Housing affordability is a hot topic in many American cities, and there’s significant reason to believe that one of the factors driving up home prices is rules that limit the supply of new housing. These can be zoning regulations that dictate what can be built where, or rules such as mandatory parking minimums or minimum lot sizes that affect the feasibility of building a home on a given piece of land.
When regulations create an artificial scarcity of homes in neighborhoods—or even whole cities or regions—where many people want to live, the cost of existing homes in those places will tend to rise, as people compete for a limited supply. (The Sightline Institute made this memorable video comparing it to a game of Musical Chairs.)
When there's a housing shortage, those who do build homes will tend to build very expensive ones, because they can easily find enough people willing to buy or rent them. This issue is explored in the article, "Why Are Developers Only Building Luxury Housing?"
The range of policy responses to housing unaffordability is extremely broad and contentious, but one often-proposed response is upzoning, which means changing the zoning regulations in an area to allow denser, taller, and/or more intense development than was previously allowed. This is done in the hope that building more homes will reduce the competition for housing, and thus cause rents in the area to stabilize or drop.
To understand how to look at and argue for gradual upzoning through a Strong Towns lens, let’s split it into two questions: “Why upzoning?” and “Why gradual?”
Arguments in favor of upzoning in general:
Strong Towns argues that all neighborhoods should be able to evolve to the next increment of development. But what does this mean?
Throughout most of human history, cities were built in a similar way. As they grew, they also "thickened up." They didn't just expand outward; existing neighborhoods also grew taller and more dense over time, as smaller buildings were gradually expanded or replaced with larger ones. This fueled a virtuous cycle of improvement, paid for by continuously rising land values—which kept local government solvent and able to afford its infrastructure maintenance. And which also meant that the city could always accommodate the arrival of new residents.
If you want to read more about the virtuous cycle of the traditional development approach—in which neighborhoods are never finished and unchanging, but rather evolving incrementally—check out this series of articles by Chuck Marohn on incremental development.
Today, many neighborhoods are not allowed to evolve in this way anymore: a lot containing a single-family home might well be zoned so that nothing other than a single-family home is ever allowed there. If you're arguing for changing that zoning, to your elected officials or fellow citizens, for reasons of housing affordability, don't fall into one of these traps:
• Don't argue that density is inherently good, for either affordability or the city's tax base. It's not clear that either is always the case. Density is a poor metric for desirable outcomes in cities.
• Don't argue that allowing more housing will result in those specific new homes being affordable. This is another simplistic view that is easy for opponents to caricature and discredit.
• Do focus on the effect of new supply on the overall market in your region, including the cost of homes that already exist today.
• Bring data. Here's a chart by Timothy Duy showing that metro areas where housing is extremely expensive tend not to have built very much of it in the last 25 years. Note the large empty region in the top right quadrant: while inexpensive regions may or may not have built a lot of homes, there is no example in the U.S. of a region that has built a lot of homes and is expensive.
• Bring more data. Here's a chart of the rental vacancy rate in Minneapolis-St. Paul plotted against the year-over-year increase in rents during a several-year period. This is just one example of how low vacancy tends to cause rents to rise, because tenants have fewer options and landlords can take advantage of the situation to demand more money.
Data: Marquette Advisors Apartment TRENDS Quarterly Report, Minnesota Public Radio
• Frame the debate. Try to get people to agree with you on some basic starting points, like the ones Spencer Gardner outlines in this article, "The 5 Immutable Laws of Affordable Housing."
Arguments in favor of an incremental but across-the-board approach, instead of targeting specific areas for more housing:
Strong Towns has advocated over the years that all neighborhoods should be allowed to evolve to the next increment of development.
By “next increment” we mean one step up in the density or intensity of land use. Where there was a single-family home, it might be replaced with a duplex or triplex. A neighborhood full of triplexes might gradually come to include apartment buildings of a few stories. A neighborhood dominated by 3- and 4-story buildings might be ripe for some taller ones. But these would be step-by-step changes to a neighborhood, not the master-planned, wholesale transformation of it.
This makes our position distinct, in some cases, from that of YIMBY (Yes in My Backyard) groups who are more likely to advocate for encouraging all forms of housing development at all scales, including projects that represent a dramatic leap in development intensity. (An example of such a “dramatic leap” would be building a 10-story building with hundreds of apartments on a block full of 1- and 2-story houses.)
Our rule of thumb is the following:
• No neighborhood should be immune from change
• No neighborhood should experience dramatic change
A few reasons for this that you can cite:
• The rapid influx of investment money and/or new development into a neighborhood can be destabilizing. It can displace long-time residents and businesses, and fray the social ties and networks that residents depend on (what academics call social capital).
• Worst of all, it can halt the normal process of gradual reinvestment by the residents of a neighborhood—improvements and upkeep on their properties, expansion of mom-and-pop businesses—that keeps a neighborhood stable and wealth-generating for its residents. Famed urbanist Jane Jacobs wrote eloquently about the subject of “gradual money" versus "cataclysmic money.”
• Land speculation—a form of cataclysmic money when it happens in a concentrated area—is one factor that drives up housing prices even further. Speculation can be worsened by the policy of upzoning small areas of a city dramatically. Consider the incentive facing the owner of a property that sits between a single-family home and a high-rise condo:
What's that lot in the middle worth? Certainly not $200,000 anymore.
For a Strong Towns discussion of this effect, check out Charles Marohn’s post on height limits. A strong town does not have a handful of 16-story towers and a ton of 1-story houses, with nothing in between: the lack of an intermediate step suggests a distorted real-estate market. For a deep dive into this topic and more arguments you can make in your community, you might also want to check out Charles Marohn’s series on Portland housing costs. For outside academic corroboration, read about a 2019 study by Yonah Freemark, which found that after specific areas in Chicago were upzoned, housing production did not rise, but housing costs did.
• If there are opinion leaders in your community who are on board with new housing, but worried about land speculation and gentrification, you can suggest to them that a policy of gradually loosening the cap on incremental development city-wide is unlikely to have these same effects of driving up land prices. Imagine a pot of boiling water with a lid on it, so that the steam in the pot is creating high pressure. If you lift the lid straight off everywhere, the steam escapes fairly gently. If you crack the lid in just one spot, however, the steam rushes to that spot with a great intensity.
• If your concern is affordability, you can point out that "missing middle" housing types (roughly, buildings with anywhere from 2 to 20 apartments or condos in them) are inherently much cheaper to actually build than larger structures. And upzoning only enough to allow the next increment of development would, in most cities, promote the construction of these kinds of buildings. The Incremental Development Alliance has some excellent resources to help illustrate the viability of these models.
• In the Strong Towns strength test, we ask the question, "Are there neighborhoods where three generations of a family could reasonably find a place to live, all within walking distance of each other?" The types of homes that are allowed when a single-family neighborhood is rezoned to accommodate the next increment of development are things like duplexes, triplexes, and accessory dwelling units. The former provide comparatively affordable homes for those on a smaller budget; as well as a homeownership and wealth-building opportunities. A duplex, triplex or fourplex is much less likely than a larger apartment building to be owned by a big institutional landlord, and more likely to be owned by someone who has ties to the neighborhood or even lives in the building themselves.
• Accessory Dwelling Units are a great solution for young people starting out, and a great solution for older people aging in place. We’ve written a lot about how they’re a no-brainer to allow in most neighborhoods.
• Point out often that this approach is not a radical experiment, but rather a return to the traditional way of doing things. Prior to the mid-20th century, allowing these “missing middle” housing types was the norm rather than the exception in American cities. Investigate where your city already has concentrations of things such as duplexes or ADUs — you may be able to demonstrate to skeptics that this is normal and “compatible.”
• Point out that we are simply re-legalizing “illegal neighborhoods,” many of which are beloved places.
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