Housing costs have been rising to unsustainable levels in New Orleans as the market struggles to increase supply to satisfy the demand. Alas, not everyone is sanguine about the ways in which demand is being met.
First, there is infill development, i.e., building housing on vacant lots in existing neighborhoods. However, in the most popular New Orleans neighborhoods, opportunities for development are scarce and developers are starting to build on smaller, irregular lots.
For example, in the 3100 block of St. Thomas Street in the Irish Channel, construction is being completed of a house on an 880-square-foot lot.
Alas, architect Jonathan Tate has faced opposition from neighbors regarding the project.
“The lot on St. Thomas ‘wasn’t worthy of a house’ is what the neighbors said,” Tate told Uptown Messenger.
Neighbors worry about increased density causing congestion and view tiny houses on small lots as aesthetic blight. At the base of it all, they also worry about their property values. Meanwhile, developers just want to meet rising demand for housing and make a buck in the process.
“We’re trying to provide an alternative option for someone with a price point that doesn’t exist in this part of the city,” Tate explained.
Other examples of this phenomenon are cropping up. Construction of a new house is underway at 4621 Chestnut Street, and the house will only be 12 feet wide. In that case, a technical zoning violation was subsequently discovered (one that the city previously missed), and a stop work order was issued.
At the ensuing Board of Zoning Adjustments (BZA) hearing, busybody neighbors came out in force to kvetch about the development.
“The neighbors are vehemently opposed to this project,” neighbor Susan Drogin proclaimed before the BZA. “We do not want it deferred. We want it denied.”
Ultimately approval was granted, but the process unnecessarily delayed construction, resulting in some weather damage to the property.
Elsewhere in the city, the demand for more housing is being met by building higher, but the city’s strict height restrictions have proven to be an impediment. Over at The Lens, columnist Matt Gatzman notes that at least six major development projects have requested height wavers in the last year alone.
The greatest push for taller buildings seems to be in the CBD/Warehouse District and along the riverfront. Although some waivers have been issued, they face an uphill battle.
Neighborhood groups, predictably, are ardently opposed to any loosening of height restrictions. In late May, the Faubourg Marigny Improvement Association (FMIA) filed a lawsuit challenging the city’s new zoning ordinance, which contained an overlay district that would permit new structures a 25-foot “height bonus” under certain specified conditions.
The FMIA cites the Master Plan, which repeatedly states that development must respect the “scale” and “character” of historic neighborhoods.
This is the same reasoning cited by neighbors who get upset about tiny houses going in on irregular lots. It conflates the language of preservation with the idea that any new development essentially can’t increase neighborhood density.
The problem with this reasoning, of course, is that it doesn’t allow the real estate market to respond to demand. This results in artificially higher housing costs for everyone.
Artificially high housing costs can have negative aggregate effects. Following the end of the housing bubble in the late 2000’s and the ensuing national recession, the federal government created the Financial Crisis Inquiry Commission (FCIC) to determine the causes of the crisis.
When the FCIC issued its report in 2011, three members of the panel released a minority opinion that argued, in part, that local land use controls were a contributing factor in the financial crisis:
“In some areas, local zoning rules and other land use restrictions, as well as natural barriers to building, made it hard to build new houses to meet increased demand resulting from population growth,” the opinion stated. “When supply is constrained and demand increases, prices go up.”
New Orleans also has other reasons to ease development restrictions. Greater densification tends to be occurring in neighborhoods that didn’t flood, increasing the city’s stock of housing above sea-level.
None of this is to say that development has to be entirely unrestricted. We don’t need to allow high-rise buildings in the middle of residential neighborhoods or outhouse-sized homes, but we need to allow denser development in high-demand areas.
Small, irregular lots in historic neighborhoods are opportune locations for housing and the city shouldn’t allow neighbors to slow (or even stop) the progress of infill development. Likewise, the city shouldn’t back down from its plans to allow taller development along the riverfront.
Neighbors opposing greater density can’t see past their own narrow, selfish interests. The market needs to be allowed to meet housing demand; those standing in opposition should not be given a soapbox.
Owen Courrèges, a New Orleans attorney and resident of the Garden District, offers his opinions for UptownMessenger.com on Mondays. He has previously written for the Reason Public Policy Foundation.