Time for a Left-Right Consensus on Zoning Reform?

Early “use-district” map of Midtown New York. Source: NYPL.

My latest piece — in which I venture into more political writing for TAC — argues that the failures of Euclidean zoning antagonize some of the most fundamental priorities of American traditions on both the Left and the Right; and that there may be an opening for some agreement between people with a broad range of philosophies. For example:

During the postwar era—when suburbs and cars were the way of the future, and cheap, undeveloped land surrounded all our cities—the postwar type of zoning seemed a reasonable trade-off for many conservatives. While it regulated the private land market, it was locally enacted. In addition, its intent was to protect a broad base of individual, private owners.

Today, things have changed. Many of our most prosperous regions have been effectively built-out—few undeveloped lots remain—and laws preserve building patterns from the less populous 1950s and 1960s. This in turn has created an artificial shortage of housing units to which local markets cannot respond. Property owners who could benefit from making more intense use of their parcels find their hands tied by local zoning. Families and individuals are priced out of regions where opportunities are strongest. Personal potential and mobility are limited. And local governments become powerful fiefdoms, selectively approving lucrative projects for (often) politically-connected developers while preventing smaller owners from similarly maximizing returns.

Meanwhile, from the Left:

If local zoning had simply permitted [working-class neighborhoods in major cities] to absorb growth as it occurred, it is likely many longtime residents would never have been priced out by rising rents or property taxes. This means that more young people could have remained in their home communities and benefited from deep ties to family, social networks, and local wealth; and space could also have been made for new immigrants (and internally-migrating Americans) on much friendlier terms. Instead, our inability to accommodate change at the neighborhood level has resulted in the attenuation of countless social ties; the loss of myriad old communities; and an increased degree of hostility and resentment between competing, but similarly powerless groups, over space that never needed to be so scarce. If anything should outrage even the most nominal leftist, it is a bureaucratic policy that pointlessly pits the American working class against new immigrants over something as fundamental as the need for decent housing.

Feel free to join in the discussion at the bottom.

Single-Family Houses and the Affordability Crisis

A zoning map from East Rockaway, New York, shows the abiding prevalence of single-family housing zones (Residence A) in a highly competitive land market.

This Times article, I think, really takes aim at the largest zoning-related cause of the housing crisis. Single-family neighborhoods will have to give way to multifamily development, one way or another, if we are ever going to build enough housing units to absorb demand in the places where economic opportunity exists. The California law facilitating “granny flats” is one step in the right direction. New Jersey’s Mount Laurel doctrine is based on a prescient, 1970s recognition of the exclusionary role of zoning. (Unfortunately, it has not done nearly enough to counter the zoning-driven shortage of affordable housing, especially in Northern New Jersey.

What other measures will come, based on the principle (which we have often recited) that restrictive zoning is creating artificial housing shortages? Innovation in this realm cannot happen soon enough. At some point, the dam is going to break. There will either be more housing; or there will be a dampening of the regional economies in places that cannot provide a housing equilibrium. What worries me, next, is that the artificial shortage of housing may have become such a chronic, long-term situation in our most affluent regions that we may have reached a point where the economy is dependent upon an artificial shortage being preserved.

Zoned for single-family.

That is to say, so many mortgages have been written on the assumption that astronomically high prices are stable; so much private wealth is now sunk into ultra-high-cost real estate. If the regulatory barriers came down, and builders were able to begin to catch up with market demand in places like New York City and California, then how much wealth would gradually begin to evaporate as prices trended toward a healthier equilibrium? The saving grace is that — absent a watershed court decision — the gears of this change will probably be quite slow to turn.

 

Limited Equity: Stable Communities, Affordable Housing

The Amalgamated Dwellings in New York City. Photo: Theo Mackey Pollack.

I have a new article published at TAC’s New Urbs blog, about the history and legal structure of New York City’s limited-equity housing cooperatives, which continue to provide surprisingly affordable, high-quality housing units in one of the most expensive real estate markets in the United States. The piece tells the story about how limited-equity co-ops got started; their philosophical roots; their early successes; why the model declined in popularity; and how an approach that recovers its best qualities might be be compatible with various subsets of the polarized political landscape of contemporary America.

I think there’s little question that the shortage of affordable housing in the regions with the best economies is a major driving force in the structural inequality that characterizes our current moment; and that the biggest beneficiaries of this status quo are rent seekers, rather than actors who contribute anything dynamic or innovative to the economy. Taking the role of speculation out of the equation can do a lot to keep prices in line with what residents can actually afford. For the reasons described in my article, I think this is an important idea that deserves to be recovered and applied in today’s metropolitan real estate economies.

California’s Radical Experiment: Granny Flats

Most would not be as fancy as Alexandre Dumas’.

Driving home from the train station on a recent night, I heard this piece on NPR’s Marketplace: a story about a recent California statute that makes it significantly easier for homeowners in that state to develop additional units on their property. Here’s a link to a memo from the Department of Housing and Community Development, describing the changes. Among other things, the new statute overrides certain off-street parking requirements, which can preclude new units that would otherwise be permitted under zoning rules. These requirements are particularly onerous in large cities where public transportation is a viable option — and this law takes aim, specifically, at requirements within walking distance of transit. Of course, this development is just a small step toward achieving a land marketplace that is actually allowed to be responsive to market demands, rather than legal ones; but I think it is a very important one.

As early as the mid-1970s, the primary cases in New Jersey’s Mount Laurel doctrine began to lay out all of the major land use regulatory devices that have stifled the development of resourceful housing options since the early 20th century. Getting rid of unnecessary off-street parking requirements, and taking a publicly favorable stand toward in increase in the number of units in heavily-regulated suburban neighborhoods, are both major steps toward dismantling the regulatory morass that has been strangling housing development as the amount of raw, zoned land has dwindled throughout our major metropolitan areas. This is an important step in the right direction. Would be interested in hearing from people who would like to see a similar bill in New Jersey.

One of the most important takeaways from the NPR story was its hard evidence of pent-up demand for smaller, less-expensive housing units in pricey California. Local builders and contractors who specialize in the construction of small homes cannot keep up with demand. Their schedules are full for months into the future.

Safety Codes, Politics, and the Crowding of Old Manhattan

‘Old law’ tenements on New York’s Lower East Side. Theo Mackey Pollack.

My recently published piece highlights how architects and builders used resourceful massing devices to save scarce urban land when developing many of the Late Victorian apartment buildings in New York City. So I was intrigued by a journal article I recently found that examines the city’s massing in the same period from a different angle: the restrictive height regulations that governed buildings and even, in the pre-zoning era, placed artificial restrictions on builders that may have exceeded the requirements of safety. In Keeping the Tenants Down: Height Restrictions and Manhattan’s Tenement House System, 1885-1930, Professor Michael Montgomery highlights the history of tenement laws and other safety codes in New York City during that time, shining a spotlight on how they limited the ability of the market to respond to the demand for more and better inexpensive housing units.

A bunch of examples of pre-law, old-law (dumbbell/airshaft), and new-law (courtyard) tenements can be found in my photo galleries of Chinatown and the Lower East Side.

Spotlight: 2013 Mount Laurel Exhibit at Rutgers

mtlaurel
Click on the above photo to see the full album.

Here are some pictures I took of a special exhibit at the Rutgers Law Library in 2013, focused on the Mount Laurel doctrine, its history, and its legacy. I just discovered them while I was going through old photos, and thought they might be of interest to some readers. Incidentally, I was in John Payne’s Con Law class during his last semester of teaching at Rutgers. His untimely death was jarring for those of us who were in his class. Interesting fact: he and his wife lived in a Frank Lloyd Wright house, in Glen Ridge.

The Jewish Roots of Planned Green Space

Howard's concept of the Garden City, visualized.

Howard’s concept of the Garden City, visualized.

A recent piece in The New York Jewish Week looks at the Torah concept of migrash. Rabba Sara Hurwitz’s description reads like an early outline of Ebenezer Howard’s Garden City. I also find it interesting that the financing structure Howard proposed is much like the one described by Herzl in Old New Land, and the one used to fund the original limited-equity coops in New York City (which grew out of Jewish labor unions on the Lower East Side).

Paul Krugman Hits the Nail on the Head

NYC Zoning mapIn a Times piece called “Inequality and the City” about the competitive real estate markets in America’s affluent cities, Paul Krugman identifies the role that restrictive land use regulations continue to play in the chronic shortage of affordable housing:

But what about all the people, surely a large majority, who are being priced out of America’s urban revival? Does it have to be that way?

The answer, surely, is no, at least not to the extent we’re seeing now. Rising demand for urban living by the elite could be met largely by increasing supply. There’s still room to build, even in New York, especially upward. Yet while there is something of a building boom in the city, it’s far smaller than the soaring prices warrant, mainly because land use restrictions are in the way.

Exactly. Thank you. In the last five years, we seem to have gone from a time when no one was even cognizant of the role that zoning laws played in the chronic shortage of urban affordable housing, to the beginnings of a left-right consensus about the inequitable and anti-competitive impacts of those laws — and the ways in which they are distorting the market. This is really a cause for celebration, and I think we should take a moment to recognize how far the conversation has come.

But we almost certainly have not come to the end of the line. This issue has been so far beneath the radar that even those who have benefited from distortions of the real estate market by restrictive zoning laws have made little political effort to defend the status quo. They have just assumed that it would go on forever. Now, as those with vested interests in the artificial limits to development — primarily, urban land owners — begin to realize that their gravy train could be in peril, the attacks on reform proposals will begin in earnest. Here’s a great example of what’s likely to be on the way, peddling the usual pseudo-leftist bullshit that appeals to the urban bourgeoisie:

We, the undersigned residents of New York City, call for an end to the violence that real estate developers have inflicted on our skyline, parks, public areas, and cityscape with the proliferation of dramatically over-scaled buildings that ignore the historic context of our city.

Translation: we paid a lot for the exclusive right to live in our neighborhood. We have just realized how precarious our investment could become if the regulations were changed, and people actually had housing choices in the same (or comparable) locations.

Keep an eye out for more of this nonsense in the near future. Of course there’s a role for design and aesthetics in development policy, and massing considerations may sometimes be a part of that role. But for now, I’m sticking with those who recognize the need to permit much more residential construction in places like New York City. Let’s keep the conversation going.

A Right to Counsel for Tenants

Mark Levine, a New York City Council member, has a bill in the hopper that would retain an attorney, at public expense, for low-income tenants facing eviction. In a Times op-ed authored by Levine and Mary Brosnahan of the Coalition for the Homeless, they cite some stark statistics:

▪ Only ten percent of tenants facing eviction in New York City have lawyers, while nearly 100 percent of evicting landlords are represented by counsel.

▪ Tenants represented by counsel are 80 percent less likely to be evicted than those acting pro se.

▪ Nearly 29,000 New York City households were evicted last year.

▪ Providing an attorney for a tenant would cost taxpayers about $2,500, but sheltering a homeless family in New York City costs, on average, more than $45,000.

New Jersey Real Estate Law Update

Scales and Lamp USSC

One New Jersey Supreme Court case, Cashin v. Bello, focused on a real estate matter this week. It was an unusually interesting case. The Star-Ledger explains:

The legal issue involves the grounds upon which a landlord can evict a tenant in order to occupy a home. Under New Jersey law, a landlord may evict a tenant from a building with three units or less if he or she intends to occupy the unit.

However, Cashin was prevented from evicting Bello for many years because she also owns an adjacent apartment building at 627 Washington Street with five rental units and both the apartment and the converted garage are listed in tax records as being part of the same property.

Bello has been living in the carriage house since 1973, and is paying just $345 per month under the Hoboken rent control law. Cashin — whose name seems apt in this case — has been trying to evict Bello since the 1980s. Now she can. The Supreme Court held that the lower courts had erred by treating the entire land parcel as a single building, containing more than three units, rather than treating the carriage house, alone, as a single, one-unit building. The temporary New Jersey Courts link is alive for now, but the original opinion will be archived next week at the Rutgers Law Library in Newark.

For your curiosity’s sake, here’s a look at the house: