Reader weighs in on Wall Street and housing issues

Tom Slade

Submitted photo

This is in response to Garrett Brand’s opinion regarding the issues with housing and his proposed solutions:

Corporations have purchased houses and other residential property as investments. Mr. Brand suggests that properties are purchased at a premium. How is it possible for anything in a free market to be sold at a price above market value? Does Mr. Brand pay $5/gallon for gasoline with a market price of $4/gallon? Probably not.

Increasing rents and costs of ownership are driven by supply and demand being out of balance. Better look at reasons for supply problems before blaming corporations.

I was particularly interested in Mr. Brand’s comments about “social housing” purported to exist outside of the for-profit housing market. This can only be done with public subsidies, which is another way of saying taking from one group and giving to another.

Mr. Brand mentions Seattle, Washington, as a shining beacon of hope and light for this issue. I worked for the Department of Construction and Land Use in Seattle for seven years as a planner. DCLU regulates all construction in the city limits with a variety of codes including a huge, cumbersome land use code, a critical area ordinance that used to protect 100-square-foot wetlands serving no environmental purpose with a buffer that was thousands of square feet. An environmental review code and many others. Of course, a builder could obtain a “reasonable use exception.” If granted, the bureaucrat decides what is a “reasonable use” of the property.

In another instance, the environmental review of a proposed apartment building was so one-sided for traffic impacts that the developer pulled out of the state. No housing constructed. Traffic congestion in this instance was caused by existing traffic in the already-congested area due to government not responding to increases in traffic with road widening, more transit service, etc.

Similar restrictions as those in Seattle are in effect in many parts of the country, causing problems with supply and cost of housing. When discussing supply demand imbalances for any issue, be careful to look for the underlying causes and not opinion based on casual observations.

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