Archive for January, 2016

Historic Districts, Economics and Misconceptions

January 30, 2016

One of the interesting facts about the heritage conservation field is that it does not track neatly with political persuasions.  My first day of work in 1983 saw the legislation creating the first national heritage area co-sponsored by every single member of the Illinois Congressional delegation, bar none.  Imagine.
lock 8 houseSeverybody loves them some locktender’s houses

So, I was a little confused that Republican lawmakers in Wisconsin and Michigan were trying to get rid of historic districts in the name of “property rights.”  This is odd, because when I wrote my dissertation on historic districts, one of the reasons I looked at districts and not individual landmarks was that they tended to have broad political support because they treated everybody – or every property – the same.  A true libertarian can’t stand individual landmarks because they require an owner to save a property while letting all his neighbors do whatever they want.

cleve ot panOld Town, Chicago.  One of the case studies in my dissertation

Given the ideological fumbling of said state legislatures, we can write these actions off as the attempts of a political junior varsity to go after some low-hanging regulatory fruit.  Historic districts are government actions after all, right?

pv-water-bottle-storeSo is water, but that issue is a tad sensitive in Michigan right now, so best to look elsewhere…

The quotes are typical of our facts-be-damned era.  Feature this:

“How would you feel if you woke up one day and found your house subject to 40 pages of rules and regulations?” said Wisconsin Republican State Senator Frank Lasee in a statement. “Burdensome regulations that require you to get permission from a government committee to improve your house, get approval for paint color, or the style and brand of windows you buy.”

Senator you are KILLING it!  40 whole pages!  That’s like almost as big as a newspaper!  “A government committee” that it turns out is made up only of your neighbors?

Paint color regulation in Wisconsin????  Are you (something) kidding me??

main drag.jpgactual Wisconsin historic district.  Paint superfluous.

And windows….oh lord help me.  Dude, if you are replacing your windows, have at it, because you have already lost.

To even things out, one of the writers at Citylab – which is generally one of my favorite feeds – decided to attack districts from the other side of the aisle.  He said that historic districts prevent affordable housing by keeping values high and excluding people.  He said we should only designate individual public landmarks and then ranted about how Charleston (SC) is ruined now that its historic district is 85 years old.  See the article here.

100 wesley eastSmy historic district, protecting my property values.  we have awesome parties too.

How cool is this!  Historic districts are hurting people’s property rights!  Historic districts are raising values and thwarting affordable housing!  Historic districts are government overreach.  Historic districts are walls keeping out the poor!  (Got whiplash yet?)

carlos thropp torSexcept when they are community planning tools in underserved areas.  BURN!

No, historic districts do not restrict density (or use) and they do not prima facie restrict affordable housing, assuming there is local legislative requirement.  I live in a district full of houses that have been turned into 5-10 units without running afoul of the landmarks commission.

215 grov 406eS

Now, in fairness to the dude, this stuff is not known by most people.  So let’s break down the common misconceptions about historic districts, zoning, and real estate economics.

Real Estate Value

Real estate is the only asset whose value is entirely externalized.  This is obvious, but our nagging and inaccurate common sense always wants to pretend there is a zero-sum game out there.  But there isn’t.  A house can be gorgeous, important, even nicely fitted out, and if its neighborhood sucks mightily, it will have NO VALUE.  Ain’t nothing you can do to reclaim the value of that asset unless you fix the whole damn neighborhood.  Here’s proof:

waller 98 2844s

This is one of the Waller Apartments, designed by Frank Lloyd Wright in 1894.  I bought this property 25 years ago for $1.  I paid $40,000 too much for it.  You got that, cowboy?  It had a NEGATIVE value because of its neighborhood, Frank Lloyd Wright be damned.

emeryville raised vicsEmeryville.  Too late, you missed it.

Yes, historic districts are like zoning, and yes, they preserve value.  People invest in their properties and want to preserve or enhance their investment.  That is why zoning was upheld by a really conservative Supreme Court in 1926.  Interestingly, because historic districts are more precise and individualized than zoning, they are a more useful tool for community activists.

Home economics

Here is the most economically illiterate sentence in the whole article:

“Houses, on the other hand, are often poor candidates for historic preservation.”

Whoa.  No.  Commercial and institutional properties are poor candidates for preservation because they have to make the rent.  They have to put a third down and convince a bank that they can offer a beige product that someone will buy NOW.

roper interior

People will spend money on their houses in a completely irrational manner because it’s their house.  There would be no pools, no doggie doors, no projection TVs, rec rooms, home theaters, basement bars or carpets if houses had to follow the same rational economic rules that other buildings do.

Urban Economics

The argument that both liberals and conservatives like to lob at historic districts is that they affect the real estate economics of the city.  This is what dude says about Charleston, which is apparently just ruined by entitled historic district owners and too expensive.

View east from KingEwww.

Ed Glaeser made the same argument about Manhattan, so it is good to see the liberals and conservatives united in opposition to preservation.  Except that this argument betrays a failure to understand economics at scale.

aeri ny8 v-z

Charleston and Manhattan are actually your best bets for making this argument, because if you take most cities and suburbs and look at all the properties and find out how much is encumbered by historic districts, you are lucky to hit 3% of the land.  You can hit maybe 15 or 20% if you look only at Manhattan or Charleston’s downtown peninsula, but once you include the rest of the city you are sitting back down in the single digits.

Which is why historic districts preserve value for the communities that seek them out (which is basically how it happens).  They are a technique to defend against larger, impersonal real estate issues rolling across the other 97% of the land.

curbcut class burlingSWhich means you can build loads and loads of these.  Blair Kamin calls them Curbcut Classicism.  I call them Lollapalazzos.

There are real estate forces at work that are much bigger and more powerful than historic preservation.  That is why all sorts of non-landmarked parts of Brooklyn have rocketed in value.  Indeed, in the late 1980s I saw Wicker Park in Chicago get landmarked and the adjacent non-landmarked neighborhood of Bucktown tripled in value in one year.  It took landmarked Wicker Park a decade to catch up.

bucktown newbersBucktown!

dodger hdonDemolished in Bucktown, 2006.

So how do you define success?  Low real estate values?   High real estate values?

This is one of those tricky issues – like gentrification – where you want to have a neat and clean reaction but you can’t.  Because it is messy.  I would like to have everyone who lives here stay here.  I would like to protect my property’s value.  I don’t want to be told what to do, but I REALLY want to tell my neighbor what to do.  Also, a pony would be nice.

sewickley hunt dogs2Sorry, we can’t afford a pony.

You want affordable housing?  Legislate it.  Here is some in Palo Alto, where the average house is about $2million.

801 alma PA w

The left and the right should both stop using historic districts as a whipping post.  These are tools that communities use to help determine their destiny in a more precise and individual way than is possible for most communities.  Also they save precious resources from filling landfills.  And grant a bit of beauty, grace and depth to our lives.

UPDATE: 24 Days later – Source of Michigan legislative illness revealed!

Turns out the Michigan law came about because the wealthy of East Grand Rapids defeated a local historic district last year and decided no one else should have one either!   Check out this article.

Sore losers I can understand.  But sore winners?  That’s just mean.

Maybe it’s just typical 1% thinking:  “Look Mom, I did something clever!  Now let’s scale!”

I saw the EXACT same thing happen in Winnetka, Illinois, 25 years ago.  Made a stink for awhile – even used the same analogies.  It died down as soon as the lobbying funding did.  Which is predictable because there are two truths this law fails to recognize:

  1. How real estate economics works (see above).
  2. How these districts got created in the first place, which was BY and FOR homeowners trying to protect their investment. That’s pretty much the ONLY WAY it happens.

Indeed, that is what happened in East Grand Rapids, except the community split over the idea of an historic district and kiboshed it.  So why would you spoil it for everyone else unless you were, say,  a developer who wanted to make your job easier.

Did I just answer my own question?

They also hired marketing gurus who came up with this whopper lie about how historic regulations work:

“Modern technology allows builders to make historic-looking home exterior parts out of aluminum or plastic, argues Afendoulis, but district commissions rarely, if ever, allow their use regardless of how closely they mimic wood.”

You know, if you are spending this much money you might do a little homework.

 

Codes and Coding

January 18, 2016

I was reading an article from the excellent CityLab feed titled: 14 Incredible Objections to a Single Boulder Housing Development and I reposted in on Twitter with the intro: Every reason but the real one.  The list had included typical arguments about density, traffic and parking and esoteric ones like “pet density”and “firefly habitat” but of course the real reason is that it is affordable housing and homeowners nearby don’t want to live near poor people.  Or black people.

Jane addams mural justice

I have studied the history of zoning codes and it struck me this morning how the coded language of the Boulder affordable-housing development opponents and the literal building and zoning codes that circumscribe our real estate are both essentially inflected by the racism at the heart of American history.

n shore chann aerial

The racist dynamic has of course inflected our social and political history – Civil War, KKK, Civil Rights, Black Lives Matter, etc., but it has also been inscribed on our streetscapes.  Zoning codes segregate and exclude – that is what they do, that is why they exist.

MLK monmt

For the entirety of my professional life I have given bus tours where we “read” the landscape we are driving through, whether urban, suburban, rural or wilderness preserve.  Reading the landscape is reading a timescape and in some places you can see the legacy of segregation in very obvious ways.  The wrong side of the tracks.

clarksvil old 2 drB

In the 19th century our systems of transportation made segregation of both people and uses pretty easy.  Industry had to be near the railroad tracks or docks.  Nice houses were surrounded by other nice houses and tracks provided definitional barriers.

highway from airBut when trucks and automobiles arrive in the 20th century they introduce uncertainty into the equation – which is the wrong side of the tracks?  Industry can go anywhere.  It is no coincidence that zoning arises in the early 20th century as a response to the radical uncertainty posed by the truck and the automobile.[1]

Zoning’s first manifestations in the U.S. were in California, and they were almost explicitly racist.  Use zoning emerged in Europe as a way to insulate residential areas from noxious industry, so 19th century Californians decided to zone against Chinese laundries to keep non-whites out of their neighborhood.

Then, exactly 100 years ago, skyscrapers added density zoning to the mix, but the massive spread of zoning between 1916 and 1926 (when it was declared constitutionally legal) was driven by residential suburbs.  In that decade, 591 communities adopted zoning, only 76 of which were cities where density zoning was an issue.

chgo skyline SW vwZoning is interesting because it has survived more than a hundred years, while the less coded forms of segregation – Jim Crow laws, restrictive covenants, insurance redlining – have fallen out of legal favor.  Part of that is because zoning is at least potentially color blind – it tends to exclude the poor and create enclaves of wealth, rather than race.[1]

I am reminded of Mike Nichols’ and Elaine May’s famous comment on urban renewal on Chicago’s South Side in the 1950s and 1960s:  “Black and white united against the poor.”  Urban renewal was zoning with its own engine.

dan ryan-black belt64

Zoning is a code by which buildings (and attendant uses like parking and roads) are developed in space.  As one can see from the example in Boulder, the zoning code allows for language that is indicatively neutral while actually coded for race and class.  Look at these fun examples from the Boulder NIMBYs:

“Although the number of unrelated people living in a unit is restricted by local law, it is well known that there almost no City/Housing Authority enforcement. It is highly likely that, especially in rental units, four or five or six unrelated residents could reside in many of these rental units.” [1]

“Highly likely?”  Does that mean you would do that?  Or just “those people”?  You know, the kind who “rent”? Check this one out:

“Our neighborhoods are already teeming with dogs and this proposed plan of 44 units will surely increase the community dog population including the need for more Animal Control enforcement for off leash violations. In addition, Northfield Commons homeowners already pay dues for dog waste pick up on it’s property. The addition of another extremely dense community will add more pets who will use our community and particularly our park, Jasmine Park, for recreation and elimination. We have purchased dog waste stations positioned in Jasmine Park, and we supply bags and waste pick up services already and this comes out of our HOA dues!”

Wowwowow.  “Those” people appear to have dogs, and they are apparently unlikely to clean up after them.  And they should be paying dues, but apparently they aren’t likely to.  The code is not very hard to crack in this instance.

3322668735_ee8cc4e1d1_b

Zoning can not escape its racist and classist legacy any more than American history can.  The first step is acknowledging that legacy.  Zoning was explicitly exclusionary of uses, and implicitly exclusionary of “others.”  The second wave of zoning codes in the 1950s and 60s was driven more by highways and urban renewal, but it maintained segregation of uses and reinforced racist geographies.

Bloody_Sunday-officers_await_demonstrators_2

Now we are in the 21st century and the noxious industrial uses that threatened fancy neighborhoods a century ago are no longer a problem.  In the last quarter century zoning codes have come to reflect the idea  that mixed uses – residential and commercial especially – are more vibrant socially and economically. The Industrial Age is over, and so is the zoning that kept smokestacks out of grade schools.

5236095

And just as we have come to incorporate a diversity of uses in our streetscapes, we need to encourage a diversity of population if communities are to sustain themselves.  That means using zoning to address injustice rather than perpetuating it.

trail-of-tears

[1] Lens, Michael C. and Monkkonen, Paavo, “Do Strict Land Use Regulations Make Metropolitan Areas More Segregated by Income?” Journal of the American Planning Association, quoted in Florida, Richard, “How Zoning Regulations Make Segregation Worse”, City Lab/The Atlantic January 4, 2016, http://www.citylab.com/housing/2016/01/how-zoning-restrictions-make-segregation-worse/422352/?utm_source=SFFB

[1] Capps, Kriston, City Lab/The Atlantic, January 6, 2016. http://www.citylab.com/housing/2016/01/14-incredible-objections-to-a-single-boulder-housing-development/422724/?utm_source=SFFB

[1] Hall, Peter G., Cities of Tomorrow: An Intellectual history of Urban Planning and Design in the Twentieth Century. Oxford, Blackwell Publishers, 1988, 1996 updated edition. See also Fischel, William A. The Homevoter Hypothesis: How Home Values Influence Local Government Taxation, School Finance and Land-Use Policies, Cambridge Mass, London, UK, Harvard University Press, 2001.

 

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