Comment of the Day: Free Enterprise City

COMMENT OF THE DAY: FREE ENTERPRISE CITY “And can we stop repeating the myth that Houston is some big unzoned city of freedom? Houston has a ton of ordinances regarding building forms and how property is used, from parking requirements that are stricter than most cities, to rules about setbacks, weirdly random designations of areas as ‘suburban’ and ‘urban’ with accompanying rules, rules about the sizes of townhouses, and so on. People love to say that we’re some kind of mecca of affordable housing because we have ‘no zoning.’ It’s nonsense. We have affordable housing because we have no natural boundaries preventing expansion and therefore have spread out more than most cities, and because we subsidize the building of big roads to make it easier to get to remote places. . . .” [John (yet another), commenting on Preservation Ordinance Passes]

21 Comment

  • FALSE. Love how the Comment of the day is patently false. Says a lot about the site really. While our geographic boundaries or lack there or do have an impact on our cost of living, to say that a lack of zoning is not a contributing factor to our low cost of living…well, it’s simply untrue. Zoning creates constrained resource. Constrained resources lead to increased demand. Increase demand leads to higher pricing. THank you, come again.

  • John (yet another),

    There are plenty of rules on how to develop, but there are NO rules on what can be developed in the Chapter 42 rules the guide development. Zoning would tell you what you can or can’t build.

    And also, if you believe that we are subsidizing the building of roads, you are living in a dream world. The link below is to a spreadsheet that thoroughly details how user fees (gas taxes) fully pay for roads and no other monies are diverted pay for it. (hat tip this to Tory Gattis at the Houston Strategies Blog.)

  • It’s not false. Trying to equate lower housing costs solely to a lack of zoning is what is false. We have lower housing costs because we subsidize roads and infrastructure, have shady building regulations that don’t favor the consumer, and we have direct access to a large pool of illegal workers willing to work for below minimum wage.

    Stricter zoning regulations wont cause our housing prices to rise nearly as much as say, enacting Arizona-type immigration laws.

  • Doofus,

    In case you didn’t know, those same illegals work throughout the US. North Carolina had them everywhere during their boom. Since it has declined, you can see a bunch of North Carolina license plates with illegals driving them heading back to Texas. Pretty much anywhere in the US where you had a housing boom you had illegals.

    Again, the subsidized road bit is a flat out lie. (see my previous post)

    As for building regulations, if you are within a municipality, you have building codes. If you are in an unincorporated area, they can’t enforce building codes because they don’t have the power to do so under the rules that govern a county’s responsibility. That is your risk to take when purchasing outside of a city.

    Also, the building quality is a canard. It all depends on who is building your home. There are plenty of lower cost homes that have good build quality.

  • Go try to develop, or better yet re-develop, some real estate in NYC, SoCal, Chicago, Boston, Seattle, Philadelphia, Bay Area, etc. and then get back to me.

    Houston may not be a free for all, but we are a walk in the park compared to the red tape and politics you have to navigate elsewhere.

    Countless billions of dollars of private money has gone into redeveloping and improving Houston’s core over the past decade or two. It’s not hard at all to imagine how much of this improvement would have NEVER occurred if we all had to deal with the BS people tolerate elsewhere.

  • Zoning can be form based as well as use based.

    My (pretty obvious) point is that we have a ton of regulations, just like other cities; they’re just not “zoning.” But hearing these endless homages to the sanctity of a free market approach in a city where businesses are required to offer set numbers of parking spaces whether they need them or not, where regulations call for suburban style stores next to dense clusters of housing in Midtown, etc., is just grating.

    Other cities may have more red tape… yet somehow, vast amounts of money pour into profitable development in them (as they do here).

    “Subsidize” was a poor choice of words; however the way the city is built – often enforced by those regulations – pretty much guarantee that people need cars more than other places, creating demand for roads, and a steady supply of gas tax revenue to fund them. Even if you think this works, it’s certainly not a free market approach; our overly wide major streets and intersections required to be too far apart for pedestrians to easily navigate are not market choices, they are regulatory choices.

    Yet we hear about how that the lack of zoning makes us fundamentally different than other cities. It’s a crock.

    By the way, I don’t want to see use-based zoning; I think it’s generally a bad idea. My point is that the lack of isn’t the same thing as a more market-based approach; we make it more expensive to offer alternatives, which distorts market forces. And the comment that prompted mine was a ludicrous statement that the preservation ordinance is “zoning” (by kjb’s definition, it’s obviously not!).

  • “form” based zoning has always been claimed to not be “use” based, but in practice it always comes down to regulating use. The concept of “form” based zoning came about to placate the citizens that are concerned with property rights. Some are dumb enough to believe the argument.

    It just like calling something the city charges you a “fee” and not a “tax”. They are the same thing.

  • I’d like to hear from John what regulations we would need to remove to be a ‘true’ “free enterprise city” and how he thinks that would change the character (and affordability) of the city.

  • I don’t think any major changes are needed. I think the idea of city development via free market is basically an illusion, because people value quality of life factors that are hard to put monetary values on. I think this city is an excellent place to live and economically has been very stable, and that’s great. I think reasonable regulation – esp. voluntary regulation like historic districts – will on the whole improve the city without affecting its basic dynamics, which are healthy.

    It’s the rhetoric that I think is a bit silly. We’ve taken a somewhat different approach to regulation, and it works well a lot of the time. I *like* the lack of use based zoning, which I think wrecks a long-standing dynamic of human beings build their communities. If anything I’d like to see policies that encourage more mixed uses.

    It’s the free market worship when there isn’t really any such thing (anywhere) – and people would hate it if it did exist – that gets a bit tedious.

  • John (Another one):

    Bull’s eye! The free market “No zoning” is simply a sound bite. Some that wave that and the property rights flag are the first to complain about the neighbor putting the trash out too early or a boat/trailor being parked in a less than desirable location. In the Heights, they complain about the “broken down shack” down the street. Do what I want you to do…not as I do.

  • Housing is affordable in Houston because land is very cheap and construction costs are very cheap (but there is a hidden cost of poor workmanship that can be costly). Houston doesn’t have zoning because PUDs are zoning on steroids. All of the residential ____wood and _____creek neighborhoods in the burbs are impenatrable fortresses of deed restrictions that would make the most restrictive East Coast zoning ordinances look like complete anarchy. Houston doesn’t have zoning because the majority of the City doesn’t need zoning. The problem is that the few areas that are not protected by strong deed restrictions are subject to the whims of developers. Thus, you get plans to drop a condo tower at the end of a residential street just inside of 610 and Post Oak, a chicken plant wedged between residences on W 12 in the Heights and a Walmart supercenter packed into a residential neighborhood with only a skinny (and soon to be crowded with feeder traffic) Yale St. for access.

  • Hey SFP –
    If Houston prices are low due to lack of zoning, why are prices in zoned cities like San Antonio and Dallas equally low?

    It has EVERYTHING to do with the price of land, which remains cheap in Texas’ sprawling suburbs.

  • And while I’m at it, it is the historic lack of regulation of builders and developers that now causes the city to ask taxpayers to pay more to help control flooding. Passage will funnel millions of dollars to the people who created the problem in the first place.

  • Finness,

    Much of the development in San Antonio and Austin occur outside of the incorporated limited of those cities in areas that welcome the new development.

    DFW is verymuch over stocked in new houses with the numerous municipalities that make up the Metroplex (that don’t talk to each other).

    Houston’s housing supply is seen as just right right. Not in excess or limited supply. That’s possible with the speed a developer can go from raw land to new neighborhood compared to other cities.

  • Leave it to KJB to turn the various housing markets in Texas into a “Goldilocks and the Three Bears” fable in which Houston is “just right because our bears don’t have any silly regulations.

  • Doofus,

    If you are going to criticize, at least bring something to the table. The shear lead times and upfront investment required to develop in San Antonio, Austin and DFW make Houston much easier in comparison.

    This has nothing to do with the silly argument of shoddily built houses. Houses built in other metros aren’t any different than here. Even the municipalities around Houston that have some form of Zoning also are much speedier than the rest of the state because they are growth oriented (some people may say developer friendly). Houston also doesn’t have a big water rights issue like the rest of the state. You want water you get it.

    Familiar example of San Antonio and Austin come to mind. A set of construction plans for a residential subdivision has required government agency reviews about 3-4 times in the San Antonio and Austin region where most agencies in Houston will see a set of plans once at about 90% completion and then the signed final copy. The review times bog down the projects in other cities and doesn’t produced a better set of plans. We produced plans for Austin and San Antonio out of our Houston office. The same level of effort, work, and QA/QC goes into those plans as the Houston ones, it just takes a better part of a year to get approvals. That time is money to a developer and does get passed down into costs typically added a few thousand dollars per house with other added fees that don’t show up as part of the purchase price.

  • I agree with the original comment in that some of the city’s development ordinances are more prescriptive than they need to be. A lot of what makes parts of the city “ugly” are a result of decisions made by our central planners: the endless chains of strip malls are a result of setback requirements; our massive swaths of parking lots are a result of minimum parking requirements; and the endless sprawl along freeway feeder roads are a result of TXDOT’s inexplicable preference for that style of road construction. (How much more pleasant is that stretch of tollway that connects IAH to Hardy Toll Road than any other freeway in the city?)
    We have an austounding amount of spontaneous order in Houston. The market has provided highly deed-restricted communities for people who prefer that kind of development. The housing stock in neighborhoods like the Heights (2-story ersatz craftsman and victorians) and Rice Military (3-story townhouses sitting on top of their garages) couldn’t be more uniform if there WERE a zoning commission determining what could and couldn’t be built.
    I firmly believe that we’d have a lot more walkable neighborhoods if our central planners hadn’t decided that a restaurant in Midtown or Montrose needs the same amount of parking spaces per square foot as one outside the Beltway (which leads to lower density, which means you have fewer places within walking distance). I have to believe that the market would be more efficient at allocating parking spaces than the folks on Bagby Street.

  • I actually like the feeder roads. That’s far better than the stupid freeways in California and other places where it’s impossible to get off and back on after taking care of your business. And, if you get off at the wrong exit, you aren’t forced to wend through some bad neighborhood trying to find an on ramp.

  • It is obvious that Houston is not a “free” market city. The argument is that is the closest we have to a free market city. That and the fact that we have close to a flat featureless plain both explain the low costs to building in the city. Yes we have regulations, but all our regulations and rules are added on to in every other city. Yes, we have regulations that encourage sprawl, i.e. min parking, extreme setbacks, minimum lots sizes, and we should get rid of or lessen those. I don’t understand why so many people argue that the fact that we have some bad regulations says that we should have more regulations. Yes, all cities should have some minimal regulation, i.e. safety codes, flood control, traffic control, but that does not mean we should or are able to dictate the perfect urban form with all of the associated politics, redtape, and increased costs.
    I love Houston because the city is the CITY, with all of its associated diversity, excitement and chaos. When and if I ever want stability and predictability I will move back out to the suburbs where I grew up.
    It was “planning” that destroyed and damaged so many of our cities, I don’t want anyone to try and finish the job.

  • What are some of the cities destroyed by planning? And how do you define “destroyed”?

  • yea, sorry, hyperbole much. I Can’t say that any cities were destroyed by planning. Can I edit that word out?