Dan Walters

By Dan Walters
March 3, 2016 – 3:28 PM

  • Supreme Court allows ‘inclusionary’ housing laws
  • Such approaches don’t really solve crisis
  • California needs to build a lot more housing

Advocates of so-called “inclusionary” policies to provide more housing to low- and moderate-income families were elated when the U.S. Supreme Court this week spurned a challenge to San Jose’s ordinance.

The court’s refusal to hear the case, however, hinged on legal technicalities, rather than developers’ allegation that requiring them to set aside portions of their projects for below-market pricing constitutes an illegal seizure of property without compensation.

In the absence of a decision on that core issue, the California Supreme Court’s ratification of San Jose’s ordinance stands, removing a legal cloud on inclusionary housing laws in a number of cities and indirectly encouraging more communities to adopt them.

The ordinances are one political response to the growing shortages and rapidly rising costs of housing for lower-income families.

High housing costs are the major factor in a Census Bureau calculation that California has the nation’s highest rate of functional poverty, with conflicts between incomes and rents particularly severe in the San Francisco Bay Area and metropolitan Los Angeles and San Diego.

The problem with inclusionary policies and other coercive approaches to housing, such as rent control ordinances, is that while they may be politically gratifying, they divert attention from the real problem of housing in California, which is that we have way too little of it.

After reaching unsustainable levels in the middle of the last decade, thanks to ridiculously lax lending policies by financial institutions, housing construction plummeted into an abyss. And as the oversupply of underwater homes and apartments was soaked up in more recent years, we developed a shortage that is now severe.

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