Gov. Glenn Youngkin answers questions from the press at the Governor’s Housing Conference Nov. 18, 2022. (Wyatt Gordon / For the Virginia Mercury)
Republican Governor Glenn Youngkin and California Democrats could hardly be further apart politically; however, their diagnoses of what is wrong with America’s housing market sound uncannily similar: Excessive regulation has hindered new housing construction, driving up home prices to the point of hurting the broader economy.
‘There aren’t enough homes’
In a speech at the Virginia Governor’s Housing Conference on Friday, Youngkin promised to introduce a legislative package before the upcoming General Assembly session to reduce regulations and promote housing production. Although further details won’t be debuted until December, the fact that both progressive Democrats and right-wing Republicans view the housing affordability crisis in a similar light is proof that pro-development politics do not follow neat ideological lines.
It’s also a sign of how painful high housing costs are for voters of all parties.
The results of a state study published this summer show just how broken the housing market has become across the commonwealth. In 2004, Virginia issued 63,215 new residential building permits. In recent years the state has barely built half as many homes per year despite adding over 1.1 million residents during that same period.
“There aren’t enough homes,” said Youngkin. “There aren’t enough units today. Full stop.”
Over the last decade, more than two-thirds of building permits have been issued for single-family homes. With the average price for such a structure in Virginia at $355,000 as of last year (an increase of 30% over 2016), this most expensive form of housing is increasingly out of reach for many middle-class households.
Renters face similar, if not more severe, struggles. Four in five renters in Virginia earn under 50% of their region’s area median income. The Department of Housing and Community Development and Virginia Housing, the state’s housing authority, estimate there’s a shortage of 200,000 affordable rental units across the commonwealth, meaning low earners have few options when rents rise rapidly.
In the Richmond region, the average rent is 21% higher than it was in 2021. In Hampton Roads, rents have risen on average 11.2% over the last year, with an additional 12% rise predicted for the coming year. In the first quarter of this year alone, rents increased 13% in Northern Virginia. Even areas outside of the Urban Crescent like the city of Roanoke have faced a 15% jump in the average rent over 2021 as people flock to cities for better job opportunities.
If housing can’t be made more affordable, the governor fears fewer folks will choose to live and locate their businesses in the commonwealth.
“We must align housing development with economic growth,” he said. “If you want a workforce, we have to have some place for them to live. We need to unleash housing development plans just like we are unleashing economic development plans.”
In his closing remarks, Youngkin attributed the dearth of housing units to three factors: regulatory burdens that restrict the supply of buildable land, permitting complications that delay and prevent development and restrictive land use controls that limit property owners’ rights to build.
To get out of Virginia’s housing hole, the governor offered three solutions he plans to put before the General Assembly in January. First, he wants to set deadlines for localities to approve land use and zoning reviews. Second, he wants the state to perform a review of land use and zoning laws with an eye toward increasing efficiency and transparency. Third, he wants to create a searchable database of residential-zoned, government-owned land on which developers could potentially build.
What would happen if a locality doesn’t approve or deny a project by the deadline? In California, municipalities that don’t comply with state housing policy are subjected to a “builder’s remedy” whereby local zoning power is removed. Such a situation in Santa Monica this year may allow that city’s housing supply to jump 7%. Youngkin’s policy shop plans to present its own proposal next month.
Where the governor’s pro-development push could run off the rails is on wetland and stream credits. In his speech, he promised to streamline permitting, “operationalize” Virginia’s existing wetland and stream replacement fund and release additional credits — all without lowering the quality of Virginia’s wetland and stream mitigation efforts.
Previous waves of growth have gobbled up farms, forests and wetlands across the commonwealth in favor of far-flung, car-dependent suburbs. A 2020 American Farmland Trust study calculated that “more than 31 million acres of U.S. agricultural land have been irrevocably lost to urban expansion since 1982 and an additional 175 acres of farm and ranchland are lost every hour to make way for housing and other industries.”
If the administration’s pro-housing proposals end up looking like a mandate for more sprawl, environmental advocates may try to tank Youngkin’s plans in the General Assembly.
YIMBY versus NIMBY
The governor’s pro-development legislative package may face a rocky road in the General Assembly. After Youngkin lambasted “overburdensome and inefficient local governments, restrictive zoning policies and an ideology of fighting tooth and nail against any new development” in a speech before the state’s joint money committee in August, senior members of his own party fired back.
“That is not how I would characterize it,” remarked Senate Minority Leader Tommy Norment, R-James City. “The people on city councils and boards of supervisors have the closest connection to the people they represent and the citizens they serve.”
Such intra-party tension comes as no surprise to Addison del Mastro, an Arlington-based contributor to the conservative publication The Bulwark.
“There are two ways conservatives think about development,” he said. “Pro-business and property rights is a very natural fit for conservatives, but some of them view zoning as a property right itself to ensure that neighborhoods don’t change and can keep out apartments housing ‘those people.’ I hear both arguments even from the same people. One actually aligns with traditional conservative thinking on markets, and the other is an attitude you learn by osmosis if you’re an affluent suburbanite.”
Guardrails on government
With more than two decades of working on land use law under her belt, Del. Carrie Coyner, R-Chesterfield, understands the costs of development delays and broadly supports the governor’s desire to reduce regulation.
“It’s important we still have zoning at the local level because we don’t know everything at the state level,” she said. “But the state can come in, set guardrails and reframe what local governments are using as the tools in their toolbox to make local land use decisions.”
When contemplating how the commonwealth could end exclusionary zoning, Coyner points to how lawmakers dealt with proffers — the fees localities are allowed to charge homebuilders to offset the costs of their developments.
“We created this state system where localities could broadly define proffers and raise the cost of housing to keep certain people out,” she said. “When the state clawed back proffers discretion from the localities, it was an effort to more closely align the intent of proffers to the original legislation.”
We have really failed to educate the average citizen and business owner. Grocery stores don’t just show up because you want them. They draw a circle and look and see if that area meets their demographics.
– Del. Carrie Coyner, R-Chesterfield
The other issue at play is a lack of communication, according to Coyner.
“We have really failed to educate the average citizen and business owner,” she said. “Grocery stores don’t just show up because you want them. They draw a circle and look and see if that area meets their demographics. If we start letting people do their own analysis, they’ll realize local leaders are not just putting more houses in to irritate me but they’re building houses here so we can have more services.”
Despite the initial support of lawmakers like Del. Coyner, the governor’s proposals to increase housing production will likely face an uphill battle. Beyond seeking the simultaneous support of a Democratic Senate and a Republican House, Youngkin will have to contend with the political power of Virginia’s cities and counties, which are always loath to lose any ounce of land use authority.
In his signature optimistic fashion, the governor believes he can find the right balance and get his bills passed: “We in fact have to respect landowners’ rights and we have to make sure the zoning and permitting processes are set up to be pro-development,” he said. “We can do both. This is not an ‘or.’ It’s an ‘and.’ Oftentimes we find ourselves arguing and forgetting that we can do both.”
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