Why No High-Density Housing In Silicon Valley

Mathew Yglesias frets that the enormous wealth spilling into Silicon Valley isn’t trickling down to the proletariat. That they are getting squeezed out of the area by skyrocketing home prices and that shouldn’t be happening.

What should be happening in Silicon Valley is an enormous construction boom. There should be oodles of blue-collar jobs knocking down suburban-style single-family detached homes and replacing them with attached townhouses. Right by Caltrain stations, there should be huge apartment towers going up. Some people might get dispaced out of the individual house they live in, but generally should be able to afford to stay in the area. And more broadly, individual instances of displacement should be swamped by the kind of localized population boom. If you look at a community like Williston, N.D., or the Odessa/Midland area in Texas, that’s what’s happening. An influx of money into the oil industry is fueling an influx of people and a surge in construction.

He lays the blame for this state of affairs on zoning and regulation.

But not Silicon Valley. In the technology capital of the world, we’re making very scant use of the technologies of steel frame construction and elevators. Land is scarce in the corridor running between I-280 and US-101 from San Jose up to San Francisco, but it’s not all that scarce. It’s just not being used very intensively. Because zoning generally mandates low-density uses and because the California Environmental Quality Act perversely hyper-empowers NIMBYs to block projects even though California’s pleasant climate makes it one of the most ecologically sustainable places for new housing to go. There is no housing boom there, but the region—and the country as a whole—would be a much better place if there were.

This makes a certain amount of sense except that Joel Kotkin pointed out some time ago, the California technocratic establishment has essentially decreed war on suburban development, and the Bay Area in particular has enlisted in the effort in a big way.

But who needs facts when you have religion? Take the Association of Bay Area Governments (ABAG) and Metropolitan Transit Commission’s (MTC) new “sustainable communities strategy,” a document designed to meet the requirements of the state’s draconian anti-greenhouse gas legislation.

This “strategy” seeks to all but reduce growth in the region’s lower-density outer fringe – eastern Contra Costa County as well as the Napa, Vallejo and Santa Rosa metropolitan areas — which grew more than twice as fast as the core and inner suburbs. Instead the ABAG-MTC projects a soaring increase in demand for high-density housing and its latest “vision” report calls for 97% of all the region’s future housing be built in urban areas, virtually all of it multi-family apartments, to accommodate an estimated 2 million residents

There would appear to be a contradiction here. Official policy driven by anti-greenhouse gas legislation requires that future development tilt overwhelmingly towards high-density but that same legislation is being used to thwart high-density development. Have we reached the point here where regulation has become self-cancelling and people just go their merry way.

I have no idea but it is intriguing. Feel free to advance your own thoughts.

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