Glaeser in NY Times Magazine:

If you missed the profile of Ed Glaeser in the New York Times Magazine, allow me recommend it to you. It is a great read in the "Freakonomics" mode, exploring Glaeser's heterodox views on cities and the impact of regulation on housing prices. An excerpt:

So, after sorting through a mountain of data, Glaeser decided that the housing crisis was man-made. The region's zoning regulations — which were enacted by locales in the first half of the 20th century to separate residential land from commercial and industrial land and which generally promoted the orderly growth of suburbs — had become so various and complex in the second half of the 20th century that they were limiting growth. Land-use rules of the 1920's were meant to assure homeowners that their neighbors wouldn't raise hogs in their backyards, throw up a shack on a sliver of land nearby or build a factory next door, but the zoning rules of the 1970's and 1980's were different in nature and effect. Regulations in Glaeser's new hometown of Weston, for instance, made extremely large lot sizes mandatory in some neighborhoods and placed high environmental hurdles (some reasonable, others not, in Glaeser's view) in front of developers. Other towns passed ordinances governing sidewalks, street widths, the shape of lots, septic lines and so on — all with the result, in Glaeser's analysis, of curtailing the supply of housing. The same phenomenon, he says, has inflated prices in metro areas all along the East and West Coasts.

Tyrone Slothrop (mail) (www):
Good post by Brad DeLong on this subject here. I'd like to think I added something here. Jane Galt also hit the topic here.
3.8.2006 8:59pm
David Sucher (mail) (www):
"Other towns passed ordinances governing sidewalks, street widths, the shape of lots, septic lines and so on — all with the result, in Glaeser's analysis, of curtailing the supply of housing."

Does Glaeser mean "result?" or does he mean "intention?"

Does Glaeser really suggest that we shouldn't have regulations about such matters? (I haven't read the article yet but it sounds fascinating if a bit ideological.)

The way anti-regulation types are jumping on this article you'd think the goal of regulation in the 70s &80s was intended to restrict supply. At least that's the way it comes across...more hippie-bashing. No?

Well as one who was there at the creation, and who can testify to the tenor of the debates, that is nonsense. No one involved could envision back in the early 70s the impact of regulation. (At least no one actually out there arguing for neighborhood protection.)
3.8.2006 10:27pm
At least in California in the late '70's early '80's, a number of people pointed out that land use restrictions and developer obligations would restrict supply and increase price.
3.9.2006 12:04am
So Houston with no zoning should be the most affordable city in the US?
3.9.2006 12:27am
Among major metropolitan areas, Houston's housing prices may be the most affordable, but it also relates to land area and topography appropriate for development. Houston - flat, lots of land. SF Bay area - not flat, lots of water and steep hillsides.
3.9.2006 12:41am
Mitchell Young (mail):
I believe something like a quarter of California's population are immigrants. I.e. 8-9 million people. Do you think if that number was cut by half, that housing prices would drop? If the influx was stemmed, that housing prices would cease to rise? To ask the question is to answer it.

Rather than attack regulation which makes for pleasant neighborhoods, let's change immigration policy.
3.9.2006 1:35am
Mitchell Young -

Very bad logic.

Cutting 4 million people out of California would certainly reduce housing prices, but it would work as well, or likely better, to cut middle class non-immigrants (who live in lower density and have higher wages).

Any data that shows stemming in the influx of immigrants into California wouldn't be replaced by non-immigrants relocating into California?

I'm all for supporting your self-interested (and facially bigoted) policy changes, but first you have prove your case.
3.9.2006 8:48am

Intentionally or unintentionally, Mitchell Young hit a nail on the head. Many of these zoning bylaws Ed Glaeser gripes about in New England are, from my experience, the result of “livability” issues, not some sort of house price scheming.

I have known a number of planning officials in MA and have been closely involved in local issues in one town, and I have never seen a zoning bylaw proposed as a way to increase home prices. I have heard rumors about financial and racial reasons for zoning in the inner suburbs of Boston, but I have never seen an actual example (I suspect there may be some of what I’ll call the “cannibalism effect” here – in some parts of the world, early explorers would find each of the tribes in some area had heard rumors of cannibals, always some distance away, but they couldn't actually find any).

I will resist making pejorative suggestions about Glaeser’s research techniques that led him to his pejorative suggestions of how MA towns got zoning that restrict density, but I can suggest plenty of real reasons why house prices are high and density is low in MA, none of which are the result of intentional attempts to jack up housing prices. For example:
-desire to keep rural towns rural
-taxes – large new developments can, among other things, mean building an expensive new school, which can have major tax implications for existing residents in a small town (MA forbids towns from levying any sort of impact taxes). In fact, if I had to pick one “financial” reason for current MA small town zoning, it would be farmers and other modest income residents trying to slow or stop development to keep property taxes affordable.
-lack of resources in small towns to create municipal water and especially sewer services that allow dense development. One developer explained to me that in eastern MA, you need something like at least 120 condos to make it financially feasible put in a private sewer system, and precious few developments in eastern MA have enough land for than many units when you include other requirements. Counties, which might manage that process in many parts of the country, don’t really exist in most of NE.
- Tough State environmental requirements. Most eastern MA towns have many streams and wetlands randomly scattered about, making development tough.
- Increasingly tough state building codes, making construction artificially more expensive.
-Busybody town officials. Unlike Glaeser’s claims, I have actually heard real town officials state as a reason for more strict environmental regulations (a) the state regulations are more restrictive than the town regulations, (b) the town decided years ago that it wants local environmental regulations, therefore (c) the town should pass new, more restrictive environmental regulations.

The article makes Glaeser sound like the type of Harvard government prof who generate research papers that local and state officials regularly circular-file, but that impression may be because of the writer and not the subject; it is the Boston Globe after all.
3.9.2006 10:05am
David A. Smith (mail) (www):
While having breakfast with Glaeser a few weeks back (before the NYT piece), I hypothesized that in fact Democrats may be zoning themselves into a permanent electoral minority: see
Going blue in the states? , which is my post from 3/1/06.
3.9.2006 10:08am
ToddN (mail):
I just got back from a northern California visit, lots of driving in the East Bay and down to Monterey. Of course it's gorgeous, and largely because of what I assume are very strict land use controls. But I kept thinking of the tradeoffs, such as: rich people have insulated themselves from everyone else; and much more driving is necessary, because so many people can't afford to live anywhere close to their jobs. It looked like a bad place to start a career and family and an even worse place to be poor, with economic differences so stark and segregated. By contrast Houston is pretty darn ugly and not only or even mostly from geography. Isn't there some irony between the politics and effects of the respective approaches? Maybe only conservatives can foresee the unintended consequences of liberalism and vice versa.
3.9.2006 11:02am
Houston Lawyer:
Houston doesn't have zoning, but it does have deed restrictions. If you buy a house in an unrestricted neighborhood, you may end up with a convenience store, dentist office or massage parlor next door.

In the master planned suburbs and other neighborhoods, deed restrictions (which are often far more restrictive than zoning ordinances) are often enforced with amazing zeal by management companies who do nothing else.

I love talking to transplants from either coast when I bring up real estate prices here. They are uniformly ecstatic about what they were able to buy.
3.9.2006 12:12pm
Tony (mail):
Being in the early stages of having a custom house designed and built in California, I can assure you that zoning regulations add immensely to the cost and difficulty of building a house. The level of micro-management is really spectacular, and ranges from annoying to very, very expensive.

What infuriates me the most, though, are the petty things. For example, a new code just passed in California stating that kitchens must have fluorescent lighting in order to "conserve energy". Never mind that SUV in the driveway that uses 1,000 times the power of an incandescent bulb - I'm obligated to cook under ugly, sterile lighting in order to save a whole three cents an hour worth of electricity.

Of course, the minute the inspector leaves those fluorescent fixtures will be ripped out and tossed into the trash, and replaced with the biggest, brightest, most power-sucking halogen fixtures I can find.
3.9.2006 12:21pm
Some Guy (mail):
Oh my! The next thing you know, some industrious young academic will suddenly discover that zoning laws are set by city councils dominated by landowners and developers who benefit from the higher parcel values their zoning regs create...
3.9.2006 1:12pm
GA Thinker:

Intentionally or unintentionally, Mitchell Young hit a nail on the head. Many of these zoning bylaws Ed Glaeser gripes about in New England are, from my experience, the result of “livability” issues, not some sort of house price scheming.

What's the point of how "livable" an area is if you can't afford to live there?
3.9.2006 1:14pm
In my leafy Oregon suburb local conservatives are up in arms because our local government is looking at how to provide affordable housing so that city and school district employees, for example, can actually afford to live here. They cry that the city is promoting "housing socialism."

What they fail to realize is that the city's expensive housing is due to restrictive and exclusive city zoning. The conservatives in this city already have socialism, in the form of zoning. Only it's socialism for the rich.
3.9.2006 1:45pm
Houston Lawyer:

P.J. O'Rourke makes your point eloquently in Parliament of Whores.
3.9.2006 2:32pm
"What's the point of how "livable" an area is if you can't afford to live there?"

Is this a serious question, or just an empty bumper-stcker statement?
3.9.2006 2:55pm
Houston Lawyer:

I live in a neighborhood where the vast majority of the old and substandard housing has been removed and replaced with much more expensive housing. Many of those who were renting houses that I wouldn't live in are quite upset about the fact that they can't rent those places any more and therefore can't live in the neighborhood.

Livability is a very elastic concept. High-end neighborhoods don't want apartment buildings or other multi-family dwellings built nearby. The residents believe that these structures attract more transient people who are not invested in their neighborhoods. Zoning to prevent such dwellings increases the costs of living for those who would otherwise live there.
3.9.2006 3:59pm
Houston Lawyer-

I understand; I live in an older, cheaper house and where I live “teardown” buyers are encroaching from the inner Boston suburbs. I am quite in favor of smart growth (including significant mandated dense development areas), but I am less in favor of uncontrolled growth.

Where I live, there is still a population of farmers and other folks who have lived here for decades, even generations, and they live in a rural town because they like to live in a rural town, and slapping up piles of ¼ acre subdivisions and apartment blocks would destroy much of what make that town what it is. That locals have tried to slow growth and minimize dense growth is understandable without any consideration of property values; in fact, as I suggested before, fear of property tax increases is far more of a motivator to slow growth where I live than any desire to artificially inflate property values.

I have read a good chunk of one of Glaeser’s papers. The math behind it is interesting (it does a fair job quantifying something that seems intuitively true) but the base data seems a bit sloppy. For example, in rural MA, there isn’t just site prep, but there is road building (often very expensive in a region of granite hills and lots of wetlands), and state septic requirements for new houses where there isn’t sewer (a $35K septic system sort of messes up the construction cost estimates a bit). The study also continually seems to conflate “zoning” with “zoning and other regulations” and ignores some other little details – like 1/8 acre zoning when there isn’t public water or sewer doesn’t usually work very well.
3.9.2006 5:33pm
I'm a CPA. My support of more restrictive certifcation standards is based my an altruistic desire to ensure the quality of the accounting profession and make the place where I live for 2000+ hours a year more livable. It has absolutely nothing to do with the fact that a restricted supply of CPAs increases the value of the credential I own. And the fact that I and my fellow credential-owners are the ones who get to vote on the restrictions for those who want to move into our accounting neighborhood is just a happy coincidence.
3.9.2006 6:07pm