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Tag YIMBYism

Can YIMBY policies cause large price declines?

Kevin Erdmann offers a helpful corrective to the “YIMBY triumphalism” of claiming that large relative rent declines in Austin and Minneapolis are results of YIMBY policies. He’s mostly correct, especially about the rhetoric: arguing about housing supply from short term fluctuations is like arguing about climate change based on the week’s weather. Keep your powder dry, promise slow change and long-term stability, and recognize that demand shocks are responsible for most fluctuations. But Erdmann makes a stronger claim: Supply has never and will never cause a collapse of prices and rents. It causes stability.  Is that true? In a case like Austin or Phoenix, sure: prices are not too far above the cost of construction, and abundant supply cannot (durably) push the price of new housing below the cost of construction. But YIMBY has more to offer to San Francisco, Auckland, or London. In those cases, prices are far above construction cost. That means that even when demand is relatively soft, there’s money to made in construction. As Erdmann allows: After a decade of more active construction in Auckland, rents appear to be 10% to 15% below the pre-reform trend. That’s a big win. After a decade. That’s what success looks like. That’s the promise – 5 to 15% relative rent declines, decade after decade. But there are several good reasons to believe this won’t happen in an even, steady pattern, at least not all the time. Hopefully by 2040 we’ll have data from several cases and be able to describe the dynamics of market restoration with much more confidence.

Hopefully, AI will create a perpetual housing crisis

I don’t know how successful artificial intelligence will be. But let’s agree, for the moment, to consider a reasonably optimistic case where AI delivers significant productivity gains across a broad range of tasks – but not in a way that radically alters our Newtonian constraints. What would happen to housing economics and, consequently, housing politics? TL;DR Construction won’t be much affected by AI. Consumers will be richer and spend a bigger share of their incomes on housing. The stakes around housing policy will only grow. Inscriptibility Karl Marx divided the economic world into capital and labor. More recent economists have frequently (and self-regardingly) divided labor into low-skill and high-skill. In an AI world, we need to start talking about inscriptible and uninscriptible labor. I’m using a circular definition on purpose – AI will replace inscriptible labor because inscriptible labor is the type that AI is good at replacing – because I have only a fuzzy idea what AI will be good at. (A diversion) (Why inscriptible rather than legible, in a James C. Scott sense? I thank Bard for the suggestion. Think about visual art – AI is probably no better than humans at guessing what nuances a human artist intended, but it can produce human-quality visual art rich with nuance. Since AI’s value is partly predicated on repetition speed, it will thrive in arenas where failures are costless. Thus, AI may be formulating 99% of new drugs in a few years even if nobody trusts it to perform a simple surgery. That’s an inscriptibility difference, not a legibility difference. The most inscriptible human tasks are presumably those that simpler software replaced long ago, usually called “routine.” The big surprise of 2023 AI was the advances that software made with tasks we have considered creative. The “routine” concept was valuable […]

YIMBYs and liberals

The pro-housing movement (more colloquially known as “YIMBYs” as an acronym for “Yes In My Back Yard” can’t catch a break from either the Left or the Right. On the Left, pundits like to “expose” them as supporters of big business. But conservatives don’t always embrace YIMBYs either; both on this page and on Planetizen I have discussed conservatives who are lukewarm about zoning reform. So are YIMBYs liberals or libertarians? I have been at least somewhat active in New York’s YIMBY group, Open New York, for the past few years. There are some center-right people in the group, but my sense is that the membership tends to be more liberal than not, and that many members are more likely than I am to support regulations designed to protect tenants from landlords. Why might this be? First, New York City is to the left of the nation, and the most expensive and highly educated parts of the city (i.e. Manhattan and Brownstone Brooklyn) are especially liberal. So naturally, any organization (other than one focused on conservative policies) is going to have more liberals than conservatives. If there were YIMBY groups in more conservative places, they would probably be less liberal-dominated. Second, Open New York tends to be dominated by people under 50; older people are more likely to have purchased houses or condos, and thus aren’t really that interested in lower rents. In recent decades, younger voters have been well to the Left of older voters. So naturally, our group leans a bit left. Third, New York is dominated by the Democratic Party, and our city’s Democrats have arguably swung to the left over the past decade or so; a group that takes conservative positions is not going to find it easy to build coalitions or to get the attention […]

Book Review: Arbitrary Lines – How Zoning Broke the American City and How to Fix It

Arbitrary Lines is the newest must read book on zoning by land use scholar and Market Urbanism contributor, Nolan Gray. The book is split into three sections, starting with what zoning is and where it comes from followed by chapters on its varied negative effects, and ending with recommendations for reform. For even deep in the weeds YIMBYs, it’s well worth picking up. There’s nothing dramatically controversial here, but give it a thorough read and you’re guaranteed to learn something new. In particular, the book’s third section on reforms is outstanding. It starts with a slate of policy proposals typical to this kind of text, but quickly goes much farther afield. After suggested policy changes, we’re invited to consider a world without zoning via an in-depth look at Houston’s land use regime. Here we’re treated to both an explanation of how it works and the unique political history that left the city unsaddled with zoning. Nolan goes on to close his recommendations with a call to reimagine what a city planner could be in a post-zoning American city; a call that, as a former New York City planner, he is uniquely fit to make. Aside from the content, this book deserves points for prose. Arbitrary Lines is blessedly readable. The writing flows and the varied anecdotes interspersed throughout the book make it feel less like a policy tract and more like a conversation with your favorite professor during office hours. For those already initiated, buy the book and enjoy nodding your head and learning a couple new things. And for those trying to share the good news of land use reform, consider making Arbitrary Lines that one thing you get friends or family to read. It’s among the most accessible books on land use I’ve ever read, and it’s a […]

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