You Probably Know Exactly Why People Want to Abandon Big Cities

By kwest @ Shutterstock.com

You probably know exactly why people want to abandon the big cities of America. They look at rural states and towns with low taxes and low cost of living, and they see the freedom they expect America to provide. But in the big cities of America, when the government tries to solve problems of high rents and lack of housing, it actually makes them worse. The Wall Street Journal’s editors explain how big-city governments are actually hurting their residents with overregulation of the housing market, writing:

If you’re looking to be a member of my Survive & Thrive club, click here.

In a December 2019 working paper, Harvard and University of Pennsylvania researchers measured land-use rules, zoning and permitting regulations and how many government entities must sign off on new construction, among other restrictions. Though outliers exist, the mismatch between expensive supply and affordable demand was significantly more acute in the places with the most severe regulations.

Meanwhile, the National Low Income Housing Coalition estimated last year that there were 30 or fewer affordable apartments available for every 100 extremely low-income renters in Washington, Oregon, California, Florida and Arizona. These states are home to seven of the 10 most restrictive metropolitan areas in the Harvard-Penn study.

RealPage and Harvard-Penn draw the borders of metropolitan areas slightly differently. But Fort Lauderdale, the Seattle-Bellevue area, Phoenix and Portland—all in the top 10 most restrictive regions—are also where 84.9% or more of new apartments are in neighborhoods with rent generally above the metro-area average. The restrictive cities of Miami, Washington, D.C., and its suburbs and Los Angeles are also in regions where only 18.7% to 35.8% of this year’s new rentals are being built in neighborhoods that low- and middle-income families can afford.

Last year, highly restrictive cities built ultra-luxury apartments at a higher rate than less restrictive ones, according to data from the real-estate market-intelligence firm Yardi Matrix. The most high-end classes of rentals accounted for 4.8% of the overall new supply in Manhattan, 3.8% in Phoenix, about 3% in D.C. and its suburbs, and 2.4% in Los Angeles.

But premium rentals are merely 0.3% of new supply in St. Louis, 0.1% in Cincinnati, Grand Rapids and Cleveland, and an even smaller share in Detroit and Rochester—all among the least restrictive building areas examined by the Harvard and Penn researchers.

The progressive solution to the lack of affordable housing—more government rules and controls—is damaging the very people they say they want to help.

If you are looking for a better America, consider the West, the sunbelt, or small towns. Retirement should be a dream come true, not a nightmare.

Bio
Latest Posts

E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.