Friday Roundup 11-26-21

Residents of Chicago’s South Shore are concerned that the Obama Library will gentrify the neighborhood and lead to their displacement. They have issued a number of demands to the mayor and city council, including giving long-time residents $20,000 each to repair their homes. It’s only fitting that the residents near the library want a handout. After all, Obama promised and delivered handouts for years. But since Obama can no longer reach into the taxpayer’s wallet, the residents have to pressure city officials to provide them with lucre.

A group of landlords in western New York is suing the state, arguing that New York’s eviction moratorium could leave them homeless. By the time the latest moratorium expires in January, many landlords will have gone nearly two years without receiving any rent. The moratoriums were invoked to protect those suffering financial hardship because of the pandemic.  Individuals, the argument went, should not lose their home because of a situation that was not their fault. All the moratoriums did was shift the financial hardship from tenants to landlords, and now property owners are facing the loss of their homes because of a situation that was not their fault.

A team of researchers recently looked at the impact short-term rentals (STRs) have on development. Using building permits to judge development activity, they looked at three sets of data: national, the nation’s fifteen largest cities, and Los Angeles County. The researchers found that, on average, a 1 percent increase in Airbnb listings led to a 0.769 increase in building permit applications. The authors conclude, “Given these findings, it follows that restricting STRs can have a significant, negative impact on local economic activity.” When they examined the data for the fifteen largest cities, they found that after STR regulations were enacted, Airbnb listings feel by 21 percent and building permits dropped 10 percent. In Los Angeles County, jurisdictions without STR regulations had 17 percent more applications for accessory dwelling units than areas with STR regulations. Despite these finding, the authors believe that some regulation of STRs is necessary.

Ultimately, our research highlights the importance of taking a nuanced approach to STR regulation. As with many fraught policy decisions, the main challenge that regulators face is to balance residents’ shorter-term needs with the longer-term economic wellbeing of the community.

In other words, there are no principles to guide cities in determining how to control property use. Each city must find some balance between property rights and the violation of property rights. But no such balance is possible because somebody’s right to property will be violated.