MENU

Reason.com

Free Minds & Free Markets

VOLOKH CONSPIRACY

Mostly law professors, blogging on whatever we please since 2002 · Hosted by The Washington Post, 2014-2017 · Hosted by Reason 2017 · Sometimes contrarian · Often libertarian · Always independent

Minneapolis Strikes a Blow for Affordable Housing by Slashing Zoning Restrictions

Zoning rules that severely restrict home construction cut off millions of poor people from jobs and affordable housing. The Minneapolis reform is the most extensive reduction in zoning achieved by any major American city in a long time.

Minneapolis.Minneapolis.

Yesterday, the City of Minneapolis struck a major blow for both property rights and affordable housing by enacting the most extensive reduction in zoning restrictions adopted by any major US city for a long time. Henry Grabar of Slate summarizes this welcome development:

Minneapolis will become the first major U.S. city to end single-family home zoning, a policy that has done as much as any to entrench segregation, high housing costs, and sprawl as the American urban paradigm over the past century.

On Friday, the City Council passed Minneapolis 2040, a comprehensive plan to permit three-family homes in the city's residential neighborhoods, abolish parking minimums for all new construction, and allow high-density buildings along transit corridors.

"Large swaths of our city are exclusively zoned for single-family homes, so unless you have the ability to build a very large home on a very large lot, you can't live in the neighborhood," Minneapolis Mayor Jacob Frey told me this week. Single-family home zoning was devised as a legal way to keep black Americans and other minorities from moving into certain neighborhoods, and it still functions as an effective barrier today. Abolishing restrictive zoning, the mayor said, was part of a general consensus that the city ought to begin to mend the damage wrought in pursuit of segregation. Human diversity—which nearly everyone in this staunchly liberal city would say is a good thing—only goes as far as the housing stock...

A lot of research has been done on the history that's led us to this point," said Cam Gordon, a city councilman who represents the Second Ward, which includes the University of Minnesota's flagship campus. "That history helped people realize that the way the city is set up right now is based on this government-endorsed and sanctioned racist system."

Kriston Capps of City Lab writes that "Minneapolis 2040 is the most ambitious upzoning guide yet passed by an American city." Some 75 percent of city residents live in areas where single-family zoning restrictions currently apply.

The case for cutting back on zoning restrictions unites economists and housing policy experts across the political spectrum. That includes both pro-free market experts and prominent left-liberals such as Nobel Prize-winning economist Paul Krugman, Matthew Yglesias of Vox, Yale Law School Professor David Schleicher, and Jason Furman, Chair of President Obama's Council of Economic Advisers. In addition to greatly increasing housing costs, zoning also cuts off many poor and lower-middle class Americans from valuable job opportunities, thereby also greatly reducing economic growth. As Grabar points out, many zoning restrictions (including many single-family home rules of the sort repealed by Minneapolis) were enacted in large part because of a desire to exclude African-Americans and other minorities. Minneapolis Mayor Jacob Frey notes that "Minneapolis has a long history going back 100 years of redlining and intentional segregation. We literally have maps at the city that identify north Minneapolis as a slum for blacks and Jews." Both liberals concerned about expanding opportunities for the poor and racial minorities, and conservative and libertarian property rights advocates have good reason to support abolishing zoning rules that make it difficult or impossible to build new multifamily housing in many major cities.

Up until now, however, most reform efforts have been stymied by a combination of public ignorance, interest group pressure, and NIMBYism. Earlier this year, for example, the California state legislature defeated Bill 827, a reform effort that would have greatly expanded the availability of housing in a state that has particularly onerous zoning restrictions. Sadly, liberal Democratic cities ruled by political coalitions supposedly committed to helping the poor have some of the nation's most severe zoning rules, thereby cutting off many of the poor from both housing and jobs. Affordable housing advocate Shane Phillips has rightly highlighted the "disconnect between liberal aspirations and liberal housing policy."

Minneapolis' new plan is a welcome break from this sad state of affairs. Having criticized other blue jurisdictions for their failure on this issue, it is only fair that I give full credit to Minneapolis' overwhelmingly liberal Democratic city government for achieving a major breakthrough. Policy experts and other reform advocates would do well to study the Minneapolis effort to see if it contains any insights on how to achieve similar progress elsewhere. Kriston Capps' City Lab post includes an interview with Minneapolis Mayor Jacob Frey discussing how the plan came about, though he offers few specifics on what he and his allies did that differed from less successful efforts elsewhere.

UPDATE: Thomas Lifson of the American Thinker blog responds to this post here, arguing that the Minneapolis reform destroys neighborhood "diversity" by overriding the preferences of people who prefer to live in single-family homes. But the fact that building multifamily residences is permitted does not mean that all homes in the city will be that way, or even that there won't be neighborhoods where single-family residences are by far the most common type. To the contrary, allowing property owners to decide for themselves what sort of homes can be built actually increases diversity. In some cases, residents of an area can even agree among themselves to limit particular types of development through such devices as private planned communities and restrictive covenants. What the Minneapolis reform does is prevent the coercive imposition of mandatory homogeneity on the vast majority of an entire city. That both fosters diversity and - perhaps more importantly - increases the freedom of property owners and people seeking jobs and affordable housing.

Lifson also doubts the racist origins of single-family zoning, claiming that Minnesota had only a very small black population until recently. The racial motivations behind this kind of zoning are well-established by historians and property law scholars. They were by no means the only motives for it, but did play a major role in both northern and southern cities. That includes some that did not initially have a large black population, but feared that one might be established because numerous African-Americans were migrating from the south to northern cities in the early to mid-twentieth century.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • dwshelf||

    This isn't about race.

    It's about economic envy. The urge to destroy the lifestyle choices of the wealthy so as to bring them down a peg or two.

    It's about stealing assets from the wealthy, as property values plummet as the wealthy desert the city for well behaved suburbs.

  • UVaGrad||

    "This isn't about race. It's about the people who aren't well-behaved invading and stealing from the good people."

    Yep, totally not about race!

  • a ab abc abcd abcde abcdef ahf||

    It increases individual liberty. That's good, in case you need a hint.

  • dwshelf||

    When it's a large city targeting a single family neighborhood for destruction, that's a taking.

    If the neighborhood votes to eliminate zoning, that's liberty.

    You know that, I know that, abstractions are not the discussion.

  • a ab abc abcd abcde abcdef ahf||

    Majority rule can destroy individual property rights?

    Gosh, I guess if majority rule wanted to keep slavery in a neighborhood, that would be ok too.

    I hadn't thought of that angle. I bow to your wisdom, kind sir.

  • dwshelf||

    Majority rule can destroy individual property rights?

    Exactly.

  • NToJ||

    So why is it that a single family neighborhood votes to enact zoning that isn't destroying individual property rights? And ordinances aren't enacted by neighborhoods, they're enacted by, for e.g., municipalities.

  • dwshelf||

    So why is it that a single family neighborhood votes to enact zoning that isn't destroying individual property rights?

    It likely would be. Covenants are a superior libertarian solution, but going, against the will of owners, from single family zoning to high density zoning, is not a move toward respecting individual ownership rights.

    If they really wanted to give people the control over their properties, they would give the owners a vote.

    Generally, the more local the decision, and the higher the bar for what constitutes a majority, the less infringement on property rights.

    In the decision under discussion, it seems quite clear that the people living in the neighborhoods under discussion strongly oppose this change, which will destroy not only their way of life, but also their property values.

    And ordinances aren't enacted by neighborhoods, they're enacted by, for e.g., municipalities.

    Which represents a threat to civilized neighborhoods when the riff raff takes over 51% of the city.

  • NToJ||

    "If they really wanted to give people the control over their properties, they would give the owners a vote."

    The owners did have a vote.

    "Generally, the more local the decision, and the higher the bar for what constitutes a majority, the less infringement on property rights."

    This doesn't make sense. Majoritarianism scales. It is the same bar for 10 people as it is for 10,000,000. 51%.

  • NToJ||

    "...which will destroy not only their way of life, but also their property values..."

    Nonsense. First, if the idea is that this causes plummeting property values, that's only true because multifamily will move in and suppress existing property values. Or at least that's the theory. But how will multifamily move in without the express acquiescence of people (sellers) who already live in the neighborhood? And how would that happen unless the land becomes more valuable to the seller by selling than it did by living in it? Zoning laws reduce property values per square foot by placing arbitrary limits on how the property can be used.

    It is true that later sellers will find their property values decreased if and when the neighborhood's highest and best uses change from single family ranch homes to apartments, or industry, or whatever, but that's how it should be. Values should be dictated (in a free market) by the highest and best use of land. Let the neighborhood compete for what they believe is the highest and best use, and see who wins?

  • NToJ||

    Second, no one's "way of life" is seriously threatened here. It might be that some people have to make compromises about how far from downtown they live, versus whether they want 3,000 or 5,000 square foot homes. But all homeowners make those compromises, and they should be made in a market environment, rather than central planning by zoning boards.

  • dwshelf||

    Second, no one's "way of life" is seriously threatened here.

    Higher density -> high crime.
    High crime -> decreased quality of life.
    Decreased quality of life -> decreased quality of people.
    Decreased quality of people -> end of way of life.

  • David Bremer||

    Higher density -> high crime.

    Utter nonsense. I live in Minneapolis (well, did live in Minneapolis, but now live in a suburb). The downtown areas (particularly the North Loop and Mill District) have much greater density today, but have lower crime rates than before. Meanwhile, the worst neighborhood (North Minneapolis) has seen declines in people (thus declines in density).

  • dwshelf||

    I live in Minneapolis (well, did live in Minneapolis, but now live in a suburb). The downtown areas (particularly the North Loop and Mill District) have much greater density today, but have lower crime rates than before. Meanwhile, the worst neighborhood (North Minneapolis) has seen declines in people (thus declines in density).

    Single family neighborhoods are by far lower crime than high density neighborhoods.

    The stuff you discuss is a non-sequitur.

  • David Bremer||

    Single family neighborhoods are by far lower crime than high density neighborhoods.

    The stuff you discuss is a non-sequitur.

    Again, you are ignoring reality. North Minneapolis has lower density than it did before, and it's the high-crime area of Minneapolis. Detroit has lost people over the years, resulting in areas of relatively low density. Those are some of the worst areas.

    My statements aren't non-sequiturs. They are real life examples that contradict the bold and baseless claim you make.

  • dwshelf||

    Again, you are ignoring reality. North Minneapolis has lower density than it did before, and it's the high-crime area of Minneapolis. Detroit has lost people over the years, resulting in areas of relatively low density. Those are some of the worst areas.

    Apparently you read me to say that loss of density is a good thing.

    I said no such thing. Rather, I described a context where increased density was a bad thing.

    In particular, the transition from single family to multi-family is devastating to quality of life. Or, if you prefer, the transition from owner occupied homes to rental properties, which is what such zoning affects.

  • David Bremer||

    In particular, the transition from single family to multi-family is devastating to quality of life.

    You're assuming all single-family homes will transition into apartment complexes. That's unlikely to happen (as there are still single-family homes in Houston).

    Also, since you're just shooting from the hip, you don't account for the fact that the majority of the single-family residence areas are going to be zoned "Interior 1" or "Interior 2," which are defined as "New and remodeled buildings . . . [and] small-scale residential. Individual lots are permitted to have up to three dwelling units. . . . Building heights should be 1 to 2.5 stories." Combining lots is generally not permitted in Interior 1 areas.

    I'm not sure why you think there will be a bunch of apartments in an areas where you can't combine lots.

  • dwshelf||

    I'm not sure why you think there will be a bunch of apartments in an areas where you can't combine lots.

    That's the point of the zoning changes.

    To convert the neighborhood into apartment living.

  • dwshelf||

    But how will multifamily move in without the express acquiescence of people (sellers) who already live in the neighborhood?

    What are you going to do when you observe your neighborhood in decline?

    You're going to sell cheap.

  • NToJ||

    "What are you going to do when you observe your neighborhood in decline?

    You're going to sell cheap."

    If I want to move, I'm going to sell the property for the amount the market is willing to pay for it, which is how commerce works generally. You're the one demanding special pleading for single family homeowners.

  • dwshelf||

    If I want to move, I'm going to sell the property for the amount the market is willing to pay for it, which is how commerce works generally.

    What was done in Minneapolis is well outside "how commerce works generally". Generally, homeowners must directly participate in zoning change decisions, and would not agree to changes which lower their property values.

  • NToJ||

    "Which represents a threat to civilized neighborhoods when the riff raff takes over 51% of the city."

    The truth will set you free. Again, though you're just spouting idiotic nonsense. However you define "riff raff" they are not the ones purchasing up expensive land in formerly single-family zoned neighborhoods. Rich residential neighborhoods aren't scared of the poors. They're scared of rich developers.

  • Thomas O.||

    Property owners "selling cheap" would be regarded as a victory for fair-housing advocates.

    Cities gotta do something about the "riff raff" (which I'm assuming are the homeless and the lower-income folks/families). The options:

    A) Let them pack themselves like sardines into existing housing with impunity, which I'm sure the neighbors will love;
    B) Keep vagrant-law enforcement lax and let them sleep and shit on the streets, and do nothing about the tent-cities that pop up (how's that working for San Fran?);
    C) Force them to live far away and make a ridiculously long commute to the only jobs they can find (in poorly-maintained cars that could break down and fuck up traffic for the rest of us, I might add); or
    D) Get rid of the overreaching regulation and give more freedom to the property owners (not to mention give them incentive to build affordable housing). Houston already doesn't have zoning per se, but they seem to be doing well with what restrictions/regulations they do have in place. Time will tell if Minneapolis has similar results.

  • Kazinski||

    Who is making the wealthy sell out and move?

    What it does is revoke the wealthy's veto over other people using their property for what they want.

    If you like your house you can keep it, but don't tell anyone else what to do with theirs. And property values are likely to go up as the economic value of property can be more easily realized.

  • dwshelf||

    Who is making the wealthy sell out and move?

    Increased crime.

  • Longtobefree||

    2A.
    A large lot = clear fields of fire.

  • DjDiverDan||

    But firing bullets across land that doesn't belong to you constitutes a trespass, even if the bullet doesn't hit anything.

  • HMI||

    Since when is municipal zoning an individual's asset?

  • dwshelf||

    Since when is municipal zoning an individual's asset?

    When the removal of such zoning will result in the destruction of lifestyle and a following destruction of property value.

  • NToJ||

    Why is anybody entitled to a zoned lifestyle or property value?

  • dwshelf||

    Why is anybody entitled to a zoned lifestyle or property value?

    Because that's what they bought when they bought their house.

  • David Bremer||

    Because that's what they bought when they bought their house.

    Knowing full well that the city council could change or repeal the zoning rules at any time.

  • dwshelf||

    Knowing full well that the city council could change or repeal the zoning rules at any time.

    The part few if any of them anticipated was that hostile elements would come to control the city, and the city would then destroy something beautiful, to eliminate "inequality".

    That reality just didn't seem plausible to them.

    The city could pass a law that all homes must be replaced by tents, and it would make equal sense.

  • NToJ||

    "The part few if any of them anticipated was that hostile elements would come to control the city, and the city would then destroy something beautiful, to eliminate "inequality"."

    So we should protect them from making a bad bet?

    "The city could pass a law that all homes must be replaced by tents, and it would make equal sense."

    You mean like a requirement that certain neighborhoods can only have certain types of structures (tents) within its boundaries? What would we call such a regulation...

  • dwshelf||

    What would we call such a regulation...

    Progressive.

    Since it would advance housing equality for everyone, including the homeless, some would call it progress.

  • NToJ||

    "It's about stealing assets from the wealthy..."

    That has nothing to do with it. Zoning is a government act intended to shift resources from one group of people to another. The removal of zoning will leave development decisions to the market and the market only. If the rich (or poor) want to live near the City, they shouldn't be given an economic advantage by local government.

  • donojack||

    Real estate is different from run of the mill commodities because it relies on government, or quasi-government, entities to supply the infrastructure. I guess the market would eventually sort it out but it would be a hell of a mess in the meantime.

  • NToJ||

    Which run of the mill commodities do not rely on infrastructure like roads? Which infrastructure resources are specific to real estate, and that are never used by commodity markets? And since the real estate market predates zoning laws, what makes you think infrastructure requirements that real estate relies on are dependent on zoning laws?

  • donojack||

    Schools, sewer, water. You can say that other commodities depend on them but that is so indirect as to be sophistry.

  • NToJ||

    Sewer and water are "so indirect" for manufacturing "as to be sophistry"?

  • donojack||

    Do you understand that you are referring to real estate here, commercial real estate? If I manufacture widgets and I decide to double my production that does not affect the infrastructure unless I need another plant to do so.

    By the way zoning is not really the main arrow in the government's quiver when it comes to controlling development. You can wipe out all the zoning laws and then I will be free to build 32 units per acre apartments where 1 per acre houses once stood. Good for me but not so good if the infrastructure can't handle it. That means I won't get a building permit. Moratoriums on building permits are common these days.

  • santamonica811||

    I am a big believer in letting local communities experiment (especially, as here, with things that cannot "spill over" to communities who want to try other approaches, is would be true for pot legalization, gun ownership liberalization, etc). It will be interesting to see how, 10 years down the road, this change has affected--and effected--life there. Hopefully, it will prove effective and an overall positive. The only thing I know for sure is that anyone who says, "I know for sure this is a good idea." OR "I know for sure this is a bad idea." is a liar or a fool.

    We'll just have to wait and see. Hopefully, other cities will also be experimenting, so we can start to figure out what works and does not work, what approaches work in some areas but not in others, etc..

    An area of our lives where the free marketplace of ideas should thrive.

  • dwshelf||

    This "experiment" is why you don't want to invest in zoning-protected homes in large American cities.

    When buying, imagine the same streets as are there now, but 4 times as many people, and 25 times as many drug addicts. Ask yourself, does this sound like a good investment?

    Choose instead a city where single family homeowners make up enough of the population that they can protect themselves against this kind of socialist takeover.

  • UVaGrad||

    Not having zoning laws is a socialist takeover? I didn't realize Houston has been run by socialists all these decades.

  • dwshelf||

    Not having zoning is fine, Houston is fine.

    Having single family zoning removed is a taking.

  • a ab abc abcd abcde abcdef ahf||

    Courts have ruled over and over again that, for instance, expanding the number of taxi permits, or allowing Uber and Lyft to operate, is not a taking just because it reduces the value of existing taxi permits.

    Same with any kind of business -- existing businesses have no property right in their current level of business which makes issuance of new business permits to new competitors a taking.

    Same with houses -- issuing permits to build new houses certainly reduces the value of existing houses, but that is not a taking.

  • hintonmj||

    Instituting the zoning laws in the first place was the taking. The removal of zoning laws is the removal of a taking.

  • mlwjr||

    I don't think using Houston is a great example.

  • dwshelf||

    Houston is a poor example of what?

  • Thomas O.||

    You make it sound like Houston's some anarchistic hellhole with all the ambience of Mogadishu. Far from it. It's flat and humid as fuck during the summer, sure, but Houston's still a livable city with a half-decent road network. And deed restrictions do cover a lot of stuff that zoning would impose.

  • Michael Masinter||

    What a peculiar conception of socialism dwshelf expresses. Zoning laws are government imposed restrictions on the right of a property owner to use his land. I would think a libertarian would champion landowner property rights, not government power to destroy them. But, as always, race and class matter more than freedom.

  • dwshelf||

    There are two common ways for homeowners to protect their value.

    1. Covenants.
    2. Zoning.

    Both serve to protect both the nature of the neighborhood, and the value of property.

    When zoning is unilaterally removed, without the vote of the property owners, that is a socialist taking.

  • a ab abc abcd abcde abcdef ahf||

    Both serve to reduce liberty and increase State power and busybody control over neighbors.

    Property is an individual right, not subject to majority rule and State intrusion.

  • HMI||

    The property owners got a vote in municipal elections, which is the sum total of what they are owed. Did they not understand that when they bought their houses?

  • dwshelf||

    Did they not understand that when they bought their houses?

    No, I'm pretty sure most of them had no such understanding. That a city would deliberately destroy single family neighborhoods is a new low in social decline.

  • NToJ||

    What do you mean by "unilaterally"? Zoning is removed by votes.

  • dwshelf||

    What do you mean by "unilaterally"? Zoning is removed by votes.

    The votes of other people.

    Much the way jpeople in New York City sometimes vote on what the government will require of people in Montana. Because there's way more people in New York City than there are in Montana. Or Syracuse.

  • NToJ||

    Do you think Minneapolis's zoning ordinances were enacted by people in New York City? Revoked by people in Syracuse?

    If you think zoning ordinance governance is illegitimate per se, why are you so defensive of the original zoning rules? Wouldn't they be illegitimate, too?

  • dwshelf||

    If you think zoning ordinance governance is illegitimate per se, why are you so defensive of the original zoning rules? Wouldn't they be illegitimate, too?

    Because the zoning was in place when he property was bought.

    Generally, in zoning cities, property owners are given significant deference over zoning changes.

    This might be easier to understand from the other side. If a property is zoned for building a skyscraper, but subsequently the city changed it to single family, the property could lose the vast majority of its value overnight. Would that seem like a taking?

  • NToJ||

    "Would that seem like a taking?"

    Yes, it's a taking. Because the government has changed your permitted use of your property. The government can't do that by removing a zoning ordinance.

  • dwshelf||

    Yes, it's a taking. Because the government has changed your permitted use of your property. The government can't do that by removing a zoning ordinance.

    They didn't quite "remove a zoning ordinance", but we might agree, the analysis would be even more crisp if they had.

    What they did was change the zoning (or "changed the permitted use"), with a resulting loss of value to the property owner. They did this against the wishes of the affected property owners.

    If such a change can ever be a taking (and we seem to agree they can), then this one qualifies.

  • Thomas O.||

    Is the government taking away your ownership of and kicking you off your property?

    No? Then it's not a taking.

    Just because they change the rules of property usage doesn't mean they'll force you to do something else with your property other than what you intended. You might not like your new neighbors down the line, but you're still free to either stay on your property or sell it.

  • Thomas O.||

    Actually, to clarify: I should've said "Just because they ELIMINATE some rules of property usage" instead of "change". Eliminating zoning codes is still NOT a taking, as opposed to imposing new zoning codes forcing you to change your property usage.

  • DjDiverDan||

    "Socialist takeover"??? Since when is an increase in economic freedom a "socialist takeover"? If you and all your neighbors really want to preserve the single-family character of your neighborhood, you remain free to do so through private deed restrictions, unanimously approved by those with actual skin in the game. What you should NOT be able to do is enlist the coercive power of government to force your economic preferences down the throats of dissenters. Calling economic freedom a "socialist takeover" is as wrong as calling the modern Democratic Party "liberal".

  • dwshelf||

    If you and all your neighbors really want to preserve the single-family character of your neighborhood, you remain free to do so through private deed restrictions, unanimously approved by those with actual skin in the game.

    In cities with single family zoning, which is most such cities outside of Texas, this isn't how it has been done. There are no covenants, because they weren't expected to be needed.

  • DjDiverDan||

    But expectations do not create a legal right. Just because you built on a lot zoned for single-family dwellings doesn't create a legal right to the continuation (in perpetuity?) of such zoning.

  • dwshelf||

    But expectations do not create a legal right. Just because you built on a lot zoned for single-family dwellings doesn't create a legal right to the continuation (in perpetuity?) of such zoning.

    No, but something has gone wrong when the riff raff comes to have enough votes to take it away from you.

  • DjDiverDan||

    "No, but something has gone wrong when the riff raff comes to have enough votes to take it away from you."

    I feel exactly the same way about gift and estate taxes.

  • NToJ||

    People in single family neighborhoods can still preserve the character of their neighborhoods. By banding together and purchasing the lots. What you're suggesting is that they should be entitled to tell other people (including developers) what can and can't go on the land, without having any (to quote Dj) skin in the game.

    Go read Coase's The Problem of Social Cost.

  • dwshelf||

    People in single family neighborhoods can still preserve the character of their neighborhoods. By banding together and purchasing the lots.

    That's one of those libertarian "solutions" which is absurd in real life. It's the kind of stuff which destroys libertarian political chances. Single family neighborhoods are simply not for sale when everything is going well.

    What you're suggesting is that they should be entitled to tell other people (including developers) what can and can't go on the land, without having any (to quote Dj) skin in the game.

    No. I'm saying that changes in zoning rules should require a supermajority of affected property owners, on appropriately sized areas of contiguously zoned lots. No one else deserves a vote.

    Something like that is how most cities actually do it, although they often require approval for such changes by the city government overall.

  • David Nieporent||

    No. I'm saying that changes in zoning rules should require a supermajority of affected property owners, on appropriately sized areas of contiguously zoned lots. No one else deserves a vote.

    No. "Affected property owners" don't deserve a vote on what other people can do with their own property.

  • dwshelf||

    "Affected property owners" don't deserve a vote on what other people can do with their own property.

    Affected property owners are the ones discussing their own property.

  • NToJ||

    So doesn't "Affected property owners" include people in the neighborhood who want to use their land for multifamily apartments? And you realize that the zoning is preventing them from doing that, right?

  • dwshelf||

    So doesn't "Affected property owners" include people in the neighborhood who want to use their land for multifamily apartments? And you realize that the zoning is preventing them from doing that, right?

    A contiguous tract of homes zoned single family should have the right to change the zoning, or to oppose a change in zoning.

    The vote need not be unanimous, although a super-majority is preferred to protect minority rights.

    The point is: when the property owners are the ones making such a decision, they're not being subjected to this kind of capricious decision.

  • OldCurmudgeon||

    " There are no covenants, because they weren't expected to be needed."

    OTOH, there is nothing to stop them from being created now. Before there are any concrete plans to build multi-family housing in these neighborhoods.

  • dwshelf||

    OTOH, there is nothing to stop them from being created now. Before there are any concrete plans to build multi-family housing in these neighborhoods.

    In the abstract, no. The libertarian utopia does exist in vision form.

    As a practical matter, it's utterly impossible.

    You cannot get 500 homeowners to all agree on the covenant. You probably can't get more than about 6 before you get a hold out. And there's no legal mechanism to say "5 in 6 homeowners want this area to be covered by a single family covenant, therefore the 1 in 6 have to go along".

    In the second libertarian utopian vision, the 1 in 6 would be bought out by the others, but as a practical matter, it would take economic sacrifice to do so, because the properties would have to be bought at above market prices to motivate sellers, and still a few would refuse to cooperate.

    Bottom line: impossible.

  • NToJ||

    "You cannot get 500 homeowners to all agree on the covenant."

    If you are actually a builder, you should understand how the covenants are put in place.

  • dwshelf||

    how the covenants are put in place.

    Most covenants are put into place by the original division of the land, before homes are built. That way all buyers can be assured that their neighborhood is 100% covered.

    Retro-fitting covenants is just not often done beyond very small groups.

  • OldCurmudgeon||

    "unanimously approved by those with actual skin in the game."

    I agree, the holdout problem is *very* thorny at this point.

    I suspect that's the overriding issue here, that one or two parties will want to take monetize the social capital embedded in their established neighborhoods.

  • NToJ||

    The experiment has been tried over and over again and the results are conclusive. There are American cities without heaps of zoning ordinances, and it's no surprise that housing is cheaper in those places without extensive zoning (see, e.g., Houston), and wildly expensive the greater the zoning restrictions (see, e.g., northern California).

  • David Nieporent||

    The only thing I know for sure is that anyone who says, "I know for sure this is a good idea." OR "I know for sure this is a bad idea." is a liar or a fool.

    If the person is a utilitarian, perhaps. But I know it's a good idea not because it will have effect X or Y, but because it lessens government interference with property rights.

  • dwshelf||

    but because it lessens government interference with property rights.

    It's a gambit. A small sacrifice for power now, with the expectation of massive power rewards in the future.

    Rental property is subjected to far greater government control because renters want government to regulate the rental contract. As renters come to control the city, the interference becomes oppressive.

  • David Nieporent||

    Once again, you're confused about what happened here. Zoning -- not removing zoning, which is what happened here -- is what's equivalent to rent control.

  • dwshelf||

    Once again, you're confused about what happened here. Zoning -- not removing zoning, which is what happened here -- is what's equivalent to rent control.

    The confusion here is the implied claim that property owners actually wanted this change.

  • David Nieporent||

    Of course a property owner wants to be able to do what he wants with his property. What property owner says, "Please, Mr. Politician, don't let me tear down my house and build something else on my land, and definitely don't let me sell my property to a developer"?

  • dwshelf||

    Of course a property owner wants to be able to do what he wants with his property.

    Not when the zoning change to allow that lowers his property value and destroys his way of life.

    This seems a kind of fundamental pillar, here.

    These property owners do not support this change. If they did, I'd see no problem at all.

  • Mesoman||

    I predict a rapid rise in deed restricted areas. Deed restrictions are far harder to change, but unfortunately, they tend to be created for the passions of the day. For example, a Jewish friend of mine lived on a lot with restrictions requiring all Jews and blacks to be off the property during the dark hours.

    Sometimes, private agreements are not preferable to laws. Sometimes.

    On the other hand, if I lived in a decent neighborhood there that might now be facing the construction of low income apartments next door, I'd be quite to try to put them into effect.

    Houses are not like most assets - their value is significantly determined by the neighborhood, they are hard to replace, and they typically represent a high percentage of a person's wealth.

  • Michael Masinter||

    Deed restrictions expose homeowners to the HOA equivalent of condo commandos, latter day nazis who want to regulate the minutiae of land use. If you think a local government can be arbitrary, wait until you have to deal with a HOA, always playing with other people's money.

  • DjDiverDan||

    You are obviously unfamiliar with the wide variety of ways deed restrictions can be drafted. While a HOA MIGHT be established by a deed restriction regiment,they are by no means required or even common. Sure, you can impose assessments to maintain common areas, or impose an architectural control regiment. But those are not necessary either. Deed restrictions can be as limited as simply providing that only single family residential use is permitted, or as extensive as the owners are willing to agree to; throughing out your list of horribles to paint all deed restrictions as bad simply reveals your ignorance.

  • KevinP||

    Not necessarily. Deed restrictions and covenants are distinct from HOAs. I live in a single family neighborhood with deed restrictions that restrict every home to being a single family home. But we have no HOA and like it that way.

  • NToJ||

    If you buy into a "condo commando" HOA, in what sense are you a victim of anything but your own poor judgment?

  • MaverickNH||

    Single-family - OK, maybe not. High-density multi-family slums? Hope not...

  • Michael Masinter||

    High-density multi-family does not equate to slums. Have you been to Manhattan?

  • dwshelf||

    Have you been to Detroit?

    High density works where there are powerful draws for wealthy people to move in. The cities where it works that way can be counted on the fingers of one hand.

  • Slocum||

    Have YOU? Detroit does not have (and has never has had) a high proportion of high-density, multi-family housing. Detroit's neighborhoods (including the 'bombed out ones') are filled with suburban-style detached, single-family homes, for example:

    https://goo.gl/7BYZuK

    Looks like a scene from a down-on-its-luck rural town, doesn't it? But -- nope -- it's right in the middle of the city about a mile from downtown. All those empty spaces once contained more single-family houses.

  • dwshelf||

    Again: high density works when there are powerful reasons for wealthy people to live close to one another, and the percentage of owner occupied units stays high.

    But single family neighborhoods are far superior to high density neighborhoods consisting of rental properties.

    It's that transition we discuss here. The transition from single family to high density rental.

  • Longtobefree||

    Yes.
    And it is everything I would include in the meaning of slum.
    Dirty, overcrowded, over regulated, the whole works.
    The fact that a few obscenely rich people ride into the city in limousines to work does not change that.

  • darkknight9||

    I honestly don't care about how anyone views this through the lenses of politics. Don't care if you see it as a gov out of control or the people doing what they want.

    Don't care.

    Just tell me this has the possibility of (eventually) reducing wait times for housing assistance as these properties are built without the restrictive zoning.

    Please let this was the last winter, in Minneapolis, that anyone has to sleep in their car. Multi month turns into multi year waiting lists even for the disabled in the Twin Cities. And living out of a vehicle you barely fit in while driving is uncomfortable enough before you figure in the temperature.

    So I've been told anyway.

  • donojack||

    I'm sure you don't care what it costs either--as long as you're not paying for it.

  • darkknight9||

    I don't care what it costs, me paying or not. I'd gladly give up every penny of my monthly social security disability payment to never have to regularly face twenty below zero in a '95 Ford Escort ever again.

  • donojack||

    Move to Santa Monica.

  • darkknight9||

    Ew, no. You have some financial interest in Santa Monica? Some business concerns?

  • donojack||

    It's warm there. If I were a homeless person my top priority would be getting myself to a warm climate, especially one where homeless people are tolerated if not coddled. So if you don't like southern California maybe try Miami.

  • darkknight9||

    Warmth isn't merely temp. Wouldn't think of leaving the area until junior is grown. Then working on other aspects that keep me somewhat near to be able to help him when I can. My personal comfort isn't a Priority. Him growing up having both parents around is.

    Besides... Miami? That's like higher than Alabama levels of humidity isn't it? I'm not a fish. I can't breath underwater! ;)

  • donojack||

    Ok man, stay warm if you can. Good luck.

  • Brian_davis100||

    Because the Minneapolis City council is running out of money it needs to increase its tax base. This will have the exact opposite effect;- housing will become LESS affordable; Eventually when housing and renting become "too damn high.: rent controls kick in and it slumsville for Minneapolis.

  • David Nieporent||

    Setting aside the illogic of arguing that removing zoning makes housing less affordable, there's the nuttiness here of claiming that raising housing prices/values will decrease the tax base.

  • ||

    Awesome! Now the Somalis can overrun neighborhoods lived in by white liberals. Time for a taste of their own medicine.

  • DjDiverDan||

    Be honest — you're just here to troll, aren't you?

  • ||

    No.

    Ask any old timer in Minneapolis about the Somalis.

  • a ab abc abcd abcde abcdef ahf||

    Or ask any really old oldtimer about all them nigras you don't like.

  • ||

    Yeah, why should 80 year old Minnesota nice whites people not love a group that is disproportionately criminal and welfare using, especially with sharia beliefs?!

  • eyesay||

    A three-family home might be a three-story building with three flats, as found in upper-middle-class neighborhoods of San Francisco. I think urban housing density is a good thing, because it reduces sprawl, increases the demand for public transit and makes public transit more economical and more frequent and reduces the use of private automobiles. I do not see three-family homes as slums or breeders of crime.

  • Doug Huffman||

    Wisconsin Center for Land Use Education teaches zoning board members that the purpose of zoning is to protect property values. That is the observed effect here in microcosm. As zoning restrictions have liberalized, property values have decreased.

  • DjDiverDan||

    That is just utter nonsense. Property is always valued based upon its highest and best permissible use. Zoning reduces the universe of permissible uses, so that even if a piece of property would be more valuable if put to use for multi-family residential, retail, or warehouse, if it is zoned exclusively for single-family residential, those higher and better uses are precluded. On the other hand, if, because of factors such as available infrastructure, traffic patterns, and population density, a property's highest and best use is as single-family residential, then that is how it is going to be used, with or without zoning. I can only assume that the Wisconsin Center for Land Use Education is staffed by economic illiterates (an assumption which I accept as a given when dealing with government bureacrats, like zoning board members).

  • NToJ||

    "As zoning restrictions have liberalized..."

    Don't you mean "conservatized"?

  • OldCurmudgeon||

    It depends on whether you're Euro or American...."liberal" means something different here.

  • DjDiverDan||

    Just an observation about the impact of governmental regulations on the value of property. When the United States Government imposes tariffs and import barriers on sugar, forcing American consumers to pay more than double the world price for sugar, it is certainly "preserving" the very high values of the sugar plantations of American sugar barons - by artificially creating barriers to competition. When New York City limits the number of Taxicab medallions it will issue, and arrests the drivers of gypsy cabs for transporting passengers without a medallion, it is certainly "preserving" the value of the property of the taxicab drivers who own medallions by locking out competition. When Donald Trump imposes 25% tariffs on foreign imports of steel and aluminum, he is certainly "preserving" the value of American steel and aluminum producers, by builting a moat against competition and imposing higher costs on every company that uses steel or aluminum as an input and every American consumer buying products containing steel or aluminum. If you think that preserving value by artificially restricting competition or free choice is a good, then you'll love zoning. But remember that someone is paying the costs, and in zoning it is the poor who are priced out of the market for decent housing.

  • Longtobefree||

    Why do a lot of the posters here have the idea that governments should 'protect' property values?
    They government does not 'protect the value of other investments; in fact, a lot of policies reduce the value of other investments.
    What I find ludicrous is the justification of this change is racial, not individual freedom. What will happen if the result is just freedom, not "diversity" acceptable to the ruling class? Will they re-impose property restrictions?

  • newshutz||

    They will not re-impose the old restrictions, they will apply new and improved restrictions intended to get the results they want.

    the beatings will continue until moral improves.

  • Jerry N||

    Great! Now Minneapolis can look like Houston!

  • Thomas O.||

    You mean Minneapolis is gonna level every square inch of their city, take out all the hills and so on?

    I've only been there once, 17 years ago, but I don't remember it being completely flat.

    At any rate, Houston doesn't look worse than any other big city for the most part.

  • donojack||

    It's hard to get past all the lefty claptrap in the articles and the interview with the mayor to figure out how they actually plan to get poor people into some of these triplexes that will be built. Other than the 40 million that the city is going to contribute, coming no doubt from Minneapolis property taxes, and section 8 vouchers, there probably will be some requirement for the builders of the units to retain one out of three and then provide that at a below market rent. Otherwise the units will not be cheaper than the existing sf house on the lot; in fact they will be much more. So in addition to the tax for the subsidy there will be hidden tax in the form of a higher price for the two non-restricted units. That's the only way the builder can cover the loss on the third unit.

    But I'm sure it will be worth it to the hipsters buying those units because of the enhanced experience of living next to the previously homeless. Who said that people don't like living next to the poor?

  • nonzenze||

    Otherwise the units will not be cheaper than the existing sf house on the lot; in fact they will be much more

    This is an interesting economic theory that adding more supply to a market will result in the prices staying the same.

    Please do expound!

  • donojack||

    First higher density usually results in higher real estate values. Thus a re-zoning will cause the sf properties to increase in value overnight. Second the new units will be, well new, and new housing isn't cheap to build these days, particularly with code restrictions adding more cost each year. Third builders can't make money easily on cheap housing; the profits are in mid to high range housing.

    Sure there will be more supply but there is likely to be enough demand for new infill units to match the supply. At least in Atlanta where I build that is certainly the case.

  • donojack||

    Should add that I assume the triplexes will be built by tearing down existing old sf houses.

  • OldCurmudgeon||

    "Should add that I assume the triplexes will be built by tearing down existing old sf houses."

    More likely, people convert their basements into apartments, airbnb properties, etc.

  • NToJ||

    "First higher density usually results in higher real estate values."

    Shhhhhh! Upthread your allies are insisting the opposite is the case.

    "Thus a re-zoning will cause the sf properties to increase in value overnight."

    Do you wonder why sf properties increase in value overnight? Have you considered that because you can fit more people comfortably in the same square footage that developers can make more money per square foot, but also that the people living in the space will have to spend less to live, say, near where they work?

  • donojack||

    "Do you wonder why sf properties increase in value overnight?" I don't wonder why I know why. If as a developer I already own the land and get it zoned for three times the density then I will likely be able to both lower the unit price for the dwelling and likely make more money to boot. But if I don't own the land I will have to pay the premium for the land having increased density. Property owners can be dumb as a box of rocks but they are never dumb about the value of their property.

  • NToJ||

    "Second the new units will be, well new, and new housing isn't cheap to build these days, particularly with code restrictions adding more cost each year."

    The addition of new units will bring the price of existing multifamily units down. The effect on a housing market is not limited to the new units themselves.

    "Third builders can't make money easily on cheap housing; the profits are in mid to high range housing."

    If the supply of mid to high range housing increases, that will depress the cost of mid to high range housing, resulting in more mid to low range income families being able to afford mid to high range housing.

  • donojack||

    "The addition of new units will bring the price of existing multifamily units down." Probably not. New always gets a premium because people prefer new.

    "If the supply of mid to high range housing increases, that will depress the cost of mid to high range housing, resulting in more mid to low range income families being able to afford mid to high range housing." If it gets overbuilt what usually happens is that construction stops on new units and builders hold the existing ones until they are absorbed. It takes a big downturn cause the price to drop.

  • NToJ||

    "If it gets overbuilt what usually happens is that construction stops on new units and builders hold the existing ones until they are absorbed. It takes a big downturn cause the price to drop."

    You're not making any sense. If "it gets overbuilt" resulting in terminated construction, that can only be the case if enough units are introduced into the market that occupancy rates or prices are no longer investment grade (~>90%). But if that's the case, your theory already assumes there is a supply larger than demand for rental units. What happens if supply exceeds demand? Prices go down. The reason "construction stops" is because investors realize they won't get an ROI. What fuels the ROI? Rental prices.

    You're pushing a theory that housing is the only industry immune to the laws of supply and demand. That would be more convincing if I weren't in construction, too. My multifamily developer and builder clients are as concerned with overbuilding as are the NIMBY neighborhoods. Because they know competition will bring down prices and, accordingly, investment ROI.

  • donojack||

    Who said I wasn't concerned about overbuilding? The response to market saturation is to stop saturating it. The normal fluctuations in supply/demand do not cause instantaneous price changes. What do you think happens when auto inventories start to rise? The companies slow production but the prices aren't lowered unless there is a persistent downturn that prevents inventory absorption. You seem to think that producers continue willy nilly without regard to market conditions.

  • NToJ||

    What I think is that zoning laws often present an obstacle to development of multifamily housing in places where there is a demand that would be filled by developers but for the zoning laws. If I'm correct, it is inescapable that zoning laws result in there being less affordable housing than would otherwise proliferate in the counterfactual world without the zoning laws. The data overwhelmingly supports that conclusion.

  • donojack||

    I don't disagree with that. Actually I have made more money by getting favorable re-zoning that by development. But don't think it will make housing cheaper in the infill areas. For example we did an assemblage of 20 sf houses to develop 120 mf units. The houses at the time were worth about 150k. (In the assemblage we had to pay much more.) The mf units were all sold for 500k+.

    So the only way you will see "affordable" mf units in the desirable infill areas is by government fiat--demanding concessions from the builder/developer to subsidize some of the units.

  • NToJ||

    "So the only way you will see "affordable" mf units in the desirable infill areas is by government fiat--demanding concessions from the builder/developer to subsidize some of the units."

    This is impossible. You cannot increase affordability by government fiat. That's why zoning causes higher prices than non-zoning.

  • Enemy of the State||

    If builder/developers could make money off "affordable housing" in today's regulatory environment, they would.

    As you note, government burdens add to costs making it impossible to sell what the poor can afford...

  • donojack||

    That's why "affordable" was in quotes. It becomes affordable for those favored by government edict, not in any sense of what one would actually call affordability.

  • AD-RtR/OS!||

    Nice little city you had their Minneapolis, too bad you couldn't keep it - but you've been actively trying to destroy it for decades now. I doubt if it will get any better.

  • JonFrum||

    " Single-family home zoning was devised as a legal way to keep black Americans and other minorities from moving into certain neighborhoods ..."

    It's in a book, so it must be true.

    No, actually it's a lie. I researched the history of my childhood home in Boston. It was in a 2-family-zoned neighborhood during the Depression, when the owner asked for a variance to split the first floor apartment. At that time, Boston's black population was quite small, and there was no reason to think that black people would be moving in.

    Zoning was put into place to support property values - black people weren't necessary, or even considered at the time. The only color people worried about was green.

  • Bill R||

    I found that assertion sketchy too. The fact that race was a factor in some zoning regulations in some cities doesn't mean that it's a factor in Minneapolis. Zoning is much more commonly used to improve the overall plan and layout of a city: shopping here, industry there, houses with yards, apartments, etc. Without knowing what aspects the planners of this particular city considered to be desirable, we can't claim it was racially biased.

  • ||

    Even if that was true, so what? Obviously, upper income blacks who move into upper income areas are no different than whites who do so. But when "average" blacks moves into white neighborhoods, they ruin them over time. There are no exceptions. Even the much lauded Prince George's County is a dump.

  • donojack||

    Yeah that was a total crock. Black people were excluded from white neighborhoods by people refusing to sell to them.

  • David Bremer||

    Yeah, about that... http://www.startribune.com/jul.....283979011/

    Read all the way through the April 2006 update.

  • Enemy of the State||

    Please; Bostonians are some of the worst racists...

  • BLNelson||

    Had there been absolute protection of private property rights: 1. Property owners could not have been stopped from selling to minorities (and those minorities' rights in their property would not have been subject to violation, but protection); 2. Property owners could not have been forced to sell to minorities. 3. Zoning distinctions would not have been accepted/allowed and exceptions would not have been needed; 4. Minorities were not the only ones harmed by the failure to protect property rights.

  • Enemy of the State||

    ^^^Yup^^^

  • Enemy of the State||

    "Lifson also doubts the racist origins of single-family zoning, claiming that Minnesota had only a very small black population until recently."

    Duh.....

GET REASON MAGAZINE

Get Reason's print or digital edition before it’s posted online