Students Team Up with Professor and Alumna in Op-Ed Examining Local Housing Shortage
Midland’s housing shortage worsens as zoning limits supply, according to an op-ed published in the Midland Daily News by four co-authors: Economics Professor Dr. Alex Tokarev; Northwood University Alumna Kristin Tokarev; and Northwood students Hanna Rapson, of Bad Axe, Michigan, and Mason Miller, of Birch Run.
Seven Days. That’s how long the average house sits on the market in Midland, Michigan, before it goes pending. For young families, first-time buyers, and workers moving into town, finding a home has become a race they often lose.
Republicans blame Biden’s inflation. The socialists who are taking over the Democratic Party blame “greed.” Populists in both parties blame interest rates.
Midland is just one of the many localities in the country facing a housing shortage. While every large city or small town is different, the common denominator is bad rules.
For more than a century, politicians and planners have piled regulation upon regulation onto the housing market, making it slower and more expensive to build. The result isn’t surprising: too many buyers chasing too few homes.
It seems like most public servants have slept through their Economics 101 classes.
Take zoning. It began as a form of centralized planning in Europe before arriving in America in the early 1900s. Michigan adopted statewide zoning authority in 1921. The stated goal? “Orderly” development.
But zoning quickly became much more than separating factories from neighborhoods. It turned into a political roulette of deciding what property owners could build, where they could build it, and how many people could live there.
Coercion replaced voluntary exchange. Instead of buyers and sellers deciding how land should be used, politicians do. And, as every economist can attest, when government restricts supply, prices rise. Housing is no exception.
Midland proves it.
After World War II, the city faced a serious water shortage. Officials built a regional water system that solved the problem.
At the same time, they also discovered something else. Control the water, and you control development.
Midland adopted what became known as the Midland Urban Growth Area policy. For years, nearby property owners who wanted city water often had to agree to annexation and city taxes. Water became leverage.
For decades, Midland’s master plans increasingly prioritized low-density, single-family neighborhoods. Duplexes, townhomes, and other kinds of starter housing used to be common before zoning codes made them illegal across much of America.
When you outlaw affordable housing, you get (surprise, surprise) less affordable housing.
The numbers tell the story.
Between 2000 and 2020, Midland added only about 81 housing units per year. Meanwhile, Zillow reports home values have jumped more than 35 percent in just five years. As a result, homes now disappear from the market in about a week.
Renters also suffer. As home prices climb, rents follow. Young workers pay more. Families save less. Homeownership drifts further out of reach.
The government solution? Subsidies. Tax credits. Affordable housing programs.
None of those interventions address the root cause of the problem.
A proposed apartment development north of Midland Mall illustrates the problem. Before construction can begin, developers face months of reviews, approvals, revisions, hearings, and paperwork. Projects seeking government funding frequently spend even longer redesigning plans to satisfy changing bureaucratic requirements.
It goes on and on…
Minimum lot sizes require builders to use more land than buyers may want. Minimum home sizes prevent the construction of smaller, less expensive starter homes. Parking mandates force developers to build asphalt instead of housing. Permit delays increase financing costs before construction even begins.
Each rule may sound reasonable in isolation. Together, they’re killing the American Dream.
Supporters argue these regulations preserve neighborhood character. Maybe. But they also preserve high prices.
When politics limits supply, existing homeowners benefit from rising property values while newcomers pay the price. That’s great if you already own a house. Not so great if you’re trying to buy one.
Before modern zoning, many American neighborhoods naturally mixed single-family homes, duplexes, small apartment buildings, and corner businesses. Entrepreneurs built to meet the people’s demand instead of political preferences.
If someone wants to build a duplex on land they own, why should the government stop them? If buyers want townhomes instead of large lots, why shouldn’t builders provide them?
The market is already sending a clear message. Seven-day home sales mean Midland doesn’t have enough housing.
Our public servants have created many of the barriers that hinder growth today. And until that wall comes down, affordable housing will remain just out of reach.
P.S. Local policies are shaped under pressure from voters. If most of them already own their homes, the rules are unlikely to change in a way that lowers property values.