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Housing affordability has become a hot-button issue from coast to coast. In my hometown of Columbus, Ohio, the CEO of the largest locally based home builder recently lamented how it’s becoming “impossible for housing developers to meet the level of demand.”
And this is a midsized Midwest market we’re talking about. The affordability issues in San Francisco and other major American markets are seemingly beyond repair. But what if the root of the solution to this systemic problem is just a change in mindset? What if it’s about rethinking the paradigm, from developers to elected officials to community members?
Amid soaring housing costs, homelessness and environmental destruction, it’s time to do away with the exclusionary “not in my backyard” (NIMBY) attitude and embrace a “yes in my backyard” (YIMBY) approach that calls for dense, responsible development.
Far too often, local jurisdictions limit density with outdated regulations. And some residents, often a few vocal individuals or groups, fight against anything that resembles change. This paradigm has shaped generations of home building in the U.S., and we’re now forced to live with the results — a dire shortage of affordable places to live. American cities have been held hostage by NIMBYism for too long.
Fortunately, there is a growing YIMBY movement, whereby supporters are embracing the tenets of urbanization and density. It’s being driven by younger Americans, who are feeling the brunt of these housing woes and being forced to delay or forgo homeownership because it is unattainable.
YIMBYism quite simply reflects how younger generations prefer to live, choosing density for the walkability and shorter commutes. According to a 2017 survey by the National Association of Realtors, 53% of Americans “would prefer to live in communities containing houses with small yards but within easy walking distance of the community’s amenities, as opposed to living in communities with houses that have large yards but they have to drive to all amenities.” That share is up from 48% in 2015. In fact, the UN reports that we’re now living in a world in which the majority of humans live in urban areas.
Isn’t it about time we design our neighborhoods to reflect this sentiment? The effects will be revolutionary.
First and foremost, adding more housing supply in a dense and thoughtful manner will keep prices in check and provide more people with affordable places to live. In developing land more responsibly, we can reduce the costs of pollution, infrastructure and public health and safety. Furthermore, YIMBYism will lead to greater economic inclusion by allowing a broader array of Americans to participate in real estate ownership and development, reflecting the modern demographic makeup of the country.
There is even bipartisan appeal for the idea. YIMBYism brings together some left-leaning supporters, who believe housing production is a social justice issue, and some free-market libertarians, who believe housing should not be heavily regulated by the government. Promoting more housing is a free-market solution to a self-inflicted problem.
We’re already seeing the results of some modern approaches to housing — both good and bad — playing out around the country.
In Denver, height restrictions have caused urban sprawl and affordability challenges. Meanwhile, San Francisco’s ward-based system has put development and progress in gridlock, exacerbating the affordability crisis. On the other hand, Minneapolis and Oregon have enacted more favorable zoning standards to promote dense and responsible growth and progress.
In my hometown of Columbus, the issue of density is being studied. According to an Insight2050 report commissioned by several local stakeholders, there will be significant differences in everything from utilities costs to pollution, depending on how the region develops. Under a scenario in which Columbus keeps building the way it has been, mostly sprawling onto new land with single-family lots, the costs for new local roads, sewer, water, wastewater infrastructure and select services will average $408 million annually. Alternatively, if growth is maximized via infill development, the projected cost to the public would be 20% lower, or $328 million per year.
While YIMBYism can reduce public infrastructure costs, mitigate the environmental impact of development and reduce overall housing prices, there is a downside to excessive urbanization. People living in areas that are the target of gentrification are often priced out and do not have the opportunity to benefit financially from new housing development. So, we must have a plan to develop densely while also ensuring equal opportunities to benefit.
Everyone should have the ability to invest in their homes. Perhaps if more people living in growing communities participated in the financial returns of new development, there would be less resistance to YIMBYism. To address this shortcoming, technology and business model innovations that expand access to real estate ownership are arriving to the market.
New business and financial models such as fractional equity, crowdfunding and renter ownership (rentership) — the latter is where my company is focused — expand access to the economic benefits of urban investment, ownership and development. We could ignite momentous change in housing and wealth creation by providing all community members with access to the financial rewards and heightened sense of community that ownership brings.
Too many communities are saying they agree with the solution — build more housing on smaller sites — but that other people can deal with the execution. That familiar NIMBY mindset doesn’t work, and it never has. While some development is happening, it’s not enough to keep up with demand, and people living in the community are not being given the opportunity to benefit financially.
The YIMBY movement is coming. The time for change is now.