The Rise and Fall of the YIMBY Consensus

By Juan Rivero

The lack of affordable housing is a complex problem. And every complex problem, as the saying goes, has an answer that is clear, simple, and wrong. In this instance, free-market fundamentalism has long provided one such answer — the notion that invisible economic forces will solve affordable housing crises if we only step aside, wait patiently, and let them work their magic. Things have never worked out that way. But free-market apologists have always found a way to blame the world for its failure to conform to their economic models. This has kept their totalizing theories roaming the earth like zombies, providing intellectual cover for their policy application, and forever eluding the grave where bad ideas go to rot. In recent years, these zombies have gotten a makeover and started to pop up in unexpected places.

The San Francisco Bay Area is a land hospitable to techno-utopianism and to the perennial search for technological fixes for life. Unsurprisingly, this is where the YIMBY (Yes In My Back Yard) movement emerged with force. Folks dismayed by the region’s high housing costs looked around and rediscovered a simple technical solution: deregulation. In their account, land-use controls had inhibited housing construction and led to higher housing prices. This connection was made by reference to “single family home” districts and to a history of exclusionary zoning practices — a move that gave the movement’s deregulatory platform the semblance of a progressive plea. Thus framed, YIMBYism gained traction and was promulgated across the country in the name of social equity by useful zealots and self-interested cynics, willfully or blissfully unencumbered by the weight of historical counter-evidence, the contingencies of context, or the findings of contemporary housing research. Before long, the Kool Aid of deregulation started showing up in YIMBY pitchers at the table of housing policy debate and, increasingly, it was the only drink on the menu.

The story of an intractable crisis caused by regressive regulation holds tremendous appeal for those in the business of selling simple, dramatic stories. Journalists and politicians have therefore been all too eager to inhabit the echo chamber of YIMBY orthodoxies. To judge from mainstream newspaper coverage, official statements across all levels of government, and the occasional half-baked pop-journalism best seller, you’d assume that the following postulations were universally accepted truths: 1) The lack of affordable housing stems from a lack of housing supply; 2) an increase in overall housing supply would make housing affordable to those in need; 3) land-use regulation has caused the housing shortage; and, given the foregoing 4) the relaxation of such regulation would stimulate new construction, expand the housing supply, and make housing affordable. And yet, among those who research housing policy, there has long been an abundance of disagreement about the accuracy of each of these assumptions.

The Washington Post covered the recent publication of research bucking the supposed YIMBY consensus. One paper, by urban and economic geographers Maximilian Buccholz, Tom Kemeny, Gregory Randolph, and Michael Storper, builds on numerous studies that have diverged from the mainstream YIMBY narrative. This scholarship challenges the assumptions, listed above, underlying the de-regulationist push to override local land-use controls and to undermine, in the name of housing affordability, the influence of communities in the development of their neighborhoods.

With regard to the assumption that relaxing land-use provides an effective means to stimulate housing construction, the co-authors point to cross-regional studies that have concluded that housing supply and prices respond similarly to demand fluctuations, regardless of the degree of land-use regulation. The paper also references a 2023 survey by Urban Institute researcher Yonah Freemark of all peer-reviewed empirical English-language research on housing-related, land-use regulatory change that found conflicting or inconclusive evidence on the impacts of deregulation on housing production at both local and regional levels.

With regard to the assumption that increasing the overall housing supply will make housing affordable to those in need, the paper’s authors cite research showing that new housing supply can cause an increase or a decrease in nearby housing prices, depending on neighborhood type and market tier and that, in any case, the impact is modest. The article then describes attempts to measure the speed at which the price effect of new housing construction filters down to segments of the market available to lower-income households. The rates tend to be small and occasionally negative. Moreover, when downward filtering does happen, it has been found to result in higher housing costs burdens. To illustrate these dynamics, the authors conduct a simulation exercise based on assumptions gleaned from the above findings to illustrate the impact of a construction boom on housing prices. They conclude that “no realistic [supply] shock could be large or quick enough to provide significant relief to today’s cost-burdened households in major U.S. cities.”

Finally, with regard to the assumption that the lack of affordable housing stems from an overall lack of housing supply, the article challenges this purported causal relationship in two steps. First, it points to recent research by urban planning scholars Kirk McClure and Alex Schwarz disputing the presence of a housing shortage and arguing that findings to the contrary fail to account for the large surplus of housing produced during previous decades. Second, the paper presents as an alternative explanation for the affordable housing crisis: the national increase in income and wealth inequality. It contributes a geographic dimension to this well-established argument, demonstrating that, because housing prices track average income growth, the affordability crisis closely reflects the national distribution of high-earning college graduates. This tendency, the article explains, accounts for the acuity of the crisis in several U.S. metropolitan areas:

“Non-college educated workers must compete for housing against residents whose incomes have benefited from globalization and technological change, amplified by agglomeration economies. Housing prices track average income growth, but that average obscures increasingly unequal income growth, with decades of stagnant wages for many workers. This gap between prices and stagnant incomes is the central driver of the affordability crisis.”
We welcome the deserved attention that this paper has received. Despite the mindless media saturation of YIMBY talking points, there has never been a shortage of research suggesting that the deregulation of housing markets will not only fail to solve affordability problems; it will likely make them worse. The political appeal of peddling a straightforward policy solution that just happens to redound to the benefit of the real estate sector has been plain to see. We hope that the new administration will part ways with its predecessor and take the less expedient path of tackling the affordability crisis as it exists in the real world and not as development interests and its YIMBY mouthpieces would like it to.

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Juan Rivero is the special projects director for Village Preservation. This article, about Yes In My Back Yard, was reprinted with permission of Village Preservation.