Where Does Regulation Have Unintended Consequences for Housing?

California has the most stressed housing markets in the country. In efforts to undo that, researchers, academics, and city officials are collaborating to identify the catalysts and propose improved systems moving forward. Where else is regulation resulting in unintended consequences and how can you work with city officials to mitigate damange to housing?

California, and particularly the Bay Area, hasn’t built enough housing to keep up with demand. By one estimate from the California Department of Housing and Community Development, the state needs to build 1.8 million units over the next seven years just to keep pace with population growth. Right now, California isn’t close to building that quickly.

There are lots of reasons for the state’s deep housing shortage. You can blame broken state housing laws, high construction costs and recalcitrant “not-in-my-backyard” communities that oppose new building across the state.

But experts say some unintended consequences of Proposition 13 help explain why the state doesn’t build housing like it used to.

The Vacant Lot Problem
Just around the corner from Krasowski sits an undeveloped lot, overgrown with weeds and surrounded by a chain-link fence.

Brian Smith has lived next door to the empty lot since he bought his house in 2004. It used to be owned by his neighbors two lots down, who had it for decades before selling last year.

“We always assumed somebody would develop it at some point, but it’s been sitting here the whole time,” says Smith, who reported the lot to the city after the weeds had grown to near eye level.