City Straw Density—Debunking that Anti-Growth Management Study
posted by February 14 at 19:00 PMon
In this week’s In the Hall column, I argued that growth management “isn’t working”—citing growth projections that show ever more residents flocking to far-flung suburban areas that are ill-served by transit.
Today’s Seattle Times cites a new UW study that argues the opposite: Growth management is working too well. The study, by UW economist Theo Eicher, concluded that fully $200,000 of the increase in housing prices over the last 20 years can be attributed to government regulations—primarily the Growth Management Act, which was intended to promote inner-city density instead of far-flung suburban sprawl. That means, if you believe it, that fully 88 percent of the growth in housing prices can be laid at the feet of government. Well, I didn’t buy it, and neither did Eric de Place at Sightline, who did a three-part analysis ripping that figure—and nearly everything else about this study—to shreds.
Here’s where my own bullshit meter went off:
A key regulation is the state’s Growth Management Act, enacted in 1990 in response to widespread public concern that sprawl could destroy the area’s unique character. To preserve it, the act promoted restrictions on where housing can be built. The result is artificial density that has driven up home prices by limiting supply, Eicher says.
Long building-permit approval times and municipal land-use restrictions upheld by courts also have played significant roles in increasing Seattle’s housing costs, he adds.
First of all, density IS supply—by definition, “density” is dense housing. So density doesn’t limit housing supply, it just creates a different type of housing than Eicher’s suburban single-family Platonic ideal. Second, “artificial density” is one of those terms like “social engineering”—it’s used by anti-density activists to argue that density is somehow contrary to the “natural” course of development. Yes, government regulation can help produce density. I guess in that sense it’s artificial. But you know what else is artificial? Sprawl. Government subsidies that pay for roads; developments that are kept low-density by zoning regulations that privilege single-family houses; laws barring street grids in favor of cul-de-sacs, forcing people to drive everywhere; and big box retailers with massive parking lots—those are artificial. They’re just a type of artificial the study’s author likes.
Eicher goes on to cite a controversial provision of King County’s Critical Areas Ordinance, which requires landowners with undeveloped rural land in unincorporated King County to keep 50 to 65 percent of their property in its “natural state.” The provision was intended to stifle out-of-control subdivision of rural land; suburban developers opposed it, because that’s how they make their money. The study argues that such rules “forced greater density in Seattle” and drove up housing prices throughout the county.
It’s hard to see how regulations that only affect a small amount of land in rural King County could have “forced greater density” onto a city several miles away, but what about driving up housing prices countywide? Well, Sightline crunched the numbers on that one, too. They found, in de Place’s words, that “it’s too close to call”—home prices in unregulated versus strictly regulated parts of rural King County were virtually identical.
According to the Wharton study [by researchers at the University of Pennsylvania], cities such as Seattle that have high median incomes, high home prices and a large percentage of college-educated workers tend to have the most land-use regulations.
[Kriss] Sjoblom [an economist for the anti-regulation Washington Research Council] says that makes sense: “People with higher incomes want the kind of amenities that regulation provides,” he says. “If you’re a homeowner and growth controls are imposed and housing prices shoot up, you’re grandfathered because you own the place. In theory people will say it’s [rising prices] a bad thing, but in practice it’s not hurting them.”
Well, except for the whole ever-rising property taxes thing. And, you know, if you ever want to move. Moreover, it’s not, as de Place points out, as if housing prices haven’t been rising in the rest of the country. In fact, they’ve been rising faster. Seattle ranked 57th in the nation in terms of annual housing price appreciation; Tacoma, for comparison, ranked 49th. The highest appreciation rate was in a place that must sound like paradise to regulation opponents like Eicher: The virtually unregulated Sun Belt.
In the final analysis, Eicher believes Seattle’s regulatory climate exists because its residents want it. “My sense is land-use restrictions are imposed to generate socially desirable outcomes,” he says. “We all love parks and green spaces. But we must also be informed about the costs. It’s very easy to vote for a park if you think the cost is free.”
Yeah - and it’s easy to drive on the freeway to the suburbs Eicher finds so idyllic if the cost of that road is hidden. But to regulation opponents, amenities like freeways are “natural,” so the subsidies that pay for them must be natural, too.