Skip to content
Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Primary Menu Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us
  • Featured

An Explainer: Why Building More Will Not Make Houses Affordable

May 31, 2023 | Pratirodh Bureau

Younger generations priced out of home ownership are locked in a precarious private rental market, while declining government support for social housing and income support has pushed lower income renters to the brink of homelessness (Image: Biswarup Ganguly CC3.0)

From Sydney to San Francisco, the housing affordability crisis is affecting communities across the world.

Younger generations priced out of home ownership are locked in a precarious private rental market, while declining government support for social housing and income support has pushed lower income renters to the brink of homelessness.

A growing chorus claims these problems could be fixed by simply building new homes. According to this view, housing is more expensive because there’s not enough new supply. They argue that land use regulation and planning processes restrict new construction, adding costly delays and uncertainty to the development process.

Others contest that simple ‘supply side’ narratives ignore the ‘demand side’ factors underlying global house price inflation, such as low cost credit under financial deregulation, or government incentives to encourage property investment.

They point to the political power of property industry groups who seek to maintain housing demand while lobbying for lower regulations. Some even caution that wholesale rezoning reforms will unleash waves of redevelopment and gentrification, displacing lower income earners.

YIMBY versus NIMBY

Historically, land use zones and restrictive development controls have operated as barriers to new and more diverse housing development.

Dubbed ‘exclusionary zoning’, in many parts of the United States, for instance, restrictive ‘single family’ zones continue to prevent multi-unit dwellings and apartments. Often local communities oppose changes to these rules and contest developments they regard to be out of ‘character’ with their neighbourhood.

In recent years, a counter movement dubbed ‘Yes In My Backyard’ (YIMBY) has emerged, gaining particular steam in North America.

Calling for regulatory reforms to dismantle barriers to diverse and higher density development, the YIMBY movement argues that more housing will resolve affordability pressures. It calls for higher density apartments to be permitted in residential areas, housing targets to be imposed on local communities, and to make planning processes faster and more certain.

Overcoming Regulatory Barriers

These approaches are used in many parts of the world. For instance, in the state of New South Wales, Australia, local governments have long been to ‘upzone’ to accommodate higher density housing in response to state mandated targets. Uncooperative councils are able to be overruled by the state which also dictates the nature and extent of development controls for subdivision, building height and appearance.

The uncertainty associated with local politics or neighbourhood opposition has been managed by referring all contentious developments to expert panels. Legal appeal rights are strictly limited, meaning that objectors are not able to appeal a planning approval — although developers can challenge a refusal in court.

Is Regulation The Barrier?

However, land use regulation may not be the primary barrier preventing new housing development.

Regulatory barriers are unlikely to explain a shortfall of new housing supply if there are high numbers of residential development applications and approvals coming through the planning process, but fewer homes being commenced or completed. Instead, market conditions, such as the cost and availability of finance, or issues around labour and materials will cause producers to reduce new construction.

Further, since commercial housing developers need to return profit, they time the release of new properties to optimise, rather than lower, their sales prices.

Does More Housing Development Fix Affordability?

YIMBYS argue that even high end housing construction would improve affordability across the market. This is because higher income earners will move into better quality accommodation, releasing other units to filter down the market.

However, the evidence to support this filtering is mixed. Although research in some countries has shown that new rental supply can moderate and even reduce local rents, in countries like Australia, an overall increase in housing units hasn’t improved affordability at the bottom of the market. This may be because wealthier people purchase second homes for holidays or the short term rental market, or because the new housing supplied is not in the locations of greatest demand.

New supply will only moderate prices if it is both cheaper than other properties in the market, and a suitable substitute for households looking to relocate. For instance, new apartments on the city fringe will not impact on house prices in inner ring suburbs which are more accessible to employment opportunities.

Boosting Housing Supply And Addressing Affordability

Government money is needed to support housing that is affordable and appropriate for very low income earners. The minimum cost of delivering housing, comprising physical construction costs, land and the profit required for taking on the risk, means that appropriate accommodation for low income earners is unable to be delivered by the market.

Governments can fund the difference between the capital costs of new construction and the amount able to be paid by target groups. They can also use their planning system levers to ensure affordable homes are included in new developments. ‘Inclusionary zoning’ requirements are used in many US cities to deliver affordable units, while in England, the planning system produces a significant proportion of the total new affordable supply.

By subsidising affordable housing development, and supporting affordable housing developers to access land or enter into partnerships with private providers, governments boost overall supply even when market conditions are weaker.

In Australia, despite the range of regulatory reforms to support new and diverse housing supply, governments have been reluctant to require affordable homes as part of new developments. So despite a construction boom, dramatically increasing the number of new dwellings overall and multi-unit housing in particular, the shortage of homes available and affordable to those on low incomes has continued to rise.

The Solutions

The solutions to housing affordability problems are multi-pronged, and should be tailored to local conditions.

Governments could direct subsidies towards affordable supply outcomes rather than simply support property investment and regulate rental providers to ensure tenants are protected from unfair evictions, rent rises, and substandard accommodation.

Removing regulatory barriers to new and diverse housing production may be part of the solution in cities where supply constraints persist. But additional strategies are needed to fix the shortage of affordable homes.

(Originally published under Creative Commons by 360info™. Read the original article here)

Tags: homes, housing, housing affordability crisis, Pratirodh

Continue Reading

Previous BJP Can Be Defeated If Opposition Is ‘Aligned Properly’: Rahul
Next Experts Warn Of Harsher Heatwaves In India

More Stories

  • Featured

PM Must Tell All-Party Meeting What He Told US President Trump: Congress

7 hours ago Pratirodh Bureau
  • Featured

Iran-Israel ‘Threshold War’ Has Rewritten Rules Of Nuclear Escalation

14 hours ago Pratirodh Bureau
  • Featured

Children’s Literature Joins The Conversation On Climate Change

14 hours ago Pratirodh Bureau

Recent Posts

  • PM Must Tell All-Party Meeting What He Told US President Trump: Congress
  • Iran-Israel ‘Threshold War’ Has Rewritten Rules Of Nuclear Escalation
  • Children’s Literature Joins The Conversation On Climate Change
  • Instead Of ‘Achhe Din’, Days Of Debt Arrived: Cong’s Dig At Modi Govt
  • A Song Of Rock And Ice
  • Access & Benefit Sharing Regulations Impinge On Rights Of Local Communities
  • Making Cuts In Implementation Of MGNREGA A Crime Against Constitution
  • Tiger Death Highlights Strained Human-Wildlife Interactions In Assam
  • Scientists And Monks Perform Last Rites For A Himalayan Glacier
  • Bihar Yearning For Change But The Election Is Wide Open
  • Shipwreck Spills Oil, Plastic & Legal Loopholes
  • As India’s Groundwater Runs Dry, The Calls For Reform Grow
  • ‘US Invite To Pak Army Chief Huge Diplomatic Setback For India’
  • Politics Based On Grievance Has A Long And Violent History In America
  • How Birds Are Taking A Hit From Microplastics Contamination
  • Kharge Reviews 11 Yrs Of NDA Govt, Says PM Made 33 Mistakes
  • Upholding The Law, SC Halts Amnesties For EIA Violators, Jolts Industry
  • Using Indian Languages When Reporting About The Environment
  • ‘Maximum Boasts, Minimum Achievements’: Congress Attacks Shah
  • On Navigating Privacy And Transparency In The Digital Age

Search

Main Links

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us

Related Stroy

  • Featured

PM Must Tell All-Party Meeting What He Told US President Trump: Congress

7 hours ago Pratirodh Bureau
  • Featured

Iran-Israel ‘Threshold War’ Has Rewritten Rules Of Nuclear Escalation

14 hours ago Pratirodh Bureau
  • Featured

Children’s Literature Joins The Conversation On Climate Change

14 hours ago Pratirodh Bureau
  • Featured

Instead Of ‘Achhe Din’, Days Of Debt Arrived: Cong’s Dig At Modi Govt

1 day ago Pratirodh Bureau
  • Featured

A Song Of Rock And Ice

1 day ago Pratirodh Bureau

Recent Posts

  • PM Must Tell All-Party Meeting What He Told US President Trump: Congress
  • Iran-Israel ‘Threshold War’ Has Rewritten Rules Of Nuclear Escalation
  • Children’s Literature Joins The Conversation On Climate Change
  • Instead Of ‘Achhe Din’, Days Of Debt Arrived: Cong’s Dig At Modi Govt
  • A Song Of Rock And Ice
Copyright © All rights reserved. | CoverNews by AF themes.