The cities of today are largely constructed by those of the present but of the past. Current developers are forced to develop around what has already been developed. But what happens when cities or metropolitan areas are designed poorly? Well, many things happen. Cities overtime will begin to show these problems. When these problems are left alone, they become an eye sore and in times will contribute to long term problems. In some cases, these can lead to a crisis. Which happens as the result of a lack of inaction or ineffective city planning. Once a crisis arises it becomes much harder to deal with, than if it was dealt with before its occurrence. Now yes, it is possible for cities to design and develop its way out of a crisis.
This is much easier said than done and the longer and longer inaction takes place within cities, the more difficult it will become. Not saying Rome is facing a crisis, but in its origins, there was no planning for streets. Modern day Rome is built around a random collection of streets that have no grid or plan. This makes it even harder for modern developers to work with. Problems simple as the planning of streets can have large impacts in the future, if left unchecked. To redesign and redevelop a city will require many things. To basically summarize it. You need to get rid of the old and new. Essentially you must get rid of older areas that are root causes of the problems of the city.
For example, the city of Detroit is faced with a huge issue of blight within its city. Detroit’s blight comes from the downfall of its era as the industrial mecca of the United States. It was a city so focused on manufacturing and once this declined and there was less need for the worker more and more people left. This caused many businesses to leave because of an inverse of the multiplier effect. As jobs decrease in those sectors, local businesses suffered as a whole. After time blight occurred as people moved out and businesses went under. Once this occurs it makes living in Detroit less appealing and the value of land to drop. This is the crisis they are facing as of now. They must remove blight and make Detroit more appealing to people. This is something that will take years, maybe even decades to accomplish. Not only does it take time but innovative and practical ideas. Cities can pull themselves out of a crisis with development and design, but it takes time and innovative thinking.
I used Detroit as an example of large metropolitan area that faces a crisis. But now let’s shift our attention to Los Angeles. It is a well-known fact that Los Angeles is facing a widespread crisis. This crisis is the areas housing crisis. Two factors have helped lead us to this. A lack of supply but a high demand of affordable housing and the costs to live in Los Angeles. The county experiences one of the largest housing costs to wage disparities across the United States. After doing research I stumbled across the mayor’s official website and there was a section dedicated to the problems of housing. The use a statement from the California Housing Partnership, that says to escape this crisis we need to build a little over 568,000 affordable homes. That is a scary number. They have made a dent but not sizable fix. I believe the county of Los Angeles could use other ways besides the current one.
One of the biggest problems with the housing crisis is that the people who are the most affected by it are some of the last to reap the solutions. Areas that are lower income are seen as very undesirable areas for developers to develop and design. Which makes sense in our current state because even though land in these areas is cheaper. Taxes and the large costs of developing in Los Angeles deter people from developing affordable housing. I believe a way to combat this crisis is to provide developers and planners with an incentive to do so. A major incentive would be reduction of the state property tax for properties that are developed and designed for affordable housing. The caveat for this is that these areas should be in abandoned or undeveloped land specifically in lower income areas. If state or local government give developers a tax incentive to build affordable housing, they will build it. This has happened before. In 1947 William Leavitt sought the construction of over 6,000 low-income housing, but overall, 17,000 homes in all. They price of the average house was extremely low for the quality they received. Leavitt was able to do this because he received G.I. Bill and Federal housing subsidies. These breaks allowed for the mean price to be incredibly under what the market value should be. This solved his areas affordable housing problem issue post WWII. History like Leavitt Town shoes that government add into housing allows for easier development of affordable housing. If they are developing affordable housing on land that had no prior use, it takes out two birds with one stone. They are increasing the supply of units while using land that has negative affects on the value of land surrounding it. Additionally, the California Tax Credit Allocation Committee (TCAC) can make it easier for developers to obtain Low-Income Housing Tax Credit (LIHTC) easier as well. There are way too many hurdles for developers to get these and we need to increase benefits and ease access to them. To get more housing we must reward developers that intend to build so. The net result is a more friendly environments towards the development of affordable housing that causes developers to invest more into them because of tax breaks from state or local governments.
Giving developers incentives is not the only way to aid the Los Angeles housing crisis. One solution that might seem obvious but gets overlooked is simply how we design housing. Currently Los Angeles does not design housing for the sake of overall efficiency. Innovation in technology and design overall decreases costs of production and overall production time. This is the case with Low-rise housing. They have variety and are cheap and easy to make. The only problem though is that current laws prevent this. Several years ago, they attempted to change this through SB 50 but outside forces prevented it because wealthier single unit housing areas do not enjoy the idea of affordable housing near them. Low-rise is smarter approach to design because it creates multifamily developments areas. It really is a smarter approach to high density housing that Los Angeles already contains.
Los Angeles is not only a city, but a metropolitan area that suffers from a crisis with affordable housing. As provided above we cause use modern solutions with design and development to help dig ourselves out of the crisis we helped formulate. Increasing incentives through tax breaks or subsidies from governmental bodies will cause developers to want to develop affordable housing in areas whereas they previously would not have. This is also the same with design because if allow for better design of high-density housing we can allocate more units of quality affordable housing with less land. Overall, Los Angeles has an affordable housing crisis that that will take time to solve but the solutions I provided are ways to help dig us out of the crisis.
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There is a lot of ways to view the LA housing crisis, but viewing it from a perspective of supply and demand I think is smart and gets to the logistical issues at the base of the problem. I think development incentives are partially the way to do it, and based on what has been spent to stop the housing crisis, that is what should be being done.
I've heard much about the LA housing crisis, and I've always wondered the reason for the scarcity in supply. High taxes provides a quick and understandable answer. Your proposition for a tax incentive is really interesting, and I think that could definitely motivate developers to aid in the LA housing crisis. Great job!