How to reduce costs
To make housing more affordable, we need to reduce costs
Costs matter.
Costs set a floor on how low prices and rents can go. When market-clearing prices drop below that floor, we see what's happening now: nothing gets sold, and no new projects start, until scarcity (less supply and/or higher demand) drives prices and rents above that floor once again.
To keep pushing down prices and rents, we need to bring down costs.
How can we reduce costs? Four suggestions:
Reduce the cost of delay. Right now there’s a fast track to approve low-density housing, and a very slow and Byzantine process for anything else (“it’s easier to elect a pope”). One way to speed things up would be to expand the fast track to allow four- to six-storey single-lot buildings.
Reduce the cost of land per square foot of floor space, by allowing more floor space.
Collecting a stream of revenue over time (like property tax) is better than imposing one-time up-front charges of $100,000 or more.
Set priorities and reduce regulations, weighing the cost and benefit of both new regulations and existing regulations.