Many housing policies aim to increase supply and reduce prices through rezoning, relying on the assumption that increasing allowable densities automatically accelerates the rate of housing supply. However, the existence of landbanking (land hoarding), where land able to be profitably developed for housing is withheld from the market in anticipation of future gains, undermines the logic of such policy changes.We expose major limits of the static housing supply model behind these policies by looking at the degree to which landbanking behaviour is consistent with model predictions.To do this, we assemble a new dataset of home sales and landbanks from the annual reports of Australia's top eight publicly-listed residential developers from 2001 to 2018 and use complete state-level planning approvals and lot production data in Queensland, Australia.In contrast to the static model prediction that landbanks serve the function of inventories, and are hence minimised, we find that (1) over 200,000 housing lots, or 13 years of new supply, are held by the eight largest housing development companies, and eight years of these landbanks are held in housing subdivisions that are approved and already for sale, that (2) the amount of zoned supply in a region is unrelated to the rate of new housing supply, and that (3) housing developers routinely delay housing production to capitalise on market cycles. Dynamic incentives to maximise total returns, including capital gains in the option value of undeveloped land, could be related to observed behaviour.
We use a unique regulatory event that occurred in Queensland, Australia, from 2007-2012, to examine the predictive power of landowner relationship networks and lobbying behaviour on successfully gaining value-enhancing rezoning. A State authority, the Urban Land Development Authority (ULDA), took planning control away from local councils in selected areas in order to increase the speed and scale of development in those areas, in the process increasing land values. Using micro-level relationship data from multiple sources, we compare the relationship-network characteristics of landowners of comparable sites inside and outside the ULDA areas, finding that 'connected' landowners owned 75% of land inside the rezoned areas, and only 12% outside, capturing $410 million in land value gains out of the total $710 million from rezoning. We also find that engaging a professional lobbyist is a substitute for having one's own connections. Scaling up from our sample of six rezoned areas to the hundreds of rezoning decisions across Queensland and Australia in the last few decades, suggests that many billions of dollars of economic rent are being regularly transferred from the general population to connected landowners through political rezoning decisions.
This critical commentary reflects on a rapidly mobilised international podcast project, in which 25 urban scholars from around the world provided audio recordings about their cities during COVID‐19. New digital tools are increasing the speeds, formats and breadth of the research and communication mediums available to researchers. Voice recorders on mobile phones and digital audio editing on laptops allows researchers to collaborate in new ways, and this podcast project pushed at the boundaries of what a research method and community might be. Many of those who provided short audio 'reports from the field' recorded on their mobile phones were struggling to make sense of their experience in their city during COVID‐19. The substantive sections of this commentary discuss the digital methodology opportunities that podcasting affords geographical scholarship. In this case the methodology includes the curated production of the podcast and critical reflection on the podcast process through collaborative writing. Then putting this methodology into action some limited reflections on cities under COVID‐19 lockdown and social distancing initiatives around the world are provided to demonstrate the utility and limitations of this method.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
hi@scite.ai
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.