Proposed CA law tells cities: Build more, or we’ll do it for you

By contrast, a suburb full of real housing can be far denser. For example, Somerville, MA, a suburb of Boston, has about 19,000 people per square mile. It’s entirely unnecessary to fill the whole of the Bay Area with 30+ floor high rises in order to increase density by a factor of 2 or more; all we need is to re-zone a fraction of the land to allow 3–6 story low rise apartment buildings in mixed-use neighborhoods instead of only allowing single family detached houses on large lots and scattered strip malls and outrageous numbers of parking spaces everywhere.

Kowloon has a density of more than 100,000 people per square mile. The Bay Area does not need anything near the density of Hong Kong to meet its housing needs.

In all likelihood they probably just don't want more supply driving down prices.

If you've got a $1 million mortgage on a $1.4 million bungalow you're not exactly going to be pleased if the housing crisis comes to an abrupt end and you're plunged deep into negative equity.

There seems to be some tiptoeing around this elephant when it comes to the politics of land development though.

This was an issue in my city recently too. People didn't want a medium-density condo project to go in, and the mayor came out and said "I lived here when your houses were built and people said the same thing... you wouldn't be here if we didn't build them".

The property is taxed; the landlord pays the tax directly, the tenants absorb this cost in their rent.

Basically people see it as a magical portal that brings downtown Oakland and San Francisco to them, with all of the attendant problems of those areas. Not entirely untrue, but it also contributes to the inability to ever improve things in the bay area.

But anyway, I don’t think it would be inherently terrible to have relatively low density suburbs.

The problem is that all the towns in the peninsula love building massive amounts of new office space, but don’t build enough housing for the workers to live there. As a result, the workers all live in SF and commute daily to the peninsula by car or corporate shuttle. This is a horrible planning pattern for everyone. (Except for the peninsula towns who get big tax revenue from the office space and don’t have to pay for any of the costs of housing the workers’ families.)

It’s plausible that increasing the housing supply in Silicon Valley suburbs would even decrease commute-hours traffic. (I’m not enough of an expert to predict precisely.)

Tennessee is quite nice as is Maine.

New buildings require a much longer minimum investment timeline because the building doesn't exist yet. It's also far easier.

So if you let the free-market write the rules here, you'd get essentially exactly what we already have, because that's essentially exactly what we've already done.

Instead, if you really want a free-enterprise approach that encourages better land utilization, you'd need to look before you leap. For instance, a conservative rent and property resell value control would guarantee a maximum ROI for the buy/hold and do nothing/dump strategy. Otherwise, you'd have to indirectly subsidize new developments through tax breaks and other financial incentives (which is exactly what is happening)

Alternatively, if you're willing to forgo the engineering and manufacturing of markets you could use community land trusts, which is likely a far simpler and less issue-prone model of execution. I've personally invested in a few and have seen a long-term, stable, dependable 3% ROI (which is better than other equally conservative vehicles) so this doesn't mean that capitalists and investors are gone - just all the messy parts.