Lots of posts on this website complain about housing affordability, especially in the Northeast and California. It is ironic for planners to wonder why housing costs so much when the biggest reason housing prices are growing faster than inflation is planners' regulations. The Economist article summary below drives home my point.
Planners can't control some housing price drivers, such as mortgage interest rates or household income levels. But planners - more than anyone else - can have a positive impact on the situation. Why don't planners make progress on housing affordability by deleting regulations on new residential development? This would enable housing supply to more closely match demand.
For instance, allow residential developments to go forward without typcial zoning checks, site plan reviews, public meetings, and impact fees. Require government review and permitting only for true public safety issues, like stormwater management and fire safety.
"Government limits on the supply of new homes have ... also helped push up house prices-especially when inflation over a long period is considered.
...[H]ouses are no ordinary good: when demand for them rises, increasing the supply can be difficult. Not only do they take time to build: building them at all can be hard, owing to planning laws governing the use of land, the density of housing and the heights of buildings.
But that has changed drastically in recent decades in the most populated parts of the country, such as the north-east coast and California, according to a new paper by Edward Glaeser and Raven Saks, of Harvard University, and Joseph Gyourko, of the University of Pennsylvania. They studied the housing markets of more than 300 American cities since 1950 and have pieced together evidence of regulation-induced inflation in many places.
...Billions are spent every year on "affordable housing" schemes, either through grants or by requiring a certain portion of newly built units to be sold or rented at below-market prices. This latter requirement is, in effect, yet another a tax on new building. A more effective and cheaper way to make housing more affordable, he reckons, is to loosen restrictions on new construction. It is inconsistent, surely, for a government to offer help with one hand, while holding back the supply of housing with the other."