Real Estate Industry Camp Followers Fabricate Claims About Housing Crisis to Weaken Land Use Laws

PLANNING WATCH LA - To be kind, the “experts” who fabricate tall tales to justify the deregulation of land use regulations in Los Angeles that benefit developers and commercial landowners might be ignorant.  If so, they should change their minds when faced with the facts. 

But, so far, the experts are immune to facts.  This leads me to a less generous explanation.  Either by design or self-delusion these professional advocates of unrestricted real speculation cook up stories about the housing crisis so City Hall will dish out more favors to real estate investors. 

One example is particularly egregious, an opinion piece in the December 29, 2022, LA Times by UCLA’s Michael Lens.  As a faculty member at a prominent university, he lends credibility to the WIMBY (Wall Street in My Back Yard) proposals for opening up cities to the profit-maximizing schemes of real estate investors.  Too bad for the rest of us that these proposals make the housing crisis worse.

Despite the misleading “No quick fix for LA’s Unhoused” header for his LAT column, its content is wholly wrong.  Stripped of cliches about the homeless, Professor Lens argues, like his fellow WIMBYs, that giving generous up-zoning handouts to real estate developers solves the housing crisis.  This is why the Times also published the same article with a more revealing header, “How do we keep L.A.’s housing costs affordable? Build more homes.”

In fact, the article’s proposals – some of which I quote below -- are already underway, and they explain why homelessness is getting steadily worse.   

• “The city used to be zoned for 10 million housing units until the 1980s, when we started limiting the number of housing units that could be built on parcels across the city. Now, our zoned capacity is down to about 4 million housing units.”  Professor Lens is referring to California Assembly Bill 283, adopted in 1979.  It required all California cities to make their General Plans and zoning laws consistent with each other.  Los Angeles completed this enormous effort in the late 1980s, nearly three decades before homelessness became an enormous crisis in Los Angeles.                                                                                                                                                           But Professor Lens is mistaken that the California Legislature’s zoning consistency program reduced LA’s potential population from 10 million to 4 million people.  The last time City Hall calculated LA’s zoning buildout population was in 1995, through the General Plan Framework’s Environmental Impact Report.  Its Table T-1F indicates that LA’s post-AB 283 zoning would result in 7,190,942 people.  Since then each single-family parcel in California has been allowed three Accessory Dwelling United (ADUs) and 4 apartments. By 2023 LA’s zoning buildout population is much higher, at least 9 million people.   Despite this increase, LA’s population nevertheless declined by 200,000 people, mostly Angelenos who moved our because of the city’s expensive housing. 

• “The number of Angelenos who struggle to stay housed has remained unacceptably high.” While true, the number of homeless people has steadily increased.  In 2018, Los Angeles had 31,000 homeless people.  In 2022 the city had 42,000 homeless people, despite concerted efforts by the State, County, and City to provide temporary and permanent housing while watering-down zoning laws, claiming these changes would spur developers to build more housing.  Yes, there was a residential building boom, but it was mostly pricey high-rise apartments, not the low-cost housing that the homeless and overcrowded could afford.  In fact, during the 2018-2022 period housing costs nearly doubled in Los Angeles.                                                                    

• “Stopping the flow of people into homelessness requires building more housing of all kinds, including market rate.” Two problems are packed into this sentence.  First, the Los Angeles neighborhoods with the newest housing – such as Downtown LA, Hollywood, and Koreatown -- also have high rates of homelessness.  This is because new housing is expensive, and it often displaces existing low-income tenants through Ellis Act evictions and demolitions.  Second, Federal programs to build public housing were largely axed in the 1970s and 1980s.  And, the California State Legislature dissolved all local redevelopment agencies in 2011.  They had been required to allocate 20 percent of their budgets to low-income housing, and this remaining source of funding for new public housing quickly disappeared. 

• “We also need to allow three and four-unit buildings in what are now single-family neighborhoods.”  Senate Bill 9, adopted in 2021, already allows this.  But it has not expanded housing supply in single-family neighborhoods.  Few existing homeowners want to move out of their house, rent an apartment or house for several years, demolish their original house and build a market-rate tri-plex or four-plex, move into one of these apartments, and then manage the other rental units in perpetuity.  SB9 projects are designed for developers, but they could care less.  They prefer to quickly profit from building and selling McMansions, not constructing and managing apartments that replace the bulldozed single-family houses they purchased.  

In addition to these errors, I also find this column’s omissions alarming: 

• The basic shortage is not the number of homes, but a lack of money among prospective tenants. They would gladly rent vacant units if they could afford them.  Income inequality has steadily increased in Los Angeles over the past decade, and nearly two-thirds of Angelinos now live pay-check to pay-check.  Furthermore, to rent the average apartment in Los Angeles, prospective tenants must earn over $38/hour, which is 2.5 times the minimum wage.  As a result, 78 percent of low-income families in Los Angeles County pay over 50 percent of their income for housing expenses.  Over 800,000 Los Angeles County families need low-income housing options, but only 300,000 units are available. 

• Despite wage stagnation, the price of housing has steadily increased in Los Angeles. According to UCLA’s Lewis Center, average monthly rents in Los Angeles have increased at annual rate of 6 percent since 1996, soaring from $500 per month to $2,300 in 2019.   Housing prices have followed the same trajectory, pricing many families out of the housing market because of a 250 percent increase over the past two decades.

• Covid-19 eviction prohibitions will soon expire in Los Angeles. On February 1, 2023, evictions will again be allowed, at which point some evictees will join the existing homeless. 

The justifications for giving public handouts to private real estate developers keep coming from the Urban Growth Machine: academics, elected officials, mainstream media, lobbying groups, and trade associations.  They are based on their unsupported claims that rolling back zoning laws reduces housing prices and therefore alleviates homelessness.  Sometimes they also argue that the deregulation of density and parking laws increases the use of transit, even though transit ridership is down, especially in neighborhoods, like Hollywood, with the new, up-scale apartments that the WIMBYs celebrate. 

(Dick Platkin is a former Los Angeles city planner who reports on local planning issues for CityWatchLA.  He serves on the board of United Neighborhoods for Los Angeles (UN4LA).  Previous Planning Watch columns are available at the CityWatchLA archives.  Please send questions and corrections to [email protected].)