Thursday, March 5, 2020

Time to End Single-House Zoning?

Here's an interesting metaphor for economists to consider from Michael Manville, Paavo Monkkonen & Michael Lens in their essay, "It’s Time to End Single-Family Zoning":
Suppose that, for your wellbeing, you need regular access to only a small amount of expensive medicine. One day you go to the pharmacy and learn the government has implemented a new rationing system strictly limiting the number of sales that can occur in small doses. Because many people, like you, only need small doses, the new rule results in few small doses being available. Plenty of medicine is available—you can see it over the counter—but the pharmacist can only sell it in large quantities. So you are stuck. If you want your medicine, you must buy more than you need, at a price higher than you can afford. This new rationing system is also strictly enforced. Not only must you buy in large quantities, but you cannot divide up your ration afterward and sell your extra doses to others who might need and value them.
Most people, we suspect, would consider such a rationing system unjust and inefficient. It would force a large number of people to spend and consume more than they otherwise would, subsidize the smaller number of people who want and can afford large doses, and keep some people from getting medicine at all. Fortunately, the United States does not allocate medicine in this bizarre manner. But it does ration urban land this way.
The authors offer this metaphor as part of their argument for the abolition of single-house zoning in cities. The most recent issue of the  Journal of the American Planning Association offers two viewpoint articles advocating the abolition of single-house zoning, along with seven short commentaries, and then two rejoinders from the authors of the viewpoint articles.

It's useful to be clear on just what this proposal entails. It is not a call for the abolition of zoning, or for the abolition of any and all rules concerning what can be built on a certain residential lot. There could still be rules regarding issues like height or setbacks from property lines. If people want to live in a detached single house, they would be free to continue doing so. However, if your neighbor wants to turn their existing house (for the sake of argument, say without changing the physical envelope of the house) into townhouses or a a duplex or triplex, they would be free to do so.

In his essay, Jake Wegman makes the point this way: "Does a zoning category or other type of regulation prohibit everything but a single-family detached house on a large lot? If so, it should be contested. My argument is that there is no defensible rationale grounded in health, safety, or public welfare for effectively mandating a 3,000-ft2 house with one unit while prohibiting three 1,000-ft2 units within the same building envelope. ... Regardless of the specifics, single-family zoning should be replaced with regulations that allow some form of low-rise, middle-density housing—or `Missing Middle'—to be built as of right."

As Manville, Monkkonen and Lens point out, single-house or R1 zoning started as a replacement for explicitly racial zoning (citations and footnotes omitted): 
R1 arose, at least in part, from invidious motives. It was built on arguments about the sort of people who don’t live in detached single-family homes and the harms that would arise if they mixed, socially or as fellow taxpayers, with those who do. R1 first proliferated after the Supreme Court struck down racial zoning in 1917’s Buchanan v. Warley decision. Buchanan made single-family mandates appealing because they maintained racial segregation without racial language. Forcing consumers to buy land in bulk made it harder for lower income people, and therefore most non-White people, to enter affluent places. R1 let prices discriminate when laws could not.
Contemporary observers denounced this regime of backdoor segregation, but in 1926 the Supreme Court upheld it. In Village of Euclid v. Ambler Realty Co. (1926), the court tacitly excused R1’s implicit racism by validating its explicit classism. Cities could prohibit apartments, the court said, because apartments were nuisances: “mere parasites” on the value and character of single-family homes. In Euclid’s wake, R1 became a quiet weapon of the White and wealthy in their campaign to live amid but not among the non-White and poor.
Today’s planners cannot be blamed for R1’s origins; however, the past throws a long shadow over the system they now administer. R1 delivers large and undeniable benefits to some people who own property. In places where housing demand is high, R1 inflates home values and protects the physical character of neighborhoods. But its social costs exceed these private benefits. Higher property values for owners mean higher rents for tenants. Because homeowners as a group are richer and Whiter than renters, policies that increase housing prices redistribute resources upward, increasing homeowner wealth, reducing renter real incomes, and exacerbating racial wealth gaps.
These viewpoints are careful to note that they do not expect the removal of single-family zoning to solve all problems of high housing prices, social inequality, long commutes, traffic congestion, high energy use, and so on. Indeed, they accept and expect that in many neighborhoods, the abolition of single-house zoning might not make much difference at all. They are just arguing that perceived benefits of single-family zoning--which are often phrased in terms of the traits of those who for various reasons need to be excluded from neighborhoods--do not justify the costs.

Manville, Monkkonen and Lens offer some thoughts on the potential importance of altering location outcomes (again, citations and footnotes omitted):
Where people live directly affects their exposure to pollution and violence, the quality of schools their children can attend, and the jobs they can reach. Residential location is thus strongly correlated with many life outcomes, from earnings to educational attainment to mental and physical health. Location, moreover, has not just large but multigenerational returns, yielding better outcomes for people who move in and their children as well.
Because opportunity is unevenly distributed both between and within metropolitan areas, and because moving people to opportunities is generally easier than moving opportunities to people, letting more people live in the most prosperous and amenity-rich neighborhoods of our urban areas would dramatically increase wellbeing. Many people, however, are effectively barred from these cities and neighborhoods because access to them is sold primarily in large, expensive, and inefficient chunks—through R1. Lower and middle-income families would benefit immensely from a small foothold in prosperous neighborhoods—perhaps a modest apartment or duplex—but R1’s prevalence means few such small footholds are available. The result is scarce housing in desirable places.
The city of Minneapolis, near where I live and work, will be a laboratory for these kinds of changes.  As Paul Mogush and Heather Worthington note in one of the comments:
In Minneapolis, allowing at least three residential units on each parcel throughout the city is part of a larger package of housing and land use policy changes intended to increase housing supply, choice, and affordability. These strategies include inclusionary zoning, increased investment in affordable housing, and tenant protections. The city’s new comprehensive plan also moves to allow multistory, multifamily development by right on all frequent bus routes and around light rail transit stations and makes it possible to build “missing middle” housing types in neighborhood interiors close to downtown that had previously been downzoned. The intent is to increase predictability in the marketplace. Planners cannot effectively address the challenges of racial inequities, housing affordability, and climate change by fighting a battle for every new apartment building.
Here's are links to the full set of  two viewpoint articles, seven commentaries, and two rejoinders: