Kriston Capps is a staff writer for CityLab covering housing, architecture, and politics. He previously worked as a senior editor for Architect magazine.
Unlike San Francisco or New York City, the nation's capital is an expensive city to call home as a result of federal fiat.
A September housing report from the U.S. Bureau of Labor Statistics is making the rounds this week after The Washington Post published its findings on the Monday holiday. The Post gave it a 100-proof headline: "It’s more expensive to live in D.C. than New York, study says."
According to "Housing: Before, During, and After the Great Recession," Washington, D.C., is the most expensive place to live in the country. These findings aren't new (and they certainly aren't news to anyone living in the District), but this graphic appears to explain how the nation's capital costs so much for its residents.
Yet tabulating mean housing costs doesn't totally capture the true value of a place. I don't mean value in some squishy sense of the word, as in that it's worth it to love the place you call home. No, the price of housing alone simply doesn't translate into affordability, in part because household incomes tend to be higher in those places where housing costs more. That's why the U.S. Department of Housing and Urban Development created the Location Affordability Index, which finds that, when you factor in transportation costs, annual vehicle miles traveled, and so on, the cities of San Francisco, New York, and D.C. start to look a lot more affordable—for high-income earners, anyway.
Back to the BLS report. "The surprising statistic comes from a Bureau of Labor Statistics report that shows that—on average—Washingtonians spend more on housing and related expenses (utilities, furnishings and equipment) than New Yorkers and San Franciscans," the Post writes. Be that as it may, the costs breakdown misses the forest for the trees. Housing in D.C. is fundamentally different from housing anywhere else.
From the start, the BLS presentation muddies matters as much as it clarifies them. One map included in the report is downright misleading: While D.C. saw by far the greatest increase in residential construction businesses of any state in the nation, that tells us almost nothing. D.C. isn't a state (and state rankings are dumb).
"These guys are going to be registered as D.C. companies, but it’s about where your business address is," says Robert Denk, senior economist for the National Association of Home Builders. All those residential construction establishments headquartered in D.C. built a lot of apartments in the Washington area. They just didn't build them in the District of Columbia.
"Maryland and Virginia suburbs swamp the District proper," Denk says. "If you show the three areas on a graph, D.C. just disappears. It’s a rounding error."
The remarkable thing about growth in the nation's capital before and after the Great Recession is that the city did not change all that much—not physically, anyway. The one reason why D.C. is so slow to adapt, and why housing costs are now so high, predates the Great Recession by almost a century: the Height of Buildings Act of 1910.
Using Census data, I put together charts showing where permits for new housing units were issued from 2004 to 2013. The chart tabulates permits by individual units, not by individual buildings. This chart covers every kind of building permit, from single-family construction to apartment or condo buildings with five or more units.
What this clearly shows is that only a fraction of the permits issued during a time of extraordinary growth in the Washington area actually happened in D.C.
As a longtime resident of the District, it sometimes feels like the entire city has been torn down and built over by apartments and condos in just a short time. The appearance is deceiving. Much as we like to complain about condos—or move into them—the vast majority of multifamily buildings that rose during the housing boom were built elsewhere in the broader Washington area.
This chart focuses on only the building permits issued for units in buildings with five or more units (from small apartment buildings to large condo developments). Multifamily construction accounts for most of the housing construction since 2004. And most of this smart multifamily construction happened outside the District.
Now, the population of the District grew from some 572,000 residents in 2000 to more than 646,000 residents today. There's nowhere near enough new housing in D.C. to meet demand. Plenty of the residents who moved here bought or rent existing housing stock, but with more and more people moving to the city every day, the opportunities are fewer, and the rents are rising rapidly. It's very easy to get around D.C., so it's an affordable location (per HUD), all things considered—if you can muster the high costs of living.
The housing situation look only slightly different in San Francisco. Using the same data, this chart shows where new building permits were issued (number of units, not number of buildings) throughout the metro area.
And here's where multifamily building permits were issued over the course of the Great Recession in the Bay Area.
What you see is that a higher share of building permits going out in the Bay Area actually resulted in construction inside San Francisco city limits. There's a huge drawback in 2009, which corresponds both with the financial crisis and a dip in Ellis Act filings. The District is bigger than San Francisco by land area (61 square miles vs. 47 square miles), but San Francisco is far denser. And the trend in San Francisco building permits is toward greater density.
Just for contrast, here's what building permits look like in Houston over the period.
Houston accounts for a fair shake of new building permits in the larger metro area, and Houston can claim a significant share of the multifamily construction, too. Now, plainly, Houston's lax zoning policies make all the difference. Plus, it's vastly larger in size than San Francisco or D.C., and it's nowhere near as dense as either of those cities. Comparing them is like comparing apples and Ruby Red grapefruit.
(UPATE 1:52 p.m.: It's worth noting, as Geoffrey Hatchard and Amanda Kolson Hurley do on Twitter, that the Bay Area is much, much larger and more populous than San Francisco. The same is true for the Washington area and the District. Although they are very different cities, in terms of population and land size, D.C. and San Francisco compare reasonably well; yet the ratio of Bay Area development taking place inside San Francisco is larger than that of D.C.)
There's no reason that residential construction in San Francisco couldn't look (on paper) more like it does in Houston, with a stronger share of multifamily construction inside the city. Indeed, that's the fledgling trend in San Francisco now. If only protectionist homeowners weren't legislating height limits in new developments, you could expect more filtering and more affordable units.
And that's the point: San Franciscans (and residents of de Blasio's New York) choose to enact bad zoning policies that put denser and more affordable housing out of reach—much as Houston residents chose a turn-down-for-what approach to development. In Washington, D.C., residents do not have a say.
The federal Height Act, enacted way back in 1910, mandates that the supply of housing in the District is permanently and absurdly limited. The city has its own homegrown NIMBYs who oppose new development, of course, or set standards for historic preservation that make even mild adaptations impossible. But D.C. is NIMBY by default—by federal law—and the only people who can change it at the root level are House and Senate legislators.
To be sure, housing is expensive in D.C. because economies of scale don't support building class-B apartments here, and developers cater only to residents looking to buy class-A units. Yet this situation can't be traced back to decisions (good or bad) made by D.C. residents or officials. Even after a big building boom and a period of growth that was barely slowed by the Great Recession, the rent is still too damned high. And the reason it's expensive to live in the District of Columbia is Congress.