Housing References and Experts

Here is an annotated bibliography on the relationship between land-use regulation and housing prices, along with the email addresses of the authors. These papers show that housing affordability problems that afflict some urban areas but not others are due to the level of land-use regulation in those areas. Files are in the following categories:

The Financial Crisis and the Obama Administration


The President’s Worrisome Narrative to Discourage Homeownership
Author: Ronald Utt
Citation: Heritage Foundation Backgrounder no. 2450, August 11, 2010, 7 pp.
Summary: The Obama administration is using irresponsible lending activities as an excuse to promote new policies discouraging homeownership.
Quote: “Homeownership among non-Hispanic whites exceeds 75 percent, while the homeownership rate among African-Americans and Hispanics is below 50 percent. As the Obama Administration pushes for less emphasis on homeownership, it will be these moderate- and lower-income families on the margins of the economy who will suffer.”
HUD and DOT Partnership: Sustainable Communities (44-KB pdf file)
Author: DOT Office of Public Affairs
Citation: Washington, DC: Department of Transportation, 2009, 2 pages.
Summary: Press release announcing the partnership described in Ron Utt’s paper above.
Quote: “The task force will set a goal to have every major metropolitan area in the country conduct integrated housing, transportation, and land use planning and investment in the next four years.”
Collusive Capitalism: The Elephant in the Room? (124-KB pdf file)
Author: Owen McShane
Citation: Presentation to the 2009 Preserving the American Dream conference, Bellevue, WA, April 18, 2009
Summary: We seem to be moving towards collusive capitalism, another name for which is neo-fascism. Like Mussolini’s fascism, collusive capitalism is based on central governmental control of business, with a strong sense that aesthetics should take priority over practical economics.
Quote: Collusive capitalism is “a more managed, highly centralized form of cohabitation between the government apparatus and the economic elite.”
Socio-Economic Metaphors: Machine or Ecosystem? (1.6-MB PowerPoint file)
Author: Max Borders
Citation: Presentation to the 2009 Preserving the American Dream conference, Bellevue, WA, April 18, 2009
Summary: Many people use a machine as a metaphor for the economy, which gives the impression that the economy can be controlled like a machine. A better metaphor is an ecosystem, which is understood to be too complex to be easily controlled.
Quote: “An ecosystem is undesigned, yet ordered, and unknowable in its totality.”
The Subprime Mortgage Market Collapse: A Primer on the Causes and Possible Solutions (888-kb pdf file)
Author: Ronald Utt
Citation: Washington, DC: Heritage Foundation, 2008, 24 pp.
Summary: Reviews the history of the mortgage market from 1946 to the present.
Quote: “Many of those who call for more federal regulation fail to recognize that earlier and more comprehensive regulatory efforts did little to deter housing market problems and in some cases may have made them worse.”

Land-Use Regulation & Housing Affordability


Residential Land Use Regulation and the US Housing Price Cycle Between 2000 and 2009
Author: Haifang Huang and Yao Tang
Citation: Department of Economics, University of Alberta, Working Paper No. 2010-11
Summary: Housing bubbles are a result of land-use regulations.
Quote: “Stringent land use regulation and restrictive geography reduce the supply elasticity in housing markets. In a housing boom with rising demand, the lower elasticity forces house prices to increase by more.”
How Urban Planners Caused the Housing Bubble
Author: Randal O’Toole
Citation: Cato Institute Policy Analysis no. 646, October 1, 2009
Summary: Only some states had housing bubbles, and those states tended to have restrictive land-use planning processes, such as smart growth.
Quote: “Local factors, not national policies, were a necessary condition for the housing bubbles where they took place. The most important factor that distinguishes states like California and Florida from states like Georgia and Texas is the amount of regulation imposed on landowners and developers.”
Smart Growth’s Role in the “Panic of 2008” (23.8 MB fully narrated PowerPoint file)
Author: Wendell Cox
Citation: Presentation given to the 2009 Preserving the American Dream conference, April 19, 2009, Bellevue, WA
Summary: Smart-growth land rationing increases both housing prices and the volatility of those prices, thus increasing the potential for bubbles.
Quote: “The issue is not foreclosure rates. The issue is mortgage losses — and if the losses had not been made so intense by smart growth, the financial crisis might have been avoided.”
The Best of Times or the Worst of Times? (7.8-MB PowerPoint file)
Author: Peter Gordon and Harry Richardson, University of Southern California
Citation: Presentation given to the 2009 Preserving the American Dream conference, April 18, 2009, Bellevue, WA
Summary: Compares the material increase in world living standards over the past several centuries with such trends as increasing suburbanization and auto ownership.
Quote: “Economic freedom prompts prosperity and prosperous people demand economic freedom. But . . . bad policies prompt bad times and bad times prompt bad policies. Which one will dominate?”
How U.S. Land Use Restrictions Exacerbated the International Finance Crisis (424-kb pdf file)
Author: Wendell Cox
Citation: Belleville, IL: demographia.com, 2008, 12 pp.
Summary: Smart growth created artificial land scarcities that raised the cost of housing, forcing more people to resort to subprime mortgages.
Quote: “From 2000 to 2007, the gross value of U.S. housing stock rose $5.3 trillion. . . . $4.4 trillion of this increase occurred in just 20 markets, all of which are characterized by excessive land-use planning.”
How Smart Growth Exacerbated the International Finance Crisis (160-kb pdf file)
Author: Wendell Cox
Citation: Washington, DC: Heritage Foundation, 2008, 3 pp.
Summary: Three-page summary of the above paper.
Quote: “Without smart growth, the international financial crisis would have been much less severe. . . . Any serious effort to prevent a repeat of such destructive price volatility will require removing the destructive land-use regulations.”
Land-Use Regulation & Housing Affordability in France (1.9 MB Word file)
Author: Vincent Benard
Citation: Presentation given to the 2009 Preserving the American Dream conference, April 18, 2009, Bellevue, WA
Summary: Land-use regulations, particularly the failure to make land available for development and a six-year process to get permission to build homes, are responsible for a housing bubble in France. 
Quote: “This bubble was especially remarkable because it was the first time it reached such intensity, but also because for the first time it was not an ‘urban bubble’ or a ‘Paris Bubble.’ Prices of existing or new homes peaked in the same proportions either in central metro areas or in rural cities as far as 30 miles from these metro areas.”
The Economic, Social, Political, and Environmental Impact of Land-Use Regulation in France (1.9 MB PowerPoint file)
Author: Vincent Benard
Citation: Presentation given to the 2009 Preserving the American Dream conference, April 18, 2009, Bellevue, WA
Summary: Contains charts that go with the text in the above Word file.
Quote: “Knowing all we now know about the effects of zoning regulations, we should take the opportunity of currently falling prices to scrap down all these regulations.”
Municipal and Statewide Land Use Regulations and Housing Prices Across 250 Major US Cities (272-kb pdf file)
Author: Theo S. Eicher
Citation: Seattle, WA: University of Washington (draft), 2008, 33 pp.
Summary: Using a database of municipal land-use regulations compiled by the Wharton Real Estate Center, Eicher shows that such regulation causes housing to become unaffordable.
Quote: “The analysis in this paper documents evidence that is both statistically and economically significant, confirming a tight association between land use regulations and housing price growth. The analysis also holds strong explanatory power, because it is based on data that was uniformly collected for all cities so that the results can be generalized.”
Land-Use Regulation Database (11.3-mb Excel spreadsheet)
Author: Wharton Real Estate Center
Summary: A database of 70 different land-use indicators in 2,730 different municipalities. Says Eicher in the above study, “Growth management is a catch-all term for several types of land use regulations at the regional, if not the state, level. In his review of the effects of land-use regulations, Brueckner (2007) groups these restrictions into three categories: 1) urban growth boundaries, 2) regulation of development densities (e.g., minimum lot-size rules), and 3) cost-increasing regulations(facility development and/or regulatory delays in the approval process). The new Wharton database is vitally important because it features an extensive array of land use regulations that cover growth boundaries, density, and cost-increasing regulations at the state and municipal level.”
Growth Management, Land Use Regulations, and Housing Prices: Implications for Major Cities in Washington State (132-kb pdf file)
Author: Theo S. Eicher
Citation: Seattle, WA: University of Washington (draft), 2008, 23 pp.
Summary: Simiar to Eicher’s other paper (above) but focusing on Washington state.
Quote: “After accounting for inflation, regulations are associated with a $200,000 (80 percent) increase in Seattle’s housing prices since 1989, while housing demand raised prices by $50,000. Cities with less stringent land-use regulations had significantly lower price increases due to regulation.”
4th Annual Demographia International Housing Affordability Survey: 2008 (772-kb pdf file)
Author: Wendell Cox
Citation: Belleville, IL: demographia.com, 2008, 42 pp.
Summary: Ranks housing affordability for 227 housing markets in Australia, Canada, Ireland, New Zealand, the United Kingdom, and the United States.
Quote: Demographa “employs the ‘median house price to median household income multiple’ (median multiple) to rate housing affordability. Until recently, the median multiple has been remarkably similar among the nations surveyed, with median house prices generally being 3 or less times median household incomes. However, the median multiple has escalated sharply in Australia, Ireland, New Zealand, and the United Kingdom, and in some markets of Canada and the United States.”
The Planning Tax: The Case Against Regional Growth-Management Planning (464-kb pdf file)
Author: Randal O’Toole
Citation: Washington, DC: Cato Institute, 2007, 20 pp.
Summary: A review of housing prices since 1969 in hundreds of U.S. housing markets reveals that prices normally grow at the rate of inflation. But prices rapidly accellerate after cities or states implement growth-management plans.
Quote: “On average, homebuyers in 2006 had to pay $130,000 more for every home sold in states with mandatory growth-management planning than they would have had to pay if home price-to-income ratios were less than 3. This is, in effect, a planning tax that increases the cost of retail, commercial, and industrial development as well as housing.”
Barker Review of Land Use Planning: Final Report – Recommendations (896-kb pdf file)
Author: Kate Barker
Citation: London, England: HM Treasury, 2006, 226 pp.
Summary: Comprehensive review of Britain’s housing crisis that concludes that a streamlined land-use planning system is needed to meet housing needs. 
Quote: “Action needs to be taken to deliver an efficient planning systm, by reducing delays, addressing unnecessary complexity and increasing certainty.”
Housing Prices, Externalities, and Regulation in U.S. Metropolitan Areas (216-kb pdf file)
Author: Stephen Malpezzi
Citation: Journal of Housing Research, volume 7, #2 (1996): 209-241.
Summary: Land-use regulation raises housing costs and reduces homeownership rates.
Quote: “No statistically significant effect was found on racial segregation or on neighborhood ratings. Effects on aggregate commuting times were small. Thus, so far we have mainly documented the existence of costs without finding much in the way of benefits.”
3rd Annual Demographia International Housing Affordability Survey (484-kb pdf)
Author: Wendell Cox
Citation: Demographia.com, 2007, 46 pp.
Summary: Ranks the housing affordability of 159 urban areas in Australia, Canada, Ireland, New Zealand, the United Kingdom, and the United States.
Quote: “The least affordable markets are generally in California, Hawaii, the U.S. East Coast, Australia, the United Kingdom, New Zealand, and Vancouver.”
Do Regional Economies Need Regional Coordination? (560-kb pdf)
Author: Edward Glaeser
Citation: Cambridge, MA: Harvard Institute of Economic Research, 2007, 68 pp.
Summary: Glaeser demonstrates that land-use regulations drive up housing prices. However, he goes out on a limb when he suggests that regional government would solve this problem by forcing cities to approve more housing permits.
Quote: “Over the past 20 years, the fastest growing regions have not been those with the highest income or the most attractive climates. Flexible housing supply seems to be the key determinant of regional growth.”
The Causes and Consequences of Land Use Regulation: Evidence from Greater Boston (316-kb pdf)
Author: Edward Glaeser and Bryce A. Ward
Citation: Cambridge, MA: Harvard Institute of Economic Research, 2006, 39 pp.
Summary: Land-use regulations in the Boston area are administered by local governments that focus on keeping densities low, the opposite of smart growth.
Quote: “Over the past 30 years, eastern Massachusetts has seen a remarkable combination of rising home prices and declining supply of new homes. The reductions in new supply don’t appear to reflect a real lack of land, but instead reflect a response to man-made restrictions on development.”
Study of Subdivision Requirements as a Regulatory Barrier (860-kb pdf)
Author: NAHB Research Center
Citation: Washington, DC: Office of Policy Development and Research, HUD, 2007, 82 pp.
Summary: A review of the zoning codes of 469 cities finds that 91 percent of them had requirements that exceeded those needed for health and safety. These excessive requirements drive up housing costs.
Quote: “The average cost of excessive regulation resulting from subdivision standards for one dwelling unit was about 5 percent of the average cost of a new home.”
The Economic Impact of Restricting Housing Supply (400-kb pdf)
Author: Edward Glaeser
Citation: Cambridge, MA: Rappaport Institute, , May 2006, 12 pp.
Summary: Land-use restrictions on housing supply slow economic growth, increase home price volatility, and drive low-income people out of a region.
Quote: “Significant price increases associated with restricted supplies of housing subsequently appear to lead to declines in employment and income.”
Regulation and the Rise of Housing Prices in Greater Boston (1.5-mb pdf)
Authors: Edward Glaeser, Jenny Schuetz, and Bryce Ward
Citation: Boston, MA: Rappaport Institute, 2006, 44 pp.
Summary: Estimates the dollar cost that land-use regulation imposes on homebuyers in the Greater Boston Area.
Quote: “Since 1990, the housing stock in greater Boston increased by only 9 percent. . . . If the housing stock had instead increased by 27 percent, as it did from 1960 to 1975, housing prices would be 23 to 36 percent lower. That is, the median house price, which is now $431,900, would have been as low as $276,100.”
Regulation and the Rise of Housing Prices in Greater Boston (608-kb pdf)
Authors: Edward Glaeser and Amy Dain
Citation: PowerPoint show introducing above paper, 2006.
Summary: Estimates the dollar cost that land-use regulation imposes on homebuyers in the Greater Boston Area.
Quote: “Localities have strong incentives to restrict new development . . . and to subvert state-level policies.”
Regulation and the Rise of Housing Prices (824-kb PowerPoint)
Author: Bryce Ward, Harvard University
Citation: PowerPoint presentation made to the 2006 Preserving the American Dream Conference, September 16, 2006, 10 slides.
Summary: Three reasons might explain high housing prices: high construction costs, a lack of land, and regulation. But in the Boston area, construction costs have remained fairly constant and there is land available. However, regulation has acted as “a really bad tax” that has limited new home construction.
Quote: “Several studies that compare communities with more stringent regulations to similar communities with less regulations find that more regulation means less new construction.”
The Impact of Zoning on Housing Affordability (364-kb pdf)
Authors: Dr. Edward Glaesser (Harvard) and Dr. Joseph Gyourko (Wharton School)
Citation: Cambridge, MA: Harvard Institute of Economic Research, 2002, 37 pp.
Summary: The U.S. is not suffering from a nationwide housing affordability crisis, but unaffordable housing in some regions is strongly associated with the level of land-use regulation in those regions.
Quote: “If policy advocates are interested in reducing housing costs, they would do well to start with zoning reform.”
An Overview of Research on the Costs of Housing Regulation (104-kb Word document)
Author: Steven F. Hayward (American Enterprise Institute)
Citation: Unpublished
Summary: Reviews more than a dozen studies and books on the relationship between regulation and housing affordability.
Quote: “The large body of research that has accumulated over the last 25 years agrees [that] growth controls lead to sharply higher housing prices [and] lead to land prices rising faster than incomes.”
The Dynamics of Metropolitan Housing Prices (84-kb pdf)
Authors: Dr. G. Donald Jud and Dr. Daniel T. Winkler (both University of North Carolina-Greensboro)
Citation: Journal of Real Estate Research, vol. 23, nos. 1/2 (2002): pp. 29-45
Summary: Analyzed the factors that influence housing price changes in 130 metropolitan areas and found that variations between metro areas were correlated with restrictive growth management policies and limitations on land availability.
Quote: “Local regulatory restrictions impede housing growth, causing a larger appreciation in local housing prices.”
Government Regulation and Changes in the Affordable Housing Stock (944-kb pdf)
Authors: Dr. C. Tsuriel Somerville (University of British Columbia) and Dr. Christopher J. Mayer (Wharton)
Citation: Vancouver, BC: Centre for Urban Economics and Real Estate, University of British Columbia, 2002, 32 pp.
Summary: Finds that housing regulation leads to shortages in affordable rental housing for low-income families.
Quote: “The effects of land use regulation are not limited to raising the price of owner-occupied housing and reducing access to homeownership. It also has a clear negative impact on the most vulnerable.”
Why Have Housing Prices Gone Up? (136-kb pdf)
Authors: Dr. Edward Glaesser (Harvard), Dr. Joseph Gyourko (Wharton School), and Dr. Raven E. Saks (Harvard)
Citation: Cambridge, MA: Harvard Institute of Economic Research, 2004, 36 pp.
Summary: Since 1970, increases in housing prices reflect the increasing difficulty of obtaining regulatory approval to build new homes.
Quote: “Our preliminary evidence suggests that there was a significant increase in the ability of local residents to block new projects and a change of cities from urban-growth machines to homeowners’ cooperatives.”
Australia’s Housing Industry (104-kb pdf)
Author:Bob Day, President, Home Australia
Citation: D. R. Doosetor Lecture, April 2, 2004
Summary: Homeownership is as much a dream for Australians as Americans, and land-use regulations are increasingly becoming a barrier to homeownership down under.
Quote: “The government’s approach to land management has been a disaster. . . . The real cost of land has increased tenfold.”
Job Creation and Housing Construction: Constraints on Employment Growth in Metropolitan Areas (460-kb pdf)
Author:Dr. Raven E. Saks, Harvard University
Citation: Joint Center for Housing Studies, Working Paper W04-10, Harvard University, 2004, www.jchs.harvard.edu/publications/markets/w04-10_saks.pdf
Summary: Higher housing prices force employers to pay workers more, which reduces the growth of jobs in regulated housing markets.
Quote: Given an increase in housing demand, “places with more regulation experience a 17-percent smaller expansion of the housing stock and almost double the increase in housing prices.”

Smart Growth and Housing Affordability


The Impact of Smart Growth on Housing Affordability: An Analysis of Metropolitan Markets by Land Use Planning System (52-kb pdf)
Author: Wendell Cox
Citation: Belleville, IL: Demographia.com, 2007, 1 p.
Summary: The above link goes to the cover of a report that was not available at the time this disk went to press. After the Preserving the American Dream conference, the full report should be available for download. 
Smart Growth Abuses Are Creating a “Rent Belt” of High-Cost Areas (684-kb pdf)
Author: Wendell Cox and Ronald Utt
Citation: Washington, DC: Heritage Foundation, 2007, 25 pp.
Summary: Areas that use smart-growth regulation suffer reduced homeownership rates and economic growth.
Quote: “Areas with very high housing prices tend to be those following smart growth practices by imposing restrictive zoning provisions (e.g., downzoning, limits on residential rezoning, green belts, and growth boundaries).”
Smart Growth and Its Effects on Housing Markets: The New Segregation (312-kb pdf)
Author: Dr. Randall Pozdena (QuantEcon, Inc.)
Citation: Portland, OR: QuantEcon, 2002, 34 pp.
Summary: If Portland’s growth policies had been applied nationwide for the last ten years, more than a quarter-million minority families who now own their own homes would not have been able to afford to buy those homes.
Quote: “It is apparent both from theory and the available data that restricting the supply of development sites is bound to raise home prices, everything else being equal. Insidiously, the burden of site-supply restrictions will fall disproportionately on poor and minority families.”
The Planning Penalty: How Smart Growth Makes Housing Unaffordable (web file)
Author: Randal O’Toole
Citation: Bandon, Oregon: American Dream Coalition, 2006, 47 pp.
Summary: Estimates the dollar penalty that smart growth and other forms of growth-management planning imposes on homebuyers in each of hundreds of U.S. metropolitan areas.
Quote: “In 2005, homebuyers nationwide paid a conservatively estimated $275 billion more for homes because of restrictive regulation. This does not count the added costs to renters or purchasers of commercial, industrial, or retail land.”
Smart Growth, Housing Costs, and Homeownership (368-kb pdf)
Authors: Wendell Cox (publicpurpose.com) and Dr. Ron Utt (Heritage Foundation)
Citation: Washington, DC: Heritage Foundation, 2001, 24 pp.
Summary: Homeownership is important for personal wealth creation and national economic prosperity, yet smart growth erects barriers to such ownership.
Quote: “For both blacks and Hispanics, the homeownership rate is still below 50 percent and is likely to stay there if housing affordability is impaired by smart-growth policies that rely on boundaries, impact fees, and downzoning.”
San Jose Demonstrates the Limits of Urban-Growth Boundaries and Urban Rail (472-kb pdf)
Author: Randal O’Toole (Thoreau Institute)
Citation: Los Angeles, CA: Reason Foundation, 2003, 23 pp.
Summary: Drawn in 1974, San Jose’s urban-growth boundary has made the region one of the nation’s least affordable housing markets by driving up land prices to well over $1 million an acre.
Quote: “According to Coldwell Banker, a 2,200-square-foot, four-bedroom home that would cost $160,000 to $180,000 in Las Vegas or Houston costs nearly $630,000 in San Jose and even more in other Silicon Valley communities.”
Smart Growth in Action: Housing Capacity and Development in Ventura County (404-kb pdf)
Authors: William Fulton (Solimar Research Group), Chris Williamson (Solimar Research Group), Kathleen Mallory (consultant), and Jeff Jones (Solimar Research Group)
Citation: Los Angeles, CA: Reason Foundation, 2001, 46 pp.
Summary: Measures passed in Ventura County aimed at protecting open space and farms will lead to a huge shortage of housing in the next decade.
Quote: “Significant deficiencies exist in the capacity of existing planning systems to accommodate rational planning goals.”
Smart Growth and Housing Affordability: Evidence from Statewide Planning Laws (548-kb pdf)
Authors: Dr. Sam Staley (Buckeye Institute) and Leonard C. Gilroy (Reason Foundation)
Citation: Los Angeles, CA: Reason Foundation, 2001, 59 pp.
Summary: Assesses the effects of statewide planning on housing prices in Florida, Oregon, and Washington.
Quote: Housing affordability “eroded in all three states after 1993 while affordability improved for the nation throughout the 1990s.”
Urban-growth Boundaries and Housing Affordability: Lessons from Portland (512-kb pdf)
Authors: Dr. Sam Staley (Buckeye Institute) and Dr. Gerard Mildner (Portland State University)
Citation: Los Angeles, CA: Reason Foundation, 1999, 16 pp.
Summary: After growth controls were implemented in Portland and in Napa County, California, housing production fell and housing prices soared.
Quote: “Growth boundaries encourage consumers to trade off land for larger homes with fewer open-space amenities such as private yards and reduce their overall quality of life by constraining land supply and contributing to higher land costs.”
Smart Growth and Housing Bubbles (1-mb rtf)
Author: Randal O’Toole, Thoreau Institute
Citation: Vanishing Automobile update #51, 2005, ti.org/vaupdate51.html
Summary: Smart growth and other growth-management planning practices make housing prices more volatile and create more risks for homeowners.
Quote: “The worst case is a Tokyo-like crash that would force large numbers of people to default on their loans, which in turn could jeopardize the health of the nation’s mortgage insurance programs, Fannie Mae and Freddie Mac.”
Did Smart Growth Make Portland Unaffordable? (588-kb rtf)
Author: Randal O’Toole, Thoreau Institute
Citation: Vanishing Automobile update #52, 2005, ti.org/vaupdate52.html
Summary: Four Oregon urban areas that adopted smart-growth plans in the 1990s were among the top five regions for the greatest losses in housing affordability in the 1990s.
Quote: “Housing shortages occur in growing regions mainly when government intervention such as growth boundaries, building limits, lengthy permitting processes, or other regulation prevents home builders with keeping up with demand.”
Unprecedented Housing Unaffordability Strongly Associated with Urban Consolidation (Smart Growth) (web page)
Author:Wendell Cox
Citation: Demographia, February 2005, demographia.com/dhi-200502.htm
Summary: Differential declines in housing affordability among urban areas strongly correlate with differences in smart-growth and other land-use regulation.
Quote: “Among the ‘Severely Unaffordable’ urban areas, 23 of the 26 are subject to strong ‘urban consolidation’ or ‘smart growth policies.'”

Inclusionary Zoning


Below-Market Housing Mandates as Takings: Measuring the Impact (736-kb PDF document)
Author: Tom MeansEdward Stringham, and Edward Lopez
Citation: Independent Institute Policy Report, November, 2007, 21 pp.
Summary: A California court rejected the notion that inclusionary zoning is a taking without compensation and found that such zoning “necessarily” makes housing more affordable. This paper shows why the court was wrong.
Quote: “Over a ten-year period, cities that impose a below-market housing mandate on average end up with 10 percent fewer homes and 20 percent higher prices.”
Housing Supply and Affordability: Do Affordable Housing Mandates Work? (1.5-mb pdf)
Authors: Benjamin Powell and Edward Stringham
Citation: Los Angeles, CA: Reason Foundation, 2004, 6 pp.
Summary: This study of fifty communities in the San Francisco Bay Area shows that inclusionary zoning — a requirement that homebuilders sell some homes at “affordable” prices — not only does not produce much affordable housing, it actually makes most housing less affordable.
Quote: “Inclusionary zoning causes the price of new homes in the median city to increase by $22,000 to $44,000. In high market-rate cities such as Cupertino, Los Altos, Palo Alto, Portola Valley, and Tiburon we estimate that inclusionary zoning adds more than $100,000 to the price of each new home.”
Housing Supply and Affordability: Do Affordable Housing Mandates Work? (812-kb pdf)
Authors: Benjamin Powell and Edward Stringham
Citation: Los Angeles, CA: Reason Foundation, 2004, 6 pp.
Summary: Brief summary of the previous paper.
Quote: “By restricting the supply of new homes and driving up the price of both newly constructed market-rate homes and the existing stock of homes, inclusionary zoning makes housing less affordable.”
Do Affordable Housing Mandates Work? Evidence from Los Angeles County and Orange County (480-kb pdf)
Authors: Benjamin Powell and Edward Stringham
Citation: Los Angeles, CA: Reason Foundation, 2004, 27 pp.
Summary: Looks at 13 cities with inclusionary zoning ordinances in Los Angeles and Orange counties.
Quote: “Price controls fail to get to the root of the affordable housing problem. The real problem is government restrictions on supply.”
Issues Associated with the Imposition of Inclusionary Zoning in the Portland Metropolitan Area (48-kb pdf)
Author: Jerald W. Johnson (Johnson-Gardner LLC)
Citation: Portland, OR: Hobson Johnson & Associates, 1997, 13 pp.
Summary: Inclusionary zoning would reduce housing costs for a few low-income people at the expense of raising housing costs for everyone else.
Quote: “The primary intent of inclusionary zoning is to increase the inventory of affordable housing. The more likely scenario is a reduction in overall housing opportunities for low-income residents.”

Impact Fees


Impact Fees and Housing Affordability (172-kb pdf)
Author:Vicki Been
Citation: US Department of Housing and Urban Development, 2004, www.huduser.org/rbc/pdf/Impact_Fees.pdf
Summary: Impact fees can correct market failures, but they can also create serious problems for housing affordability. 
Quote: “Impact fees also can be abused, either to exclude low- and moderate-income residents or people of color from communities, or to exploit new homebuyers, who have no vote in the community.”

Deregulating the Housing Market


Ideas That Work: Building Communities Through Homeownership (4.1-mb pdf)
Author: Office of Policy Development and Research, HUD
Citation: Washington, DC: HUD, 2006
Summary: Presents research on ways to promote affordable homeownership.
Quote: “The security that homeownership provides to low- and moderate-income families can increase their stability, produce better outcomes for children, and help homeowners feel a part of community life.”
Why Not in Our Community? Removing Barriers to Affordable Housing (544-kb pdf)
Author:Advisory Commission on Regulatory Barriers to Affordable Housing
Citation: U.S. Department of Housing and Urban Development, 2005, www.huduser.org/intercept.asp?loc=/Publications/pdf/wnioc.pdf
Summary: Regulatory reforms can dramatically reduce the costs of building or rehabilitating housing.
Quote: “Exclusionary, discriminatory, or unnecessary regulations constitute formidable barriers to affordable housing.”
The Politics of Hope: Changing the Terms of the Debate in Australia (27.5-mb PowerPoint)
Author: Wendell Cox
Citation: PowerPoint presentation made to the 2006 Preserving the American Dream Conference, September 16, 2006, 42 slides.
Summary: Australia has no shortage of land, yet strict government regulation has limited the supply of land for housing and made it one of the most unaffordable housing markets in the world. Recent actions by the government could release more land and make housing more affordable.
Quote: “Land-use regulations stunt economic growth. A Federal Reserve study found 20 percent less job growth in metropolitan areas with the strongest economic growth.”
Affordable Housing: How Do We Build It? (80-kb pdf)
Author:J. Michael Noonan, Rottlund Homes
Citation: Presentation given to Leadership St. Paul, March 11, 2004
Summary: Twin Cities’ housing prices have increased 43 percent in five years, and increased regulation is one reason for the increase.
Quote: “The Metropolitan Council has a distorted policy perspective, one that does not seek to provide balance in the housing market.”
An Economic History of Zoning (176-kb pdf)
Author:William A. Fischel, Dartmouth College
Citation: Presentation to Florida State University Critical Issues Symposium, November 8-9, 2001, www.dartmouth.edu/~wfischel/Papers/02-03.pdf
Summary: Zoning is an attempt to protect home values, but it ends up excluding people from housing markets. Fischel proposes home-equity insurance as a way to reduce the demand for exclusionary zoning.
Quote: “Zoning’s original purpose was to protect homeowners in residential areas from devaluation by industrial and apartment uses that had been made footloose by trucks and buses around 1910-1920. Completion of the interstate highway system around 1970 made jobs and employees so mobile that suburbs adopted growth controls to stem the tide.”
Collective Private Ownership of American Housing: A Social Revolution in Local Governance (104-kb pdf)
Author: Dr. Robert Nelson (University of Maryland)
Citation: Adopted from a forthcoming book, Privatizing the Neighborhood
Summary: Protective covenants monitored by homeowner associations are an attractive alternative to zoning, bringing governance to a very local level and providing homeowners with security about the future of their neighborhoods. Dr. Nelson proposes a method of transitioning from zoning to such covenants.
Quote: “In the long run municipal zoning in the United States perhaps is best abolished. The existing functions of zoning perhaps instead should be served through private neighborhood associations.”


The Benefits of Affordable Homeownership

Democratizing Prosperity (31.6-mb PowerPoint)
Author: Wendell Cox
Citation: Presentation given at the 2005 Preserving the American Dream conference
Summary: Homeownership plays a vital role economic growth and prosperity. Smart growth creates huge obstacles for homeownership and thereby creates a hostile economic environment.
Quote: “The history of the world is the history of poverty. The democratization of prosperity is associated with urban growth and sprawl.”
Threats to the Democratization of Prosperity (38.3-mb PowerPoint)
Author: Wendell Cox
Citation: Workshop presentation given at the 2005 Preserving the American Dream conference
Summary: Smart-growth advocates such as James Howard Kunstler view the suburbs as “trashy and preposterous with no future.” Yet anti-sprawl policies reduce homeownership and other indicators of the quality of life.
Quote: “Anti-sprawl policies create sprawl by pushing people further out to where they can find affordable housing.”
Does Sprawl Reduce the Black/White Housing Consumption Gap? (44-kb pdf)
Author: Dr.Matthew Kahn (Tufts University)
Citation: Housing Policy Debate 12(1): 77-86
Summary: Census data show that low-density (“sprawled”) regions are more affordable and have less of a homeownership gap between blacks and whites.
Quote: “In sprawled areas, black households consume larger units and are more likely to own their homes than black households living in less sprawled areas.”

Design Issues

The Effects of Subdivision Design on Housing Values: The Case of Alleyways (56-kb pdf)
Author: Dr. Randall S. Guttery (University of North Texas)
Citation: Journal of Real Estate Research, vol. 23, no. 3 (2002), pp. 265-273
Summary: Analyzed more than 1,600 homes in Denton, Texas, and found that alleys (favored by New Urbanists) reduced home values by more than 5 percent.
Quote: “These findings hopefully will influence New Urbanism subdivision designers to reconsider alleyways in favor of traditional suburban parking.”

For more on design issues, see the section on Urban design and crime.

Housing Preferences


Leadership in a New Era (120 KB pdf file)
Author: Arthur Nelson, University of Utah
Citation: Journal of the American Planning Association, volume 72 (2006), number 4, pp. 393-407
Summary: Claims that only 25 percent of American want to live in a suburban home with a large lot, and therefore estimates that the U.S. will have a “surplus” of 22 million large-lot homes by 2025. Therefore, Nelson urges planners to rebuild cities using a new “template” that emphasizes small lots, multi-family, and mixed-use developments.
Quote: “Many millions of homes on large lots will lose value between now and 2025. . . . This could leave many millions of older homeowners in poorly maintained, suburban homes on large lots.”
Comment on Planning Leadership in a New Era (contained in the same 120-KB file as the above paper)
Author: Emil Malizia, University of North Carolina
Citation: Journal of the American Planning Association, volume 72 (2006), number 4, pp. 407-409
Summary: Disagrees with Nelson’s paper (above) advocating “financial incentives” for high-density development, instead prefering to rely on consumer preference.
Quote: Nelson’s data on housing preferences “may not be terribly reliable. . . . The samples are self selected, . . . the responses may be heavily influenced by the data collection method, . . . [and] people often do not behave in ways that are consistent with the preferences or opinions they express.”
Current Preferences and Future Demand for Denser Residential Environments (484-KB pdf file)
Author: Dowell Myers and Elizabeth Gearin, University of Southern California
Citation: Housing Policy Debate, volume 12 (2001), number 4, pp. 633-659.
Summary: This is the paper on which Nelson (above) based his claim that only 25 percent of Americans want to live in a home on a large lot, but in fact the paper says nothing of the kind.
Quote: “Americans overwhelmingly prefer a single-family home on a large lot. . . . 83 percent of respondents in the 1999 National Association of Home Builders Smart Growth Survey prefer a single-family detached home in the suburbs. . . . 74 percent of respondents in the 1998 Vermonters Attitudes on Sprawl Survey preferred a home in an outlying area with a larger lot. . . . 73 percent of the 1995 American Lives New Urbanism Study respondents prefer suburban developments with large lots.”
Consumers Survey Conducted for NAR and NAHB (48-KB Word file)
Author: National Family Opinion
Citation: April 22, 2002
Summary: Survey of 2,000 households that had purchased a home in the previous 4 years found that Americans overwhelmingly prefer a suburban home to one located near jobs, transit, and shops.
Quote: “Please rate the importance of these factors if you were to buy a new home today (% who said very or somewhat important): Houses spread out – 62%; Bigger lot – 45%; Close to work – 28%; Closer to public transportation – 13%”

Housing Data


1975-2008 House Price Index by State (1-mb Excel spreadsheet)
1975-2008 House Price Index by Metropolitan Area (6.3-mb Excel spreadsheet)
Author: Office of Federal Housing Enterprise Oversight
Citation: Washington, DC: Office of Federal Housing Enterprise Oversight, 2009
Summary: Provides quarterly price indices for all 50 states and more than 380 metropolitan areas going back as far as 1975. These data are based on actual sales of the same homes over time. In addition to the raw data, the American Dream Coalition has added a graphing capability to these spreadsheets: simply enter up to six states or metropolitan areas and the spreadsheets will graph the inflation-adjusted price trends. Try graphing California vs. Texas or San Jose vs. Houston to see the effect of land-use regulation on housing prices and housing bubbles.
Coldwell Banker Home Price Index for 2009 (40-kb Excel spreadsheet)
Coldwell Banker Home Price Index for 2008 (44-kb Excel spreadsheet)
Coldwell Banker Home Price Index for 2007 (36-kb Excel spreadsheet)
Coldwell Banker Home Price Index for 2006 (44-kb Excel spreadsheet)
Coldwell Banker Home Price Index for 2005 (52-kb Excel spreadsheet)
Coldwell Banker Home Price Index for 2004 (44-kb Excel spreadsheet)
Author: Coldwell Banker
Summary: Estimates the 2008 price of a four-bedroom, two-and-one-half bath, 2,200-square foot home with a two-car garage in each of several hundred U.S. and Canadian cities.
Quote: 2008 – San Jose – $1,012,675; Portland – $358,370; Houston – $158,412.
2007 – San Jose – $1,145,000; Portland – $317,500; Houston – $169,736.
2006 – San Jose – $1,410,662; Portland – $357,233; Houston – $155,304.
2005 – San Jose – $1,272,625; Portland – $304,650; Houston – $151,600.
2004 – San Jose – $952,500; Portland – $262,600; Houston – $173,512.
Recent median housing prices by metropolitan area (44-kb Excel spreadsheet)
Author:National Association of Realtors
Citation: Existing-Home Sales Series, Metropolitan Area Prices, realtor.org/Research.nsf/Pages/MetroPrice
Summary: Presents median home prices by metro area for 2002, 2003, 2004, and each of the four quarters in 2004 plus the first quarter of 2005. Note that a house that was a median home in 2005 was probably bigger than a house that was median in, say, 1995.
Quote: The highest median housing prices were in California, but the fastest recent growth has been in Florida.