Quote:
Originally Posted by VKChaz
Though I agree with some of the sentiment, is there a feeling that developers are being constrained en masse? My sense was Chicago is compartively pro-development. And vast amounts of land sit undeveloped because of some mix of interest rates and lack of demand.
|
Chicago is fairly pro-development, but aldermen often appease NIMBYs by chopping the height of proposals or make otherwise anti-urban changes. In times where interest rates are making it harder to build, every little bit matters and the density that we usually chop off to appease NIMBYs is too valuable to lose.
That being said, there's lots of reasons why vast amounts of land sit undeveloped:
- property taxes structured favorably to an empty site vs. a land value tax that would promote active use
- lack of proper infrastructure in & around large, former industrial lots means higher cost to build
- soil contamination on some former industrial sites is costly to clean up, typically requiring gov't help ($)
- NIMBY homeowners whose main investment has been their home like to see it continue rising in value and fight new developments from the start, costing time & money in the process that leaves too many developments as dirt lots
- interest rates, but only more recently
- labor & materials costs
- lack of demand is harder to attribute, because we don't really know what the demand would be if new housing were built there, only speculate given the local market and run forecasts. And it can change if the city adds a new bus route or something. Obviously it depends where we're talking, but at a metro level, housing prices in Chicagoland have risen some of the highest in the nation recently, and new construction numbers are very low. Vacancy rates should be 5-10% but are commonly 1-3%, maybe a little higher in some neighborhoods. These things are 100% related and help prove there is (growing) demand. Otherwise prices would be remaining the same or falling. May as well let the developers take the risk and maybe get some public works projects while they're at it.
Prev
Linear Mode
