Three Short Stories on Housing Economics

Originally published on Notes on Liberty. 

Do you love housing economics but have struggled to get the basic ideas across the younger generation? Yes, you get excited about reading 60-page reports, but kids these days have better things to do.

That’s why I wrote these three, action-packed, short stories which you can read to any child (or child at heart).

So without further ado, here are three stories about how the supply of housing affects the prices of housing.

Continue reading “Three Short Stories on Housing Economics”

The Economic and Political Dynamics of Zoning

Originally published on Mises.org

Ludwig_von_Mises[1]Both economic decisions and political decisions involve choices and tradeoffs. The difference is that economic decisions are ultimately informed and rely upon monetary prices, revenues and costs. Political decisions, meanwhile, do not depend on market outcomes—they can be based on love, legacy, favors, or establishing power relations.

Zoning is the practice of governments controlling the type, size, and population density of buildings. (Zoning should not be confused with building codes, which control the building materials and other design aspects of buildings.) The purpose of zoning has been to create separate regional “zones” of building types: broadly, these categories typically include residential, industrial, retail, and parks. The zones are then broken down into more minute categories, like low, medium, and high density homes, different kinds of retail businesses, and so on.

Zoning is a type of government intervention into economic decision making: it the practice of the state (whether it is the municipality, subnational, or national level) intervening in the affairs of private individuals in where and what they can build. By intention, zoning is a limit on the supply of housing. In effect, it is a limit on the quantity of the stock of housing; that is, it acts like any other quota or prohibition.

While many economists, from Rothbard himself, to even those in the mainstream, recognize the deleterious effects of zoning, there does not exist a single, thoroughgoing Austrian analysis on the subject. The purpose of this piece is to be that analysis. It is broken up into two sections: the politics of zoning, and the economics of zoning.

Continue reading “The Economic and Political Dynamics of Zoning”

Rethinking the Yellowbelt: Report Release

After a full year of research, the largest, most comprehensive report on the economics, politics, history, and policies of zoning in Toronto is available for download.

The full report is available both on the Housing Matters website, and quickly downloadable here: Rethinking the Yellowbelt. 

The “Yellowbelt” refers to the portion of the city that’s zoned exclusively for detached homes. The report goes into detail explaining when and why such a zone came into existence, where it spreads in the city, who is hurt by the existence of this zone and how; and what it will take to change the system.

A summary of the report follows. Of course, the report itself goes into much more detail.

Continue reading “Rethinking the Yellowbelt: Report Release”

Toronto city councillors want to make housing even less affordable. Ontario’s stopping them

Originally published in the Financial Post. 


Building more homes just became easier in two of the most densely populated areas in Ontario: Toronto’s downtown core and its “midtown,” a small strip of land centred at Yonge St. and Eglinton Ave. For anyone interested in finding a place to live in those areas, this is great news. Continue reading “Toronto city councillors want to make housing even less affordable. Ontario’s stopping them”

Response to Ryerson CBI on Bill 10

Originally posted on Housing Matters.


Earlier in May, the Ontario Government tabled new legislation as part of its long-anticipated Housing Supply Action Plan. Known as Bill 108, it proposes numerous changes to several existing laws and regulations.

The preamble of the Bill makes it very clear: the Government of Ontario “believes that increasing the supply of housing will help every person in Ontario by making housing more affordable.” We at Housing Matters share in that belief. We’ve come to this belief through careful analysis of economic theory and data. And after careful study of the contents of this Bill, we believe that it will do as promised: increase the supply of housing, and, consequently, make housing more affordable.

However, the researchers at the Ryerson City Building Institute (CBI) have reached a different conclusion from their analysis of the same Bill. Indeed, CBI begins their analysis by predicting:

it is unlikely that the Housing Supply Action Plan and Bill 108 will improve housing affordability while also targeting the lack of housing options, including missing middle and family sized multi-unit housing. What is proposed may, in fact, reduce livability and affordability throughout the province — particularly in areas facing intense growth pressure…. (p. 1)

We disagree with these statements. To be clear, we believe that Bill 108 — while not a perfect panacea — will (1) increase the availability of housing options, (2) increase livability, (3) increase affordability, (4) and this will be especially true in areas facing intense growth pressures. The following post will analyze the changes to Bill 108 with respect to these areas, and we will compare our findings to that of the CBI.

Table of Contents

— The Economics of Supply and Demand
— On Development Charges
— On the LPAT and OMB
— On Heritage Protection
— On Community Benefits, Public and Private
— On Inclusionary Zoning
— Changes to the Building Code
— Conclusion

Continue reading “Response to Ryerson CBI on Bill 10”

Statement on the Decision to Partially Eliminate Rent Control

Originally posted on Housing Matters


The Government of Ontario announced in its fall economic outlook this past week that they were removing some restrictions on rent control. While rent control remains unchanged for existing tenants, new rental units will not be subject to any price controls whatsoever.

This policy change is a response to the previous government’s “Fair Housing Plan”, introduced in 2017. Prior to the Fair Housing Plan, only homes built before 1991 were subject to rent control. In 2017, rent control was extended to all rentals regardless of the year of construction.

Following the introduction of the “Fair Housing Plan”, 1,000 units originally slated to be purpose-built apartments were converted to condos. That, in a city with a rental vacancy rate of 0.7% — a sixteen year low for the city, and one of the lowest rates in the world.

As a partial reversal of a one-year-old policy, the short-term impact of the new government’s change will likely be small.

However, as we will explain below, this policy has long term impacts that affect the quantity, quality, and price of rental housing, as well as the kind of individuals likely to be affected. In particular, this new policy averted a future of extreme rental shortages, declining rental housing quality, rapidly increasing rents, and discrimination against low-income renters. Continue reading “Statement on the Decision to Partially Eliminate Rent Control”