Opinion

Local regs to blame for high housing costs

About 2,078 homes in the San Antonio-New Braunfels metropolitan area were sold in January, a 16 percent increase over the previous year, according to the San Antonio Board of Realtors. About 2,078 homes in the San Antonio-New Braunfels metropolitan area were sold in January, a 16 percent increase over the previous year, according to the San Antonio Board of Realtors. Photo: Edward A. Ornelas /San Antonio Express-News Photo: Edward A. Ornelas /San Antonio Express-News Image 1 of / 48 Caption Close Local regs to blame for high housing costs 1 / 48 Back to Gallery

Bexar County Judge Nelson Wolff’s recent comments about how much regulations add to the cost of housing in San Antonio were a big red flag and should instill a sense of urgency in all who care about the city.

“Developers will tell you 25 percent of the cost of building a new home today is because of the city of San Antonio regulations,” he said, according to the Express-News.

That means a $250,000 home would be a $187,500 home without the city’s regulatory costs. And a $1,000 apartment would be a $750 apartment. And those are just the hard costs.

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In fact, from San Antonio to California to the East Coast, there is ample evidence that a hefty portion of the affordable housing shortage across the country is self-inflicted, with devastating results.

“The creeping web of these (land-use) regulations has smothered wage and gross domestic product growth in American cities by a stunning 50 percent over the past 50 years,” wrote Chang-Tai Hsieh, a professor of economics at the University of Chicago, and Enrico Moretti, a professor of economics at the University of California, Berkeley, last September in the New York Times. “Without these regulations, our research shows, the United States economy today would be 9 percent bigger — which would mean, for the average American worker, an additional $6,775 in annual income.”

It gets worse.

“The cost for the country of too-stringent housing regulations in high-wage, high-productivity cities in forgone gross domestic product is $1.4 trillion. That is the equivalent of losing New York State’s gross domestic product,” the economists concluded. “Because of the prohibitive cost of housing caused by these regulations, innovative companies in Silicon Valley and Boston do not grow as much as they could, and new businesses do not get created. This means slower economic growth, fewer jobs and lower wages across the nation.”

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The culprits aren’t only elected officials or the staffs that support them. Besides the ever-expanding reach and costs of regulations, the NIMBY — not in my backyard — attitude is a major force. For every new development that could create affordable housing as well as jobs, there seems to be a local activist group ready to shut it down. They rail about alleged traffic nightmares, gentrification, destruction of historic neighborhoods, property taxes and viewsheds.

Some also bring up the ugliest of gripes: “We don’t want low-income housing near us.”

Meanwhile, they slow the development process to a crawl, which adds cost upon cost, and guess who pays the bill. The buyer or renter, of course.

In Texas, we also have a property appraisal problem. First, the appraisers across the state are massively overloaded, often with thousands of parcels per appraiser and an impossible task of appraising each one without enough information or time. In addition, the appraisal review boards — where you go if you protest your valuation — are simply not sophisticated enough to understand the complexities of real estate, market dynamics and other factors affecting value. These positions should be elected by the very taxpayers who appear before them — with transparency as to their voting and educational background.

Bexar County Commissioner Tommy Calvert should be applauded for pushing, successfully, for the county’s hiring of a housing consultant and the creation of an advisory committee of citizens. But hiring consultants is just a start. It simply is not enough.

It’s not hard to see how decent housing became out of reach for far too many people. Now is the time to heed the warning signals and unwind many of the regulations, attitudes and codified processes behind the skyrocketing costs of housing.