6 ms·

CDs vs. NIMBY

41 points by pr337h4m 21d ago

bcftbca 21d ago
an article about housing that totally ignores the fact that most homes are bought with mortgages. the whole part about a $1M dollar house falling in value being totally fine because other houses fall in value too ignores that when house prices go down mortgage holders can't sell for a price high enough to even buy the now-cheaper price this is a shitty article with no understanding of reality
happytoexplain 21d ago
A tortured analogy. The concept of `NIMBY === house as investment` is a very common strawman. Believe it or not, most people care about their homes and communities for their intrinsic value, which is where most NIMBYism comes from.
- GaryBluto 21d ago
  I've got to agree there. The whole article had the smell of somebody arguing with themself.
- thewebguyd 21d ago
  The problem is when every neighborhood is NIMBY, something has to give or the problem will never be solved. At the end of the day, valuing aesthetics, parking, or quiet is a preference. Having shelter near jobs, schools and public transit is human necessity which is what should be prioritized. Freezing the SFH neighborhood also doesn't protect the community long term, as NIMBYs believe. When supply gets restricted, prices go up. It prices out the local teachers, service workers, aging family, and even the NIMBY's own children get priced out, until now it's just a neighborhood of million dollar+ SFHs with no young families, no local workforce. It's economic segregation. Continuing to allow local vetoes and restrictive zoning just pushes us out further and further into unsustainable suburban sprawl, without the transit to match, and boosting emissions. Not popular in individualistic America, but when we have the housing crisis we do, the needs of the many are going to have to take priority over the needs of the few NIMBYs.
  - kurthr 21d ago
    But why does the high density housing have to be where the SFH are? Why does it need to share the parking, facilities, retail, roads, schools, etc. of something that was built and has been maintained and evolved for 50-100 years? Why not build the high density with it's own transit, roads, malls, parks, schools etc? This is how it's done in the rest of the world, certainly Korea, Japan, and China. I see this in England and France as well. They develop a high density area with new facilities that can grow and evolve for how people want to live there, rather than mowing down houses (in communities of color) or plopping 5-7 story apartments without parking or parks right next to single story SFH, as developers like to do in the US. I assume it's because it's more profitable for the developers. They don't have to build anything, but the part they can immediately sell, and they ride on the value of the neighborhood created by the people who already live there. I think some infill near commercial districts or malls also faces much less "NIMBY" criticism. To give a more personal example: I like the location and view of where you live. I like the plants you water, and you keep the house looking clean. I want to just build another large room on top of your house, where me and a bunch of friends will live. We'll just share the stairs, hallways, and front door, and of course our share of the water and electric bill. We probably won't be too loud most nights, and usually when friends come over they won't use your bathroom or take anything from your rooms, or at least we'll ask them not to. Sorry about the construction noise while we do it, and just think you'll get to meet so many new people! Sorry that the part of your house you still own will be worth less than your neighbors when we're done, but that's the price you need to pay for living in a nice place and keeping it up. The argument that SFH infrastructure repair is subsidized by new building is a much better one. Of course that was true of the tax increases and subsidy of the original town, when the SFH were built as well.
    - hylaride 21d ago
      > But why does the high density housing have to be where the SFH are? It depends on where said SFHs are. Cities need to eventually grow upwards! If we never allowed land-reuse Manhattan would still be 2 stories on the whole borough. I live in Toronto and the harshest NIMBYs are adjacent to downtown and/or subway stops. They fight tooth and nail against even 6 story condominiums on the major high streets (Margret Atwood, who lives in a large SFH close to downtown was among them recently-ish). The ultimate result is that we have a handful of extremely dense clusters of condominiums centred around a few subway stops that then super-concentrate people and cause extreme crowding on transit, amenities, etc. It would be better if you had mid-rise multi-unit dwellings more spread out. It's actually become an acute problem in so many ways. The people who own the SFHs tend be over 50 and childless. The result is that many schools in these neighbourhoods are at barely 20% capacity, while the condominiums (where most younger families can afford to live) are causing the schools near them to be overflowing with kids. > This is how it's done in the rest of the world, certainly Korea, Japan, and China. I see this in England and France as well. The countries broadly speaking default to higher density than North America for historical and economic reasons. They have their own issues, but the majority of Koreans live in high rises and Japan rebuilds their buildings constantly: https://www.theguardian.com/cities/2017/nov/16/japan-reusable-housing-revolution https://www.theguardian.com/cities/2017/nov/16/japan-reusabl...
- seanclayton 21d ago
  > most people Citation needed*
  - happytoexplain 21d ago
    No need to be obnoxious. Just say that your opinion/experience is different. It seems natural to me that the majority of emotions regarding one's home and community are in regards to the idea of home and community, rather than their monetary value, since that's the obvious human perspective. And of course you can care about both things at once, which maybe you assumed I was omitting? I only said the the majority of people care about their home/community, and implied that I believe it's the stronger emotion, not that the majority of people do not also care about the investment (which does materially affect their actual life, as opposed to the more common image of a wealthy "investor"). I could be wrong. It's a sentiment, so it's not something easily measured (unless you fall for the trap of over-interpreting statistics, which is common in an engineering-minded folks).
  - majormajor 21d ago
    Development raises land value. That's the entire reason it's done, after all. Look at the cost of land in Manhattan vs suburban Atlanta. In the supply-choked cities in the US, development isn't gonna tank the wealth of land-owners, quite the opposite. There are exceptions, but they're "this is the largest available plot in Beverly Hills"-style outliers. What people want, even in those denser supply-choked cities, is basically just stability. "I don't want to be forced out because a bunch of rich people move in next door, and I don't want it it turn into something dramatically different experience-wise than what I bought." If everyone in those areas just wanted to maximize the financial side they'd be looking to flip their single family home for a fourplex and put the profit into another, etc etc. "We don't want this to turn into Manhattan" is NOT what anyone owning land in a maybe-could-turn-into-Manhattan place if they were just interested in the money. (That's less viable in the middle-of-the-country suburbs because the "increased land value" of the old empty pasture next door could still result in lower land value for your on-the-suburban-fringe neighborhood, if there's high amounts of empty land and more new identical suburbs popping up. But that's not where the problem is most acute, anyway!)
- smallmancontrov 21d ago
  Mmmhmm, and the fact that it results in loads of money in NIMBY pockets at outsiders' expense is purely coincidental? I don't believe you.
  - happytoexplain 21d ago
    You're confusing amount of money with amount of people. Financial investor mindset is a real and dramatic example, but a minority in the set of reasons that individual people care about the community they worked so hard to live in.
    - smallmancontrov 21d ago
      You are undertaking motivated reasoning to dodge culpability. The transfer of money from house-seekers -- many of whom do more to establish the community you are touting than yourself -- to your own pockets is not incidental, it's the point of the exercise, and your claims otherwise are transparently dishonest and self-serving.
      - bpt3 21d ago
        > many of whom do more to establish the community you are touting than yourself Citation needed
      - happytoexplain 21d ago
        You're projecting the image of some kind of specific asshole onto me, personally, for no reason that I can discern. This genre of comment is hideous, and should not be on HN. My family and I participate extensively in our community, both socially and civically. We all know and love each other, and regularly welcome newcomers. We are not wealthy - we're barely middle-class. We would like to die here. Our home's value has not changed (adjusted for inflation) in the decade since we purchased it. We couldn't care less if its value goes down if it means keeping our home and community. Try not to spit in a person's face and tell them who they are based on essentially nothing.
- dividefuel 21d ago
  I agree with this. People buy a place to live usually because they like the qualities of that place. Changes to those qualities affect their day to day experience, whereas changes to their primary residence value usually only materialize when they need to access that value. To me the issue is that densification (in the US; can't speak to other countries) usually comes with more downsides than upsides. Mainly this is because of the US's focus on cars: the biggest downside is usually increased traffic. Unfortunately it feels towns in the US do the bare minimum to address it, like adding some traffic lights and maybe a lane or two. Instead I wish the US had more good examples of densification for existing residents, where along with the increased housing larger steps were made to improve the community. E.g. significantly expanded mass transit, bicycling infrastructure, community third places, etc. And I get it, these things are really expensive and hard to do. But turning densification into something that more clearly benefits the day-to-day experience of existing residents would do a LOT to combat NIMBYism.
deleted 21d ago
[deleted]
bwhiting2356 21d ago
Increasing housing supply does not decrease home values, because high density housing benefits from network effects/economies of agglomeration. NIMBYs don't object because they think their house will be worth less, they object because they believe their quality of life will go down (based on what is important to them). Higher density brings both good and bad: upside: - high paying, specialized jobs - specialized, high quality services - stores open late - better dating (more fish in the sea) downside: - more traffic - more noise - more pollution - more anonymity, crime (people in small towns leave their doors unlocked and say hi on the sidewalk) The people who benefit most from higher density tend to be young professionals, which tend to not currently live in the neighborhood and will move in if density goes up.
- pydry 21d ago
  increasing supply while demand remains steady does actually lower prices. NIMByism can be killed with a land value tax/a property tax that approximates LVT and vice versa. It was kicked into overdrive in California thanks to prop 13 which capped property taxes.
  - bwhiting2356 21d ago
    Can you show me an example where prices went down (in the long term)?
  - jakintosh 21d ago
    the problem is that all supply is not equal. in the classic NIMBY case, we’re talking about single family home owner in a neighborhood that has high housing demand, meaning it is largely built out, and they are opposing the introduction of multifamily housing to their neighborhood. in order for new multifamily units to come online, this means that over time existing SFH units are being converted/redeveloped into multifamily homes. this means that at the point where NIMBY pushback starts to matter, the number of SFH in a neighborhood has already largely peaked, and that the supply of that type of home will only ever go down and become more scarce (especially as a percentage of overall units). as more people move into a neighborhood in new multifamily buildings (and bring jobs, businesses, services, and general opportunity) the demand for that neighborhood goes up as well—demand is not fixed, and often goes up with supply, and depending on other macro factors can even outpace it if the agglomeration benefits are working properly. in this case, the NIMBY’s SFH value goes up, because the land value is much higher due to redevelopment potential, and also because that type of home is scarce and highly desirable to wealthy people who want proximity to opportunity in an urban place with the privacy and luxury of a detached SFH. tl;dr: “while demand remains steady” is doing a lot of heavy lifting that doesn’t really make sense in a real dynamic urban system.
abeppu 21d ago
> If all this sounds like wishful thinking, consider the polar case where housing deregulation drives the price of housing to zero. Yes, this wipes out the value of whatever housing you already own. But it also means that you can move to a palace anywhere on Earth for free. Indeed, it means that you could own a palace in every location you desire for free. Lose the value of your home, gain access to every home of your dreams. It’s not just a fair trade. It’s the deal of a lifetime. Umm, what? If you start with "If this all sounds like wishful thinking", maybe departing into even more unhinged fantasy isn't the next step that helps you? The supposition that _deregulation_ could cause the price to go to zero is crazy; houses are built with labor using materials, on land. In the absence of regulation they shouldn't cost significantly _more_ than their labor+materials+land value, but they shouldn't cost _zero_. If you wanted the world where you don't pay for housing, I think you need a _lot_ of regulation -- after all building millions of Stalin blocks took a lot of intervention. Throughout the piece, Caplan seems to assume that the only impact of regulation worth discussing is on prices, which seems suspect. But assuming that the only source of prices is regulation is worse. If you think that NIMBY policies are ultimately harmful, maybe the only thing rougher than talking to NIMBYs is seeing a supposed expert try to argue against them but do it really really badly.
cyberax 21d ago
I'm a rabid NIMBY, and I know that my house price will go UP when density increases. I don't care. I want to live in my house, not sell it.
- pchristensen 21d ago
  Props to you both for honesty and understanding the economics.
- tptacek 21d ago
  You're entitled to whatever policy preferences you might have (within reason, I guess; this housing position is within reason). Whether your surrounding community should honor that preference is a different question. Depending on where you live, your preference, and even those of the consensus of incumbent residents, can be more or less persuasive. If you live out in the middle of nowhere --- an exurb, say, with large lots and built around people who have consciously chosen to opt into long commutes and out of metro hub and metro county services --- your neighborhood's preference against density can indeed be somewhat compelling. Though I'd note that states are moving towards a directional consensus that local governments should not be able to impose single-family exclusionary zoning preferences no matter where you are. To that whole scenario: big shrug. On the other hand, if you're in an inner ring suburb, the equation changes sharply. Your community likely siphons high-dollar tax checks out of the regional school system fabric and into a mostly economically homogenous enclave of concentrated opportunity. You'd benefit from close connectivity to the metro hub, short commutes, economic spillover, all while walling yourself off from the area. In that scenario, it is reasonable (and probably the straightforward correct policy) to ignore your personal preferences, and to think about the preferences of the entire region and of the prospective future residents density would enable. It all depends.
  - cyberax 21d ago
    > On the other hand, if you're in an inner ring suburb I live in an urban village, and my taxes and utility fees _already_ disproportionately go to fix the issues caused by new development. I'll be paying around $150000 in incremental property taxes for a failed light rail that does not go anywhere close to me. Yet the surrounding streets are already overloaded with traffic because the city allowed developers to construct dense housing about 2 decades _before_ the supposed arrival of the rail. I see absolutely NO upsides from increased density pretty much ANYWHERE. Density is universally bad except in artificial formations like Singapore.
iluvcommunism 21d ago
[dead]
bpt3 21d ago
It looks like this is a poor attempt to argue for deregulation in the housing sector? I agree that this is needed, but regulation would be required to compel neighborhoods to allow increased density as well...
nyc_pizzadev 21d ago
Not sure this home math is right. Usually home builders are profit seekers, so if they build in a neighborhood of 1MM homes, they will price aggressively against those comps and quality. Let’s say a home goes for half price, then those homes will get snapped up and eventually everything resells closer to the true valve. Given real estate rarely drops a lot in value, that price might be a bit below 1MM.
triceratops 21d ago
I think NIMBY is an overly generous term. I take no issue with someone who doesn't want higher density in their own, literal backyard i.e. land they own. NIMBYs want to control other people's land.
- happytoexplain 21d ago
  It sounds like you think "NIMBY" sometimes refers to one's own property, but it has always referred to things that affect one's home and community that are not occurring literally on your private property. There are already many reasonable laws controlling such things, since that's obviously a real problem, regardless of NIMBY concerns. We live in communities, not in concrete boxes. It's perfectly reasonable to care about what happens outside the literal boundaries of one's legal property. That's fundamental - not really arguable. It's just about where you draw the line.
- LatteLazy 20d ago
  BANANAs Build Absolutely Nothing Anywhere Near Anything
ndiddy 21d ago
One thing a lot of YIMBYs get wrong is that you can't deregulate your way out of a housing crisis because of how new housing is financed. Builders depend on outside investors to finance new housing projects. These investors base their investment not only on the land value and potential rent they'd be able to collect when the housing is built, but also how much they'd be able to raise the rent after it's built. This means that when the rent in a given area isn't rising enough to make new housing an attractive investment, new housing will stop being built in that area. A big factor in why housing was affordable for most of the 20th century was the Savings and Loan associations, a product of New Deal era banking regulation. S&Ls were the only financial institutions allowed to take deposits in most communities due to limits on bank branching. They had access to very cheap financing because of regulations prohibiting interest on checking accounts, and limiting interest rates on other types of deposits. They were also only allowed to lend money for local real estate projects. This meant that you had a captive market where local savings could fund local housing development. The system fell apart after Reagan era deregulation forced the S&Ls to compete with national institutions offering higher returns. The S&Ls were pressured into offering higher returns themselves by shifting from residential financing to more speculative commercial real estate projects. The result was the failure of many S&Ls, and the rest of them being absorbed into the larger banking system. The S&L system meant that it was possible to finance housing ahead of demand, which caused a relative decline in housing costs. Between 1950 and 1980, rents in urban areas rose by about 30% less than the CPI as a whole. Meanwhile, in the last 10 years, rents in urban areas rose by about 30% more than the CPI. (see https://fred.stlouisfed.org/series/CUUR0000SEHA https://fred.stlouisfed.org/series/CUUR0000SEHA , https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL ). Housing prices will always increase more than inflation as long as new housing development has to compete with all other types of investment. The YIMBYs are right that blocking any given building from being built will push housing prices up higher in that area, so new development is overall good for housing prices. What they miss is that deregulation will never reduce housing prices back to what they previously were or lower because developers will never come in and build new housing in a market where rents are stagnant or decreasing.
- slopinthebag 21d ago
  Really? Deregulation will never do this? Care to wager before I provide examples to the contrary?
vkaku 21d ago
If this were I I'd rip every CD and upload FLACs to the Internet Archive, vibe code a free music playing app and release it for free. None of these restrictive arguments would stop me from doing the next 2-3 steps even, after buying those many discs.
PeterStuer 21d ago
I wonder how the people using the term 'NIMBY' feel about other non-consensual acts.

41 points by pr337h4m 21d ago

an article about housing that totally ignores the fact that most homes are bought with mortgages. the whole part about a $1M dollar house falling in value being totally fine because other houses fall in value too ignores that when house prices go down mortgage holders can't sell for a price high enough to even buy the now-cheaper price this is a shitty article with no understanding of reality

happytoexplain 21d ago

A tortured analogy. The concept of `NIMBY === house as investment` is a very common strawman. Believe it or not, most people care about their homes and communities for their intrinsic value, which is where most NIMBYism comes from.

GaryBluto 21d ago
I've got to agree there. The whole article had the smell of somebody arguing with themself.
thewebguyd 21d ago
The problem is when every neighborhood is NIMBY, something has to give or the problem will never be solved. At the end of the day, valuing aesthetics, parking, or quiet is a preference. Having shelter near jobs, schools and public transit is human necessity which is what should be prioritized. Freezing the SFH neighborhood also doesn't protect the community long term, as NIMBYs believe. When supply gets restricted, prices go up. It prices out the local teachers, service workers, aging family, and even the NIMBY's own children get priced out, until now it's just a neighborhood of million dollar+ SFHs with no young families, no local workforce. It's economic segregation. Continuing to allow local vetoes and restrictive zoning just pushes us out further and further into unsustainable suburban sprawl, without the transit to match, and boosting emissions. Not popular in individualistic America, but when we have the housing crisis we do, the needs of the many are going to have to take priority over the needs of the few NIMBYs.
- kurthr 21d ago
  But why does the high density housing have to be where the SFH are? Why does it need to share the parking, facilities, retail, roads, schools, etc. of something that was built and has been maintained and evolved for 50-100 years? Why not build the high density with it's own transit, roads, malls, parks, schools etc? This is how it's done in the rest of the world, certainly Korea, Japan, and China. I see this in England and France as well. They develop a high density area with new facilities that can grow and evolve for how people want to live there, rather than mowing down houses (in communities of color) or plopping 5-7 story apartments without parking or parks right next to single story SFH, as developers like to do in the US. I assume it's because it's more profitable for the developers. They don't have to build anything, but the part they can immediately sell, and they ride on the value of the neighborhood created by the people who already live there. I think some infill near commercial districts or malls also faces much less "NIMBY" criticism. To give a more personal example: I like the location and view of where you live. I like the plants you water, and you keep the house looking clean. I want to just build another large room on top of your house, where me and a bunch of friends will live. We'll just share the stairs, hallways, and front door, and of course our share of the water and electric bill. We probably won't be too loud most nights, and usually when friends come over they won't use your bathroom or take anything from your rooms, or at least we'll ask them not to. Sorry about the construction noise while we do it, and just think you'll get to meet so many new people! Sorry that the part of your house you still own will be worth less than your neighbors when we're done, but that's the price you need to pay for living in a nice place and keeping it up. The argument that SFH infrastructure repair is subsidized by new building is a much better one. Of course that was true of the tax increases and subsidy of the original town, when the SFH were built as well.
  - hylaride 21d ago
    > But why does the high density housing have to be where the SFH are? It depends on where said SFHs are. Cities need to eventually grow upwards! If we never allowed land-reuse Manhattan would still be 2 stories on the whole borough. I live in Toronto and the harshest NIMBYs are adjacent to downtown and/or subway stops. They fight tooth and nail against even 6 story condominiums on the major high streets (Margret Atwood, who lives in a large SFH close to downtown was among them recently-ish). The ultimate result is that we have a handful of extremely dense clusters of condominiums centred around a few subway stops that then super-concentrate people and cause extreme crowding on transit, amenities, etc. It would be better if you had mid-rise multi-unit dwellings more spread out. It's actually become an acute problem in so many ways. The people who own the SFHs tend be over 50 and childless. The result is that many schools in these neighbourhoods are at barely 20% capacity, while the condominiums (where most younger families can afford to live) are causing the schools near them to be overflowing with kids. > This is how it's done in the rest of the world, certainly Korea, Japan, and China. I see this in England and France as well. The countries broadly speaking default to higher density than North America for historical and economic reasons. They have their own issues, but the majority of Koreans live in high rises and Japan rebuilds their buildings constantly: https://www.theguardian.com/cities/2017/nov/16/japan-reusable-housing-revolution https://www.theguardian.com/cities/2017/nov/16/japan-reusabl...
seanclayton 21d ago
> most people Citation needed*
- happytoexplain 21d ago
  No need to be obnoxious. Just say that your opinion/experience is different. It seems natural to me that the majority of emotions regarding one's home and community are in regards to the idea of home and community, rather than their monetary value, since that's the obvious human perspective. And of course you can care about both things at once, which maybe you assumed I was omitting? I only said the the majority of people care about their home/community, and implied that I believe it's the stronger emotion, not that the majority of people do not also care about the investment (which does materially affect their actual life, as opposed to the more common image of a wealthy "investor"). I could be wrong. It's a sentiment, so it's not something easily measured (unless you fall for the trap of over-interpreting statistics, which is common in an engineering-minded folks).
- majormajor 21d ago
  Development raises land value. That's the entire reason it's done, after all. Look at the cost of land in Manhattan vs suburban Atlanta. In the supply-choked cities in the US, development isn't gonna tank the wealth of land-owners, quite the opposite. There are exceptions, but they're "this is the largest available plot in Beverly Hills"-style outliers. What people want, even in those denser supply-choked cities, is basically just stability. "I don't want to be forced out because a bunch of rich people move in next door, and I don't want it it turn into something dramatically different experience-wise than what I bought." If everyone in those areas just wanted to maximize the financial side they'd be looking to flip their single family home for a fourplex and put the profit into another, etc etc. "We don't want this to turn into Manhattan" is NOT what anyone owning land in a maybe-could-turn-into-Manhattan place if they were just interested in the money. (That's less viable in the middle-of-the-country suburbs because the "increased land value" of the old empty pasture next door could still result in lower land value for your on-the-suburban-fringe neighborhood, if there's high amounts of empty land and more new identical suburbs popping up. But that's not where the problem is most acute, anyway!)
smallmancontrov 21d ago
Mmmhmm, and the fact that it results in loads of money in NIMBY pockets at outsiders' expense is purely coincidental? I don't believe you.
- happytoexplain 21d ago
  You're confusing amount of money with amount of people. Financial investor mindset is a real and dramatic example, but a minority in the set of reasons that individual people care about the community they worked so hard to live in.
  - smallmancontrov 21d ago
    You are undertaking motivated reasoning to dodge culpability. The transfer of money from house-seekers -- many of whom do more to establish the community you are touting than yourself -- to your own pockets is not incidental, it's the point of the exercise, and your claims otherwise are transparently dishonest and self-serving.
    - bpt3 21d ago
      > many of whom do more to establish the community you are touting than yourself Citation needed
    - happytoexplain 21d ago
      You're projecting the image of some kind of specific asshole onto me, personally, for no reason that I can discern. This genre of comment is hideous, and should not be on HN. My family and I participate extensively in our community, both socially and civically. We all know and love each other, and regularly welcome newcomers. We are not wealthy - we're barely middle-class. We would like to die here. Our home's value has not changed (adjusted for inflation) in the decade since we purchased it. We couldn't care less if its value goes down if it means keeping our home and community. Try not to spit in a person's face and tell them who they are based on essentially nothing.
dividefuel 21d ago
I agree with this. People buy a place to live usually because they like the qualities of that place. Changes to those qualities affect their day to day experience, whereas changes to their primary residence value usually only materialize when they need to access that value. To me the issue is that densification (in the US; can't speak to other countries) usually comes with more downsides than upsides. Mainly this is because of the US's focus on cars: the biggest downside is usually increased traffic. Unfortunately it feels towns in the US do the bare minimum to address it, like adding some traffic lights and maybe a lane or two. Instead I wish the US had more good examples of densification for existing residents, where along with the increased housing larger steps were made to improve the community. E.g. significantly expanded mass transit, bicycling infrastructure, community third places, etc. And I get it, these things are really expensive and hard to do. But turning densification into something that more clearly benefits the day-to-day experience of existing residents would do a LOT to combat NIMBYism.

deleted 21d ago

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bwhiting2356 21d ago

Increasing housing supply does not decrease home values, because high density housing benefits from network effects/economies of agglomeration. NIMBYs don't object because they think their house will be worth less, they object because they believe their quality of life will go down (based on what is important to them). Higher density brings both good and bad: upside: - high paying, specialized jobs - specialized, high quality services - stores open late - better dating (more fish in the sea) downside: - more traffic - more noise - more pollution - more anonymity, crime (people in small towns leave their doors unlocked and say hi on the sidewalk) The people who benefit most from higher density tend to be young professionals, which tend to not currently live in the neighborhood and will move in if density goes up.

pydry 21d ago
increasing supply while demand remains steady does actually lower prices. NIMByism can be killed with a land value tax/a property tax that approximates LVT and vice versa. It was kicked into overdrive in California thanks to prop 13 which capped property taxes.
- bwhiting2356 21d ago
  Can you show me an example where prices went down (in the long term)?
- jakintosh 21d ago
  the problem is that all supply is not equal. in the classic NIMBY case, we’re talking about single family home owner in a neighborhood that has high housing demand, meaning it is largely built out, and they are opposing the introduction of multifamily housing to their neighborhood. in order for new multifamily units to come online, this means that over time existing SFH units are being converted/redeveloped into multifamily homes. this means that at the point where NIMBY pushback starts to matter, the number of SFH in a neighborhood has already largely peaked, and that the supply of that type of home will only ever go down and become more scarce (especially as a percentage of overall units). as more people move into a neighborhood in new multifamily buildings (and bring jobs, businesses, services, and general opportunity) the demand for that neighborhood goes up as well—demand is not fixed, and often goes up with supply, and depending on other macro factors can even outpace it if the agglomeration benefits are working properly. in this case, the NIMBY’s SFH value goes up, because the land value is much higher due to redevelopment potential, and also because that type of home is scarce and highly desirable to wealthy people who want proximity to opportunity in an urban place with the privacy and luxury of a detached SFH. tl;dr: “while demand remains steady” is doing a lot of heavy lifting that doesn’t really make sense in a real dynamic urban system.

abeppu 21d ago

> If all this sounds like wishful thinking, consider the polar case where housing deregulation drives the price of housing to zero. Yes, this wipes out the value of whatever housing you already own. But it also means that you can move to a palace anywhere on Earth for free. Indeed, it means that you could own a palace in every location you desire for free. Lose the value of your home, gain access to every home of your dreams. It’s not just a fair trade. It’s the deal of a lifetime. Umm, what? If you start with "If this all sounds like wishful thinking", maybe departing into even more unhinged fantasy isn't the next step that helps you? The supposition that _deregulation_ could cause the price to go to zero is crazy; houses are built with labor using materials, on land. In the absence of regulation they shouldn't cost significantly _more_ than their labor+materials+land value, but they shouldn't cost _zero_. If you wanted the world where you don't pay for housing, I think you need a _lot_ of regulation -- after all building millions of Stalin blocks took a lot of intervention. Throughout the piece, Caplan seems to assume that the only impact of regulation worth discussing is on prices, which seems suspect. But assuming that the only source of prices is regulation is worse. If you think that NIMBY policies are ultimately harmful, maybe the only thing rougher than talking to NIMBYs is seeing a supposed expert try to argue against them but do it really really badly.

cyberax 21d ago

I'm a rabid NIMBY, and I know that my house price will go UP when density increases. I don't care. I want to live in my house, not sell it.

pchristensen 21d ago
Props to you both for honesty and understanding the economics.
tptacek 21d ago
You're entitled to whatever policy preferences you might have (within reason, I guess; this housing position is within reason). Whether your surrounding community should honor that preference is a different question. Depending on where you live, your preference, and even those of the consensus of incumbent residents, can be more or less persuasive. If you live out in the middle of nowhere --- an exurb, say, with large lots and built around people who have consciously chosen to opt into long commutes and out of metro hub and metro county services --- your neighborhood's preference against density can indeed be somewhat compelling. Though I'd note that states are moving towards a directional consensus that local governments should not be able to impose single-family exclusionary zoning preferences no matter where you are. To that whole scenario: big shrug. On the other hand, if you're in an inner ring suburb, the equation changes sharply. Your community likely siphons high-dollar tax checks out of the regional school system fabric and into a mostly economically homogenous enclave of concentrated opportunity. You'd benefit from close connectivity to the metro hub, short commutes, economic spillover, all while walling yourself off from the area. In that scenario, it is reasonable (and probably the straightforward correct policy) to ignore your personal preferences, and to think about the preferences of the entire region and of the prospective future residents density would enable. It all depends.
- cyberax 21d ago
  > On the other hand, if you're in an inner ring suburb I live in an urban village, and my taxes and utility fees _already_ disproportionately go to fix the issues caused by new development. I'll be paying around $150000 in incremental property taxes for a failed light rail that does not go anywhere close to me. Yet the surrounding streets are already overloaded with traffic because the city allowed developers to construct dense housing about 2 decades _before_ the supposed arrival of the rail. I see absolutely NO upsides from increased density pretty much ANYWHERE. Density is universally bad except in artificial formations like Singapore.

iluvcommunism 21d ago

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bpt3 21d ago

It looks like this is a poor attempt to argue for deregulation in the housing sector? I agree that this is needed, but regulation would be required to compel neighborhoods to allow increased density as well...

nyc_pizzadev 21d ago

Not sure this home math is right. Usually home builders are profit seekers, so if they build in a neighborhood of 1MM homes, they will price aggressively against those comps and quality. Let’s say a home goes for half price, then those homes will get snapped up and eventually everything resells closer to the true valve. Given real estate rarely drops a lot in value, that price might be a bit below 1MM.

triceratops 21d ago

I think NIMBY is an overly generous term. I take no issue with someone who doesn't want higher density in their own, literal backyard i.e. land they own. NIMBYs want to control other people's land.

happytoexplain 21d ago
It sounds like you think "NIMBY" sometimes refers to one's own property, but it has always referred to things that affect one's home and community that are not occurring literally on your private property. There are already many reasonable laws controlling such things, since that's obviously a real problem, regardless of NIMBY concerns. We live in communities, not in concrete boxes. It's perfectly reasonable to care about what happens outside the literal boundaries of one's legal property. That's fundamental - not really arguable. It's just about where you draw the line.
LatteLazy 20d ago
BANANAs Build Absolutely Nothing Anywhere Near Anything

ndiddy 21d ago

One thing a lot of YIMBYs get wrong is that you can't deregulate your way out of a housing crisis because of how new housing is financed. Builders depend on outside investors to finance new housing projects. These investors base their investment not only on the land value and potential rent they'd be able to collect when the housing is built, but also how much they'd be able to raise the rent after it's built. This means that when the rent in a given area isn't rising enough to make new housing an attractive investment, new housing will stop being built in that area. A big factor in why housing was affordable for most of the 20th century was the Savings and Loan associations, a product of New Deal era banking regulation. S&Ls were the only financial institutions allowed to take deposits in most communities due to limits on bank branching. They had access to very cheap financing because of regulations prohibiting interest on checking accounts, and limiting interest rates on other types of deposits. They were also only allowed to lend money for local real estate projects. This meant that you had a captive market where local savings could fund local housing development. The system fell apart after Reagan era deregulation forced the S&Ls to compete with national institutions offering higher returns. The S&Ls were pressured into offering higher returns themselves by shifting from residential financing to more speculative commercial real estate projects. The result was the failure of many S&Ls, and the rest of them being absorbed into the larger banking system. The S&L system meant that it was possible to finance housing ahead of demand, which caused a relative decline in housing costs. Between 1950 and 1980, rents in urban areas rose by about 30% less than the CPI as a whole. Meanwhile, in the last 10 years, rents in urban areas rose by about 30% more than the CPI. (see https://fred.stlouisfed.org/series/CUUR0000SEHA https://fred.stlouisfed.org/series/CUUR0000SEHA , https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL ). Housing prices will always increase more than inflation as long as new housing development has to compete with all other types of investment. The YIMBYs are right that blocking any given building from being built will push housing prices up higher in that area, so new development is overall good for housing prices. What they miss is that deregulation will never reduce housing prices back to what they previously were or lower because developers will never come in and build new housing in a market where rents are stagnant or decreasing.

slopinthebag 21d ago
Really? Deregulation will never do this? Care to wager before I provide examples to the contrary?

vkaku 21d ago

If this were I I'd rip every CD and upload FLACs to the Internet Archive, vibe code a free music playing app and release it for free. None of these restrictive arguments would stop me from doing the next 2-3 steps even, after buying those many discs.

PeterStuer 21d ago

I wonder how the people using the term 'NIMBY' feel about other non-consensual acts.