THE OC register reports that a California judge struck down a new law allowing up to four units on a single lot:
“The Legislature finds and declares that ensuring access to affordable housing is a matter of statewide concern and not a municipal matter,” states SB 9. “Therefore,…(this law is applies) to all cities, including charter cities. »
But the law does nothing to ensure more affordable housing, Kin wrote. At the same time, he rejected the state’s argument that SB 9 promotes housing affordability at lower income levels by increasing the overall housing supply.
“‘Affordable’ refers to housing below market rate,” Kin wrote. The state provided “no evidence to support the assertion that the reclassification authorized by SB 9 would result in an increase in the supply of below-market rate housing.”
Redondo Beach City Attorney Michael Webb praised Kin’s decision, saying SB 9 amounts to “some kind of economic spinoff applied to zoning.”
In fact, the best way to provide more affordable housing is to build more unaffordable accommodation. And contrary to Michael Webb’s claims, housing is a classic example of economic spillovers in action.
Consider the following analogy. Let’s say you’re concerned about high used car prices. Low-wage workers struggle to afford the few used cars available on the market. Are you suggesting that car companies start building crappy junk cars that sell for $5,000? Obviously not. The optimal solution would be to build more “unaffordable” new cars. Wealthy people who buy these new cars will then sell their old cars, putting downward pressure on the price of used cars. Ultimately, the benefits would “trickle down” to people who cannot afford to buy a new car. Not only does trickle-down economics work, it is the key to understanding important markets like automobiles and real estate.
In any evolving society, new houses should be better than existing houses. This means the new homes will be “unaffordable” for the median home buyer of that size. It’s good. This is how the standard of living improves over time. If new homes weren’t more expensive than existing homes, we’d all still be living in log cabins.
Judge Kin does not seem to understand the laws of supply and demand. He talks about building houses at prices below the “market rate”, when the very goal of this policy is to make housing more affordable by reduce the price of the housing market. Build more homes and the benefits will trickle down to the working class.
I don’t even like the term “trickle down” because it suggests the process is slow. The benefits of housing construction will be flood in the lower segment of the market.
PS. The judge’s ruling applies to the state’s 121 “charter cities,” but not to the much larger number of “general law” cities that do not have charters.
