Rent anxiety and fears of displacement fuel support for obstructing market-rate housing in pricey cities.
Where new housing gets built—or, more likely, doesn’t get built—is often driven by the obstructionist tendencies of existing residents. NIMBYism is rooted in the fear that an increase in the supply of housing will lower the value of homes and neighborhood amenities. Sometimes, this fear comes disguised as local protectionism, accompanied by cries lamenting the decline in neighborhood aesthetics—blocked light, congestion, and noise. Other times, it’s thinly veiled racism.
Conventional wisdom might suggest that renters are immune to the temptations of NIMBYism, simply because they stand to gain from lower housing prices and an increase in affordable units. But that doesn’t stop them from joining the obstructionist bandwagon in expensive cities, according to new research by Michael Hankinson at the Joint Center for Housing Studies at Harvard University. Via the paper:
Despite showing strong support for an increase in the housing supply citywide, renters in high-rent cities exhibit spatial sensitivity (NIMBYism) towards market-rate housing at a level on par with homeowners.
In his paper, Hankinson examined attitudes towards new development in a national survey with over 3,000 respondents, and then juxtaposed it with a poll of over 1,600 San Francisco voters. Overall, he found, homeowners were indeed more likely to go Full NIMBY: In the national survey, only 28 percent of homeowners supported a citywide increase in housing. For renters, this was 59 percent.
Not all new housing is regarded the same, though. Hankinson created a chart showing how perception towards new development changes with proximity and type of housing. The further left of the central vertical line in the chart, the higher the NIMBYism. Perhaps predictably, he found that affordable housing (in blue) proposed within a 2-minute walking distance was much more unpopular than market-rate development (in red) 2 miles away:
Renters, on the other hand, did not report strong NIMBYist tendencies. “If anything, for buildings containing affordable units, renters exhibit a positive YIMBY (‘Yes In My Back Yard’) effect, with support growing the closer the building is to their home,” Hankinson writes. In the chart below, you can see that the affordable housing markets, in particular, are on the left of the central line:
But in high-rent cities, that difference evaporates. Renters didn’t object to affordable housing. When it came to market-rate development, however, the renter NIMBYism and homeowner NIMBYism was practically the same. This was the case despite the fact that renters supported an increase in the city-wide housing supply.
The perceived threat from new neighborhood development was also linked to anxiety about rising housing prices and rent burdening (paying large shares of income on rent). The prospect of displacement, it appears, is behind this tragedy of the commons. In the paper, Hankinson explains:
Imagine you are a renter in a city with high housing prices, living in one of the few remaining affordable neighborhoods. On your street, a new condominium is proposed, to be rented at market-rate, defined as the unsubsidized or ‘typical’ price for housing that renters are willing to pay. Generally, you believe that new supply helps to mitigate rising prices. However, this one condominium is a minuscule addition to the overall supply, making it unlikely to appreciably lower prices citywide. Meanwhile, the new building may signal to other developers that your neighborhood is an undervalued investment. Your landlord may see the new building and consider renovating her own, leading to your eviction. In the end, while the new condominium may marginally ease prices citywide, it may also attract demand locally, driving a spatially localized rise in rent. To you, the long run benefit of lower citywide prices is eclipsed by the immediate, short run cost of displacement.
You can see this effect in action in San Francisco, one of the most unaffordable housing markets in the U.S., at least in part, because of its limits on new construction. And despite rent stabilization, recent changes in state law have increased the threat of evictions. In a renter-majority city, the typical homeowner-driven NIMBY politics that work well in less dense, more elastic cities may not apply.
In his survey, Hankinson asked San Fransisco voters if they would support a 2015 ballot measure that proposed the suspension of new development in the gentrifying Mission District, unless it was fewer than six units or completely consisting of affordable housing. An overwhelming 62 percent of renters responded negatively, compared to 40 percent of homeowners. At the same time, 8 out of 10 renters favored expanding housing supply citywide (compared to 73 percent of homeowners).
Since the fear of being priced out of their homes is at the bottom of renter NIMBYism, perhaps strengthening anti-displacement measures is a good place to start. But beyond that, the question of how to strike the balance between what a neighborhood wants and what it needs can have complicated answers. Any solutions require listening to renters and better understanding what caused this acute divergence in their attitude towards new development. Via the paper:
Do renters support more housing citywide because they believe that prices will drop if every neighborhood carries their share? Does a citywide increase in housing seem more equitable than the status quo targeting of politically weak neighborhoods? Or do renters simply support supply in aggregate because it is difficult to visualize ‘supply’ compared to the specific developments of the conjoint experiment?... By understanding the sensitivity of support for housing citywide, we can better identify the most useful strategies for overcoming this collection action problem of spatial proximity.