Book Review: Escaping the Housing Trap

Before starting Escaping the Housing Trap: The Strong Towns Response to the Housing Crisis by Charles Marohn and Daniel Herriges, I was very skeptical of what it would say. While I’ve found a lot of value in Chuck’s writing in the past, I know his background is not in housing and so I doubted his insights into the housing crisis. What I found was the most well rounded analysis of the cause of the housing crisis and some interesting suggestions for solutions to the crisis.

The housing trap that we find ourselves in is simply stated in the introduction of the book, “We need housing prices to fall; we also cannot afford for them to fall. Thus, we are trapped.” Chuck and Daniel do a wonderful job explaining how the US economy became dependent on high housing prices. There is so much wealth tied to the mortgage and mortgaged derivative markets that if home prices went down in an meaningful way, our economy would collapse. While this might sound like hyperbole, the 2008 crash shows the very real threat a housing crash would have on the backing industry.

Of course, this is not a new problem, it’s one that’s been building since the Great Depression. Escaping the Housing Trap walks through the programs put in place in the 1930s and then changed and expanded throughout the second half of the 20th Century to get us to the housing market we have today. It is this analysis and history of the financial structures that make housing possible, not just of the changes to zoning and building codes, that sets this book apart.

Many recent books that focus on housing like The Affordable City or Arbitrary Lines, look at just a small handful of issues that drive housing prices. Escaping the Housing Trap looks at a full range of issues, which leads to a broader range of potential fixes for the housing crisis. As is the Strong Towns way, the focus here is very much on the financial feasibility of building new homes. Even the analysis of the constraints created by zoning and building codes is viewed through the lends of how they affect the cost of building.

The authors spend a couple of chapters discussing NIMBYs and YIMBYs. These were the chapters I had the most trepidation about. Chuck is not known for his YIMBY stances, and I was not expecting the basis of his solution to be building more homes. While this book is sympathetic to the desires of NIMBYs to resist change to their community, its evaluation of the results of their selfishness is harsh. On the other hand, the chapter on YIMBYs starts by questioning their simplistic view of the housing market, while ending up generally agreeing with it. The biggest critique of the YIMBY movement isn’t in its goals of building more housing, but its limited scope of enabling more housing through zoning reform alone.

The basic premise for solving the housing crisis according to Escaping the Housing Trap is something that Chuck has been saying for years; no community can be exempt from change, and no community should be subject to radical change. To achieve this, every community must allow the next increment of development by right. Single-family homes must be able to be converted to duplexes and triplexes, Neighborhoods of triplexes must allow for missing middle housing types. Areas with small apartment buildings must allow for large apartment buildings. Historically, this is how (some) cities developed over time.

To achieve this, not only do regulations need to change, but new types of developers are needed. Most developers today specialize in the ecosystems that have developed over the past 70 years. Generally, they are either single family home developers or mid-rise apartment developers. Few developers are working in that middle space (although a new third type of developer is quickly coming onto the scene, the ADU developer.) What is needed is a new type of developer, like what the Incremental Development Alliance is trying to create, that focuses on everything from duplexes to various types of small apartment developments.

The book spends a chapter discussion how this type of development can happen using South Bend, IN as an example. Unfortunately, South Bend has long been a city suffering from disinvestment and a shrinking population. While it’s a great example of incremental development, it also illustrates the model’s limits. This type of small scale development relies on the end-state of the suburban experiment to be financially viable. Incremental development only works in neighborhoods that are run down, after long periods of disinvestment, and where the real estate is cheap. It is simply not possible to do small scale and incremental development in high-demand (and therefore high land cost) areas.

This is the real weakness of Escaping the Housing Trap. The Strong Towns approved solutions to the housing crisis simply don’t work in places where the housing crisis is most acute. Building to the next increment of intensity is not financially viable in places with high land prices. In communities that have resisted the pressure to grow for decades (i.e. most of California), there is so much pent up demand that slowly transforming cities through incremental development is not viable. The only options are to not change or to change radically, at least until the backlog of housing demand has been worked through. The Strong Towns approach to housing development is ideal for places that aren’t already suffering from a housing crisis, but they simply don’t work to solve a housing crisis from inside the crisis.

The penultimate chapter of the book starts to talk about how to create economically thriving neighborhoods using local resources. There is a whole series of short paragraphs that could be chapters in their own right. Escaping the Housing Trap would have been a much better book if this chapter had been expanded to fully explore the ideas that were briefly introduced here. Hopefully Chuck will consider coming back to this chapter and expanding it into his next book.

In the end, Escaping the Housing Trap provides a wonderful jumping off point to gain a well-rounded understanding of how we ended up in the housing crisis we’re in today. However, the Strong Towns mindset limits the range of solutions that are offered, and provides solutions that are neither viable nor solve the housing crisis where it’s most needed. Using the first two parts as a jumping off point, it would be interesting to see someone else provide a full range of solutions that could let us escape the housing trap we’ve built for ourselves.

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Removing a Portion of the Housing Trap

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Prevent Homelessness to End Homelessness