YIMBY
It’s hard to find affordable housing pretty much anywhere in the United States these days. This is the product of a confluence of factors, but one of them is a pretty simple one: supply and demand.
What is YIMBY?
YIMBY is an acronym for “Yes In My Back Yard.” While the name references the “NIMBY” term that originated in the nascent environmental movement of the American midcentury, it does not mean that “yes, we’d like to live in Love Canal,” but rather that we’d like to support the development of things. There is no one interpretation of how we have to do this, which makes for a more pluralistic movement in many ways. YIMBY brings together interests that are not commonly aligned:
- Energy and environmental conservation (left of center): More density lowers environmental footprint and increased energy efficiency.
- Pro-social (typically left-of-center): Density creates more neighbors, and neighbors are good.
- Building stronger communities (a generally bipartisan objective): Creation of more housing and strengthening the ability to develop it within a city means stronger local economies, more exchange between the people who live and work in these economies. This signals to outside actors that a community wants to attract and retain businesses and residents, and make it easier for them to do business there.
- Reduce burden on public resources (typically right of center): More density and less sprawl means less strain on public infrastructure, which saves taxpayers money.
- Private property rights (right-of-center and libertarian): the ability to do what you want with property you own, unencumbered by silly restrictions. Smaller government by way of less restrictions on what you can do with things you own.
Q. Will YIMBY reduce housing prices?
Implicit in a lot of YIMBY discourse is the idea that building a lot of housing will reduce the upward price pressure on rental rates and sale prices. The best way to get there, the YIMBY argues, is by making it easier to build housing. I call this the YIMBY Thesis. This thesis generally seems to be true according to a growing body of research, but with some asterisks. An increase in supply will either lower prices or reduce upward pressure on rental rates or housing prices, so long as the new supply of housing outpaces the demand for housing (econ 101, right?!). Prices can still go up, but more housing supply means more competition, which means that price increases are more likely to become unsustainable more quickly.
Q. What about all of the vacant housing?
A. Cities with high rates of vacancy in finished, habitable structures, should figure out a way to disincentivize owning a property and keeping it vacant indefinitely, if not banning the practice outright. This is a huge problem in cities like Vancouver or New York City, where foreign oligarchs invest in North American property as a safe haven asset, but are happy to keep it vacant, thereby limiting the supply of units available for rent or sale.
Q. What about Wall Street buying up oodles of properties for private gain?
A. Indeed. What about that? We should probably restrict that. Opponents of restricting investment in housing point out, however, that it’s difficult to restrict who is buying what in many cases because it’s not as though a publicly traded company is directly writing a check, but rather providing liquidity to property investors, who then buy up the homes through shell companies with dumb names like BRIGHT FUTURE VINYL SIDED GLORY III, LLC. Exactly how to best restrict this is anyone’s guess. But it’s possible to make housing a less attractive asset class, or by creating additional regulatory disincentives to corporate ownership, if not banning the practice outright.
Q. Shouldn’t We Decommodify All Housing?
A. Sure! Great idea! How to do it? It’s really hard to decommodify something that is in extremely limited supply.
Q. Shouldn’t We Socialize All Housing?
A. I mean, sure, comrade– but who’s going to make that happen?
This page will be amended as time goes on.