Discussion
How Reverse Game Theory Could Solve The Housing Shortage
peder: Leftists doing anything except just building more housingRent is falling all over the Southeast where housing has been built in droves, and actually in greater quantities than new demand. The only solution is just flooding the market with housing.
profsummergig: I've noticed that it's super-rich leftists who oppose permits for new housing, not all leftists.An interesting group of people they are, the super-rich leftists. The way they weaponize the environment to prevent others having what they want... really makes you wonder.
01HNNWZ0MV43FF: It's true.There's no one silver bullet, it will have to be a multi-front push:1. Just build more2. Zone for multi-family housing3. Get rid of minimum parking and minimum lot size requirements4. Allow mixed-user residential and commercial buildings5. Shift property tax towards taxing the land and exempting buildings from tax, to force speculators to sell vacant land and derilect buildings for development6. When things start moving, invest in walkability and public transit to support dense urban cores. Cars are great for low-density, but paying for miles of road and polluted air in dense city cores is silly behavior
fn-mote: Yes, hate to say it but there is only one way to lower housing prices.Also I have limited sympathy for people who move to high COL areas and then are upset by housing prices.
antisthenes: Montgomery county is one of the worst places in the entire US for housing shortage.The whole first part of the article tries to highlight the success of the 1972-era zoning policy, but ends up making the opposite point, whereas agricultural land is preventing enough housing being built in the north of Montgomery County, whereas Virginia has successfully incorporated density (and more jobs as a result).Not sure if that was author's intention, or how game theory is even relevant here. It's just zoning and housing policy and understanding of the zero-sum dynamic for desirable land. Some other examples from the article don't make much sense either (except Houston).Source: DMV native for 20+ years, also an economist (by education, not profession).I suspect the publication paid the author to write a very particular opinion, because the article reads more like a NIMBY-defending piece.
neutronicus: I was gonna say - as a Baltimorean MoCo is the last place I would hold up as some triumph of YIMBYism.
WarmWash: >Also I have limited sympathy for people who move to high COL areas and then are upset by housing prices.*Move to a high CoL area to get a high paying job, and then are upset by housing prices.Many people would be overall better off with a lower paying job in a lower CoL area
WillAdams: If there were jobs in those locations --- Catch 22.
cucumber3732842: It's not even the "super" rich. They don't care what you do. They can afford walls, hedgerows, extra land as a buffer, the finest sound deadening windows, etc, etc, etc. And they can afford to live among people like them so pretty much all that is only of limited relevance to begin with.It's some asshole who makes $200k who can afford the house but can't afford to not care what their neighbors do that drives all this.He's the one trying to scheme up some way to get the government to use other people's tax dollars to threaten them with violence if they try and do something he doesn't like. Can't run a bar here. Can't have an apartment building there. Can't have too little parking, but if you have too many cars you're running a junkyard, and on and on and on and on.Society needs to hate overt busybodysism and the people who feel emboldened it the way it hates plenty of other isms. Only then will the problem get solved.
lux-lux-lux: San Francisco has more homes per capita (~2.0) than any of the southeast states (2.1-2.4).
Tade0: China built a lot of housing and it didn't do anything until the ponzi scheme started unraveling.Asymptotically what you said might be true, but before it gets there years might pass as they did in China. It's not clear how long this madness would last if not for COVID.
scythe: Certainly, building new housing works well at a policy level. But calling for new housing doesn't seem to work at a political level. We've been fighting this fight ever since the financial crisis and every election cycle brings us a few victories with an equal number of reversals. And it isn't only within the left that the opposition arises; it wears red in progressive neighborhoods, but it seems to have a taste for brown when that's convenient.I don't think that the urbanist movement can succeed if it is driven by policy wonks who want to throw out the rulebook and impose reforms from the ivory tower without a real small-d democratic political strategy. Many of us are used to fighting the political battle against climate change by being Absolutely Correct and expecting that Science with her indefatigable armies of Reality will guard the flanks. A fully economic fight like this one just doesn't have the same kind of inevitability. Every step forward on the ground weakens the sense of urgency in the legislature, leading to an equilibrium trap without a vigorous political movement that can hold momentum.Nerds do not usually want to do politics, but in housing you have to do politics.
bpt3: IMO, this is largely because the government's job is to stay out of the way, and people who hold elected office in areas where this is a problem (the Northeast Corridor and West coast generally), mostly have a certain something in common that indicates they are likely to think they need to "help" the market along.It's not a coincidence that the "housing crisis" continues unabated in places like NYC that are losing population, yet appears to be solved in areas in the south that are absorbing those people.
GN0515: Does this not have more to do with desirability? It's kind of hard to compare property prices in NYC with Alabama. Like no shit housing will be affordable in places that, no offense, are kind of a shit hole. In Canada, housing prices are crazy in beautiful in beautiful Vancouver, but are totally "affordable" in the arctic circle. It has nothing to do with legislation.
avidiax: I agree with the general principle that game theory is a powerful tool for public policy, but the idea of these transferable development rights or "air rights" seems a bit absurd to me.What the government is saying by allowing these rights to be sold, is that the place to which they are transferred to has arbitrarily restrictive zoning. In my mind, the value of transferrable development rights should be zero. Zoning should actually have some hard principle behind it that isn't bendable by allowing the non-development of some other desirable piece of land. Either a building is too tall for the neighborhood or it isn't. It should be "too tall unless you pay a farmer 10 miles away".Why is uneven, concentrated development some kind of public good?How does this position unroll? How does the farm eventually get developed in 50 years? Do they have to buy TDR from someone else? Does an "equivalent" TDR have to be demolished?
vonneumannstan: Do you really need Game Theory to figure out you need to build more houses and can't let NIMBY's be in charge of the decisions for where and when that is done?
bpt3: #2 - #4 are really just specific ways of accomplishing #1.Most people don't want to live in dense urban cores, so #5 and #6 can easily backfire and stunt progress on #1.Just let people decide what to build where, both as individuals and communities. If dense urban cores truly are the "better" way of living, it will prove itself soon enough without the urbanists trying to force everyone down their path to their own detriment.
rubyn00bie: > Most people don't want to live in dense urban cores, so #5 and #6 can easily backfire and stunt progress on #1.80% of the US population would disagree. It really seems like you’re applying what you like to the entire population and then assuming that anything else is rubbish.Having grown up in a rural community, and small towns, I never really want to go back. Dense urban areas are wonderful, I find huge amounts of joy in multiculturalism. The plethora of ideas, language, food, and art is inspiring. I will never get that anywhere except dense urban areas.Demand vs supply is the crux of the affordability crisis, and the points outlined in the post you’re replying to are all valid and great ways to help increase supply.And FWIW—- you’re absolutely welcome to enjoy and appreciate sparsely populated areas, but I really think you need to understand the vast majority of people disagree with you. Not because they’re “stuck” in some dense urban area but because they want to be there.
howdyhowdy: Go read about things like rent maximizer from yardi then come back. Another reason people can't afford to buy housing is because companies like these enable apartment complexes to collude on pricing under the guise of software. Rent is higher than a mortgage payment in some places, and folks can't afford to pack any savings away. So they rent until they fall behind, then they rent something less ideal, then they leave the area or live out of their car. Either way it's garbage. The only reason I could afford my home is because I managed to find a private renter who was charging significantly below market rate for years so that I could build a down payment, and I managed to buy at the right time. Two years after closing the 'value' of my home jumped 60% and I would have been priced out, it's all just bullshit.Maybe instead of going around our elbow to get to our asshole we should just call a spade a spade and make rent 'optimization' illegal. Then once people can actually afford a home we'll have a better picture of how many should be built. Because ultimately? People just want to be able to live without the stress of bills and the looming worry of maintaining a roof over their heads.
tuna74: If you don't want to live in an apartment, buy a house outside of the urban core. Are you arguing that cities should not build infrastructure or make it nice for the people living there?
tristor: No, he's saying the government should get out of deciding what to build and make it legal to build so that people build more housing, of any type, period. "Just buy a house outside of an urban core" is only possible if such housing exists.
nearting: Unless this is a very generous approximation, 2.0 is less than 2.1-2.4.Even setting that aside, homes per capita is not indicative of supply and demand - if everyone in SF wants to live in a house alone, it really won't matter that SF has slightly more homes per capita.
kbelder: I voted you up because you're correct, in that the only solution is construction and there are people that are doing everything in their power to avoid that truism.But I don't think it is a left/right issue. In certain regions it may be the left, in others the right, but generally it is subset of both that have investment in artificial scarcity. It's just the justifications that change depending on ideology.
justonceokay: See NIMBYs all down the west coast. I bet 90% of city dwelling homeowners would identify as “democrat or further left”, but are very conservative with the character of their neighborhood
jerf: If you want to understand a fairly non-trivial amount of the brokenness of the world, pondering the implications of "Hey, what if we thought about what our incentives will actually do instead of what we want them to do, and made plans based on that?" being a brilliant and bold breakthrough in the world of governance rather than common sense can take you a long way.
chrchr: It's funny that they call it "reverse game theory", like it's a new thing, when it's actually just regular game theory.
lukifer: Half-agree: zoning restrictions and non-essential building regulations are a de-facto government handout to existing property owners.At the same time, apologists for rentiers will do anything except taxing unimproved land value (which among other virtues, functions as a vacancy tax to reduce unproductive speculation, and incentivize development).The blunt reality is a zero-sum tension: homeowners and landlords want number go up, new buyers and renters want number go down.
convolvatron: places where there is remaining land to build more single family homes don't actually have zoning regulations requiring developers to build high-density units. there is nothing stopping anyone from buying land and building there, except a lack of demand.the place where there is leverage is in taking high-demand areas historically zoned for single-unit and opening them up to the market to build higher density housing.
gadders: Leftists doing anything except curbing immigration.Fixed it for you.
nradov: I don't know where you're coming up with that 80% number because the actual percentage of people living in dense urban cores is much lower. Many people live in neighborhoods that the Census classifies as "urban" but that includes a lot of neighborhoods that most regular people would classify as suburban. It turns out that given a choice, most people prefer to have some space and privacy rather that being squeezed together in high-rise apartments.
forgotaccount3: > Does this not have more to do with desirability?Not really. NYC population still hasn't fully recovered to the pre-covid peak: https://fred.stlouisfed.org/series/NYPOPNYC is losing it's share of the global finance jobs as firms shift staffing to other, more desirable locations: https://pix11.com/news/local-news/nyc-job-market-loses-thous...NYC rent being unaffordable is due to legislation that keeps apartments off of the market due to not being financially viable to repair to habitable standards in addition to legislation overly empowering local groups to block new construction.
