Friday, July 06, 2007

Affordable Housing

No issue in this city lends itself more to unfocused whining than the shortage of "affordable" housing. It seems like everyone pontificating on this issue slumps into Mossback-like pining for 1962. We certainly could achieve 1962-like demand for housing by simply deporting the excess population and barring newcomers, but I hope no one is advocating that.

The most contemptible of these gripes are those who, when citing the fact that housing is unaffordable, cite the price of single-family homes. Here's a quick economics lesson: given that the supply of potential single-family homes within the Seattle city limits is finite, and the demand almost certainly exceeds that, the price will increase. Accept it. The Seattle Times is particularly bad about using this metric in an economically illiterate way.

Living in the city limits is desirable. There's a finite number of homes available. Call it n. If you're the n+1-th richest household that wants to live in the city, you're SOL. You don't have an inalienable right to what is an extremely limited resource. Transit connections are excellent in South King County and Tacoma -- move there.

Real Solutions:
(1) Increase Density. Increase the supply of housing available, and prices will come down -- or at least grow more slowly than they otherwise would. Duh.

"But I have to have a yard...!" Then get out of the city.

(2) Allow Ex-urban Growth. Much worse for the environment than (1), but you can' t have everything. Are you trying to reduce housing prices, or reduce sprawl? The two are fundamentally in conflict sometimes, so pick one.

I'll talk about subsidized housing in a later post.

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