Tag Archives: land use

The Unzoned City

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Matt Festa has posted an interesting, short article, Land Use in the Unzoned City, to SSRN. He writes,

The popular conception that Houston is unzoned because it is some sort of ultra-Texan free-market landscape is not accurate. Houston’s land use is in fact highly regulated. While no Houston ordinance explicitly uses the “z-word,” and its rules for the most part don’t prescribe limitations on use, there are numerous land use regulations that, in any other city, would be part of the zoning code. Houston defines certain areas as “urban” versus “suburban,” with different regulations.There are laws prescribing minimum lot sizes, which in turn restrict density. There are setbacks from the street, buffer zones for development, and regulated street widths. There are other laws that affect land use, such as the new historical preservation ordinance, which allows citizens to petition the council for designation as a historic area, which comes with additional restrictions. These are all government measures that, in my opinion, operate as “de facto zoning”— they prescribe different land use rules based partly on geographic location. And even these rules pale in comparison to the extensive regime of private covenants and deed restrictions that govern a majority of the property in Houston. (17)

Festa explains that this lack of zoning may have some partial explanations that have to do with the culture of the city. But he finds a more compelling explanation in the ban on zoning contained in the Houston City Charter. This ban, which can only be overturned by referendum, has been challenged three times but zoning supporters have come up a bit short each time.

Festa is certainly correct that land use scholars (Edward Glaeser, for instance) use Houston as a foil to communities that heavily limit new construction with restrictive zoning provisions. So Festa’s thesis is an important one that I hope he develops in a longer article. Until we determine how much less restrictive Houston’s land use regime is than other American cities’ formal zoning ordinances, we can’t fully understand the interaction between restrictive land use policies and the housing crisis affecting cities across the country.

Reiss on Housing Shortgage

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MainStreet.com quoted me in Housing Shortage Presents Challenges for Buyers. It reads in part,

While the housing demand continues to outpace supply in various urban pockets around the U.S., potential homeowners are faced with competing bids from other buyers.

The pent-up demand has created bidding wars from New York to San Francisco, putting additional pressure on homebuyers, many who are buying their first home in an unprecedented climate.

Despite weaker job growth, there remains a shortage in housing supply to satisfy current demand, said Jeff Meyers, president of Meyers Research, a Beverly Hills, Calif. data provider for real estate. Job growth is expected to pick up throughout this year, which will only increase demand. Unemployment will finish at 6.4% in 2014, which will be its fourth consecutive year of improvement, according to a forecast from Zonda, a mobile application for the residential homebuilding industry.

While all local markets experience their own dynamics and quirks, areas such as San Mateo county in California have more demand for housing because of a strong job market and limited development activity compared to weak demand in Wayne County in Michigan due to poor labor market conditions and an embattled housing market, he said.

Consumers with extra cash have the upper hand in trying to win a bid, especially in markets such as Manhattan where demand for a two-to-three bedroom apartment has pushed prices up to the $1.5 million to $3 million range, said Kinnaird Fox, director of development at Fenwick Keats Real Estate in New York which specializes in residential properties.

“This fierce competition created bidding wars with nearly every new listing since the beginning of 2014,” she said. “Cash rules for obvious reasons in a market like this.”

The bidding war frenzy has turned off many qualified buyers who are wary of the increase in prices, Fox said.

“Despite what seems like a booming sellers’ market, many qualified buyers may be looking, but choose not to jump in,” she said. “With buyers losing out on their bids, buyer fatigue sets in and some withdraw from the market. One could say the lack of inventory masks the actual demand.”

While some cities have a weak demand for housing, many have an even weaker supply, which yields in a housing shortage, said David Reiss, professor of law at Brooklyn Law School in New York.

“Some communities place severe restrictions on new housing construction so even modest upticks in demand can push rents and prices higher,” he said.

Buyers should not forget the fundamental rule of real estate. Location can have far reaching effects, especially if you are moving a significant distance, said Reiss.

“Perhaps first and foremost, ask whether the house you are considering is the right one for your family,” he said. “If the answer is yes, then you are probably on the right track because a house is first and foremost a home and secondly an investment.”

Reiss on Urban Planning Legacy of the Bloomberg Administration

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The BLS Real Estate Society is sponsoring The Zoning and Urban Planning Legacy of the Bloomberg Administration on Monday, November 25th from 6:30 p.m. – 9:00 p.m. in the Student Lounge on the first floor of Brooklyn Law School, 250 Joralemon Street. The press release reads:

Come hear two real estate experts discuss and debate zoning and urban planning issues and the legacy of the outgoing Bloomberg Administration.

Panelists

Mitchell Korbey ’03, Chair of Zoning and Land Use Group, Herrick Feinstein

David Reiss, BLS Real Estate Professor (previously Paul Weiss, and Morrison & Foerster)

No RSVP is required for this event. Contact Rafe Serouya at rafe.serouya@brooklaw.edu for more information.

Mitch’s bio reads in part,

Prior to joining Herrick, Mitch served for six years as commissioner of the New York City Board of Standards and Appeals under Mayor Rudolph Giuliani, and as director of the New York City Department of City Planning’s Brooklyn office, where he guided Brooklyn’s first mixed use zoning districts through the public review process and spearheaded plans for the rezoning and revitalization of a number of neighborhoods, including Williamsburg and Greenpoint.  Prior to running the Brooklyn office, Mitch was deputy director of the Staten Island office and served in the City Planning Department’s Housing and Economic Development Division.

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Mitch is an Adjunct Professor in Hunter College Graduate School’s Urban Affairs and Planning Department where he teaches Land Use Law and leads a seminar entitled “Lawyers and Planners in the Development Process.”  His insights on real estate development and the intricacies of local zoning laws have appeared in major real estate and business publications, including Crain’s, The New York Times and The Real Deal.

He is also a co-author of Herrick’s land use and zoning blog, ZONE, which keeps readers up-to-date on the latest issues in land use and environmental law.