Plus: a new episode of Messing with Maps
If local people want to protect the affordability of their communities and avoid becoming the next Place, they need to stop attracting the investment class and struggling with how to house the servant class that inevitably results. I think there is a much easier solution than subsidizing and building affordable housing to solve this problem. Simply junk up your yard. Put out an old couch with springs popping out, a broken washing machine, or a car on blocks out there and leave it to the elements. Sacrificing your front yard is a lot better than sacrificing everything else, and is way cheaper than paying for new parks, performance halls, flower boxes on main street and all the other tax-subsidized "amenities" that help boost real estate sales. I have longed for this to happen in my hometown (mentioned in your article) for decades. Too late for my town and quite a few others, but some can still be saved.
I enjoyed the contrasting examples of Williston and Jackson Hole, and I agree with the concept of Place-based distortion to housing supply and demand.
So long as we (communities, regions, states) do not adequately disincentivize the pursuit of home-mongering, there will be no end to it, and Jackson is proof of that. There is an ever deeper wealth class with an insatiable appetite for large, exclusive single-family (or zero-family?) homes, and in turn no economic reason for developers to do anything other than fill this demand.
There is also no solution that will please all parties. Deed-restrictions, transfer taxes, short-term rental caps, unoccupied home fees -- none of these are a magic bullet. But they are price signals that can and should be experimented with.
Fascinating two pieces, thank you. You mention income inequality but not wealth…we are about to witness the largest transfer of generational wealth in human history as the boomers die out. So income tax is only part of the picture. Personally, I’d rather encourage successful entrepreneurs, doctors and executives (that is, high earners) to buy homes in my resort community than trust funders, though I would welcome both up to a point!
In San Diego CA, the median home price crossed the million dollar mark last month. However, 40% of the cost of a new home there includes permits, fees and regulations. The rest is labor and materials. I might add that San Diego has the highest electricity prices in the nation and climate change advocates are pushing for all electric homes.
Thank you, Jonathan, for addressing what is not often-enough recognized as the huge modern world problem it is: there are way too many people running around with way more money than they know what to do with. Add to that the fact that there is a mammoth number of folks with zero money and the sum of these factors equals the current ridiculously cruel inequality from one end of this world to the other. Not likely to end well.