The zoning debate between NIMBYs and YIMBYs is fueling a housing crisis felt nationwide. Jerusalem Demsas, staff writer at The Atlantic, joins host Krys Boyd to discuss why she feels decisions about land need to be accountable to the public, why zoning boards and preservationists are hurting home affordability, and why the buck should stop at elected officials. Her book is “On the Housing Crisis: Land, Development, Democracy.”
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Transcript
Krys Boyd [00:00:00] Many, many Americans are paying more than they can afford to keep a roof over their heads. Maybe some of them were tempted by fancier digs than their budgets would really allow, but the vast majority find themselves with no choice. They live in communities where there simply are not enough homes in their price range to accommodate everybody who needs them. From Kera in Dallas, this is Think. I’m Krys Boyd. The solution is economics 1 to 1, build more low cost housing, including plenty of multifamily units like apartments. Shortages ease up and prices come down for everybody. But while individual communities are hurt by the lack of affordable housing, my guest has learned that for this particular problem, local governments are often not in a great position to implement solutions. Jerusalem Dempsey is a staff writer at The Atlantic. Her book length collection of articles is called “On the Housing Crisis: Land Developments Democracy.” Jerusalem. Welcome to Think.
Jerusalem Demsas [00:00:58] Hi, Thanks for having me.
Krys Boyd [00:00:59] I just want to start with this term crisis. What makes this country’s housing situation at this moment worthy of that label?
Jerusalem Demsas [00:01:07] Yeah, that’s a that’s a great question. I mean, obviously, for a lot of people, especially folks who are at the very low end of the rental market, folks who have been homeless, I mean, for for four decades, this has been a crisis for them. But I think what’s happened is that you’ve seen this balloon far past, folks who are very low income to include working class, middle class and even upper middle class people who are searching for housing, whether that’s rental opportunities that are affordable to them for good jobs or good schools or near their family, or it’s people trying to break into homeownership. And that phenomenon, the phenomenon of someone who has a good job, someone who has a stable home environment and isn’t experiencing some other unrelated crisis, that those people also are having trouble finding housing that meets their needs. That’s, I think, what has caused more and more people to label this a crisis.
Krys Boyd [00:02:01] Part of the reason I started there was that you write that there’s a surprising amount of skepticism around this problem. What are shortage skepticism and supply skepticism?
Jerusalem Demsas [00:02:11] Yeah, no, that’s a great question. So supply skepticism is a term that’s coined by some researchers in New York, Vicki Been among them, who was also a policymaker for many years. And the idea is that there’s a lot of there’s a lot of people who don’t believe the econ story that you laid out that the problem is that we don’t have enough housing. People are very skeptical that increasing the supply of housing will help make housing more affordable for them. And they have good reason to be skeptical that they have witnessed their communities often build housing, and yet they still see their rents going up or they still see homeownership become more unaffordable for them or for their children. And so they put those pieces together and they assume something must be wrong here in this market such that new housing is not actually bringing down rents. And they’re right half right right there have right to because the there is something wrong with this market. But the problem isn’t that new housing isn’t bringing down rents or at least bringing down rent depreciation or home prices. But it’s that we’re not building enough of it in the places that need it the most. When you look at around the country, especially in the most productive job centers, right. We’re talking about places like San Francisco, Los Angeles, New York, Boston, D.C., Seattle. These are places that have drawn so many new people to live there. And they’ve come from all over the country that come from all over these states. And they’re drawn in because of the great jobs that have been created in these in these powerhouses. And we call them superstar cities for a reason. And in these places, while they have added new jobs, they haven’t added new housing. And so at the same rates, they’ve added much less. When you look at the ratio of job to housing that’s being created. And the impact of this is that you see sprawl happen, but then eventually you kind of run out of places to sprawl, and then that increases pressures in suburban communities, in exurban communities, and then eventually people start moving. So you see people moving out of places like California, working class and middle class people moving out of California to lower cost states in order to afford housing. And that means you’re exporting that housing prices all over the country.
Krys Boyd [00:04:35] Why do we have this form of skepticism around housing when we all essentially understand that prices rise when there aren’t enough cars or eggs or plumbers to go around?
Jerusalem Demsas [00:04:45] Yeah. So there’s a trio of political scientists in the University of California system, and they look at this question, right? They ask people, hey, like, do you think that when you when when there’s a there’s a snag in this in the used car market. Right. Do you think that will increase prices or reduce prices or you don’t know what will happen? And people generally are able to respond, like if there’s a snag in used car market, that means the supply of cars is is lower and that means that prices should be higher. So people can do that sort of thinking, that reasoning. On average, they’re able to do that when it comes to other sorts of goods and when it comes to housing, they they struggle to do it. And I think it’s because of what I said around the fact that new housing has seemed like it’s already been becoming like when you think about the course of 20 years or 30 years of someone’s life. You know, I go home to suburban Maryland where where I grew up and it looks different to me. And if it looks different and more housing has been created, then how come that didn’t bring down rents? But the question is, again, of course, how much housing is being created relative to the need.
Krys Boyd [00:05:49] This is a problem that is obviously very much felt at the community level. So this is often where the most consequential laws are passed around land use and zoning and construction standards. I mean, it makes a certain sort of sense that local solutions should be applied to local conditions. But you note that this kind of decentralization actually grants huge amounts of power to very small numbers of stakeholders. How does that work?
Jerusalem Demsas [00:06:15] Yeah. So, you know, that sort of thinking that local problems should be handled at the local level. I mean, even the common phrase housing politics is local has really dominated the American policymaking space here. It’s only recently that we’ve even started hearing folks at the state and national level really pay attention to the problem of housing supply and production. And, you know, the reason why the political issues kind of come down at the local level is that while it’s the case that the harms of housing. Right, like construction is annoying, right? It might interrupt your commute. It might cause some local stormwater runoff problems, whatever. There are there are things that are actually done at the local level that cause problems that might increase parking fines and invite increased traffic. But the benefits of housing are really diffuse. Right. So who’s going to live in that new apartment building? Who’s going to live in that new single family home? You don’t know who that person is and the people who benefit from that broadly in in the form of lower prices. It’s everyone by a little bit. The impact of a new home, it’s basically not even measurable. It’s when you get into these large numbers of homes that are being built that you can actually see these pressures coming down. But as a result, what happens is that every single local community is basically incentivized against new housing because they feel like the benefits are so diffuse, they can’t really quantify them to their voters. But I think more importantly, what happens here is that democracy has really broken down in local government. When we think about, you know, do people even know who their local officials are? Largely, no. Largely, they don’t vote at all in local elections. Even voting for things is consequential as mayor is very rare. And then on top of that, even if they do go vote, the vast majority of local offices are unopposed. And so you’re voting for someone and it doesn’t really matter because you don’t really have a viable alternative. And so that vote is is really cast aside. But then I think even if you have an opponent in a race, right, so you’re able to choose between multiple candidates, how are you supposed to know which candidate is better on the issues you care about? Not only is there a lack of local media and attention, but the structure of local government is so complicated. We have 90,000 different units of local government in this country. It’s very, very difficult for voters to ascertain, okay, I’m voting for this person because they did well or not. How do you know if they did well? It’s hard to know who’s responsible for what sorts of issues. When we think about the housing crisis, it’s not just your mayor and your city councilman. It’s your zoning board. It’s your historic preservation Committee. It’s all of these different groups and committees and and organizations that are involved. And as a result, there’s no way to actually hold people democratically accountable. And then when there’s that vacuum, right, when voters kind of check out at the local level for various for various reasons, that means that the influence of just a few voters of just a few interest groups really matters. If you’re an elected official to local level and you’re winning your race by a matter of 100 votes, if 50 people say they’re upset about a housing development, there’s no way you’re going to stand up to those people. What that ends up meaning is that these decisions are being made by a very unrepresentative set of of of voters at the local level. And we know this. We’ve studied this. There’s a great research called Neighborhood Defenders by some researchers at Boston University. And they find that they find that the people who show up to zoning board meetings are really unrepresentative of the greater population. They’re more likely to be homeowners, they’re more likely to be wealthy. And that’s relative to the people that live in that community. And so that really skews Democratic decision making.
Krys Boyd [00:10:07] So let me make sure that I’m following you here. Jerusalem. You’re saying if a new subdivision is planned in my neighborhood and I’m already a homeowner, I might think, well, that sounds like a bad idea. I don’t like change. I’m going to show up as a homeowner stakeholder and argue against this. But the 75 families that might benefit in two years when this project is completed, they’re kind of still out there in the ether. They may not even know this is happening, even though this could change their lives at some point.
Jerusalem Demsas [00:10:35] That’s exactly right. But even on top of that, right, like you as the homeowner in that community, maybe you’re really sensitive to the fact that there’s going to be some harm to you. Maybe you don’t like change in your community or you’re afraid of the parking problems or whatever it is you’re afraid of, but you’re not really thinking about or internalizing the potential benefits. Right. And I think this is one of the biggest problems here, is that you have the broader concern about affordability at all. So you have these homeowners whose children grow up, who can’t afford to live in their communities anymore, or you have seniors who may have opposed housing at one point, but now as they’re older and they want to stay in their communities, but they need to downsize because, you know, you could you could become disabled and you’re unable to use the stairs in your home. So you need something smaller or something new that’s ADA compliant. And those homes don’t exist in their communities, so they’re forced to choose between staying in their community in a house that doesn’t suit their needs anymore or leaving at a time in your life where you really want to maintain those those connections, the people that you know in the places that you know very well. And so that in many ways it’s not just this fight between new people moving in and the people who are already there. It’s also just a failure of local government to be able to help people internalize that you’re harming yourself five years down the line, ten years down the line, you will also feel the pain of not being able to have diverse housing types in your community.
Krys Boyd [00:11:56] Yeah, you note that often. Exactly. The kinds of housing needed to solve the short supply of decent homes for people with a wide range of needs, require special permission with local planning commissions, and getting that permission requires people to jump through a lot of hoops.
Jerusalem Demsas [00:12:13] Yeah. Yeah. No, exactly. I mean, when we think about the types of housing that we have permitted by. Right, So that means that if a developer owns the land and you know that he, he or she has a set of rules and they know what rules they have to follow, they could just build that property. When it comes to large single family homes on land that zoned for residential, it is very easy to just say like, okay, I bought this land, I’m a developer, I got my financing right. I’ve hired by contractors. I don’t have to ask any permission. I have permission already to build these large single family homes. But if you want to build like a small single family home, something that could be a starter home for people who want to build a duplex, you want to build anything that’s kind of not the normal, large single family home that many, many Americans are sort of used to seeing built over the last 30 or so years. Then you have to go ask for a variance, which is what special permission is called. And that means you have to go through this very political process. And instead of the government saying, okay, just like we do with single family homes, here are a clear set of rules, You have to abide by these standards, these safety standards, these these building code standards, all these things. And if you follow these rules, you can just build what you want to build. They don’t do that. They make you jump through all these political hoops. And the effect of that is that in large swaths of this country you do not see starter homes being built anymore. You do not see small homes being built. And those are the kinds of housing options that people really, really need, particularly as the country is aging. And you have people who who don’t want and don’t need these large single family homes, but they want to stay in their communities.
Krys Boyd [00:13:45] A minute ago, Jerusalem, you were talking about the need for a variance to do something sort of different than the average. And you talked about developers. I mean, at least developers probably know how to go about seeking one of these things. But if somebody, say, owns a home, has a big backyard and wants to put up a little grandparent apartment to keep an aging parent nearby or rent to a tenant, this if it’s not against the law, it might be really confusing for people to get permission to find out if they’re even allowed to go forward with it.
Jerusalem Demsas [00:14:18] Totally. I mean, these are called accessory dwelling units. So ADUs. And that means Casitas or a mother in law suite in your backyard or even converting your garage into an apartment for, you know, maybe a maybe a child that’s graduated college and needs to move back home. Those sorts of things. I mean, people are surprised to find this happens all the time. They own their properties. They are homeowners. They’re not trying to build like some insane apartment building in their backyard. They just want to turn their backyard into a place for for a family member to live. And they need to go to their local zoning board and get this express permission. There’s now a bunch of energy to try to make these sorts of buildings and these sorts of homes legal by right as well. Of course, no one is suggesting that we should get rid of any of the health and safety standards or environmental standards in order to make these structures safe. But if developers and homeowners are wanting to follow the rules and hire a contractor to build a safe and accessible structure, I don’t think the government should be telling them that they can’t do that.
Krys Boyd [00:15:26] So if a small, not truly representative number of opponents to affordable housing development have this outsized effect on which projects get greenlighted or scrapped, that’s a huge part of the problem, right? Like a city council representative whose constituents show up to speak out against new housing construction feels compelled to respond. This happens not only within cities, but within larger regions, right? People are like, Let’s let the next town over build all the apartments we need because people can commute and we’re going to keep our parks and single family neighborhoods.
Jerusalem Demsas [00:16:02] Yeah, exactly. I mean, it’s a collective action problem, right? Because, of course, there are areas of land that we would want to maintain free from development. Right? There’s there’s parkland that we like. There’s biodiversity that we care about. There’s just generally things that people care about other than building new structures on their land. But because we decentralize the process so much, there’s no way for us to say, you know, every single town to kind of voluntarily say, we’ll preserve this part of our land, but we’ll build over here. And that’s why, you know, a lot of people, including myself, have been advocating for states to really step in here and they’ve begun to do so, which is to say that at a state level, you can actually coordinate and manage all of these priorities. You can say, you know, you know, we’re in Colorado. We’re not going to pave over all of our ski slopes in order to make sure we can build enough housing. We’re going to make sure that housing goes where people need to live, which is in in sort of these urban and suburban areas where you do see a lot of desire to to build enough housing. And you can also say, okay, like we want to make sure that there’s there’s enough parks and green space available for people. So we want to make sure that we’re not just cutting down all the trees, but at the local level, right? Like you’ll just say something exactly what you just said. You’ll have problems where a local government will say, Well, I don’t think I’m responsible for for building more housing. I think that the next door town should be the place where the new housing is built. And time and again, you get the problem where every town thinks this way and every town is individually rational. Right? Because it’s not actually on some tiny suburb to figure out the housing crisis. One more development in some small town is like a drop in the bucket of the problem we’re trying to solve. But if every single town thinks that way, that’s how you get 4 million home shortage that we’re facing right now.
Krys Boyd [00:17:46] Why do Nimby types, people who say, fine, fix housing but not in my backyard, why do they have less influence, generally speaking at the state level if policies are determined there?
Jerusalem Demsas [00:17:56] Yeah, I mean, this is this is this is the question, right, that political scientists have have been asking. And the reason is this. It’s not that NIMBYs have less influence, that everyone has more influence personally. People vote more at the state level. And so there’s just higher rates of voting. People vote for governor and often those elections are coinciding with with presidential or with with, you know, national elections for Senate or for Congress. So people are just already turning out to they’re going to engage. And that means that elected officials are responsible to a broader electorate than just the, you know, 50 or 100 or a few hundred people who show up to a zoning board meeting and who determine the course of of local elections. But then on top of that, too, you know, state governments, particularly governors, right. And people who are leading the Democratic or Republican parties in these states are responsible for broad economic conditions. I may not blame my mayor for the unemployment rate. Right. I think I generally most people don’t really view their local officials as responsible for four broad economic crises like the housing crisis. But when things are going south in your state and definitely in the country as a whole, you do start blaming those election officials who are responsible for these broader trends. So that means that these elected officials have a significant incentive to address these problems. You know, Gavin Newsom in California, Jay Inslee in Washington state, Jared Polis in Colorado, in these states, you see these leaders as being very sensitive to the problem of housing supply and seeing their political legitimacy and futures as resting on figuring out a way to make housing more affordable. And so, you know, as a as a mayor or as a local elected official, these people would probably not be be held accountable to these concerns. But at the not at the at the state level, they are held accountable.
Krys Boyd [00:19:51] So I live in Texas, a state which has a pretty well-deserved reputation for residents who don’t care, being told to be told what to do by ever larger levels of government. How do you get local jurisdictions to agree to cede control over housing policy to larger, more remote agencies like states and potentially even the federal government?
Jerusalem Demsas [00:20:12] Well, Texas has been doing a relatively good job on this. On this question, I mean, of course, there’s still some problems and pressures there. But in general, Texas has been building. I mean, that’s why you see a lot of people moving to Texas, a lot of growth happening in Texas because it’s a pro growth oriented place. And the Texas state legislature has has been I mean, there are legislators in the Texas State House that have been more amenable to this problem because I think in general, you have Republican leaning states being more positive towards towards growth. And the problem has mostly rested in Democrat led states. And then this problem of trying to to deal with the push and pull between state and local power. I mean, honestly, where I’ve seen a lot of energy at the state level is sort of this recognition that local governments have been left on their own for a very long time to try to resolve these problems and they haven’t been able to do it. And so what ends up happening is state government just steps in and says, hey, look, you know, we’re going to do something. If you guys don’t fix this problem, if you guys don’t figure out a way to get production up and they don’t do it. And so state governments have to step in. And so you’ve seen this in states across the country, all along the West Coast, but also Montana and Colorado, some energy and in Arizona and Texas. Yes, of course, as well. And so you do see the fact that state governments are stepping in. And it’s important to note here that while at the federal level, right, between the federal government and the states, there’s constitutionally protected powers, Right. The federal government can just say, well, the states are messing this up. I can just force them to do what I want. But at the state level, there’s nothing in the US Constitution sets aside rights or powers for local governments. It doesn’t even mention local governments. And what that means is that local governments are entirely at the will of the state government they reside in. Some state constitutions do uphold aside powers for local governments. But but in general, it is up to the governor and the state legislature of these places to allow and to continue to allow local governments to continue messing things up on housing. And so this question of can they engage here is definitely clear. If state governments can hold local governments accountable and they can also provide them resources in order to solve these problems. But at the end of the day, it is really on the states to do the job.
Krys Boyd [00:22:39] So if I’m hearing you right, you’re saying it might be easier for state governments to make decisions and impose policies that in the short term make people unhappy, but in the long term will benefit communities in ways that local governments really can’t do because of the way local government works.
Jerusalem Demsas [00:22:59] But also it only makes some people unhappy. This isn’t a question of acting against the popular Democratic will. You look at polling at the state level and people are often they don’t have strong preferences about whether local governments or state governments are solving the housing crisis. They just want someone to solve it. And so this idea that local control of housing is a popular issue isn’t really borne out when you look at the polling data. And so I think that that’s one thing that’s really important, is that often local governments are making the argument that they have the right to retain power over this issue area. But that’s not what the voters are saying at all. And so I think that’s that’s that’s really important to note. But also, of course, there are people who will be upset by the fact that now it’s easier to build housing in their communities. But I think that they’re also upset right now that housing is extremely expensive in their communities. And the role of government is not to say, well, will this action upset or do you want it saying, okay, I’m getting a lot of information, I’m getting competing information, competing values from people. They want to have affordable housing. They want to make it possible to have ADA compliant housing, housing for seniors, housing for workforce. At the same time, they’re concerned about things like overdevelopment. They’re concerned about things like losing environmental space and how to balance that as to how the state government needs to intervene here instead of balancing that. Right now, we’ve gone all in on opposition to housing, and that’s that’s really the problem.
Krys Boyd [00:24:27] So if broadly in theory, most Americans agree we need to find ways to get everyone into decent homes that they can afford to pay for, one huge block of resistance to new construction tends to be from occupants of single family homes and neighborhoods who do not want new multifamily housing built near where they live. Why are there so many objections to new apartment complexes where no apartment complexes have existed before?
Jerusalem Demsas [00:24:54] Yeah, this is a really great question. I think it’s I think it’s important that first that like when apartments are brought up, they’re brought up in such a controversial way. Right. Like no one asks me, Hey, Jerusalem, are you okay with a new single family home being built down the block? It just kind of comes up one day and I’m like, all right, I guess that’s there. But they do when when it comes to an apartment building, right? You have these massive signs posted going around saying like, just a notice. Land use hearing for a huge development is proposed in your community. It’s already kind of framed as this controversial issue. That’s going to be a problem. And people are really primed when they see that sort of thing to think, I guess something must be wrong. Otherwise why would they be doing this since there’s already this presumption of something being wrong with these sorts of developments? But also, I think in general, you know, people are used to thinking about apartments as being, you know, low income. They’re not really for regular Americans, and they worry that they’re going to be really ugly and they can’t see how the renderings would really work in their community. And so I think it’s also like for many, many years, there’s been a sort of as we’ve relied on these large single family homes, there’s been a sort of idea that these sorts of things don’t fit into the American dream. And, you know, I’ve seen at the same point in time no one is trying to build apartment buildings everywhere. Most of what’s really needed is just sort of missing middle housing, which are often, you know, smaller single family home, starter homes. It’s duplexes or townhomes or or multiplexes that often already exist in many towns and communities across America. This is how we used to build housing all the time. These are the types of homes that, you know, the baby boomers were able to buy into the first time they got into the housing market, these small starter homes, Jerusalem.
Krys Boyd [00:26:47] I think when people prepare themselves to have a conversation about the problem of lots of folks being unhoused in cities, we pride ourselves to talk about access to mental health care and drug counseling and job training when many advocates believe the primary reason people end up without a place to live is that there aren’t enough affordable places to live. I mean, it’s obvious once it’s pointed out, but it is not how we tend to think about this problem.
Jerusalem Demsas [00:27:12] Yeah, that’s definitely true. I think that part of the problem is that when you think about housing policy, for a long time it was just considered, it’s you know, we provide more funding to build affordable housing units. And we didn’t really think about what are the constraints that are preventing developers right now from building the kinds of homes that we want to see. And so that kind of reframe has been really important.
Krys Boyd [00:27:36] This explains why certain cities seem to have more or fewer people experiencing homelessness, right? It’s not that unhoused people somehow descend on particular parts of the country. Will you talk a little bit about that.
Jerusalem Demsas [00:27:48] Yeah, I think this is really counterintuitive for a lot of people. But, you know, we have these stories about how homelessness is caused by drug addiction or by poverty or mental illness. And, you know, when you look at the data, right, when you look at places, this is a great book called Homelessness as a Housing Problem. And they check to see if if this even passes the gut check of of correlation correlational research. And so they look at places with high levels of mental illness or high levels of drug addiction. And they say, are these the places with the most homeless people? Is this happening in West Virginia? Is this happening in Ohio, in places like Philadelphia? Are you seeing in places with high poverty? That’s where the most homelessness is? No. Homelessness is concentrated in low poverty places. Places like San Francisco, places like New York City. These are very, very wealthy, wealthy cities. And instead, the place where they see the most, the direct relationship is where you see low supply of rental housing. So when you don’t have enough housing, right, that’s when people get pushed into homelessness. And the best way I think it’s been explained to me is this sort of analogy to the game musical chairs, right? If you watch kids play musical chairs and you see that the chair removed and they run around and they try to get a chair. Usually the kid who wins is like faster, or they’re going to be more gregarious, more willing to pull the chair away from someone else. They’re not an anxious kid. They’re not a slow kid. You’re not going to see a kid who has a broken leg winning musical chairs. And you know, you could say something funny about that, right? Like, the reason why Timmy didn’t win is because, you know, it’s because he has a broken leg. Or you could say, the reason why Sherrie lost musical chairs is because she’s anxious. And I suppose that’s true. But at the same time, the reason they don’t have chairs because you removed chairs from the game and that’s the same game we’re playing with housing where you are removing housing options by having all of these exclusionary zoning laws. And then you’re asking yourself, why are all these mentally ill people, people who suffer from drug addiction, why are they on the street? Why are poor people on the street? And it’s because you took their house away. And if they don’t have homes available to them, then when disaster strikes, Right. When something bad happens to you, when you have a divorce, when you lose your job, when you get addicted to drugs, when you experience a mental health episode, instead of experiencing that while remaining housed, you experience that homeless. And this is something really important to realize is that the modern homelessness tent encampment phenomenon, that is something that is very modern 1980s when we start seeing that happen.
Krys Boyd [00:30:32] Jerusalem You mentioned, you know, removing housing options from people who need them at different income levels. It’s understandable that, you know, in wealthy cities there are fancy homes and apartments for wealthy people. But why is it that more liberal cities and states are often harder places for low income Americans to find decent housing than more conservative cities and states?
Jerusalem Demsas [00:30:57] This is perhaps the question that has been animating so much of my work. Why is it that you go to these places that say they really care a lot about equity, they care a lot about economic inclusion. You go to places like San Francisco, Seattle, New York City, and yet these are the places where you have this hotbed of of of of homelessness, of a crisis, of affordability. And fundamentally, I think that when you think about the this problem, there’s been ideas that have really taken root within liberal thinking which have been opposed to growth. Right. And some of these came from very reasonable places. When the environmentalist movement, for instance, really started to gain traction, it was animated by an opposition to development of all kind. It was animated by this idea that developers had gone too far. They had taken up too much green space. And so what we needed to do was seed the seed, the system with all of these veto points to make it possible for people to participate in local democracy. And in so doing, we basically biased all of these processes in these liberal cities against building enough housing and in more conservative places you know, first of all, like they didn’t have experienced this, this massive run up in development in the same way that that these these superstar cities did. I mean, it’s only recently that you see our fastest growing cities and regions are concentrated in Republican led states. And so it’s kind of a newer problem for for these states to confront. But also, there’s just a difference in ideology when it comes to growth. There’s much more amenable thinking in in Republican circles towards growth, economic growth in general, but also development as as a positive goal. And, you know, that has pros and cons. It means if it’s easier to develop things in Texas, it can also make it easier to build pipelines or to build to to extract those sorts of things from the ground. And maybe some people don’t like that. But in liberal states, it’s hard to build everything. It’s harder to build housing, it’s harder to build clean energy. It’s harder to build, you know, carbon, carbon, fossil fuel of energy. It’s hard to build anything that you want to do. It’s hard to start small businesses in these states. The permitting process in these places, it’s just much more difficult to get things through. And so when you have that sort of system, it’s very, very hard to pick and choose what sorts of things you’re willing to make it easy to build. It’s kind of an all or nothing deal.
Krys Boyd [00:33:28] There are other countries that build housing for their citizens fairly regularly and not exclusively for very low income people. Are there reasons government housing is really not an option for most Americans unless they’re at the very lowest income levels?
Jerusalem Demsas [00:33:45] Yeah. I mean, public housing in this country was conceived of as only being for low income Americans. And so our history with public housing is something that most people really shy away from, right? We didn’t try to build mixed income communities or even developments. We chose to build like these cinder block public housing developments that were only for poor people that were concentrating poverty and concentrating, you know, minority groups into these spaces. And that is really, you know, of course, not attractive for people, including people who are low income, who don’t want to be concentrated away in a you know, in a crumbling tower that doesn’t get enough federal financing to actually keep up with the capital expenses of of maintaining these buildings. You know, the history of that, I think, is is really rooted in, you know, their desire for exclusion and for keeping low income and particularly black people in this country separated from from the rest of the country. I don’t think it has to be this way. I think that there’s a role for public development in a lot of places as both conservative and liberal have been considering ways for the for the government to finance housing and public development very differently from the old model. Like really kind of not really the same thing at all. The government wouldn’t be wouldn’t would be essentially providing, you know, creating a revolving fund, the loan fund to make it possible for development of, you know, middle income, low income and an upper middle income housing to exist in the same building. And these buildings will be developed by private developers the same way that normal buildings are developed right now. But they would just have requirements in place for levels of affordability, so you’d have a mixed amount of affordability. Some people for 50% of the area, median income or to a like the average median income of the area or 120% of people, or slightly richer than the average median. All living in the same building but mandated affordable in the long term. And so those sorts of things, those are interesting experimental ideas that are coming about. It’s happening in place like McHenry County, Maryland, and places in Georgia and Tennessee are considering this as well.
Krys Boyd [00:35:58] Recently, there’s been a whole lot of concern about institute institutional real estate investors buying up large numbers of homes with the intention of turning them into rental properties, thereby reducing the number of homes available for individuals to purchase. You found that it is happening, but not enough in most places to be a major factor in housing costs.
Jerusalem Demsas [00:36:16] Yeah. I mean, this is one of those stories that I think that a lot of people are searching for an easy scapegoat in the system. And of course, private equity and institutional investors are very easy to scapegoat for various reasons. But when you look at the numbers, it just doesn’t really add up. Very few numbers of houses are going to institutional investors. I think there’s been some kind of shoddy reporting often about these statistics. And so the kind of textual here write like, 30% or 60% of homes are being bought by investors. They’re doing something very, very misleading there. They’re saying the word investor and then they’re talking as if they’re talking about these large institutional investors. Most investors are very, very small. We’re talking about people who own homes, less than ten, ten units, 50 units or 100 units. But all of those are lumped into the term investor. And, you know, you can think that that’s bad or not. That’s actually up to people to view. But it isn’t the case. There are these small number of large actors that are buying up all these homes. There’s actually a very competitive market of housing investors across the country, including, of course, individual homeowners. And, you know, I think that it’s a difficult problem, right, Because you can say, look, I’m concerned that single family housing is being bought up and turned into rental housing, but we need both rental housing and homeownership options for people. And so finding that balance is really important. And any time an individual person purchases a home and then rents it out, that person’s an investor. And so it seems like a bit shortsighted to demonize that part of the market when a large number of Americans supported their life are going to be renting homes. And so those are two things are necessary and important, I think, when it comes to these large institutional investors. There, of course, needs to be regulation and to ensure that they’re not breaking the law in any way. There’s been some research that there that they’re not as your scrupulous landlords and you want to make sure they’re not violating laws and treat their tenants badly. They’re keeping up the the the properties appropriately. But in general, you can’t really blame them for price increases even at a local level. No one has found has done any research to attribute the increase in prices we’ve seen to the purchase of homes by large investors.
Krys Boyd [00:38:34] Did you find any evidence that the resistance to the construction of more affordable housing by existing homeowners is ever motivated by the fact that, look, it’s good that housing is more affordable for everyone, but. People who are already in a house have some money to gain or lose based on what the prices look like.
Jerusalem Demsas [00:38:51] Yeah, this is a great question. So this thesis is called the Voter hypothesis. So the idea essentially that people oppose new housing in their neighborhood because they’re afraid of the impact on their property values. And people will often say, right, like, I’m concerned about my property values if you allow for this new development to happen. But when you look at the actual numbers, right, if you make it easier. So it’s called up zoning, right? So if you make it if you make it possible for a single family home to actually be turned into a duplex or a multiplex or an apartment building, you’ve actually increased the value of that home. And by that, I mean like now if you’re a homeowner, you’re now able to sell your house to a developer who can make a bunch of money off of it. Right? And so if you actually up zoned an area, you should see an increase in property values. And so why then do you still see homeowners opposing housing and saying they’re concerned about their property values? I think it’s because when they say property values, they don’t actually mean literally, how much can I sell my home and get something for it? They often mean the value I get from my community because I like how certain things look. So I value a place that has low density. I value not a ton of traffic and not fighting with people for parking spots in my in my area. I value a view that I think is really beautiful, but I don’t want to go away. And so when people talk about property values, I think they’re really talking about and this is the thing that I’ve really found it by reporting, they’re often talking about sort of this this intangible sense that their community is a good place to live, has good schools, has good neighbors and other amenities. And so I think it’s really important to address these specific concerns. Right? Like, well, how do we make sure that when people are are accepting growth into their communities, that they’re not being harmed for it? Right. That they’re getting benefits out of it, whether it’s the increased tax base, how are you able to ensure that people are able to keep their parking spots in front of their house? Is there a way to increase the transit systems in certain areas or the road capacity of certain areas to ensure that, okay, yeah, there are more people, but there’s more ways for them to get around. So it’s not completely destroying how people like to live. And so I think these sorts of concerns are what people really need to address or feel comfortable with new growth in their communities.
Krys Boyd [00:41:13] We should talk here about gentrification, this phenomenon by which people move into mixed income or lower income neighborhoods and transform them into more expensive neighborhoods. It’s very easy to blame the kind of new entrants with a little more money than the long established residents of these low cost areas. But you say the real problem is Nimby, homeowners in the wealthier neighborhoods. So explain how that works.
Jerusalem Demsas [00:41:35] Yeah, So when we think about gentrification, we’re often thinking about the change, right? We’re saying, okay, the problem is the gentrifiers. The problem is the new people moving in and they are changing my community. And the reason why that’s happening is because new housing is being built here. New investment is coming in, and that’s changing my community. I don’t want that to happen. It’s going to be priced out. But I think there’s a couple of things that’s important to disentangle, right? There’s this question of does change is change happening in your place? I think most people are happy if there’s public or private investment to beautify an area, to add more shopping or whatever. The problem is when people are priced out of it or if those sorts of amenities are built and they’re not accessible to them. And what we find is that increasing the supply of housing in an area actually reduces private rental price pressure, which means that more housing makes it more affordable to live in an area. But why then, do we then have this sense and feeling that like there is all of this change being concentrated in these sort of like middle income areas? And the reason why that’s happening is because we have allowed certain parts of cities to become so off limits to development that all of that gets concentrated in these lower political power areas. Right. So I live in Washington, D.C., and the northwest part of D.C. has basically been preserved in amber for for most of my life. I grew up in Maryland. And you see the same kind of neighborhoods staying stagnant, these single family homes remaining as they are. And yet a lot of development is pushed towards kind of the more urban corridors of DC, whether it’s downtown and and then these other places. And in many ways that can be a good thing. But that pressure is happening all in those areas because we refuse to allow diffuse pressure to exist everywhere. But most importantly, I think it’s important that we talk about gentrification appropriately and actually to target the real problems associated with it. The problem with gentrification is not the new buildings, it’s not the new shops, it’s not the new people. The problem with gentrification is people are being pushed out of their communities and the reason that happens is because there’s not enough to go around. You know, in D.C., for instance, and other places I’ve I’ve visited, you see homes that used to be purposed for, you know, middle income families. Right. Like a row house, for instance, is now converted to be for for yuppies who are able to have roommates and because they’re able to pay higher rents. But why are they living there? Right. Like, why is the case these yuppies who are maybe earning, you know, $80,000 a year are living in these row houses. And the reason is that you haven’t built other opportunities for them to live in. And so I think the thing that I usually say is that, you know, richer people are always going to get housing. They’re always going get is the question is, is everyone else going to get housing? And so if you don’t build enough, eventually all that housing is going to filter up to the wealthiest Americans. And I think the clearest example of this is in New York City. When you go to New York City and you see the kinds of apartments that rich people are living in, it is shocking, right? Like some of them are not even up to code. They’re small for the amount of money that they’re paying. Some of them have of, you know, they’re they’re extremely old. They don’t have like basic amenities that we’re used to, like having a a laundry machine or a dishwasher. And why are rich people living in these places? Because there’s not enough places that are new for them to live in. And so they’ve taken up housing in middle income and lower income places. And so when homeowners oppose new housing in their communities writ large all over, they are creating the conditions for gentrification to happen, for people to be pushed out of their communities as a result.
Krys Boyd [00:45:22] Jerusalem Demsas is a staff writer at The Atlantic. Her book length collection of articles is called “On the Housing Crisis: Land Development, Democracy.” Jerusalem, thank you so much for the conversation.
Jerusalem Demsas [00:45:33] Thank you so much for having me. These were great questions.
Krys Boyd [00:45:35] Think is distributed by PRX, the Public Radio exchange. Again, I’m Krys Boyd. Thanks for listening. Have a great day.
