New York, Los Angeles, and the Bay Area should all be more like Sacramento.

Sacramento's Tower Bridge

Got your attention, didn't I? Great.

Because when it comes to the housing shortage, and if you want an example of what to do, New York, LA and the Bay Area should follow Sacramento's example. Yes, Sacramento, the cowtown mid-sized city that hosts the state government. There's three major reforms that Sacramento's doing right now, which other cities would be wise to emulate.

  1. they're rezoning the whole city at once for more housing.
  2. they're giving automatic approval for new apartments that meet the underlying zoning law.
  3. they abolished the minimum parking law.

I'll discuss each of the three in turn.

First: Sacramento upzoned across the board.

The big, flashy thing Sacramento did is to change the lowest zoning classification from single-family residential to four-unit residential. This allows rowhouses and small apartment buildings to be built in all of Sacramento's residential neighborhoods. This is important, because it distributes growth across neighborhoods instead of having the kind of high-velocity gentrification that's been a cardinal feature of the housing shortage for the last forty years.

As a bonus, it means that old, worn-out housing in suburban neighborhoods gets replaced with modern apartments, rather than being flipped or replaced with McMansions. And for the grognards who complain about "neighborhood character," these small apartment buildings fit in just fine with single-family homes. To illustrate using an example from Midtown Sacramento: on the left is a single-family home, and on the right is a four-unit apartment building.

On top of this, the City Council decided to rezone all the land near Sacramento's underused light rail system for 5- and 6-story apartment buildings.

This is a huge deal, since so many of Sacramento's train stations are surrounded by acres and acres of parking lots, strip malls, and suburban subdivisions.

Upzoning like this kills two birds with one stone: you alleviate the housing shortage, and you get more use out of the underused rail infrastructure.

This kind of rezoning is exactly what needs to happen near Long Island Rail Road, LA Metro, and Caltrain stations.

Second: In Sacramento, if it meets the code, you can build it.

The zoning law in expensive coastal metropolises rarely matches up with what's written in the law book. This is because because there often isn't automatic approval for new housing which otherwise meets the zoning code. This means that if you want to build new housing, you don't just need an architect and a contractor - you also need a lobbyist. The process is arbitrary, capricious, and subject to all kinds of political meddling.

This kind of bad-faith kabuki theater makes building housing very, very risky. You might spend half a million dollars on engineering, environmental review and legal fees, and still walk away empty-handed because a city councilman was feeling grouchy that morning. In New York, the primary vehicles for these challenges are the poorly-drafted building code and the Uniform Land Use Review Procedure. (Specifically, the building code is so complex and poorly-written that a building permit isn't necessarily binding - and nosy neighbors can force the city to issue a stop-work order.) In California, this is because of the California Environmental Quality Act.

Not in Sacramento. Sacramento abolished City Council review for new urban apartments, so if a proposed building meets the city's zoning law and building code, the city's staff approve it. Period. No environmental review, no public hearings, no nosy neighbors.

This deceptively simple reform cuts the approval time for new apartments from a few years to a few months, and it's exactly the kind of reform that needs to happen in the rest of California and in New York City. More money for contractors, less money for lawyers. Everyone wins.

Third: Sacramento abolished their minimum parking law.

This means that developers can build as much or as little parking as they please when they build new buildings. This is good, because minimum parking laws dramatically increase the cost of new housing. I'll illustrate. The average city lot is about 7000 square feet, and each standard parking space takes up about 400 square feet because you have to include clearance for the car to enter and exit. So, if you have four apartments on the lot, you're legally required to pave over at least quarter of the lot to accommodate parking, no ifs ands or buts. This is not cheap. And the worst part is, even one space per apartment is overkill. In the Bay Area, almost 30% of garage parking spaces go unused, even at peak hours.


Those three things - up-zoning, streamlined approvals, and repealing of minimum parking laws, are preconditions for fixing the housing crisis, because those are the three major blockers to new housing development. (Coincidentally, it's also a great way to make a dent in carbon emissions.) And once you make those reforms there's a bunch of different ways you can go, depending on your ideological bent.

For the lefty types, it means building public housing, like they do in Vienna. For squishy neoliberal types, it means a future of light-touch regulation and by-right zoning, allowing private developers to build large numbers of condo towers near train stations, like Tokyo. If you're a libertarian, you could try to eliminate zoning altogether and let the market decide, like Houston. All three are perfectly sensible ways of having cheap housing for everyone who wants it. But first, you have to make it easy to build housing in the first place. And for that, New York, LA and San Francisco will have to be like Sacramento.

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