I have heard it stated locally that upzoning increases housing prices: by allowing more units on a lot it becomes more desirable to developers who are now willing to pay more in pursuit of favorable returns. I have also heard it stated that upzoning will decrease property values: a multiunit building built next to my property will make it less desirable and therefore decrease the value. Even still I have heard it stated: upzoning will increase land value but overall cost per unit will be lower because of scale.
The truth is the effects upzoning has on prices are not so clear. Policies can take many forms and the results are influenced by so many other variables. Unlike scientific experiments, isolating just one variable to study is not possible in real world observations. Therefore research on the subject is limited by context. This unfortunately means there are studies out there that can justify a variety of upzoning outcomes — so how can we know how to move forward? The answer is not to get stuck debating whether upzoning alone will raise or lower prices, but rather ask a better question. But before that, let’s first consider what upzoning means.
Upzoning has become a loaded word that really just boils down to increasing what can be done with land. It is an umbrella for a variety of strategies to curb urban sprawl, redevelop blighted areas, reduce car dependency, and spread out infrastructure costs (think roads, pipes, powerlines). The controversy comes from existing residents’ concerns about how this will impact their quality of life – which is totally reasonable. The challenge is that we tend to scrutinize the ways upzoning might change a neighborhood while paying less attention to how the status quo is already changing it.
Here in Jefferson county we have seen the majority of our non-home-owning workforce cut off from homeownership because wages, home prices and lending requirements no longer line up. This forces this segment to continue navigating a dwindling pool of attainable rentals or leave the area.
For the time being we are buffered somewhat by working families who bought in before the housing spike and landlords who continue to rent below market rate. But as our workforce continues to age (Jefferson County is trending older with 38% of our workforce is already over the age of 55), and more homes are sold and bought at prices beyond local wages, we approach a cliff of a different kind. Not one where neighborhoods change in physical form, but one where the people and institutions that make up our community slowly disappear. One where businesses shutter, young families are sparse and we are increasingly reliant on neighboring communities for services and resources.
Upzoning isn’t inherently an outcome; it’s a tool. The value of the tool depends on what we are trying to accomplish and how we use it. The question we need to be asking is: how can we create housing that leads to a healthy, thriving community?