Tuesday, April 15, 2003

Thieving Las Vegas

Interesting piece in this morning’s WSJ about the scarcity of land in Las Vegas and the effect that is predicted upon the local economy. Considering there is nothing but desert for hundreds of miles on either side of the city, you might think there would be plenty of land for development. Right. In a free market, perhaps.

One of the fastest-growing cities in America, Las Vegas embodies a problem cropping up across the country. The nation has seen a rapid increase in demand for new housing in recent years, fed by fast population growth, new immigration and easier credit. But the land available for home building has grown increasingly scarce. Builders eager to capitalize on a historic building boom have already gobbled up many of the most desirable parcels and bid up the prices of remaining land close to urban areas.

A backlash against builders by city councils and neighborhood groups, fed by worries about the effects of rapid development, has further restricted builders’ options.

And that’s without even mentioning the wacked-out environmentalists and what they do to hose the market:

Elsewhere, environmental regulators, city planning boards and land trusts have put up new roadblocks. They are setting aside land for conservation or wildlife protection, or extending the amount of time it takes to get permits...Dozens of cities have enacted or considered moratoriums on residential construction in recent years.

What seems to be happening is that an unholy alliance has been formed between 1. environmentalists, who have an agenda of No Growth and use trumped-up environmental concerns to further the agenda 2. The NIMBY crowd, who got while the getting was good in the prior decades and now don’t want anyone else to develop land in the areas they live in and 3. Local pols, who, without a basic understanding of the importance of the free market, listen to the aforementioned groups and enact draconian legislation on their behalf.

So those already with land do fine, because by restricting development the price of the existing houses is artificially raised and the enviros get their way by limiting the natural growth of the economy (their true goal). It’s everyone else that’s taking it in the keister, by having to live in more crowded urban areas, in smaller houses and more like a European:

As local politicians move further to rein in development, the resulting land constraints are upsetting the fundamental economics of the U.S. housing system, forcing families in many areas to devote unusually large percentages of their incomes to housing, much as they already do in New York, San Francisco and European cities.

Over time, that could make the U.S. look more like those places, with denser neighborhoods, smaller living spaces and higher prices.

Isn’t it nice to know that your hard work and savings could one day get you an expensive, crappy little house in the city? Isn’t that the American dream?

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