucks to be a resident in area that ends up being the low-value one, but someone will end up having to get the short stick.

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#17

Post by pwg »

The article also completely ignores the effects of "easy money" in the price inflation of housing costs.

By "easy money" I mean the period there where the banks would give almost anyone with a pulse a huge size loan for a house purchase. Because everyone was running around with an outsized "money press" in the form of their approved bank loan value, they were quite capable of bidding prices up, which is exactly what they did. Therefore, as to this cause of the price inflation, it somewhat inverted the supply/demand curve in that prices rose to accommodate greater supply of money in the hands of prospective purchasers.

Yes, building restrictions do play a part, but fully ignoring the effects of using very cheap "other peoples money" for bidding on houses ignores another significant factor in the inflation effect.

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#18

Post by hiou »

jvm wrote: post #11
PeterStuer wrote: post #10

The article seems to have it arse backwards. Yes, a lot of times this is a situation of "Distributed Costs and Concentrated Benefits", but with the benefits going to the property developer, and the costs to the impacted community. NIMBY is the catchy phrase constructed by marketing to discredit serious concerns people have when they are on the receiving end of someone's 'unacounted externality'. Technology has made i…

I completely agree that development creates negative externalities which are legitimate complaints for neighbors. However, restrictions on development create a regressive tax in the form of high rents, which is, as the article describes, distributed broadly. What's needed is some sort of cost-benefit balance between the two. For example, I rent a 400 sq foot apartment in SF for $3k. The operating and capital cost of…

Do you happen to have another example of an city with a similar weather and employment profile that is significantly cheaper? Regardless of development?

Is there unanimous agreement that high rents(which are occurring throughout the US and abroad right now) are solely due to lack of development?

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#19

Post by ancap »

The chief problem with the idea of NIMBY is that it is not really the concerned party's back yard. A more accurate term for the concept might be NIMNBY (Not In My Neighbors' Back Yard).

NIMBY is an affront to the concept of property rights. But, some say, the concerned party has the legitimate concern that development on a neighboring property will negatively impact the value of their own property. While an understandable concern to have, it does not justify the prevention of allowing the neighbor to develop on their rightfully owned property; just as company A should not be allowed to prevent company B from creating widgets because the extra competition will impact company A's bottom line.

Re: Clever reforms can reduce the power of NIMBYs and cut housing costs

#20

Post by ghaff »

ancap wrote: post #19

The chief problem with the idea of NIMBY is that it is not really the concerned party's back yard. A more accurate term for the concept might be NIMNBY (Not In My Neighbors' Back Yard). NIMBY is an affront to the concept of property rights. But, some say, the concerned party has the legitimate concern that development on a neighboring property will negatively impact the value of their own property. While an understan…

Backyard in this context means something more akin to neighborhood/city/etc. as opposed to patch of green behoind hous

Many property rights are limited in various ways--often by zoning in the case of land. And, typically, those limitations would be known at the time of purchase. Most would agree some level of zoning is reasonable; no incinerators or drilling for oil in residential neighborhoods for example.

I actually agree that excessive permitting processes that block otherwise allowed development are often a problem. But some level of zoning (whatever you call it) is effectively required for a functioning city or other community.

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