Monday, March 27, 2006

Environmental Zoning and California's Historically Low Home Affordability

California's rate of home ownership (according to this SF Gate article) is far lower than that of the rest of the country due to the combined effects of such things as tax law (e.g., Proposition 13) and environmental zoning regulations (e.g., the Marin Agricultural Land Trust (MALT)).

This article in SF Gate looks at whether environmental zoning policies should be altered to allow for more building (yes, I know, the proposal is backed by a building association but that doesn't change the fact that there is a problem that needs to be addressed). Of course, the timing of this is not surprising given our current historically low affordability rates. But if real estate bulls are right, if "it is different this time", and house prices do not correct in a major way so as to re-establish more normal housing affordability, then I do not see how we can afford to not alter the environmental zoning regulations.

Should preserving current owner's property values (at least in the short to medium term) trump housing affordability and take precedence over future generations' ability to own their own house in California? Or do we just smugly sit back, congratulate ourselves on our pricey homes and how desirable they must therefore be, and hope incomes will rise enough to make housing affordable again in California and let the current generation flounder as it will until that time? With respect to MALT, are cows and pasture land more important than people?

Update: It seems that Santa Barbara is already having to swallow this bitter pill.

Some choice quotes:
The study, titled "Homeownership in California," makes the case that the state's 57 percent homeownership rate -- the second lowest behind New York -- lags far behind the national average of nearly 70 percent because a patchwork of environmental policies and legal decisions has choked off new home building and thereby pushed home prices $300,000 above the national average.

"We may be producing some of America's best college graduates, but we're exporting them to states where owning a home is more than just a fantasy," said Alan Nevin, chief economist at the California Building Industry Association in Sacramento and the author of the study.

In the 1950s and 1960s, California's homeownership rate was equal to the United States' as a whole. But in the 1970s, that changed as the California Environmental Quality Act and other measures were passed, Nevin said.

Now, as a dwindling number of residents can afford even modest homes, the building industry contends the answer is to curtail the use of the quality act by environmental groups to halt development and to force cities to identify and plan for a 20-year supply of new housing.

The study coincides with the building association's sponsorship of several bills that would make it easier for builders to access and develop available land.

Environmental advocates, however, say the builders are using the specter of recent, huge housing price increases to attempt to curb important protections for open space and endangered species.

20 Comments:

Blogger Rob Dawg said...

California's rate of home ownership is far lower than that of the rest of the country due to the combined effects of such things as tax law (e.g., Proposition 13) and environmental zoning regulations (e.g., the Marin Agricultural Land Trust (MALT)).

Completely unsubstantiated conclusions. California has a low ownership rate because of immigration and demographics and urban density not Prop 13. Places in California with the strongest envirozoning have among the highest ownership rates in the state. Ventura 68%, Marin 64%, Napa 65%. Contrast that with the go-go high density counties; LA 48%, SF 35%. See?

Mar 27, 2006, 10:44:00 AM  
Blogger peterbob said...

Robert Coté said...
Completely unsubstantiated conclusions. California has a low ownership rate because of immigration and demographics and urban density not Prop 13. Places in California with the strongest envirozoning have among the highest ownership rates in the state. Ventura 68%, Marin 64%, Napa 65%. Contrast that with the go-go high density counties; LA 48%, SF 35%. See?


But how much higher would home ownership be in EACH of these locales if there were less roadblocks to development.

I predict that over the next few years, as affordability has plummeted, we will get more and more hard numbers on just how expensive various zoning and NIMBY laws have been.

Mar 27, 2006, 1:29:00 PM  
Blogger Rob Dawg said...

Peterbob,
We are talking past each other. Ownership higher if we still had Prop 13 AND lower prices AND development subsidies AND ...? Doesn't parse. You assume Prop 13 is a roadblock, you assume envirozoning is a roadblock, etc. Look at my data; LA low ownership, Ventura high ownership. LA few roadblocks, Ventura arguably the biggest roadblocks in the nation. Seems to me if we want higher homeownership we should emulate Ventura and not LA.

Mar 27, 2006, 5:32:00 PM  
Anonymous Anonymous said...

Unfortunately I don't think environmental zoning is going to go away until almost all of the Baby Boom generation are dead and in the ground. They're the ones who kicked off the environmental movement in Marin County in the 60s; they're the ones who bought in the 70s and 80s when Marin was still (relatively) affordable; they're the ones who are benefitting hugely from the grossly inflated property values now; they're the ones for whom "protecting the environment" (while "conveniently" keeping out any more newcomers and maintaining those high property values) is the most sacred of sacred cows; and as homeowners, they're the ones who have most, if not all, of the political clout in this area. Scams like MALT are not going to go away; to rethink environmental zoning would mean people would have to live with the uncomfortable idea that somewhere, a dairy farm is being displaced by a subdivision, and as we all know, "Developers are EEEEEEEVIL! Erm, except for the ones who built my house, that is."

Mar 27, 2006, 5:58:00 PM  
Blogger Marinite said...

Scams like MALT are not going to go away; to rethink environmental zoning would mean people would have to live with the uncomfortable idea that somewhere, a dairy farm is being displaced by a subdivision, and as we all know, "Developers are EEEEEEEVIL! Erm, except for the ones who built my house, that is."

All the more reason to get up now, take a stand, and make yourself heard.

Mar 27, 2006, 8:21:00 PM  
Anonymous Anonymous said...

Places in California with the strongest envirozoning have among the highest ownership rates in the state. Ventura 68%, Marin 64%, Napa 65%. Contrast that with the go-go high density counties; LA 48%, SF 35%. See?

It does not follow that "envirozoning" = high rates of home ownership. There are other factors at work besides just the one. San Francisco has a lot of renters because there are a lot more rental properties. Not to mention a very active renters' rights lobby, well-represented on the Board of Supervisors, that makes such things as condo conversions extremely difficult. Rental properties are relatively scarce in Marin.

Mar 28, 2006, 1:06:00 AM  
Anonymous Anonymous said...

All the more reason to get up now, take a stand, and make yourself heard.

OK, I'll take a stand on this issue. I will fight, tooth and nail, any effort to bust up MALT, or to build anything on any land in Marin that is currenly zoned for open space. There, I said it.

You can call me a NIMBY, a commie, an elitist snob, I really don't give a sh-t. All I know is that I grew up here, and will do my utmost to pass the same Marin on to my children that was passed on to me.

Want to know what happens to an area when most people are concerned about getting their affordable dream home, and ignoring the impact on the environement and the community at large? Two words for you folks: Los Angeles.

If you build it, they will come. Never, EVER, forget that.

Mar 28, 2006, 5:01:00 AM  
Blogger marin_explorer said...

Regarding MALT, if anyone thinks that suffices as environmental protection, consider how hillsides converted to grazing land actually decimate the native environment (plants and animals) in much the same way as conventional housing development. (It's actually worse, due to agricultural runoff/waste) The only difference being, people can look at the green hills and believe west Marin is somehow "preserved". Does w. Marin really belong to some cows and rather unproductive dairy farms?

I say this based on some experience working on restorative projects in various parts of Marin. Despite appearances, Marin is actually in worse shape than other locations in the bay area with a similar "appearance".

It's my opinion that niether a reactionary fence around the "environment," or a parade of developer's bulldozers is the solution. I think it's going to take a while for the old generation to be replaced by new ideas. That is, if people here get past their assumptions of what is "environmentally conscious".

Mar 28, 2006, 8:26:00 AM  
Anonymous Anonymous said...

Want to know what happens to an area when most people are concerned about getting their affordable dream home, and ignoring the impact on the environement and the community at large? Two words for you folks: Los Angeles.

MALT was a stupid, mindless way to protect the environment. Fencing off huge tracts of land is not the way to do it. Sensible building with the environment in mind is quite doable but needs to be done carefully. LA took the opposite extreme to MALT. Comparing the two is ridiculous and only further argues that a middle ground must be sought.

I also grew up in Marin and continue to live here and I also have children. I will also fight tooth and nail to undo MALT in favor of better alternatives. MALT has proven itself unworkable.

Mar 28, 2006, 9:05:00 AM  
Blogger Rob Dawg said...

It does not follow that "envirozoning" = high rates of home ownership. There are other factors at work besides just the one.

One reason we are so very expensive is because we have stricter
"anti-sprawl" rules than even Portland. Our problem is that to relax
the rules would flood the place until it looked like the San Fernando
Valley or Orange County. In FAct 40 years ago Orange and Ventura
Counties were nearly identical yet today Orange has 4 times the
population, higher prices, and a clearly worse quality of life so i
don't feel bad about our chosen path. I do feel bad for those that
cannot afford to live here but I also own waaaay out in San Bernardino
rental property that I lease at reasonable rates. The issue is building
where there is already buildings.
RPPI says in #320;

"The real problem is government restrictions on supply.
Supply has not kept up with demand due to these artificial
restrictions. One recent study found that 90 percent of
the difference between physical construction costs and the
market price of new homes can be attributed to land use
regulation.

The solution is to allow more construction."

There already exists a market mechanism to address affordable housing.
When housing becomes unaffordable, prices fall and time on market
increases. What RPPI proposes -instead- is that government not only get
out of the business of manipulating the market but that government also
get out of their actions regulating for an orderly market abandoning
supply and demand in exchange for demand only markets. This, in my
opinion, ignores the reality that zoning and land use regulation needs
to exist for the protection of -existing- land uses and land owners.
Turning this on its' head to become a tool of potential owners or uses
is antithetical to the usual positions of RPPI.

Affordable housing is easy. Lay down some streets and stand back. But
like I said affordable housing is only the wedge issue urban agendaists
are using to force social changes to their liking.

More, lots more at my blog.

Mar 28, 2006, 9:37:00 AM  
Anonymous by_palladium said...

oooohh, I have been waiting for a thread on MALT.

The entire concept of MALT - that dedicating land to its historical and cultural use as agriculture in Marin is a worthwhile endeavor IS BOGUS.

The reality is that this history of ag in marin is only aproximately 200 years at the max. Compared to anywhere else on the planet, that isn't history. The concept that the absolutely marginal grazing land's highest and best use is as pasture, when thousands of commuters drive past such land is a sad testiment to the wastefulness of these alleged environmental regulations.

Any one remember the old signs Save Horse Hill overlooking 101 in Mill Valley? Though not MALT, here is some prime land that is on a transportation corridor, surrounded by development on three sides, this is the perfect place for housing marin's families - if anyone really cared about that. Take a look at what the horses had done to that hillside in terms of erosion. The sign should have been changed to Pave Horse Hill. It would be better for the environment on balance.

I am close to starting a blog dedicated to discussing MALT and its contemporaries in Santa Barbara and Monterey and their effects on the local societies. Given time constraints, I would probably only get 2 posts a week out.

Mar 28, 2006, 9:43:00 AM  
Anonymous Anonymous said...

If you build it, they will come. Never, EVER, forget that.

Yeah, so don't build it, and let them overdevelop someobody else's county. "It's all about me, babyeeeee!...."

You want to talk about "entitlement mentality"? How about this attitude of Marin exceptionalism?

Mar 28, 2006, 10:00:00 AM  
Blogger Marinite said...

Any one remember the old signs Save Horse Hill overlooking 101 in Mill Valley? Though not MALT, here is some prime land that is on a transportation corridor, surrounded by development on three sides, this is the perfect place for housing marin's families - if anyone really cared about that.

I know it well. I've looked fondly upon it since I was little. But it is just begging to be developed. Not to do so is irresponsible. There are other plots like this in Marin.

I am close to starting a blog dedicated to discussing MALT and its contemporaries in Santa Barbara and Monterey and their effects on the local societies. Given time constraints, I would probably only get 2 posts a week out.

Do it! It is desperately needed IMO. There should be a single place people can go to discuss the issue and find links to resources. I will provide any assistance that I can and that you are willing to accept.

Ok, now I bow out of this interesting thread.

Mar 28, 2006, 10:17:00 AM  
Anonymous Anonymous said...

Any one remember the old signs Save Horse Hill overlooking 101 in Mill Valley?

The reasons for that whole campaign can be summed up thusly: people drove by that hill every day, saw the horses gamboling about on the hill, and though, "Awww, isn't that pretty?" So when they found out the horses might be removed in favor of homes, they went into knee-jerk Marin "stop everything" mode. I think part of the reason why people feel the need to preserve these last few bits of our agricultural past smack in the middle of urban Marin is partly a way to assuage the guilt they feel at being part of the urbanization of a once idyllic countryside. If Horse Hill, Silviera Ranch, etc., are preserved, people can think, well, at least it's not ALL city. But the problem is, we're human beings. We're inherently social. We live in cities. That's what we do. Oh sure, if you want to be more isolated, you can be. Move to a cabin up in Cazadero or something if that's what you want. This is town. Stop pretending otherwise. You can't have it both ways.

Mar 28, 2006, 10:32:00 AM  
Anonymous Anonymous said...

people drove by that hill every day, saw the horses gamboling about on the hill, and though, "Awww, isn't that pretty?" So when they found out the horses might be removed in favor of homes, they went into knee-jerk Marin "stop everything" mode.

That is exactly, 100% correct. That is precisely what was happening then.

people can think, well, at least it's not ALL city

That is exactly it. That is an almost word-for-word quote of my boomer mother when she is forced to justify MALT.

Mar 28, 2006, 11:03:00 AM  
Anonymous Anonymous said...

If MALT was ever "broken" as a trust...what do you think? It's gunna be some kind of Utopia where land is given to kids who want houses? No Way! First of all, it wouldn't happen overnight. That means 200+ acre plots (as they currently are) would be broken down into 40 acre or MAYBE 20 acre plots. What do you think those plots would sell for? Cheap? Forget about it!! You think Marin is full of "Rich Snobs" now???

Mar 28, 2006, 11:07:00 PM  
Anonymous Anonymous said...

If MALT was ever "broken" as a trust...what do you think? It's gunna be some kind of Utopia where land is given to kids who want houses?

Exaggerate much? Nobody has said anything about utopia. If anybody's utopian, it's the people who are trying to preserve this county in amber.

Yeah, those damn kids. Imagine them wanting to buy, you know, shelter, for themselves and their own families. Miserable uppity brats.

Mar 29, 2006, 1:43:00 AM  
Blogger fredtobik said...

"If MALT was ever "broken" as a trust...what do you think?"

I'll "speculate" that you will see 80% million dollar homes and 20% 700k, all stacked on top of each other and 2ft apart with no yard, but a cool sub name like "Rolling Meadows" etc...

Mar 29, 2006, 9:00:00 AM  
Anonymous Anonymous said...

"Yeah, those damn kids. Imagine them wanting to buy, you know, shelter, for themselves and their own families."

It's not a matter of feeling or not feeling for kids and their lack of means at the current time in their lives. It's just an opinion of how things would unfold if MALT were broken.

Mar 29, 2006, 10:47:00 AM  
Blogger stella said...

In 1998 we bought our cabin (where we now live full time). The mortgage for the rental cabins was $600 (large down payment). Had we upgraded our primary residence a second home would have been out of the question at that time. For $1300 a month we had two houses that we loved and were still comfortable, financially.

Apr 2, 2008, 4:56:00 AM  

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