- Hey, I've got a problem
I need to run by you. California doesn't have enough houses. By a considerable amount. As in several hundred thousand, and an estimated three
million plus within 10 years. Also, homes here are
ludicrously expensive, and threatened by wildfires. Okay, first things first. About those wildfires. That's easy. Ban wildfires. First thing I did when
I moved to California is sponsor a referendum
outlawing feral infernos. Problem solved, but that does still leave the broader issue of
the spectacular shortage of affordable housing. Now this is a complex topic with a lot of different
policy implications, but today we're going to explore just one that would go a long way in making me not regret deciding to
live here for some reason. Upzoning, lifting restrictions
on the kind of houses you can build. Because most of California
has literally outlawed building anything other
than one family homes. Now I'm not sure you quite believe me about the dire nature of
housing in California. The median price for a house in this state is $600,000, which is
twice the national level. For $600,000 you could
buy a house in Nevada and Alaska, and spend your entire life just avoiding summer and winter, or you could buy a house in Oklahoma, plus 1100 or so tool sheds. And if you had $600,000 in Arkansas, you wouldn't even have to live there. Shots fired, Arkansas. You know what you did. Four of the five most
expensive residential markets are right here in California, and in a separate, but
nonetheless related issue, California only has 12%
of the U.S. population, but a quarter of its homeless population. Not only is housing insanely expensive, there's not even enough
of it to go around. Now at first I thought
maybe we can trick houses into migrating here from Canada, or maybe we can just
encourage people to leave, which I do, all the time. Terry, go away. Nobody likes you. Move to Kentucky, it's full here, Terry. But it turns out, these
solutions don't work at all. Terry is very much at large, and it is awkward. So let's explore why there's a dearth of affordable housing here. To understand that, we
need to understand zoning, a concept I know lots about because I've spent the
last 16 years of my life in the friend zone. Zoning is when the government
tells private citizens what they can use a
particular piece of land for, or the sorts of buildings
they can construct on it. In a targeted, highly limited
capacity, that makes sense. I wouldn't oppose a law
which forbade schools from being put downwind
of a mustard gas factory. Los Angeles enacted its first
zoning ordinance in 1904 to prohibit any public
laundry or wash house from entering a residential district, which I initially assumed
was to protect people's homes from chemicals. Okay, makes sense, protect
people from harmful chemicals. Okay, but it turns out the law was actually
to protect Los Angeles from Chinese people. Chinese immigrants had come to the state during the gold rush. Laundry was predominantly
handled by Chinese businesses, and various California
cities wanted to keep them out of city limits, and accurately assumed
that pretending it was a health and safety issue would be easier to avoid court
scrutiny over overt racism. Off to a bang up start. In 1908, Los Angeles took
things a bit further, dividing the city into industrial
and residential districts. Okay, I could maybe see some
unintended consequences to that but overall I get the impulse to avoid putting factories next to gazebos, okay. But then, in 1934, Congress passed the National Housing Act along with the Federal
Housing Administration. President Roosevelt wanted
the federal government to encourage home ownership by guaranteeing home
loans with longer periods to pay off mortgages, which got politicians
in California worried. If the federal government was
helping people buy mortgages, would that mean black
people might buy mortgages? In California, municipal leaders thought single family homes would be resistant to demographic change, read black people, than apartment buildings, and they worried that multi-story apartments would attract low income black families, so they used zoning to declare
wide swaths of their cities as single family homes. These solitary houses could in turn band together under
neighborhood covenants, which forbade homeowners
from selling a house to undesirable elements, which is code for black people. The municipal storm of
vicious mayonnaise white blasted its way through California. In 1933, less than 5% of
Los Angeles' zoned land was restricted to single family homes. Today nearly half of Los Angeles is set aside for single family homes. Of the land zoned for
residential construction, 75% is reserved for single family homes. That is to say right now if you want to build a duplex or an apartment building in Los Angeles, you can only legally do it in less than a quarter of the land in L.A. Okay, so other than a history of trying to soft pedal segregation by
red lining black people out of California's cities, what's the harm of putting a cap on how many people can live in one place? Well, one of the effects
is massive urban sprawl. Zoning away multi-family housing means you are forbidden by law
to build apartment buildings. That means in the second
most populous city in the United States we can't build up, because that would be illegal. We can't build under because
of violent mole people. So we build out. Los Angeles continues to expand one or two story structures at a time in great heaving distances bound together by over-clogged highway systems. Public transit works best
in dense, walkable cities, like Manhattan, and works worst in geographically disparate regions, such as Los Angeles, which means more people
are reliant on driving, which means more smog,
pollution, and carbon emissions, and if you're a low earner, you might well have to commute 90 minutes to
get to your job in the city from your affordable house way out on the edge of the suburbs. And it's not just that
urban sprawl is ugly. I mean, it is ugly. Los Angeles is chockfull
of asphalt strip malls with the occasional palm tree shoved in, which is like trying to spruce up a corpse by giving it an injection of Botox, but aesthetics aside, if you're poor, there's a good chance you live
far away from where you work. All that time spent
commuting through traffic and strip malls every day detracts from time spent with your family, makes higher stress, and higher gas bills. Now that's not an issue for me, because I make my income
cat fishing old dudes on the internet by pretending to be a Ukrainian mail order bride. But it is a major consideration for lots of low income
families in Los Angeles, and middle income families in Los Angeles. Actually, you know what? Endless traffic affects
everyone in Los Angeles, so what could potentially alleviate this vast network of urban sprawl? An amazing innovation in housing called the apartment building. Behold, an apartment. We've developed a new
architectural technology where we stack housing
units on top of each other, sort of like bricks. We believe that by stacking these units, we can have more than one
family live in the same area. Our tallest scientists believe we could have apartment buildings three, maybe even four stories high, creating more housing
and denser urban areas. (upbeat music) Even if we can perfect
crazy, early 20th century apartment stacking technology, we can't legally do so in
wide swaths of California, and if legalizing apartment buildings sounds too radical, keep in mind we don't even have to go that far to alleviate the housing shortage. We could expand housing without even having to build skyscrapers. (upbeat music) We've developed a new
architectural technology called the duplex. Essentially what we do is split a house into two homes. Now obviously, you want to
ask people to leave the house while you're splitting it. We don't want to chop
any families in half. But if properly executed, we believe the concept of a duplex could double the amount of families living in one building. Or we could construct
what's called a townhouse, which is basically a duplex for people who shop at Whole Foods, which is like a townhouse for fruit. Either way, there are a variety of methods to provide housing other
than a single big house with one family and a big backyard with a lawn, in the desert, for some reason. I'm a recent transplant to Los Angeles, but having now met many
of my new neighbors, I believe they're ready to live in a city with black and Chinese people, perhaps even other ethnic groups, and I for one think providing more housing is a higher priority than maintaining overtly
racist housing regulations from the 1940s. Upzoning, which is to say
legalizing multi-family homes, would stop forcing the city to blubber out like concrete versions of pancake mix, and it would reduce the
cost of housing as well, because present single family zoning laws create artificial scarcity. If you have two families,
each living in an apartment of 700 square feet,
they're apt to pay less than a single family
living in an apartment of 1400 square feet. They're taking up less space. And of course there's
the very basic concept of supply and demand. As you increase the supply
of available housing, the price decreases. That said, some economists
do think other factors would balance out that price reduction. They're concerned that when you build multiple apartment buildings in one space, landlords have more tenants to charge, and the land itself becomes more valuable and therefore more expensive as a result. Meanwhile, while you do increase housing, you also increase property values, so the price doesn't actually drop. Okay, I will acknowledge that risk, but unquestionably, upzoning
would at least provide more housing. Observe. This is my ideal ranking
of housing situations. Free castle, sublet in
the Playboy Mansion, low rent, abundant housing, high rent, abundant housing, high rent, insufficient housing, bunk bed situation, bunk bed with cats, and finally, there at the bottom, roommates with violent mole people. As you can see on my chart, while high rent, abundant housing is not ideal, it's still better than high rent with insufficient housing. Now, to California's credit, lawmakers have partially repealed some of these single
family occupancy laws. In 2019, the state made it a right for all homeowners to build
accessory dwelling units, sometimes called in-law suites, of up to 800 square
feet in their backyard, which is a huge step forward. 800 square feet is larger
than my current apartment. It basically lets people who own a house rent out a smaller
house in their backyard. Good. Why not extend that logic further? And in the meantime, if you own one of these 800 square
foot mother-in-law suites, and it's less expensive
than my 500 square foot porchless bachelor box, let me know, 'cause I'm-- I'm really paying a lot for that. (sighs) In conclusion, if your state has an embarrassing abundance of
cheap, affordable housing, you can fix it by emulating California, and if California wants to fix many of the housing
problems of its own making, it can implement upzoning, and then repudiate the ghost
of racist municipal planners that screwed up housing for everyone. With the Pacific Legal Foundation, I'm Andrew Heaton. (upbeat music) Oh, they're making a duplex. (soft upbeat music)
