I hope all these developers are able to find enough skilled labor to build tons of new high quality buildings. Since demand for building trades has been artificially constrained by dumb zoning and supply of skilled labor in the trades has been artificially constrained by a culture idolizing 4 year degrees, it looks like we're in for a perfect storm of skilled worker shortages. I hope this doesn't lead to cutting corners, might then cause a backlash against new buildings.
This policy change on its own is great, but a holistic housing policy suite would include revamping the education system to make sure the state has enough people with the right training by the time these proposals are ready to break ground.
Great summary. Do you (or any commenters here) have good references for this statement?
> Research has long supported that private developers are most interested in building in affluent neighborhoods over poorer ones because its more profitable.
For context, we're working on convincing some local communities in CO that when broad-based (rather than targeted) upzoning that includes wealthier neighborhoods is implemented, developers are more likely to target wealthier neighborhoods for new development than lower-income neighborhoods. They are concerned that broad-based upzoning will lead to higher rates of construction in lower-income neighborhoods "because the land is cheaper"
I personally understand the theory of why this wouldn't come to pass: developers are chasing the highest margins, not lowest input costs - and these figures don't always correlate. Even if base land cost is higher in wealthier neighborhoods, that margins on this construction are likely to be higher due to higher sales prices.
But wondering if we have empirics on this.
- We have a suggestion it would be the case from Houston's 1998 small lot zoning reforms, where most development occurred in middle-income neighborhoods, rather than low-income neighborhood (high-income neighborhoods we largely excluded from the reform). https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3659870
This is pretty amazing if I'm understanding it right. I wish I was a little more certain of my understanding, though.
Maybe I'm not the target audience here, because I'm not deeply informed on YIMBY issues or California laws. I have a lot more than zero knowledge, having lived in CA for 15 years and being a long-time reader of Yglesias, but still - a lot of the details here are a bit over my head.
I guess I got the upshot, though, which I'd tl;dr like this: A statewide YIMBY law was put into place in the Reagan years but not enforced with any teeth until much recently. It gets rid of nearly all residential zoning requirements. For some reason, it got implemented in Santa Monica months before anywhere else, but will now apply in some % (what %?) of California cities.
Hope I'm not misunderstanding. Maybe I missed it but are there estimates on how many more units are expected to be built or what % of California this might apply to? It would be interesting to speculate on how much CA population growth this could lead to.
The political backlash will be fierce. These wealthy communities will not go down without a fight. This will be a huge issue in the upcoming governors race as well as many communities around the state.
@Darrell - In the sentence below, did you mean Emeryville? I thought they were the ones who got pro housing status. If I'm misremembering, my bad.
"In December, HCD bestowed Oakland and only 6 other cities (none in the Bay Area) the state designation of “pro-housing,” which comes with a pot of affordable housing funds due to Oakland resident’s supportive attitudes towards housing approvals."
Can anyone take a guess on how much more population this will allow in California over the next decade? Could it add more than 1 million before the next census compared to if it didn't happen?
I hope all these developers are able to find enough skilled labor to build tons of new high quality buildings. Since demand for building trades has been artificially constrained by dumb zoning and supply of skilled labor in the trades has been artificially constrained by a culture idolizing 4 year degrees, it looks like we're in for a perfect storm of skilled worker shortages. I hope this doesn't lead to cutting corners, might then cause a backlash against new buildings.
This policy change on its own is great, but a holistic housing policy suite would include revamping the education system to make sure the state has enough people with the right training by the time these proposals are ready to break ground.
Great summary. Do you (or any commenters here) have good references for this statement?
> Research has long supported that private developers are most interested in building in affluent neighborhoods over poorer ones because its more profitable.
For context, we're working on convincing some local communities in CO that when broad-based (rather than targeted) upzoning that includes wealthier neighborhoods is implemented, developers are more likely to target wealthier neighborhoods for new development than lower-income neighborhoods. They are concerned that broad-based upzoning will lead to higher rates of construction in lower-income neighborhoods "because the land is cheaper"
I personally understand the theory of why this wouldn't come to pass: developers are chasing the highest margins, not lowest input costs - and these figures don't always correlate. Even if base land cost is higher in wealthier neighborhoods, that margins on this construction are likely to be higher due to higher sales prices.
But wondering if we have empirics on this.
- We have a suggestion it would be the case from Houston's 1998 small lot zoning reforms, where most development occurred in middle-income neighborhoods, rather than low-income neighborhood (high-income neighborhoods we largely excluded from the reform). https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3659870
- And Portland /modeled/ likely outcomes when upzoning SFH areas, showing it would reduce displacement faster than the status quo in almost all cases. But this is a model, not empirics. https://www.portland.gov/sites/default/files/2019-12/vol_3_appendix_b_displacement_risk_and_mitigation.pdf
- Early explorations on Seattle reforms has shown most middle housing has been built in higher income neighborhoods. https://www.seattletimes.com/opinion/editorials/serve-the-people-not-developers-amend-middle-housing-bill/
That's all I have for now!
Great, detailed update. Do you (or readers) have any resources that gives community’s status in SoCal? Am particularly interested in LA county cities
This is pretty amazing if I'm understanding it right. I wish I was a little more certain of my understanding, though.
Maybe I'm not the target audience here, because I'm not deeply informed on YIMBY issues or California laws. I have a lot more than zero knowledge, having lived in CA for 15 years and being a long-time reader of Yglesias, but still - a lot of the details here are a bit over my head.
I guess I got the upshot, though, which I'd tl;dr like this: A statewide YIMBY law was put into place in the Reagan years but not enforced with any teeth until much recently. It gets rid of nearly all residential zoning requirements. For some reason, it got implemented in Santa Monica months before anywhere else, but will now apply in some % (what %?) of California cities.
Hope I'm not misunderstanding. Maybe I missed it but are there estimates on how many more units are expected to be built or what % of California this might apply to? It would be interesting to speculate on how much CA population growth this could lead to.
The political backlash will be fierce. These wealthy communities will not go down without a fight. This will be a huge issue in the upcoming governors race as well as many communities around the state.
@Darrell - In the sentence below, did you mean Emeryville? I thought they were the ones who got pro housing status. If I'm misremembering, my bad.
"In December, HCD bestowed Oakland and only 6 other cities (none in the Bay Area) the state designation of “pro-housing,” which comes with a pot of affordable housing funds due to Oakland resident’s supportive attitudes towards housing approvals."
Do you happen to know where I would look to see about Santa Cruz?
Can anyone take a guess on how much more population this will allow in California over the next decade? Could it add more than 1 million before the next census compared to if it didn't happen?