In the previous post, I discussed how overbuilding wasn’t the cause of high vacancies after 2008 and really has never been associated with high vacancies.
Thanks for framing the data this way. I'm still trying to figure out when things started to go wrong with housing production--pardon the following as a "thinking out loud" moment.
Comparing Figure 1 and Figure 3 seems to reveal that changes in housing production from the 60's through the 70's tracked household size pretty consistently. So for that period, a gradual drop in completions was consistent with the decline in household size. Despite the periodic economic turmoil of the 80's the tracking was still consistent, and still mostly trending downwards--which isn't a bad thing (yet) because I'm reading this period as a time of relative abundance across the boards. However, and this is where I'm indulging in a leap of speculation, the tools of abundance---lot availability, transportation infrastructure, and financing options--were demonstrating stress that started to interfere with homebuilding capacity.
Building sites for large subdivisions started to dry up through the 80's and 90's in and around what would become Closed Access cities. I'm making an anecdotal claim, but it's testable by somebody who doesn't mind crunching data. The NIMBY's started tightening up zoning and planning codes to prevent suburban development. At the same time, road building started to drop off in certain areas. This might have been less of a problem if densification had been improved in and around city cores, but that wasn't considered at the time because there was still "white flight" to the suburbs.
The 1990's concealed some of these problems because homebuilding still looked healthy, but price pressures driven by declining supply in the Closed Access cities was laying the groundwork for your first two books. In some respects, I think the 90's and early 2000's should have been the time to push back on NIMBY zoning policies, but no one had put all the pieces together yet.
I suspect that most of the foundation was laid by the 1970s but the closed access cities cores were losing population because of local conditions and so it didn’t bind until demand started to rise in the 1990s. And it didn’t bind in other cities because of greenfield single-family development until mortgage lending contracted after 2007.
Thanks, and the Twitter thread from Jonathan English you linked to today was well timed on this subject. Although I agree with him, I would push back gently on his notion of a housing "surplus" because if a dwelling is in bad shape and in a bad location proper market forces should reflect that. A neighborhood of abandoned dwellings could count as a "surplus" in one method of counting, but it doesn't describe what's going on to make them abandoned.
The rebound of city cores that began in the 90's might have served to distort some of the production metrics during that period and leading into the 2000's. All the more reason why the switchover from surplus to shortage caught us by surprise.
I have to give a brief lecture to my architecture students on this topic, so I'm using these comments as a notepad.
Thanks for framing the data this way. I'm still trying to figure out when things started to go wrong with housing production--pardon the following as a "thinking out loud" moment.
Comparing Figure 1 and Figure 3 seems to reveal that changes in housing production from the 60's through the 70's tracked household size pretty consistently. So for that period, a gradual drop in completions was consistent with the decline in household size. Despite the periodic economic turmoil of the 80's the tracking was still consistent, and still mostly trending downwards--which isn't a bad thing (yet) because I'm reading this period as a time of relative abundance across the boards. However, and this is where I'm indulging in a leap of speculation, the tools of abundance---lot availability, transportation infrastructure, and financing options--were demonstrating stress that started to interfere with homebuilding capacity.
Building sites for large subdivisions started to dry up through the 80's and 90's in and around what would become Closed Access cities. I'm making an anecdotal claim, but it's testable by somebody who doesn't mind crunching data. The NIMBY's started tightening up zoning and planning codes to prevent suburban development. At the same time, road building started to drop off in certain areas. This might have been less of a problem if densification had been improved in and around city cores, but that wasn't considered at the time because there was still "white flight" to the suburbs.
The 1990's concealed some of these problems because homebuilding still looked healthy, but price pressures driven by declining supply in the Closed Access cities was laying the groundwork for your first two books. In some respects, I think the 90's and early 2000's should have been the time to push back on NIMBY zoning policies, but no one had put all the pieces together yet.
All good questions and comments.
I suspect that most of the foundation was laid by the 1970s but the closed access cities cores were losing population because of local conditions and so it didn’t bind until demand started to rise in the 1990s. And it didn’t bind in other cities because of greenfield single-family development until mortgage lending contracted after 2007.
Thanks, and the Twitter thread from Jonathan English you linked to today was well timed on this subject. Although I agree with him, I would push back gently on his notion of a housing "surplus" because if a dwelling is in bad shape and in a bad location proper market forces should reflect that. A neighborhood of abandoned dwellings could count as a "surplus" in one method of counting, but it doesn't describe what's going on to make them abandoned.
The rebound of city cores that began in the 90's might have served to distort some of the production metrics during that period and leading into the 2000's. All the more reason why the switchover from surplus to shortage caught us by surprise.
I have to give a brief lecture to my architecture students on this topic, so I'm using these comments as a notepad.