Real estate developers have good reason to feel cannibalized when they attempt to develop something today.
Building permits for their projects are often exceedingly difficult to secure, requiring thousands of dollars in architect’s and attorney’s fees, and months (if not years) of submitting plans to boards and commissions, sometimes a repeat number of times. Many projects end up abandoned because the developers simply run out of money for the holding costs involved, not to mention spiritual energy to fight the psychological battles.
Even if the developer is lucky enough to eventually get the project built, the costs to sell or lease the space end up far higher than they should be due to all of the red tape involved. This in turn means needlessly higher rents and prices for homes, apartments, and commercial space. (For the sordid details of the land development approval process, read “The Collapse of Building,” by Gary Hull, The Intellectual Activist, July 17 and November 17, 1989.)
The cause of this mess is, in a word, zoning.
Zoning creates the problem by subjecting development to the arbitrary whim of government, which can virtually make or break a project on any basis the bureaucrats wish.
Zoning operates as follows: a local government, either a city or county, breaks its jurisdiction up into zoning districts. The government then drafts an ordinance stating which types of land uses are allowed in each district. For example, a city may have an ordinance which has several zoning districts, some of which allow only residential uses, a few more allowing only commercial uses (i.e., stores, offices, etc.), a couple which allow industrial uses, etc.
But zoning involves more than merely the specific use to which the property may be put; considerations such as the size, height, and architectural style of the development, setback distances from the lot lines, the amount of ground it covers, how much parking is required, and a myriad of other aspects of a project’s design are also among the arbitrary rules found in zoning ordinances.
When a developer proposes a project and applies for a building permit, before he can build he must first obtain approval from the local government in whose jurisdiction the project is planned, which comes only if the project conforms to the local zoning ordinance. If it does not, then he must change the project to conform or receive the government’s permission to deviate from the ordinance; if he can not do either of these, he must then try to persuade the public, in an open hearing, to allow him to change the ordinance.
These moves are subject to political pressure from constituents (such as competing real estate developers) of the elected officials from whom approval must be sought; if local politics are against him, the developer may have to give up on the project altogether.
Zoning is an evil because it is a violation of the property owner’s right to develop and use his property for purposes of his choosing. It is a gun pointed at the head of anyone who wants to develop his land in any way, before such a person has used any force himself against anyone else — i.e., before he has used his property in any way, constructed anything, or harmed anyone through his use; and, it is being wielded by an entity which has no ownership interest in the property and thus no right to set the terms of its use.
If someone wants to develop his property, thanks to zoning he no longer has any real right to do so. With zoning, a developer may only develop by the government’s permission, which, though it may not be de jure withheld arbitrarily under the law, may still be de facto withheld for so long through stonewalling and political maneuvering that the developer may run out of money merely trying to get the permit.
