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That doesn't mean that zoning can never change, or that someone is suddenly due a 6-figure check because land they don't own has been rezoned to allow people to

by pc86 3y ago

That doesn't mean that zoning can never change, or that someone is suddenly due a 6-figure check because land they don't own has been rezoned to allow people to live on what was once a patch of grass. "Rugpull" implies that they were told or under the impression it would always be SFH and they'd have the ability to deny its change unilaterally, which is not and has never been the case. If you live in a SFH in a subdivision on a quiet road, next to a large piece of undeveloped land, that's desirable property. But the fact that it's desirable now doesn't guarantee it will be desirable at any point in the future, and you don't have any say in what happens to that undeveloped land unless you own it.

ndriscoll 3y ago
Nothing in life is certain. When they buy, the law says you can't build more densely in that area. Obviously the law can change, but that's about as close to "always" as you can get. Similarly, society could decide to do away with land ownership altogether without compensation, so they take a risk paying for ownership. Naturally, they'll be against changing the law in ways that harm them. That six figure check might not be so exciting when it means they have to pay transaction costs (~10%) and transfer taxes. Hopefully they don't also have capital gains too (the nominal gain isn't much comfort when they need to find a similarly priced new home; capital gains on housing is mostly a tax on avoiding inflation). Hopefully they aren't also seeing an increase in mortgage rates if they need one. Then they need to find somewhere new to live, probably in an entirely new city (or state) to find somewhere with the zoning they wanted still in place. This destroys social connections and probably requires finding new work, on top of the move itself and the difficulty picking out somewhere to live in an unfamiliar area. If they try to instead stick it out, increased property taxes might bleed them out until they're at a net loss and are forced to move. So yeah of course people who don't want high development near them and picked somewhere to live with regulations against it will vote to preserve those regulations. Conversely, speculators and developers know when they buy property that is is zoned not to allow what they want, but they take a gamble on their ability to change zoning.

by pc86 3y ago

ndriscoll 3y ago

Nothing in life is certain. When they buy, the law says you can't build more densely in that area. Obviously the law can change, but that's about as close to "always" as you can get. Similarly, society could decide to do away with land ownership altogether without compensation, so they take a risk paying for ownership. Naturally, they'll be against changing the law in ways that harm them. That six figure check might not be so exciting when it means they have to pay transaction costs (~10%) and transfer taxes. Hopefully they don't also have capital gains too (the nominal gain isn't much comfort when they need to find a similarly priced new home; capital gains on housing is mostly a tax on avoiding inflation). Hopefully they aren't also seeing an increase in mortgage rates if they need one. Then they need to find somewhere new to live, probably in an entirely new city (or state) to find somewhere with the zoning they wanted still in place. This destroys social connections and probably requires finding new work, on top of the move itself and the difficulty picking out somewhere to live in an unfamiliar area. If they try to instead stick it out, increased property taxes might bleed them out until they're at a net loss and are forced to move. So yeah of course people who don't want high development near them and picked somewhere to live with regulations against it will vote to preserve those regulations. Conversely, speculators and developers know when they buy property that is is zoned not to allow what they want, but they take a gamble on their ability to change zoning.