A Bright Spot on the Horizon for Massachusetts Housing Affordability

Tuesday, February 27, 2018
Boston skyline
A survey of housing affordability ranks Boston among the most expensive cities in the English-speaking world. (Katie Wheeler)

Boston citizens have long struggled with high housing costs, since suburban zoning laws slow down building and changes to allow new housing are rare. Yet there may be some hope on the horizon. Governor Charlie Baker recently spoke on behalf of his plan for changes that would make it easier to permit more housing.

Baker’s bill proposes changing the voting threshold for decisions that would increase potential housing in Massachusetts towns and cities. The existing two-thirds majority would give way to a simple majority rule. Importantly, the bill makes clear that this new threshold would not apply to decisions that would decrease the amount of housing landowners may build. This can come in the form of reduced parking requirements, allowing garage apartments, allowing mixed-use development, and other land-use regulations.

The proposal has garnered support from the state’s municipal association, in stark contrast to typical state-level attempts to reform zoning laws. Most proposals rely on some form of state preemption limiting what municipalities may regulate. Baker’s bill avoids that by changing the voting threshold for land-use decisions, leaving more authority with the towns.

No powers are curtailed. The municipal land-use regulatory toolbox would be unchanged. If anything, local politicians would be empowered. Simple majority voting would make it easier to allow concessions to bring desirable housing and businesses to towns. Anti-development homeowners, bothersome local NIMBYs, and incumbent local businesses hold less sway when they need to convince more than half a town council to say “no” to new housing or businesses. Reform-minded local politicians benefit at the expense of stasis-minded councilors, to the advantage of cost-burdened Massachusetts residents.

Majority voting on decisions that increase landowner property rights is a step toward making the housing market more flexible, to allow it to meet demand for different types of housing in different towns. The ideas expressed in the bill reflect recent insights into the political economy of land-use regulation, such as the work of David Schleicher and Roderick Hills. Proposing bills that simply allow more housing are rarely tractable. Politics and federalist mechanisms must be taken into account in any robust housing reform.

Yet, there is nothing magical about a simple majority. A more aggressive version of Baker’s bill could require less than a majority to pass.

The default option could be to allow things like apartments with no parking near transit or the build-out of home-based retail businesses, with a supermajority needed to limit building based on the existing zoning land-use regulations. This would yield a zoning regime that allows more leeway for building, with entrepreneurial developers seeking to build to market demand without creating negative externalities that trigger a supermajority community vote to reign them in.

Whatever the voting threshold, Baker and his advisors deserve credit for proposing one of the most promising zoning reforms in the nation. They have learned from past failures to pass bills that would address Boston’s high rents. In an urban state full of cost-burdened households, political pressure will continue to build for bills that will increase the housing stock. Despite past failure to pass rent-relief bills, the Massachusetts legislature has an opportunity to correct its mistakes in 2018. Between this bill and California’s SB 827, housing advocates have plenty to hope for this year.

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Nick Zaiac

Nick Zaiac is a fellow in commercial freedom at the R Street Institute based in Washington, DC, and he has been an AIER contributor since 2017. His work focuses on land-use policy, housing, infrastructure, and regulation. He has been featured in many outlets, including the Washington Post and Baltimore Sun, and he serves as an analyst at the Maryland Public Policy Institute. He is pursuing his MA in economics at George Mason University. Follow @NickZaiac.