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This NY Times article describes the "quiet revolution" in New York City over the last few years as 3,600 blocks have been rezoned to prevent or limit new housing.
Enacted in the name of preserving "the character" of local communities, this is more in the nature of a neutron bomb, keeping the buildings while driving out the working class families who once could afford to live in the city. With a projected demand of 300,000 new people looking for housing in the City in coming years, the inevitable result of limiting the housing supply is soaring home prices.
The Gutting of Affordable Housing: For the poor of the City, this means longer and longer commutes and even homelessness. For the middle class, it means many fleeing the city for suburbs where they will destroy the environment driving SUVs and become Republicans.
"Gut renovation" is the process by which a building maintains its facade while it’s inner parts are destroyed and replaced with shiny new parts. That’s New York City, as the facade is maintained but the inner soul of working class families are replaced by the wealthy able to afford the housing prices.
This Harvard study last year estimated that as much as half the costs of housing in New York City is due to zoning and other regulations that restrict the housing supply. So working families could potentially be paying half as much for housing costs, but instead the trend in the City is in the opposite direction as the supply of new housing is even further choked off.
New York City was not always so unaffordable, because it used to build new housing to accommodate that growth. As the Harvard study notes, "there were 13,000 new units permitted in Manhattan in 1960 alone, only 21,000 new units were permitted throughout the entire decade of the 1990s. In spite of skyrocketing prices, the housing stock has grown by less than 10 percent since 1980." And the relation between decreasing housing permits and soaring prices is clear in this graph:
The Suburbanization of the City: One of the biggest problems is that zoning increasingly blocks taller residential buildings, the key to affordable housing in a city where land prices are so high. Since an extra floor costs no additional land, the marginal cost of adding floors to a building are inevitably lower and more affordable than less dense housing.
But again, the last decade has seen a range of height restrictions that have discouraged taller, more affordable housing:
Urban Liberal Hypocrisy on Equity and the Environment: This attack on density not only undermines affordable housing, it undermines mass transit, since fewer people means fewer riders, so train stops have to be further apart or trains run less often to be economical. As areas like Staten Island and other low density parts of the City are zoned to prevent taller buildings, this inevitably encourages more driving and makes new public transit nearly unaffordable to build.
What’s shocking is that many New York liberals — like most liberals in urban areas- talk a great game on poverty and the environment at the national level, but in the biggest area where they fully control economic policy– urban planning — they have made "lifestyle" choices through their elected representatives as destructive to equity and the environment as the suburban SUV drivers they usually disdain.
Housing is the largest expense for most families, yet the main housing policy of urban liberalism is to block new housing and drive up the costs. This is the quiet suicide of urban liberalism, as working class voters are driven into the welcoming embrace of "red state" suburban sprawl.
None of this argues that existing historic neighborhoods should be bulldozed, but it does mean that traditional neighborhoods have to welcome higher-density affordable housing in their local areas. Otherwise, urban liberals have zero excuse for lecturing anyone else on poverty or the environment.
*Nathan Newman is guest author at BlogNYC. Newman is a community and union activist, policy advocate and writer his website is NathanNewman.org
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28 Comments
1. Lady Penelope
2. James
3. liberal
4. liberal
5. liberal
6. JRoth
7. James
8. JRoth
9. liberal
10. liberal
11. Nunya
12. Nunya
13. Nunya
14. Sean
15. liberal
16. liberal
17. Nunya
18. Nunya
19. liberal
20. joe
21. Outlandish Josh
22. liberal
23. Constantine
24. Ken Houghton
25. liberal
26. Lady Penelope
27. Nunya
28. Nunya
Want a neat little picture by your comments? Get one here.I don’t entirely buy this argument. I live in a six floor walk up. In my experience, it’s the old tenement walk-ups that still have affordable housing; the high-rises are all billed as “luxury,” staff doormen and go for twice the price (the cheapest high rises I know about go for around $2,000 per one-room studio). In hell’s kitchen, the battle to preserve the historic walk-ups–usually rent stabilized–is a fight staged by its residents to maintain affordable living space.
A landlord won’t charge less rent because he has more units per square block of land; he’ll be taxed for owning a high-rise, and he’ll bill as much as he can possibly get away with. If we want affordable housing, we ought to instead be talking about preserving rent stabilization.
Posted Tuesday, October 11, 2005 at 10:32 am | Permalink
I believe most high rises that are built are supposed to have a certain percentage of low-moderate income units. That’s usually how they convince the city to let them build them.
Although I do agree with Lady P. We do need to fight to preserve the rent stabilized buildings that already exist.
Posted Tuesday, October 11, 2005 at 10:36 am | Permalink
Lady Penelope wrote, In my experience, it’s the old tenement walk-ups that still have affordable housing; the high-rises are all billed as “luxury,” staff doormen and go for twice the price (the cheapest high rises I know about go for around $2,000 per one-room studio).
But if the market functions properly, ultimately it’s supply that matters. Higher buildings, more supply.
A landlord won’t charge less rent because he has more units per square block of land; he’ll be taxed for owning a high-rise,
You’ve put your finger on the problem. The real culprit is that improvements are taxed. (One poster on USENET figures that the effective tax rate on improvements is twice that on land.) The solution is to get rid of the tax on improvements, drastically increase the tax on land, and loosen zoning regs.
and he’ll bill as much as he can possibly get away with.
But that’s the way the market should work. The problem isn’t people charging market values for rent; the problem is that the market functions like a monopoly, and landowners collect land rents for doing absolutely nothing.
If we want affordable housing, we ought to instead be talking about preserving rent stabilization.
Nope. Rent control will never work, because it provides a disincentive to build structures and other improvements.
The problem of unaffordable housing, and poverty more generally, was found over a century ago by Henry George. Funny thing is that almost no one understands that the solution to the problem (land value taxation) is well within our grasp.
Posted Tuesday, October 11, 2005 at 10:45 am | Permalink
Sorry, should have written “problem was solved” not “found”.
Posted Tuesday, October 11, 2005 at 10:46 am | Permalink
James wrote, I believe most high rises that are built are supposed to have a certain percentage of low-moderate income units. That’s usually how they convince the city to let them build them.
Sounds like putting a band-aid on a cancer.
Although I do agree with Lady P. We do need to fight to preserve the rent stabilized buildings that already exist.
Nope.
Posted Tuesday, October 11, 2005 at 10:46 am | Permalink
Let’s be clear on a couple things:
First of all, this post (fairly enough, given the name of the blog) applies almost exclusively to NYC, particularly Manhattan. Almost every other northeastern city is emphatically not suffering for lack of 20 story residential towers. So it seems a bit exaggerated to call it the “quiet suicide of urban liberalism.” Maybe the “counterproductivity of NYC liberalism.”
Second, that Harvard study was not universally accepted. I wasn’t blogging at the time, so I no longer have any links for the discussion, but that 50% number is suspiciously high. More importantly, it’s without context - how much of housing unit costs are ascribable to regulation in other northeastern cities? It wouldn’t surprise me if the same methodology gave 20-30% as an answer - maybe higher. Point being, it’s absolutely not true that half of housing costs in NYC are due to liberal obstructionism: life safety codes and some sort of zoning will apply regardless.
Third, to disagree with Lady Penelope’s response, the problem with too few new luxury towers is that the rich simply buy out the formerly middle/working class buildings; this is where the gut rehab reference comes in, and it’s apt. Neighborhood definitions are so malleable in Manhattan (Hell’s Kitchen, anyone?) that _any_ neighborhood is vulnerable to gentrification. I think that opponents of rent control suffer from libertopian tendencies (free the market, and the invisible hand will provide for all!), but I also think it’s foolish to deny that building new housing is the best way to reduce/maintain housing prices. That, or allow the city to devolve into a 1978-style dystopia.
Posted Tuesday, October 11, 2005 at 10:49 am | Permalink
So liberal, you don’t agree that we need to preserve rent stabilized housing? Could you expand on that?
Posted Tuesday, October 11, 2005 at 10:50 am | Permalink
If liberal means what I think s/he does by “land value taxation,” I’m in favor of it, but it hasn’t done us a damn bit of good in Pittsburgh. One of the prime locations in the whole city, across from City Hall and between 2 of the tonier office towers in town, has been nothing but a surface parking lot for decades. LVT is far from a magical fix-all.
Posted Tuesday, October 11, 2005 at 10:57 am | Permalink
James wrote, So liberal, you don’t agree that we need to preserve rent stabilized housing? Could you expand on that?
Easy: capping rents provides a disincentive to building more housing.
The stuff in short supply is land. Land, unlike capital goods (such as housing) is in fixed supply and hence shouldn’t be treated the same way, either on grounds of equity or efficiency.
Google on “land value taxation” and “Henry George”.
Posted Tuesday, October 11, 2005 at 11:17 am | Permalink
JRoth wrote, I’m in favor of it, but it hasn’t done us a damn bit of good in Pittsburgh.
* Pittsburgh was for years on the list of one of the most liveable cities on the US.
* Perhaps the guy with the surface parking lot isn’t paying fairly assessed land tax.
* IIRC the class of evil, landowning thugs scored a victory in Pgh a few years ago and had the land tax gutted or reduced.
Posted Tuesday, October 11, 2005 at 11:20 am | Permalink
If Liberal is going to invoke Henry George he should provide you with some info if you are unfamiliar with him.
http://www.progress.org/books/george.htm
The name for what Liberal proposes is Geolibertarianism
Also, it should be noted (and this may come as a shock to some) that:
Geolibertarians are generally influenced by Georgism, but the ideas behind it predate Henry George, and can be found in different forms in the writings of John Locke, Thomas Jefferson, Adam Smith, Thomas Paine, David Ricardo, and John Stuart Mill. Perhaps the best summary of geolibertarianism is Thomas Paine’s assertion that “Men did not make the earth. It is the value of the improvements only, and not the earth itself, that is individual property. Every proprietor owes to the community a ground rent for the land which he holds.”
http://en.wikipedia.org/wiki/Geolibertarians
There are so many flavors of libertarianism and the Cato Institute’s variety of anarcho-capitalism is easily the most whack.
“They spiritually baptize the deceased as libertarians because they cannot protest the anachronism: Locke, Smith, Paine, Jefferson, Spooner, etc.”
The Marxism of the Right
http://www.amconmag.com/2005_03_14/article1.html
(You don’t have to learn big, foreign words like “proletariat”.)
Critiques of Libertarianism:
http://world.std.com/~mhuben/libindex.html
An amazing collection of information and an excellent resource.
Posted Tuesday, October 11, 2005 at 11:28 am | Permalink
Shhhh! Don’t tell the children. Most of the Founders would be socialist-commie-pinkos today.
Posted Tuesday, October 11, 2005 at 11:34 am | Permalink
And just as a bit of trivia… who do you think really invented the board game Monopoly? Henry George scared the bejeesus out of the powers that be. That’s why most of you have never heard of a man that was at one time the third most well known man in America, if not the world.
http://www.pbs.org/opb/historydetectives/case/202_index.html
http://www.pbs.org/opb/historydetectives/pdf/202_monopoly.pdf
Posted Tuesday, October 11, 2005 at 11:44 am | Permalink
The study, which was commissioned by the Manhattan Institute, is basically driven by one huge assumption: that any difference between the price per square foot of a condominium in Manhattan and the marginal cost per square foot of building a condominium in Manhattan must be due to regulation. Anyone with even a passing familiarity with the real estate industry in New York should recognize that that’s incorrect.
It’s true that many New York liberals take hypocritical positions on land use (see the opposition to Ratner’s big project in Brooklyn), but it’s way too simplistic to say that without regulation, housing in Manhattan would be cheap.
Posted Tuesday, October 11, 2005 at 11:46 am | Permalink
Nunya wrote, If Liberal is going to invoke Henry George he should provide you with some info if you are unfamiliar with him.
I already instructed people to google on HG and LVT.
The name for what Liberal proposes is Geolibertarianism
Nope. Geolibertarians are “single taxers”—namely, ground rent is the only thing that should be taxed, and the size of the state’s budget should be limited by that. (Some propose in addition a head tax, which I would strongly oppose.) I’m not. Rather, I think that the first thing that should be taxed is economic rents, particularly ground rents. After that, I’d prefer a flax tax on wealth (assuming it’s practical), which would be far more progressive than the current tax system we have, since most poor people have almost no wealth, and there are a lot of truly wealthy people who pay little income tax. (Income =/= wealth.)
http://world.std.com/~mhuben/libindex.html
Huben himself says that the Georgist critique of non-Georgist libertarianism is very strong. (IMHO it’s the biggest weakness in non-Georgist libertarianism; and non-Georgist libertarians despise freedom.)
As for providing the background information, any leftist or left liberal owes it to herself to read or skim George’s Progress and Poverty.
Posted Tuesday, October 11, 2005 at 11:48 am | Permalink
Nunya wrote, Henry George scared the bejeesus out of the powers that be. That’s why most of you have never heard of a man that was at one time the third most well known man in America, if not the world.
What’s puzzling to me is why so many liberals and leftists reject the entirety of George’s analysis. I’ve decided they can’t get (the errors of) Marxist thought out of their heads.
Posted Tuesday, October 11, 2005 at 11:50 am | Permalink
The Manhattan Institute gave us Charles Murray and The Bell Curve.
Anyone who takes anything that comes from that racist/corporate propaganda mill seriously deserves where it takes them. I’ll take the Harvard study.
Posted Tuesday, October 11, 2005 at 11:50 am | Permalink
I stand corrected, Liberal. Carry on.
Posted Tuesday, October 11, 2005 at 11:55 am | Permalink
Nunya wrote, I stand corrected, Liberal. Carry on.
No problem.
It’s always thrilling to meet other people in cyberspace who actually understand and believe in freedom.
Posted Tuesday, October 11, 2005 at 11:58 am | Permalink
Lady P,
If luxury towers were allowed to build higher, it would reduce the demand on older midrises and apartment houses, thus making those units cheaper.
JRoth’s comment may be technically true, but all you have to do to apply this same argument to other cities is change the number of stories a little bit.
What this leaves out is the suburbs. The natural pattern of urban growth is both up AND out. While NYC should be allowed to accept their share of increased demand via taller buildings and infill, the burbs should be expected to accept their share via smaller lots for houses, apartments, and even some urbanist-style developments around train stations. In fact, the NYC residents concerns - taller buildings will overtax the infrastructure and wipe out human scale development - are a lot more defensible than suburbanites’ - if we allow rental housing to be built in Westchester, black people will steal my television.
Posted Tuesday, October 11, 2005 at 12:35 pm | Permalink
Can I get a hey-o for the suggestion to let the city devolve into a ‘78-style dystopia? I’ve long felt that what we need is another crime wave to get rid of all these fucking yuppies. Let’s get junk back out front on Avenue A — there’s a free market solution guaranteed to drive the return of affordable housing.
Posted Tuesday, October 11, 2005 at 1:16 pm | Permalink
One extra comment—I visited a friend in Brooklyn a couple years ago. Subway stop was first one (coming from Manhatten).
What kind of buildings were there, near the subway stop? Low rise, 2- or 3-story buildings, and pretty dilapidated. As far as I could tell, this wasn’t true for just a small locale, either.
Just a stunningly, grotesquely inefficient use of space.
Posted Tuesday, October 11, 2005 at 3:46 pm | Permalink
I agree with joe. More construction of $2000/month luxury apartments in high-rises will reduce pressure in neighborhoods where people currently willing to spend that much on a studio incent landlords to renovate existing units “up to their luxury standards.” High-rise luxury construction serves as a “safety valve” that guides luxury-renters towards those new units instead of flooding into other neighborhoods and gentrifying them.
Posted Tuesday, October 11, 2005 at 4:31 pm | Permalink
Why do I suspect liberal hasn’t gone back to Bklyn recently? The flaw in the Harvard study is that it acts as if NYC=Manhattan (and Manhattan below 96th Street at that).
What has happened as Midtown has gotten more expensive? Washington Heights has developed (my large-2BR-$600/month apartment now rents for about $1600-1800), the Bronx has developed and Brooklyn has developed, with neighborhoods prospering and local businesses opening where there used to be empty storefronts.
I believe this is generally referred to as “an effect of the market.”
Posted Tuesday, October 11, 2005 at 5:58 pm | Permalink
Ken Houghton wrote, Why do I suspect liberal hasn’t gone back to Bklyn recently?
Huh?
There must be very strong anti-competitive forces to have kept that part of Brooklyn in such a dilapidated state for decades. I think a good hypothesis is that it’s the same as in most places—the leading causes are (a) overly restrictive zoning, plus (b) taxation schemes which encourage speculators to sit on land and not develop it, waiting for a capital gain, and which punish intensive development (by taxing a lot with a high-rise much more than the same lot with a single-family dwelling, for example).
And I highly doubt the anti-competitive forces that I observed in action have changed in the last two years. Of course, occasionally there will be a happy confluence of land speculators finally cashing out and (for some reason or another) intensive development taking place.
Posted Tuesday, October 11, 2005 at 6:22 pm | Permalink
I’ll just add that there’s hardly a shortage of luxury rentals. Even so there’s zero incentive for anybody to charge normal rents in manhattan right now.
If you want a manhattan middle class, it either has to be enforced or subsidized.
Posted Tuesday, October 11, 2005 at 6:55 pm | Permalink
Lady Penelope said: If you want a manhattan middle class, it either has to be enforced or subsidized.
I was going to say, “Eat the rich.” But I wasn’t seriously proposing such an idea. Then I saw the atest post here. About Paris Hilton. I still don’t think we should actually eat them, not all of them. But we could feed an awful lot of the to their own pampered pets.
Posted Friday, October 14, 2005 at 7:43 pm | Permalink
liberal wrote: As for providing the background information, any leftist or left liberal owes it to herself to read or skim George’s Progress and Poverty.
And they can even do that on-line. No excuses.
liberal wrote: It’s always thrilling to meet other people in cyberspace who actually understand and believe in freedom.
I’m not sure what “freedom” is but I do like liberty, whatever that is.
Is that your website?
http://truthandpolitics.org/
I will visit.
Posted Friday, October 14, 2005 at 7:51 pm | Permalink
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