It looks obvious

“Things should be made as simple as possible, but no simpler.” — Albert Einstein

The effect of regulations on housing prices

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"We should have a law for this" is a phrase that become common idiom. The notion that government can regulate the market, or better - human condition, is common and accepted as fact of life. The general acceptance is that government’s agencies have only the public interest in mind, and that the people working in them are competent enough to make such regulations.
I argued , as many others, that such believe is not only wrong practically but is immoral. Doug, from the Liberty papers , brings another example for the effect of government regulations. He quotes an article from the Washington Post about high housing prices around Washington DC. Among other reasons the Article points to:

Architect Christian Lessard said he and the other developers of MetroWest, the 2,250-home project underway near the Vienna Metro station, would happily build a larger number of smaller homes, but community opposition limited the number of units they could build. To make back the cost of the land, he said, the builders designed the townhouses they were allowed to build to be as large and expensive as possible — about 2,500 square feet, a size that in similar developments sells for about $500,000.

Lessard acknowledged that the outcome was not ideal.

Put simple, the government by limiting the number of homes built driving the prices up and making the ability of people with lower income to buy a house. Maybe when Doug’s suggestion will sound less radical we will have better hope…

Here’s a radical idea. Stop telling developers what they can do with their property and let them build housing based on market demand rather than economic necessities created by your regulations. Maybe it just might work.

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Written by Rogel

July 9th, 2006 at 9:25 pm

Posted in Libertarianism

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