Tuesday, August 9, 2016

How to Control Richardson Housing Costs

"Dallas joins Portland, Seattle and Denver as a top market for home price gains". That's the headline in The Dallas Morning News. And by "Dallas" the News means "Dallas-area" which includes Richardson. Everyone has heard the stories of Richardson houses going on the market and immediately receiving bids above asking price.

If you're selling, that's good news. If you're buying, that's bad news. And if you're doing neither, if you already own a house and just don't like seeing your property taxes go up, that's also not such good news. I'm here to tell you that, no matter your circumstances, if you consider housing inflation to be a problem in general, that there is a solution. And it comes from Tokyo.

First, Vox pinpoints one of the sources of the problem. Spoiler alert: it's us.
Most big American cities and their surrounding suburbs have housing regulations that strictly limit the number of new housing units that can be built. As a result, the demand for housing in the most economically dynamic cities has dramatically outpaced the supply.
In the United States, local housing markets are plagued by grassroots "Not In My Back Yard" (NIMBY) activists who organize to stop efforts to build town homes and apartment buildings in their local neighborhoods. Because every construction project is located near somebody, the result tends to be that little housing gets built anywhere.
Source: Vox.
The solution to be found in Tokyo is to take veto power away from neighbors.
Japan sets housing regulations at the national level. As a result, if a Tokyo landowner wants to knock down his single-family home and replace it with a six-unit condo building, there's little that his neighbors can do to stop it. That can be annoying to individual homeowners, of course. But it also has the huge upside of keeping housing costs under control.
Source: Vox.
As graphs accompanying the Vox article show, Tokyo has succeeded in keeping housing costs under control even in the face of population growth, unlike San Francisco, Boston, New York, and...Richardson. So, if you want to keep housing prices under control, there is a solution. For Richardson, it involves approving more of those multi-family projects that neighbors hate. Is the cure worse than the disease? That's a judgment call each person has to make for himself.

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