Can we code our way out of gentrification?

> A developer could likely fit 3-4 nice cottage homes on that lot, sell them for $500-700k, and make a profit

Denver takes 264 days to approve "multi-family or industrial projects with a valuation in excess of $1.5 million, such as a new apartment or office building, large additions" [1]. Construction loans in Colorado cost "8% to 13%" [2]. For a project with $1.5mm up-front costs, from land purchases to permit fees and legal costs, that comes to $87 to 141 thousand per project.

This isn't as bad as San Francisco, where permiting delays alone add hundreds of thousands of dollars to housing costs. But in addition to upzoning, it's something to be considered, particularly since Denver seems to categorise practically all impactful residential development as "major commercial."

[1] https://www.denvergov.org/Government/Agencies-Departments-Of...

[2] https://www.clearhouselending.com/commercial-loans/colorado/...

Huge fan of zoning reform, however I'd love to see equal effort in lending reform. The availability of multi-million dollar mortgages on 30 year terms means that we all get poorer. Getting people into owned homes is a dream left over from the Clinton era that has warped into an ever expanding pool of debt and over sized buildings. Developers will build to the limit of what people can afford (and slightly beyond), and that is defined by mortgage policy. The harsh reality is that as long as you're supporting a system where a 1k sqft house can cost 300, 400, 500k you're not helping anyone who isn't in the business of lending. The only way to reverse the trend is to limit the pool of available capital and bring the sale value of property down.

No, we can't. Once could lower the rate of increase of housing prices (and, more realistically, land values), but "gentrification" isn't really just about pricing, but a change in preferences: Areas close to urban centers had low prices because people wanted to live in deep suburbs, far away from city crime and bad schools. Now they are desirable, and thus people far more affluent are going to bit outbidding the communities that live there anyway. So the gentrification is inevitable, and IMO any attempts to stop it are bad: Nobody has right to a character of the neighborhood, whether we are talking a Mexican American community or people that want racial covenants in their subdivision. The entire idea is just straight out illiberal in the broadest of senses.

It's true that the gentrification process speeds up when there is no building, as those differences in preferences mean existing tenants are competing with even richer people, and would have to move even further out, but the change in preferences still exists, and thus the gentrification is straight out unavoidable.

Besides, in almost every place where we have serious housing problems, the small changes proposed here are insufficient. When the land is expensive, the normal behavior everywhere is to redevelop plots to the maximum economically viable density. Turning 1 house into 4, which would sell for 500k each, doesn't make sense when the possibility of an apartment building is there. Single stairway apartments turn those 4 cottage homes into 16 3-4 bedroom units. If one is simplifying permitting anyway, why not simplify it for that density, and get far more out of the same land. Those 4 new cottages, now new, would not get redeveloped again for another 30, 40 years, so they would become difficult to afford really quickly. That's why you don't see many places actually attempting this low key densification, as it's way too much work for what you get.

> Today, the neighborhood is mixed-income with a range of families from different backgrounds

This is a good thing!

Overall I think this is simply an outcome of NIMBYism, regulators over regulating to justify their existence, and a K shaped economy.

There's nothing wrong with the market building what there is actual money in. No one should be forced to lose money to serve those who cannot afford the product. (That's the space of charities)

Denver seems to have done an amazing job, relative to other places I've been, at actually adding a lot more housing. The market likely would be _worse_ had there not been so much built (and building)

Fixing housing is incredibly easy:

1. Remove Zoning / Deed Restrictions / Parking Minimums

2. Remove Red Tape (Environmental impact assessments, time cap approvals to a couple weeks, at cost fees)

3. Land Value Taxes

Watch as Gentrification suddenly goes away and infill development occurs. These complicated schemes are unnecessary.

I'm down with killing restrictive zoning laws. But removing regulation has not historically been a great curb for the uber-wealthy.

Is gentrification a bad thing?

Neighbourhoods change, some get richer and some get poorer. That is the way of things. Both poor and rich alike need somewhere to live.

Very curious about what tools or platforms are used to make the visual housing figures with highlighting like you see in strategy 2 figure. any tips much appreciated

There are millions of homes that are super cheap and no one wants to live there. I think we missed a real opportunity for WFH to allow people to move where things are more affordable, rather than having everyone live in mega cities and complain of high prices.

Thought it was something like using computer programming to save the market lol

Thankfully this article is about the zoning codes, not code as in computer programs.

You cant just 4x every plot because that would destroy the ultilties that have been allocated.

No because gentrification is a side effect of private property, not insufficient technology.

Plans like this would be interesting to me if I believed it were possible to get all the necessary parties to agree.

A rare anti-Betteridge's law of headlines article.

Yes, there are laws that, if passed, would stop or slow or even reverse the increasing price of real estate. Would they pass? Hard to say and probably not quickly.

As has been repeated many times: it's in the financial interest of people who own property to increase their property's value by constraining supply via zoning/building codes, and they usually have a good amount of influence in the local politics that determine these rules.

The solve is fairly straightforward: allow absolute maximum density so long as it is built safely.

You'll get tall apartment buildings pretty quick. Then everyone can go to the schools and enjoy the low crime and fast fire response.

But that isn't allowed because incumbents don't want it.

There's not much new about this... it's the same story all over the US.

The premise is that the author is a libertarian, except that housing in the neighborhood they live in should be fixed at the price that they can afford, and that the character of the neighborhood from the point that they moved into it should be preserved.

It's only real gentrification when upper-middle class YIMBYs get forced out.