Regarding the commentary, “Eureka! We’ve been selected for a rezone!” by Ken McCalip in the April 2 edition:
The idea of affordable housing or low-income housing are another example of government-sponsored socialism at work. The recent example of the federal-level programs is the “subprime loan” national financial crisis that has resulted from the government insisting that everyone has a right to an affordable home even if he cannot afford it, and has no means to pay for it.
Affordable housing is in the eye of the beholder. There are always going to be some people who cannot afford the “affordable.” On the other hand, the housing business is driven by the market demand, the competition, and the cost of doing business. Whenever the government gets into the loop, the process becomes distorted. As a result, the costs are artificially increased beyond what they would be if market driven.
In California, the Environmental Quality Act is one leading reason for the distortion of the housing market. Its extreme costs for environmental impact reports and endless meetings and employment of specialists to do something contributes nothing to the house-building process, and then the endless appeals by the environmentalists are the overwhelming reasons for high costs.
Then there are the “no growthers” and the NIMBYS who don’t want anything developed near them. Their opposition contributes to the cost of the housing projects.
The government then steps in again and insists that quotas for housing are met by the counties and that some are affordable, which drives up the costs because someone has to pay for the “affordability” or lack of a market.
When the government then says that everyone should have access to housing whether they can afford it or not, the demand is artificially inflated and the costs go out of sight.
Housing will get back to what the average Americans can reasonably afford with their average salaries when the government gets out of socialist programs and ends the onerous environmentalists’ studies and restrictions. The free market will again drive price and supply.
But even then, there will be those who still cannot afford the affordable, and, as always in the past, they are renters.
This article appears in Apr 16-23, 2009.