News and Commentary
Presidential Candidate Cory Booker came out with a revised housing plan. Included in his plan is a renter tax credit, a “baby bond” to help new families afford down payments on homes, and $16 billion in block grants for communities that roll back restrictive zoning regulations.
In part two of a series for the Mercatus Center, Kevin Erdmann identifies the role landlords play in the housing market. These include managing the transaction costs for homebuying, providing upfront capital to renters who consume housing slowly, and by reducing the risk home price decline for those who would otherwise own only one home.
New Research
A new study from Yale Law Journal finds that progress in family law is being hampered by zoning law. The “functional turn” in family law recognizes a broader set of relationships as qualification for belonging to a family (rather than just by blood, marriage, and adoption). Zoning law, however, sticks to the traditional definition, creating restrictions for “functional families” that live together.
As “superstar” cities refuse to build enough housing to keep up with demand, a new paper theorizes how federal policies could increase growth in places that are left behind. This would include subsidies to universities and other research institutions, increasing H1B visa allowances to bring high-talent individuals to distressed areas, and other geographically targeted initiatives. While this wouldn’t solve the zoning problem in high-productivity cities directly, it could help many urban areas in struggling regions become their own talent magnets.
One of the better arguments made by NIMBYs (granted, it’s a low bar) is that new housing construction often builds new “luxury” units that are generally unaffordable for those hardest-hit by the housing crisis. A new paper by Evan Mast shows otherwise. He finds that building new, more expensive housing leads higher-income residents to move into apartments that better fit their incomes. In turn, this reduces demand in poorer areas and brings rents down. You can read Nolan Gray’s summary of the findings here.
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