Is KC Tenants destroying the development future of downtown KCMO?

[Highlander]

A frequent argument that I heard in past years was that developers wouldn't ever overbuild apartments (to the point of rent decreases) because it wasn't in their financial interest. I guess the developers in Austin, Portland, SF, et al failed to collude properly! More seriously, development is highly competitive with a mix of large and small developers that any kind of coordinated cartel-like behavior is just so unlikely. Developers have payroll to meet, too - so there is always a bias towards doing projects.

Investors and lenders are a different story - those are the groups that put the breaks on development activity the past 18 months, not developers.

I spent a lot of my life in the Houston metro. There always seemed to be a surplus of new homes and apartments available in Houston and rental and home prices were quite reasonable. There was so much housing under construction at any given point of time that the lag before overbuilding became apparent was always enough to leave a significant inventory available. Plus, Houston has grown so much in the last 20 years that overbuilding never seems to be a huge issue for lenders/investors as the surplus housing eventually gets absorbed. KC just seems to have a much more risk averse lending/investment community.

[Cratedigger]

KC just seems to have a much more risk averse lending/investment community.

Have to wonder if this goes back to the regional banks based here and their more conservative lending strategies.

[TheBigChuckbowski]

the long-term trend over years and decades across the country is that rent increases outpace inflation, because for-profit enterprise does not intentionally engage in activities that diminish profit.

Pretty much everything included in inflation is for-profit. By your logic, everything should be outpacing inflation, which is impossible for obvious reasons.

We don't let the housing market function so it's no wonder that prices rise faster than inflation. Our housing regulations are seemingly only in place to build less units than are needed and make them more expensive than what the market wants. And we allow private citizens that put up enough of a fight the ability to stop projects. Imagine if Ford had to get approval from multiple boards and citizens every time they wanted to build 200 cars. Do you think cars would be more expensive?

[phuqueue]

Man if I had a nickel for every time somebody on this board misapplied "my logic" in trying to explain it back to me. Sure, I guess if you assume you can make valid apples-to-apples comparisons between literally any products, then you got me, but I'm not sure the fact that flat screen TVs cost a fraction of what they used to necessarily indicates that you could also construct new housing in high enough volume to be both affordable and profitable (importantly, it should actually be more profitable than constructing more expensive housing in lower volume would be, but I'm skeptical it would be profitable at all, even if you got rid of the NIMBYs and zoning and all), especially not the kind of housing that this board wants to see (dense, urban, multifamily development). If we start talking about dropping manufactured homes into exurban greenfield sprawl, maybe the math changes (not counting, of course, the massive spending on infrastructure that such development entails), but I don't think we're talking about that.

It is worth considering that a hundred years ago, NYC did break a housing shortage by following basically the YIMBY playbook. There are some crazy stats in that article, like that more than 1/5 of NYC's present-day housing dates from the 1920s. But despite supply rapidly rising to meet demand in just a few years, there was not a corresponding drop in rent (the article implies that it was just low-income tenants who didn't benefit, but the report itself suggests it was broader than that: "did not achieve the more general aim of lowering rents"; "no effect on rents"; 2/3 of the population "still suffered from high rents"; "On paper, the number of vacancies ... indicated normal conditions," but they "were found in apartments for which low- and middle-income families could not compete"; etc). Why? "Studies revealed that private initiative was then, always had been and apparently always would be, unable and unwilling to provide adequate housing for the lower income groups. Under the existing conditions, it was unprofitable to do so."

[beautyfromashes]

^Great Depression cleaned out a lot of the government building bureaucracy and also provided super cheap labor. Politicians were just doing anything to shorten the soup kitchen line and keep crime down. Had to be a crazy time. Not sure what we’d do now in the same circumstances. I guess just slash interest rates and send out checks.

[CrossroadsUrbanApts]

The idea isn't really that developers will actively collude to keep rent high, it's that when rents begin to fall, the profit incentive shrinks, and if this becomes a persistent trend, developers will begin to exit the market until rents stabilize and then rise again. It doesn't mean overbuilding won't happen from time to time, but the long-term trend over years and decades across the country is that rent increases outpace inflation, because for-profit enterprise does not intentionally engage in activities that diminish profit. This is why expecting developers to consistently overbuild and bring rents down isn't a long-term solution to the affordability problem, notwithstanding that some markets might occasionally see rents level off or even fall modestly (and yes, emphasis on "modest," because let's not pretend that any of these cities are suddenly meaningfully more affordable than they were a year ago).

Before this spirals into a multipage argument again, just gonna get in here to note once again that I agree wholeheartedly -- in principle -- that KC (and the rest of the country) needs a lot more housing. That doesn't necessarily mean that the skepticism toward developers of low-income renters or groups like KCT that represent them is unwarranted, though.

My point is that the housing development market is more fractured and diffuse than many other types of markets. So both direct and indirect collusion (aka "shrinking profit incentive") is actually less likely than in other markets. Also, developers aren't any more or less greedy than they were in the past. So pointing to developer greed as the main issue with the current affordability crisis is just wrong [I'm not saying this is your argument, but it is the argument you hear from KCT].

Many on this board, including myself, are saying "let's make an effort to make the market work better." How to make the market work better? Make it easier for small developers to enter the market and build a wider variety of housing types. The types of housing that the big institutional builders won't develop. It won't solve the entirety of the housing issue but it would make a dent in it, at least in our lifetime. That's the pitch we are making to City council members and other leaders with an influence on development policy.

Yes, I would love if we could get KCT support for aspects of this reform program. But I think it is clear at this point that they have ideological reasons to want the private market for housing development to work worse, not better. Because they don't want a functioning private housing market at all. Council members are listening to this, and making policy decisions that make the housing market, already ridiculously hamstrung, work even worse. KCT cheers this on because it heightens the contradictions and gets them closer to their goal of ending a role for private capital in housing. I don't think they are shy about saying this quite clearly.

I get it - it is not the role of KCT to go to bat for developers of any size - but to the extent they are arguing against housing reform arguments that I think could help the city, it is important to be clear about how their anti-development arguments are wrong (as opposed to their anti-slumlord arguments, many of which I don't have any issue with).

[im2kull]

Yes, I would love if we could get KCT support for aspects of this reform program. But I think it is clear at this point that they have ideological reasons to want the private market for housing development to work worse, not better. Because they don't want a functioning private housing market at all. Council members are listening to this, and making policy decisions that make the housing market, already ridiculously hamstrung, work even worse. KCT cheers this on because it heightens the contradictions and gets them closer to their goal of ending a role for private capital in housing. I don't think they are shy about saying this quite clearly.

You hit the nail on the head.

[Sirius_Blue]

Hard agree with you, CrossroadsUrbanApts. Their hearts are in the right place but boy howdy do they have some funky means.

[herrfrank]

[The] Great Depression cleaned out a lot of the government building bureaucracy and also provided super cheap labor. Politicians were just doing anything to shorten the soup kitchen line and keep crime down. Had to be a crazy time. Not sure what we’d do now in the same circumstances. I guess just slash interest rates and send out checks.

We were then still on the gold standard (and after 1934, silver standard), meaning that our central bank could not simply print money. Nixon took us to a FIAT fisc. We also continue to operate the de facto world currency (huge structural advantage btw). The US has so much more fiscal flexibility (we basically did print our way out of a similar depression in 2008) than other countries. We live far larger than we should, by all rights, cuz we own the dollar.

[herrfrank]

^TL;DR Winning WW2 and not being Soviet or an Empire (UK) has paid dividends for 80 years and running.

[Metro]

https://www.kcur.org/housing-developmen ... kc-tenants

When will the city stop being held hostage and admit that killing developments off isn't the solution?

When we quit electing people like Bunch & Duncan

[phuqueue]

I'm not really interested in rehashing the argument about what KCT does or doesn't really want. We just did it a few months ago and a few pages back, and I'm not aware of any new information that would change anything since then. Your arguments on the point are duly noted, mine already fill up pages 16 and 17.

The idea isn't really that developers will actively collude to keep rent high, it's that when rents begin to fall, the profit incentive shrinks, and if this becomes a persistent trend, developers will begin to exit the market until rents stabilize and then rise again. It doesn't mean overbuilding won't happen from time to time, but the long-term trend over years and decades across the country is that rent increases outpace inflation, because for-profit enterprise does not intentionally engage in activities that diminish profit. This is why expecting developers to consistently overbuild and bring rents down isn't a long-term solution to the affordability problem, notwithstanding that some markets might occasionally see rents level off or even fall modestly (and yes, emphasis on "modest," because let's not pretend that any of these cities are suddenly meaningfully more affordable than they were a year ago).

Before this spirals into a multipage argument again, just gonna get in here to note once again that I agree wholeheartedly -- in principle -- that KC (and the rest of the country) needs a lot more housing. That doesn't necessarily mean that the skepticism toward developers of low-income renters or groups like KCT that represent them is unwarranted, though.

My point is that the housing development market is more fractured and diffuse than many other types of markets. So both direct and indirect collusion (aka "shrinking profit incentive") is actually less likely than in other markets. Also, developers aren't any more or less greedy than they were in the past. So pointing to developer greed as the main issue with the current affordability crisis is just wrong [I'm not saying this is your argument, but it is the argument you hear from KCT].

I'm not talking about collusion of any kind, "indirect" or otherwise. This isn't even specific to developers, it's just how businesses function in general. You go into business to get a return, if the return isn't there, you pull back on your investment, and if this continues, you eventually exit the industry. Each individual business does this in consideration of their own interests, but if there is no profit to be made, they'll all reach the same conclusion, no collusion required. I'm sure you're right that developers aren't any more or less greedy than they were in the past, and I don't think developers are any more or less greedy than any other business, either. It is the nature of for-profit enterprise to be "greedy" in that generating profit is the reason it exists in the first place, but I don't hold this against the business. It's not a moral question. But it is the key point that gets overlooked. Developers don't exist to build housing. Developers exist to make money. Yes, they make money by building housing, but building housing is a means to an end, not an end in and of itself. Developers will stop building housing if building housing no longer makes money for them, and in any case, they will seek to build the type and amount of housing that maximizes their profits, which is not necessarily the same housing that will meet somebody else's wants or needs. This is why, even if developers might appear to be a convenient ally for affordable housing activists in the near term in the midst of a housing shortage, their incentives are not actually aligned with affordable housing interests in the longer term.

Many on this board, including myself, are saying "let's make an effort to make the market work better." How to make the market work better? Make it easier for small developers to enter the market and build a wider variety of housing types. The types of housing that the big institutional builders won't develop. It won't solve the entirety of the housing issue but it would make a dent in it, at least in our lifetime. That's the pitch we are making to City council members and other leaders with an influence on development policy.

I understand what you and the others who want to "make the market work better" are saying. What I'm saying is that the market is not going to provide housing that does not generate profits. The market doesn't exist to ensure that a thing gets allocated to everybody. Low-income tenants suspect (not without merit, I imagine) that there is little profit to be had in providing housing to them on the market. No matter how well you "make the market work," it's never going to work for everybody.

[FangKC]

Many on this board, including myself, are saying "let's make an effort to make the market work better." How to make the market work better? Make it easier for small developers to enter the market and build a wider variety of housing types. The types of housing that the big institutional builders won't develop. It won't solve the entirety of the housing issue but it would make a dent in it, at least in our lifetime. That's the pitch we are making to City council members and other leaders with an influence on development policy.

Why small developers are getting squeezed out of the housing market

...
Even while recognizing the need for comprehensive solutions, too many urbanists have ignored the importance of finance in charting a different course for the future. Without credit markets that can actually finance the creation of new housing, very little can get built. Without flexible credit markets, very little good can get built. This particularly impacts small developers, and by extension the quality of our communities overall. Small builders imbue identity, intrigue, and charm into the places they work, and confer significant quantitative benefits like providing housing typologies that larger firms might not be willing or able to build, and offering it at attainable pricing.

This piece will focus on the role that finance plays in shaping our cities, starting with an exploration of why debt is used for construction projects in the first place. After, we’ll look at how lenders deal with the risks associated with the inherently challenging process of real estate development. This risk mitigation is critical to understanding why our world looks the way it does. Finally, we’ll dive into how America’s housing finance system is leading to negative consequences, privileging large scale institutional development at the expense of more incremental, community based building, and why we should work to support more of the latter. Small developers are the backbone of our communities. If they can’t access financing, our cities and towns will materially worsen.
...

https://www.noahpinion.blog/p/why-small ... re-getting

[CrossroadsUrbanApts]

I understand what you and the others who want to "make the market work better" are saying. What I'm saying is that the market is not going to provide housing that does not generate profits. The market doesn't exist to ensure that a thing gets allocated to everybody. Low-income tenants suspect (not without merit, I imagine) that there is little profit to be had in providing housing to them on the market. No matter how well you "make the market work," it's never going to work for everybody.

Because KCT thinks the market "won't work for everyone", they specifically attack that market and try and make it work worse for everyone. I guess what you are not getting is that their organization is actively trying to limit the addition of new supply to the KCMO housing market, because the great majority of that additional supply is going to be high-end market rate apartments. If KCT didn't fight new development, I wouldn't have a problem with them!

I really thought the new Council would have proposed needed revisions to the city's development and incentive policies by now. I think the simplest reason that no revisions have been made is that KCT still wields a great deal of influence over development policy in the city and they are against any perceived deregulation of development rules because of their stated concerns over displacement and "developer handouts." Paired with standard issue conservative NIMBYism (not enough parking! too much density!), the result is a left-right NIMBY alliance that has prevented the kind of robust housing production that other US cities have seen over the past few years. [Recall this latest discussion started with a comment/question on why KC is building so little housing compared to many other cities].

This affects my livelihood so I'm pretty invested in trying to find a way to break through that left-right NIMBY bloc. I would like to do more development in KCMO and it sucks that it has gotten so much more difficult after a pretty good run from 2013-2109.

I also strongly disagree with your characterization of how business works and what drives profit but that would take us far off-topic.

Also, thanks to Fang for sharing that article by Cody Lefkowitz. I enjoyed that post when it came out and shared it with my friends/colleagues. Kansas City has certainly seen great results with smaller scale development, from Butch Rigby, Diane Botwin, Terrell Jolly, John Hoffman and Lance Carlton and too many others to name. One thing they had in common was effective use of development incentives in executing their small-scale developments

I do think a lot more attention needs to be paid to the role of finance in housing development and how distorted the market is. Cody's blog post that Fang linked is a great contribution to that conversation. To his credit, Chuck Marohn has been outspoken on the pernicious role of national, institutional finance on shaping development outcomes. I don't agree with a lot of his thinking on economics and, especially, the role of the Federal Reserve, but I do think he is doing good work in bringing attention to the issue of how small-scale, incremental development is not well-served by today's financial markets.

[TheBigChuckbowski]

I'm not talking about collusion of any kind, "indirect" or otherwise. This isn't even specific to developers, it's just how businesses function in general. You go into business to get a return, if the return isn't there, you pull back on your investment, and if this continues, you eventually exit the industry. Each individual business does this in consideration of their own interests, but if there is no profit to be made, they'll all reach the same conclusion, no collusion required. I'm sure you're right that developers aren't any more or less greedy than they were in the past, and I don't think developers are any more or less greedy than any other business, either. It is the nature of for-profit enterprise to be "greedy" in that generating profit is the reason it exists in the first place, but I don't hold this against the business. It's not a moral question. But it is the key point that gets overlooked. Developers don't exist to build housing. Developers exist to make money. Yes, they make money by building housing, but building housing is a means to an end, not an end in and of itself. Developers will stop building housing if building housing no longer makes money for them, and in any case, they will seek to build the type and amount of housing that maximizes their profits, which is not necessarily the same housing that will meet somebody else's wants or needs. This is why, even if developers might appear to be a convenient ally for affordable housing activists in the near term in the midst of a housing shortage, their incentives are not actually aligned with affordable housing interests in the longer term.

You are dead on with all of this but then somehow miss the point. One of government's jobs in a financial system like ours is to harness capitalism's drive to make money into a greater good for society. Our local government is completely failing in its role. It's not harnessing capitalism, it's fighting it. Our zoning code isn't functioning as a means to produce housing for people that need it, it's functioning as a means to keep property values high for those that already own it. Zoning has wasted so much developable land in and around our cities on low density sprawl, we are now forced to build in exurbs or do complicated and slow infill. Our building codes don't factor in cost, only risk. Single staircase buildings work and are not dangeous everywhere else in the world. But here? Nope, too dangerous, doesn't matter how costly. If our regulations are not working to make housing more affordable but exist precisely to do the opposite, make it more expensive, why would we expect anything else to happen? And why would we fight developers instead of fixing our regulations?

Developers can be an ally for affordable housing activists if our regulatory and incentives environment was structured in a way to make that work. Instead, it's structured to do the opposite so that's what we see. It's structured to build exclusively $500,000+ single family houses and 100+ unit "luxury" apartments and nothing else. Why is it a surprise that environment doesn't produce affordable housing and why do we blame developers for this and not the government regulations that require it?

I understand what you and the others who want to "make the market work better" are saying. What I'm saying is that the market is not going to provide housing that does not generate profits. The market doesn't exist to ensure that a thing gets allocated to everybody. Low-income tenants suspect (not without merit, I imagine) that there is little profit to be had in providing housing to them on the market.

You're not wrong but you're also missing a pretty important element of this. Developers don't need to make a profit off of low income tenants. We already have housing built 10-100+ years ago that can be maintained or renovated at a fraction of the cost of building new. And, take profit out of it. New social housing is going to run into the exact same zoning and building code issues that contribute to the expense of for profit housing. Ignoring regulations and focusing on profit makes little sense. Take out profit but replace it with bureaucracy that has the same material costs, labor costs and regulatory hurdles and you're not going to produce cheaper units.

Yes, providing housing for families making minimum wage without government help is never going to be profitable. If we want to provide new housing for those people then the government needs to step up and figure out how to produce it and/or fix the voucher system. Expecting developers to do it with limited incentives, while navigating a years-long political process that's constantly changing while investors and banks see faster, simpler, less risky returns in every other market, is never going to work (and that's not the developer's fault).

And, beyond all that, we can't lose sight of the fact that the housing market is much bigger than just those with the lowest incomes. Housing prices continually increasing affects everyone and we can't cut off our nose to spite our face by making housing more expensive for everyone because we're only interested in making housing affordable for those with the lowest incomes. Affordability matters across most of the market.

[Highlander]

I understand what you and the others who want to "make the market work better" are saying. What I'm saying is that the market is not going to provide housing that does not generate profits. The market doesn't exist to ensure that a thing gets allocated to everybody. Low-income tenants suspect (not without merit, I imagine) that there is little profit to be had in providing housing to them on the market. No matter how well you "make the market work," it's never going to work for everybody.

Because KCT thinks the market "won't work for everyone", they specifically attack that market and try and make it work worse for everyone. I guess what you are not getting is that their organization is actively trying to limit the addition of new supply to the KCMO housing market, because the great majority of that additional supply is going to be high-end market rate apartments. If KCT didn't fight new development, I wouldn't have a problem with them!

The more insidious part of their efforts is to restricts the growth of wealth within Kansas City that will eventually add to the tax base that makes things like social housing achievable in the first place. While incentives may temporarily delay some money from reaching the tax rolls, it brings in people into the city to pay sales tax and the earnings tax and eventually property taxes. The growth of the community makes it possible to bring in more people and retail stores etc... Kansas City's urban core has grown but it's still having a difficult time attracting basic stores like an urban Target. Unfortunately for KCT, some gentrification is necessary as KC has lost so much of it's middle class to the surrounding burbs in the last 50 years. Trying to achieve affordable housing (and particularly social housing) by making your community ultimately poorer is a pretty cynical zero-sum game to play.

[im2kull]

Because KCT thinks the market "won't work for everyone", they specifically attack that market and try and make it work worse for everyone. I guess what you are not getting is that their organization is actively trying to limit the addition of new supply to the KCMO housing market, because the great majority of that additional supply is going to be high-end market rate apartments. If KCT didn't fight new development, I wouldn't have a problem with them!

It's actually even simpler than this. Bottom line.. KC Tenants, as an organization, doesn't want or care about "Affordable Housing", they want "Social Housing". For everyone. Forced on everyone.

There is no middle ground with their org. They want true social housing. It's right within their mission statements, etc. As soon as we all begin highlighting that and educating everyone, the sooner we can move beyond them... as it's a common misconception that they want what everyone else views as "Affordable Housing", when the reality is that they want "Social Housing".

[bspecht]

KCT will be honored for their 5 years as a special action during today's Council meeting, via Duncan.
Cosponsors: Bough, Robinson, Parks-Shaw, Bunch, Willett, Lucas, Patterson Hazley
https://clerk.kcmo.gov/LegislationDetai ... FullText=1

[phuqueue]

Because KCT thinks the market "won't work for everyone", they specifically attack that market and try and make it work worse for everyone. I guess what you are not getting is that their organization is actively trying to limit the addition of new supply to the KCMO housing market, because the great majority of that additional supply is going to be high-end market rate apartments. If KCT didn't fight new development, I wouldn't have a problem with them!

I'm still not really interested in relitigating what KCT's goals are. Suffice it to say, I don't think their ultimate objective is "to limit the addition of new supply to the KCMO housing market," this is just an effect of the tactics that they employ, and that distinction does matter because it speaks to the range of mutually agreeable outcomes that could potentially be found (which, in your framing, would be zero, but I think your framing is wrong). Again, on pages 16 and 17, I already discussed what they are trying to accomplish and why they do what they do, don't think there's any new information to discuss here and don't really have the energy to just repeat it all again.

The "left-right NIMBY alliance" that you talk about later in your post isn't even remotely unique to KC, but you acknowledge that other cities have had more success building housing anyway. Supposing KCT isn't just a scapegoat for more complicated issues affecting the KC market, what is it that you think makes KCT disproportionately more powerful than likeminded groups in other cities?

You are dead on with all of this but then somehow miss the point. One of government's jobs in a financial system like ours is to harness capitalism's drive to make money into a greater good for society. Our local government is completely failing in its role. It's not harnessing capitalism, it's fighting it. Our zoning code isn't functioning as a means to produce housing for people that need it, it's functioning as a means to keep property values high for those that already own it. Zoning has wasted so much developable land in and around our cities on low density sprawl, we are now forced to build in exurbs or do complicated and slow infill. Our building codes don't factor in cost, only risk. Single staircase buildings work and are not dangeous everywhere else in the world. But here? Nope, too dangerous, doesn't matter how costly. If our regulations are not working to make housing more affordable but exist precisely to do the opposite, make it more expensive, why would we expect anything else to happen? And why would we fight developers instead of fixing our regulations?

I agree with your points about code but doubt that these changes will make low-income housing sufficiently profitable. And from a practical standpoint, I feel like you might be overlooking how incredibly difficult it will be, politically, to enact genuine reforms here. Land use regulations that protect existing property values didn't just arise by accident, and their beneficiaries (homeowners who are whiter and wealthier than the nation as a whole) are a much more powerful constituency than the low income renters of color who create and comprise groups like KCT. Granted, other solutions, like constructing public housing, are also extremely difficult politically, so there are no easy answers here, but public housing would at least have the benefit of actually being affordable, where the market-driven free-for-all will produce only whatever kind and amount of housing can be expected to maximize profits. That being said, I am all for reimagining our zoning laws and building codes, I just don't expect this to singlehandedly fix the housing crisis.

You're not wrong but you're also missing a pretty important element of this. Developers don't need to make a profit off of low income tenants. We already have housing built 10-100+ years ago that can be maintained or renovated at a fraction of the cost of building new. And, take profit out of it. New social housing is going to run into the exact same zoning and building code issues that contribute to the expense of for profit housing. Ignoring regulations and focusing on profit makes little sense. Take out profit but replace it with bureaucracy that has the same material costs, labor costs and regulatory hurdles and you're not going to produce cheaper units.

It's true that developers themselves don't have to build housing for low-income tenants, but it's still necessary for providing low-income housing to be the most profitable use of whichever property, whether it's a new build or an existing building. Landlords who own existing buildings still have costs beyond just maintenance or renovation (and I would be careful about assuming that an old building can necessarily be renovated at "a fraction of the cost" of new construction), like mortgage and taxes (depending on incentives, the tax burden on an existing building may be much higher than on a new build). If a landlord finds it more profitable to renovate his 100 year old building and rent it to higher-income tenants, he's going to do that. Or property owners might decide to knock down and replace their building (or sell it to someone else who will do that), which won't necessarily yield more (and certainly not cheaper) units than were there before. Anecdotally, I've heard complaints from Chicago about old apartment buildings getting replaced with new houses (not sure how widespread this is there, apparently enough for someone to gripe about it, but that can be a low bar), and the NYT also wrote about a similar phenomenon in NYC a couple years ago. Obviously, just by definition, there will always be some housing that is old or undesirably enough to find itself at the bottom of the market, but there is nothing about the market that will guarantee that any given unit remains at the bottom of the market or that there is enough housing at the bottom of the market for everybody in that price range. That will only happen if providing low-income housing is the most profitable use of a property. In most cases and assuming a healthy market, I am doubtful that it is.

(That NYT story is also interesting in that it notes cases in which current zoning would have allowed more -- sometimes many more -- units than developers chose to build. Obviously the developer at 15 W 96th St felt that 21 multimillion dollar condos would make them more money than either the 30 apartments that were already on the site or the 66 they could have built.)

Public housing wouldn't necessarily need to be cheaper than privately-built development. If there is political will to build it, it will be built, whatever it costs. Our electeds certainly don't lose any sleep over our eye-popping infrastructure costs, they just keep writing those checks. That isn't to advocate for intentionally inefficient/wasteful spending, but realistically, it isn't an obstacle.

Yes, providing housing for families making minimum wage without government help is never going to be profitable. If we want to provide new housing for those people then the government needs to step up and figure out how to produce it and/or fix the voucher system. Expecting developers to do it with limited incentives, while navigating a years-long political process that's constantly changing while investors and banks see faster, simpler, less risky returns in every other market, is never going to work (and that's not the developer's fault).

I agree, but I also don't think it is ever going to work even if developers don't have to navigate a years-long political process.

And, beyond all that, we can't lose sight of the fact that the housing market is much bigger than just those with the lowest incomes. Housing prices continually increasing affects everyone and we can't cut off our nose to spite our face by making housing more expensive for everyone because we're only interested in making housing affordable for those with the lowest incomes. Affordability matters across most of the market.

Sure, but this is the KCT thread, so we also can't lose sight of the fact that any solution that boils down to "give the people with money what they want now and we pinky swear we will work on something for the poor later" is never going to happen. Also, any solution that provides an adequate amount of housing that is affordable to low-income renters will necessarily relieve upward price pressure from the bottom up.

[CrossroadsUrbanApts]

phuqueue, you are right that this left-right NIMBY alliance issue exists in many cities - that's why there is a nationwide housing shortage! What I'm saying is somewhat unique to Kansas City is that developers used a very effective incentive tool - tax abatements - to build a good amount of infill housing from 2010-2019. What changed then? KC Tenants came on the scene and used their influence to effectively kill those incentive tools. Now only the biggest developers get them through their political connections. Smaller developers are shut out. I'm just saying let's repeal those misguided incentive changes from 2019 and go back to what worked well in the past. It's a simple story I'm trying to tell.

I'm fine with some kind of public housing strategy for very low-income families and individuals. But we shouldn't kneecap privately-financed, market-rate development efforts in the meanwhile while someone figures out how to build public housing in 2024. Tying low-income housing efforts to market-rate development was a mistake in 2019. Inclusionary zoning failed to accomplish any goal other than restrict new market-rate developments.