Red Tape and Housing Costs: How Regulation Affects New Residential Development

Details:
Red Tape and Housing Costs: How Regulation Affects New Residential Development Michael I. Luger and Kenneth Temkin Realizing the dream of owning a home is an ongoing struggle for millions of American families. Are state and local governments willing to reform deeply entrenched development regulations to ease the delivery of affordable housing from developer to home buyer? This book explores the delicate balance between regulations designed to promote the production of sound housing in safe community environments and the red tape in which housing developers become entangled. Builders of new residential housing bemoan the regulatory barriers they confront--requirements and constraints that add thousands of dollars to their costs in delivering new units to the market. Less visible but equally damaging are what Luger and Temkin term the "opportunity costs of delay" that cause developers to lose critical momentum and mistime the market. Who ultimately pays the price: the developer or the home buyer? The authors report on case studies undertaken in various communities in New Jersey and North Carolina to compare land-use regulations, regulatory authorities, and local development processes. Building upon their five-tier taxonomy of costs, they tease out the economic and social consequences of development regulations and show how variations in their interpretation and implementation can influence the bottom line. A literature review establishes the general issues surrounding regulation and housing, and chapters on regulatory process and practice in the case study states look at court decisions and environment regulatory bodies. Summaries of developer, planner, and engineer surveys provide perspective for understanding the concerns of various stakeholders in the development process. The authors conclude with policy recommendations to reduce regulatory costs without compromising regulatory benefits.