Many studies have found that zoning and other land use controls increase the cost of housing. This is consistent with the basic economic truth that when a supply is arbitrarily limited the price for that item will increase.
The costs imposed by zoning go beyond supply and demand. Bureaucratic delays, legal and permit fees, "impact fees", etc. also impose additional costs upon a developer. These costs are ultimately passed on to consumers, in the form of higher housing costs.
Higher housing costs are not limited to single-family homes. Zoning has the same affects on apartment complexes and other multi-family homes. In addition, most zoning ordinances place strict limits on high density development, which further reduces the available land for such projects. Again, both the limited supply of land and the fees and delays imposed by zoning increase the price of rental housing.
Those most affected by this reduced affordability are the poor, the middle-class, and first-time buyers. Unfortunately, these individuals seldom realize that zoning is the reason they cannot afford to purchase a home. They are the hidden and voiceless victims of zoning.
Consider the Ashby High Rise. The project has already been delayed for months because of protesting neighbors and a pandering City Hall. At one point the City indicated that it might accept a “compromise”—a smaller version of the project.
Regardless, the developers have sustained additional costs because of the delays. A smaller project will invariably mean reduced economies, i.e., higher per unit costs. All of these additional costs will ultimately be passed on to the tenants and/ or buyers of the units in the building. Which means, the affordability of the housing will be reduced.
Perspective purchasers and tenants may not even be aware of the current situation. Consequently, they have no voice in the process. (I hasten to add that nobody but the developers should have a voice in the process.) Yet, they could find themselves a victim of a “debate” that occurred without their knowledge, consent, or input. They too are the voiceless victims.
© J. Brian Phillips 2008