Are new improvements in housing policy a sign of more to come?

Where do people go when anti-camping ordinances are implemented? In Albuquerque, I joined housing colleagues in an op-ed pointing out that existing building codes, intended to ensure health and safety, are so stringent they are preventing safe, improvised solutions. I followed-up at Forbes with a “Tale of Two Villages,” in which I explain  two answers to the “where” question: one simple, cheap, and fast; and the other massively expensive because of code requirements. I urge that the rulemaking body for building codes, the International Code Council, must tackle the problem of encampments and address the need for an expedient solution that meets basic standards of health and safety.

In August, I wrote about the nuances of cash for rent as a solution. This month, I looked again at a study that shows that Housing Choice Vouchers—also called Section 8—are too hard to use because of too many rules, regulations, and inspections. My solution is to make vouchers more like cash. I reiterate that policymakers have studied this enough: “When a family is struggling to pay the rent, they don’t need a voucher, or a program, they need cash.” An experiment conducted by the National Bureau of Economic Research found that families don’t spend cash benefits frivolously but on immediate needs like housing. I ran the numbers and cash consistently outperforms  tax credit schemes in efficiency and creating a rapid subsidy for families in need.

Elsewhere, the Rhode Island state legislature has made some necessary changes to reduce regulatory red tape that thwarts the production of new housing. But the big question is: are those changes sufficient to create more production and supply in the market that will lead to lower housing prices and rent? As with Austin, Texas’ changes to zoning, the legislative changes to process and regulation are important and necessary, but in my view, simply not enough. 

I had a chance to engage Providence Mayor Brett Smiley about the Rhode Island changes and how his city would respond to state legislation. He said, “Right now, the average review process currently takes upwards of 30 days, if successful, our newly implemented concurrent review system could complete reviews for new single-family and two-family homes within seven days.”

That’s a significant improvement, but all the other associated costs, like utilities, may still hinder uptake. Time will tell if state and local governments build on the initial positive first steps or whether, like in Austin, more reform will be needed to stoke more production.

Finally, I come right out and say it: “It Is Time to Start Winding Down the Federal Home Loan Banking System.” I was already skeptical of acquiring an asset with 30-year government-backed financing, 15 years of interest payments up front, and that is dependent on hyperinflation in the housing market for appreciation. Now I’m an abolitionist. I argue that we get rid of the current system for building equity-based ownership and replace it with something else over time, like cooperative ownership, which I have previously suggested. It is a controversial opinion, but one worth having a wider and deeper discussion about.