Wednesday, November 25, 2009

Why is Housing So Expensive in California? Part 2

In part 1 of this series we took a look at the tax incentives facing cities. Because property taxes are so low in CA, cities often have little incentive to build housing, which consumes more in services than cities receive from it in taxes.

In this part we look at NIMBYism ("not in my back yard"). NIMBYism is resistance to a construction project by the people that live in an area. In their 2002 article entitled "The Great Housing Collapse in California", Myers and Park note that "citizen resistance to denser infill development is impeding apartment construction" (p. 4). Infill development means taking underused land in existing cities (such as abandoned factories or parking lots), cleaning it if necessary, and redeveloping it.

If the growth in the supply of apartments doesn't keep up with the demand, the price will rise and people will live in more crowded conditions or stretch their budgets dangerously thin. Infill development is useful because it adds density which can cut travel distances (by supporting more nearby businesses), aid walkability/bikeability and promote frequent transit service, and because it keeps natural habitat from being destroyed at the urban fringe.

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