Opinion: The reality behind the supposed ‘housing crisis’

Our governments, both state and local, are suddenly freaking out about the “housing crisis.” Given the level of hype, you’d think that we were in Turkey, with earthquake-collapsed buildings in all directions. But no one seems willing to dig into the underlying causes. Instead, as has occurred many times before, they just push for more growth, while ignoring critical concerns: Coloradans actually want less or no growth; continuing to grow indefinitely is not sustainable; and the COVID “bump” was just that — people shifted to working remotely in more desirable living situations.

Recent surveys say most Coloradans don’t want lots more people moving here. To quote one article, “Rasmussen Reports surveyed over 1,000 ‘likely to vote’ Coloradans to gauge their feelings on the matter. Overwhelmingly, the answers showed they want to limit population growth. In recent years 92% feel that the state has become more crowded. 90% desire a future where far fewer people move to the state. 59% prefer a complete stop to population growth or even a decline in the population.”

We have failures of planning on every level. The state’s Office of Economic Development and International Trade (OEDIT) gives out tax breaks to companies in existing urban areas, almost all of which already have pressure on housing prices because of excess job growth. Why hasn’t the Legislature restricted these tax breaks to areas that are losing jobs? Nor do our governments require a balance between jobs and housing growth; that’s why housing prices have risen so much in employment areas.

There are no requirements for jobs-housing linkage fees adequate to force new job development to pay for the affordable housing needed for its workers. This helps balance growth, as well as hugely improving affordability. Nor are new housing developments (like the 2206 Pearl proposal for 300-square-foot micro-units at $1,700-$2,600/month!) required to have the percentage of affordable units necessary to maintain the population’s economic distribution. In contrast, imposing rent control on existing units can create real problems: For example, it can put owners with high debt costs underwater or force them to reduce maintenance, and it inhibits landlords from helping temporarily needy tenants with rent reductions.

Both state and local governments want to promote the densification of single-family neighborhoods, even though they have the worst access to transit. But they also want to densify along transit corridors, that have the best access. This contradiction is completely ignored, as is the disruption for long-time homeowners that very reasonably expected their single-family neighborhoods to be stable.

Increasing demand for transit will require a tax increase, since RTD’s expenses are mostly paid by sales tax, not by riders. Also avoided are much better solutions to reducing traffic in our spread-out urban areas: Charging for parking and using the money to pay people to car-pool, vanpool, etc.; shifting to tolls and user fees to pay for road maintenance rather than general taxes; and imposing development impact fees to require growth to pay its way for new transportation projects. 

Expanding development potential by up-zoning single-family neighborhoods will raise prices everywhere in those neighborhoods. This will exclude first-time homebuyers but increase purchases by land speculators. Price increases will cause property taxes to skyrocket. Also ignored is that some people aren’t putting their homes on the market because they don’t want to face the currently high mortgage rates on their next place.

Areas with existing HOAs or neighborhood covenants are legally exempted from the proposed densification; case law says you cannot force people to densify. This legal protection also means that some folks will start creating neighborhood covenants to self-restrict densification. They know that it’s grossly unfair that they should be forced to take on the burden for a problem that they did not create.

The notion that we must have a continuous supply of young people is both not accurate and unsustainable. Per the St. Louis Fed’s data, the over-65 population in the U.S. increased by 80%, from 1960 to 2021. So, according to the “more young people” theory, you’d think our economy would have tanked. But our national productivity increased by 240% in the same 61 years. Besides, we can’t keep growing indefinitely; we’d use up all the farmland, water, natural resources, open spaces, etc. along with making any number of species extinct.

Finally, no question, jamming more people into smaller spaces allows for more efficient transit, and lower per capita energy costs in buildings (if they aren’t net-zero, which they should be). But our problem is simply too many people overall.

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