by Jon Sanders
Research Editor and Senior Fellow, Regulatory Studies, John Locke Foundation
Somewhere out West, my friend and now retired colleague Dr. Michael Sanera is thinking "I told them so!":
As home prices in Charlotte continue to rise, a study released Friday suggests that some city land-use regulations put affordable housing out of reach for Charlotteans earning a modest income.
The study, commissioned by the Piedmont Public Policy Institute, concluded that housing in Charlotte is unaffordable for families earning 90 percent or less of the city’s median income, or around $52,000 a year from 2010 to 2012. That’s about 140,000 households, according to Census Bureau data from 2010. …
The trio of city land-use policies examined in the study — the stormwater control ordinance, tree ordinance and urban-street design guidelines — add more than $17,000 on average to the cost of a home.
This news is in The Charlotte Observer, but it wouldn’t be news to Sanera or anyone familiar with his work at the John Locke Foundation. After all, he tried and tried to warn Charlotte (and Raleigh and other North Carolina cities and counties, too) about the dangerous, ill effects of anti-family, anti-affordable housing ‘Smart Growth‘ policies and excessive land-use regulations.
Not that planners wish to heed the facts. They prefer their utopian visions to reality. Who doesn’t? Nevertheless, retreating into a fantasy world to implement a policy doomed to backfire is a step into path dependency, as the policy’s unintended negative consequences create the need for additional retreating, as opposed to owning up to those eminently foreseeable problems.
To quote from Sanera’s report on unaffordable housing,
A crisis in housing prices is largely a self- inflicted wound.
City officials in Chapel Hill and Carrboro are quick to decry housing prices that spiral ever upward, but they ignore their responsibility in causing those high prices. Their restrictive land-use policies have decreased the amount of available land and, as a result, caused a dramatic increase in home prices. A recent study determined that restrictive land-use regulations cause 90 percent of the difference between construction costs and home prices. So it is unlikely that more government regulation is the solution for problems created by existing regulation.
The new study reminds us, once again, that overzealous regulations impose costs on people — and that the poor are made to bear those burdens disproportionately.
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