Liberals tend to blame the bust we’re going through on underregulation. Conservatives finger overregulation. Example: Tight land-use controls that impeded housing construction, limiting supply and (temporarily) driving up prices.
Jay Brady, a writer for Florida’s Gulf Coast Business Review, recently wrote a long article arguing that land-use rules, mostly at the county level, were culprits in Florida’s soaring home prices, which of course ended with a huge bust. (He thought I’d be interested since the article quotes an article I wrote in 2006, “Boom! Bust! Boom?”)
Economic research reveals a series of government missteps led to over-regulation of the housing industry in Southwest Florida, “tragically distorting” housing and creating the root cause of the real estate crises.
Before the housing boom kicked off in 1997, a typical lot in working class Lehigh Acres was $5,000. At the peak of it, that same lot may have sold for $55,000.
And now, according to Brad Hunter, of housing development tracker Metrostudy, it’s back at $5,000 and may not have yet hit bottom. In one zip code in this 96-square-mile unincorporated city in east Lee County, one in eight housing units faces foreclosure.
For the whole article, click here.