May 25, 2011
The Tragedy of Zoning
The new residents of the apartment building may sometimes be of lower economic status, on average, than the individual owner of the home that was replaced, but collectively, the economic productivity of the land (in the form of rental income and/or property taxes) has dramatically increased. Homeowners may object to the presence of the new building, or possibly the presence of its residents, but they are nonetheless the beneficiaries of the increased land values should they decide to sell.
I think there's some truth to this argument, but I'm not sure that the author fully considers how profoundly land use regulations limit the supply of housing, and thus drive up prices.
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