Michael Wiebe

Cambridge 2019 nexus study:
www.cambridgema.gov/-/media/File...

But this is a dark road. By this logic, they could reduce housing need simply by deporting poor people to another city. And if this becomes the legal standard, impact fees will be used to price out the poor, creating a perpetual housing crisis.

7/7

Now, the city could argue that it cares only about residents. If the worker lived elsewhere in the No Build scenario, then their housing need is someone else's problem, and Need(No Build) actually is 0.

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The nexus studies are designed to find a negative impact, because they assume Need(No Build)=0, so ΔNeed = Need(Build) − 0 = Need(Build) >0.

They ignore the worker's housing need in the counterfactual.

5/

Hence, they cannot calculate the causal effect on housing need (ΔNeed), and cannot claim that development *creates* new housing need.

And since development creates jobs and boosts wages, it actually makes the worker better off. The impact is positive!

4/

But the nexus study only calculates Need(Build): the worker's affordable housing need when the development goes ahead.

They never look at the worker's housing situation in the counterfactual scenario where the development doesn't happen.

3/

New development has a negative impact on a worker's housing affordability if their housing need is higher when the development is built compared to when it is not built:
ΔNeed = Need(Build) − Need(No Build).

2/

'Nexus' studies claim that development brings in poor workers who need affordable housing, which is a negative impact to be mitigated.

This is fundamentally flawed: the studies do not measure a worker's housing need in the No Build counterfactual, so cannot prove a causal effect.

1/

The problem is that incumbent homeowners foist the cost of infrastructure maintenance onto new development. The price signal is skewed by politics.

This is actually an interesting research question: when apartments are allowed, do they bring in richer or poorer residents?

Which price signals?

On "growth should pay for growth": homeowners are all too happy to accept higher property values (created by growth in population, jobs, and public infrastructure), but refuse to pay for the costs that make growth possible. Is that fair?

Tipping point?

Isn't that the author's job?

Automated checking?

Why "only"? That's a big deal!

How are you defining upzoning/rezoning?

Spot the fallacy:
"Expanding the urban growth boundary won't reduce housing prices, because the upzoned agricultural land just becomes more valuable, wiping out any cost savings."

Might have been a different Pete Fry.

Pop quiz: why does upzoning shift the supply curve for housing? Eg. rezoning agricultural land to residential.

The supply function tells us: for a given price, what quantity of homes will developers produce? Shifting the curve means this quantity is higher at every price.

bsky.app/profile/mich...

Schrodinger's zoning regulation: it doesn't prevent housing development, but must never be relaxed.

Exercise for the reader: what is the effect of upzoning agricultural land to residential?

Note: the land value residual approach is not a model of price determination. It tells us only about developer willingness-to-pay for land (ie. the demand curve), and not about supply.

Full model:
michaelwiebe.com/blog/2025/07...

Compare immigration (assuming no demand effect): by reallocating a worker from country A to B, the supply of labor in B increases (wage falls), the supply of labor in A decreases (wage rises), and the migrant's wage increases as they switch markets.

Upzoning reallocates a parcel from the house-zoned market to the apartment-zoned market. This ⬇️ the supply of house-zoned land (⬆️P_H ), and ⬆️ the supply of apartment-zoned land (⬇️P_A). The upzoned parcel itself increases in price as it switches markets (from P1_H to P2_A).

Round 1 assessed value is statsig lower. (The round 0 values are very precisely estimated)

Yes, data coverage is not as good, but similar results as other studies.

A new condo building in Honolulu has 310 income-restricted homes. These don't merely benefit the residents in the new units; through vacancy chains, those residents free up their previous homes for other poor people to live in.

This vacancy chain mechanism also works for the 202 market-rate homes.