Poverty, Housing, and Market Processes

Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/68441/2/10.1177_107808747200800108.pd

Summary of an Article on Reforming Land-Use Regulations

This article describes how excessive land use control adversely affects the cost of housing. Numerous studies showing the impact of over-regulation on housing costs are cited. The article provides both a historical and philosophical context for public land use regulation and describes key judicial decisions as well as competing public and private interests that shape the regulatory environment.Specific attention is given to the work of the Committee on Government Regulation and the Cost of Housing of the President's Commission on Housing. The various recommendations of the Commission are set forth, the central one being the enactment of state and local legislation to restrict zoning regulation to that which is necessary to achieve what the Commission terms a "vital and pressing" governmental interest. A number of other specific Commission recommendations are also enumerated including density of development, restrictions on manufactured housing, size of dwelling units, growth controls, farmland preservation, development standards and fees, and local permit processing. The article concludes with a strong statement regarding the need for public education as a prerequisite for reform. Copyright American Real Estate and Urban Economics Association.

The Interaction of Building Codes and Housing Prices

The study analyzes the effect of restrictive building codes on the price of housing, and the simultaneous impact of housing values on the strictness of codes. A model is defined and estimated, using data for more than 1100 localities. The results show that strict codes raised housing values, in 1970, by about one thousand dollars. They furthermore show that the strictness of codes is in turn affected by housing values, as well as by the strength of construction unions. Homeowners and construction unions are thus both observed to gain from restrictive building codes, which can explain the prevalence of such regulations. Copyright American Real Estate and Urban Economics Association.