walkitout (walkitout) wrote,

A Few High-Level Remarks about Development, Zoning, etc.

My current research interest (read: Aspie "special interest", irritating obsession, derogatory term of choice) is "What is the Job Market/Economy of the Future?" Future, for these purposes, is 10-30 years. I got interested in this when I realized that while R.'s and my anticipation of densification was in fact occurring, neither of us had any sense of how the economy of the future might differ from what-it-is-today. (Please don't say, get a job in health care. Everyone knows that, all right? It is therefore not a possible research interest, except to show that maybe it's not actually true. But I think it is, so other than getting into speculation about how the regulatory and credentialing environment might change, again, not a possible research interest.)

Because it is my nature to get horrifyingly distracted by anything involving real estate/the built environment, I started exploring multi-family housing on the theory that multi-family housing generates jobs (definitely) and possibly more net jobs than single-family housing (probably not a question I can answer without buying some big databases and doing some programming, neither of which is going to happen). In the course of exploring multi-family housing, I stumbled across mall + residential redevelopment, which was so fantastically weird, that I couldn't resist digging around in that for a while. That led me to residential REITs, and that led me to Avalon and a few other developers who target "places" (generally, but not always, states) which have laws like Massachusetts 40B or New Jersey's Mount Laurel decision, or Connecticut's law, which provide a mechanism for overriding "home rule".

Why are REITs (who spent the previous decade and a half developing and managing LIHTC buildings, which are a wildly different proposition that I'm fantastically uninterested in) that specialize in (judging by the amenities, locations and rents) luxury multi-family focusing on "high-barrier-to-entry" states? Easy answer: they are trying to develop multi-family in areas with (a) jobs and (b) good schools. Needless to say, _all_ of those places are already built-out single family and very opposed to multi-family development (<-- may not be true; please supply counter-examples). MA, NJ and CT provide a legal structure for "breaking" "home rule" zoning that prevents multi-family: include a certain percentage of affordable housing and as long as the local jurisdiction is uniformly unaffordable, you can go build anyway (subject to _state_ level environmental and other regulations). Town planning boards become _much_ more cooperative to multifamily proposals (because if they don't make it go to court, they can still negotiate for whatever details they really care about) in this environment.

Once the towns are in compliance (usually some percentage of units in town must meet certain price/rent/income constraints based on local/regional median income), they can give the finger to future multi-family developments -- uniformly or selectively, as they please. The effect of the law from the perspective of Avalon could not be better: _they_ can build, but once they've got a complex or few in place, _no one else_ can compete.

I don't have much of an opinion about the regulatory structure as it exists (altho on many of the days when I think the Christian Scientists might be right about doctors, I also tend to feel that Houston might be right on the subject of zoning). I _do_ have opinions about how some people approach the regulatory structure (that whole thing in Concord really appalled me), and I'm not inherently opposed to changing the regulatory structure -- but I voted no on this:


A libertarian might look at that and say, hey, getting rid of laws, that's good, right? But on the other hand, it would have had the effect of creating a much bigger set of regulatory hurdles to get over (never mind the social justice aspects). Would a libertarian really vote to create _more_ regulation that further limits the rights of property owners?

I don't have any specific suggestions about how the zoning process should be changed, either at the local level or any other level. What I do know is that people get really excited about the built environment (especially when it changes) and important symbolic and cathartic purposes are served by slowing down the development process and making everyone talk to each other. I might come up with something eventually. Mostly, I don't really care.

What I _do_ care about is predicting the future, and the immediate future economically is that we are further into the business cycle, at a point when housing development should be taking off again. But it does not make sense to do single family housing right now, so multifamily should be taking off: there's money, there's desire (new units are being absorbed and rents are still rising). The only thing slowing multifamily down at this point (before it was chickenshit finance partners or lack thereof) is regulation.

There are people in New Jersey who are very coherent on the subject of preserving their low density single family housing within a good commuting distance of great jobs. They don't get sidetracked by whether the units will attract the wrong kind of people (either lower income or with kids or whatever might make multifamily less desirable to a town, in terms of reducing property tax income and increasing costs); they just fucking hate density. I find this somewhat amazing, because the inside of my head is sort of like SimCity: I _expect_ density and when density doesn't happen, I start looking for what slowed it down. My people are not healthy and must need something. (<-- See? Worry about propaganda embedded in video games. That stuff works.)

A more absolutist person on the subject of property rights might say, hey, why shouldn't they get what they want, as long as they pay enough in property taxes to afford their services and don't discriminate based on protected classes or whatever -- money ought to buy you something, right? And this is where we get down to how contingent property rights actually are. If you sell the beach and the owners don't let people use it, then everyone else lost something for the benefit of a few. If you cover up Thornton Creek, if you dam the river, if you etc. Some of things, we collectively say, okay, we'll sacrifice the salmon for the hydropower. We'll let you have that section of beach if we can make the rest public and you pay us a lot of money every year for the privilege (property taxes). I'll sell you the right to block my view of Mt. Rainier. Etc.

All those people occupying healthy, closer in/older suburbia and keeping the school districts nice are going to have to give a little, however, because property rights are contingent, and vast oceans of people who were once totally okay with sacrificing hours of their day to own their own piece of paradise out on the fringe can no longer afford to do so and must instead find a place to live, work and raise their family. Closer in. Where a whole lot of people already are. We're _going_ to navigate this, somehow, and our _existing_ regulatory framework is our starting condition. We might be able to change that framework (people tried really hard in 2010. They failed.). But this is what we've got. And what _I_ want to know is where all those young families are going to land and where their kids are going to go to school and where they are going to shop and who is going to hire them.

Because _I_ want to understand the economy/job market of the future. Soon.
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