To Combat Housing Crisis, ‘We Must Build Up,’ Manville Argues

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Architectural Digest spoke to Associate Professor of Urban Planning Michael Manville about Apple’s pledge of $1 billion to address California’s housing crisis — including devoting 40 acres of company-owned property in San Jose to affordable housing. Much of the area is currently zoned for detached single-family homes, a “very inefficient use of valuable land,” Manville said. Increasing the housing stock by allowing for more density would surely face resistance from homeowners who want to preserve the atmosphere of their neighborhoods and the soaring value of their property. However, Manville argued, “if your desire to have your neighborhood remain the same is imposing extremely high costs on other people in the form of high rents, there has to be some give.” He concluded, “Land is finite, but housing is not. … We must build up, so that the same plot of land of one home can accommodate many families. You know, the elevator also exists in Silicon Valley.”

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Upzoning Alone Won’t Solve Housing Crisis, Manville Says

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Associate Professor of Urban Planning Michael Manville was featured in a Marin Independent Journal article about new design standards for housing in Marin, California. County planning officials will soon unveil the standards, which are intended to preserve the look of the area while complying with state laws mandating denser housing. While changing zoning requirements to allow more units per acre would increase the number of housing units in the county, newly built units would not necessarily be affordable for people with low incomes. “It’s never been the case that you would expect new construction to be affordable to very low income people,” Manville said. The two ways to create affordable housing are through subsidies or by “building housing and letting it get very old,” he explained. While any increase in housing supply in high-demand areas should lower prices across the board, upzoning alone won’t solve the housing crisis, he said. “But you can’t not do it.”

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Manville on New Legislation to Combat State’s Housing Crisis

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A Courthouse News article on a new legislative package unveiled by California lawmakers to combat the state’s housing crisis called on Michael Manville, associate professor of urban planning, to provide context. The six-bill package calls for small apartments near transit centers, a new affordable housing bond, residential projects in existing retail and commercial zones, and a wave of new duplexes. Manville said that Los Angeles has had success with residential developments on major streets and boulevards. “It’s definitely much more palatable [for officials] to approve boulevard projects than having to go back to one of their neighborhoods and saying some changes are coming,” he said. Issuing new bonds to spur affordable housing for low-income families and the homeless is an important step, Manville said, but he cautioned that the bond money could go to waste unless zoning reforms are first put in place.

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Manville Explains ‘Induced Demand’ on Congested Highways

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Associate Professor of Urban Planning Michael Manville appeared on KCRW’s “Greater L.A.” podcast to discuss the practicality of freeway expansion projects. The I-605 Corridor Improvement Project is a massive freeway expansion plan that would add new lanes and exit ramps along 16 miles of I-605 and a stretch of the I-5 and other highways in southeastern Los Angeles County. However, Manville argued that “there’s no situation in a vital growing economy under which expanding a roadway to fight congestion makes much sense.” Highway space is valuable land that should be priced accordingly, he said. “We offer it to people for no direct charge,” Manville explained. “And so as a result, at times when lots of people would like to use it, there is more demand for the highway than there is actual highway in existence, and we end up with congestion.” He suggests charging for use of the roadway to deter just enough people from driving to avoid traffic congestion.

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A Blunt Assessment of Grand Olympic Promises

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The notion that cities chosen to host the Olympics are guaranteed to reap a financial windfall for years to come is flatly untrue, according to noted U.S. economist Andrew Zimbalist, who has spent years scrutinizing the costs and benefits of major sporting events. Zimbalist dissected the extravagant promises and deep pitfalls of past Olympic experiences and handicapped Los Angeles’ chances of success in hosting the 2028 Summer Games at the Luskin School’s first Transdisciplinary Speaker Series event of the academic year. Host cities have been beset by cost overruns, environmental degradation and displacement of local populations, he said. And with fewer cities willing to bid for the Games, the International Olympic Committee has been forced to consider hosts with questionable human rights records. “It’s valuable to have the best athletes from around the world congregate in the Olympic Village and live together and model what peaceful co-existence looks like,” he said, “I just don’t like the way it’s organized now.” As for the upcoming L.A. Games, “Yes, there’s a risk, but I think it’s a safe risk,” said Zimbalist, an author and professor of economics at Smith College. Southern California is already home to major sports venues and other infrastructure, including a ready-made Olympic Village at the UCLA dormitories, which also accommodated athletes during the city’s 1984 Games. For the future, Zimbalist envisioned permanent Olympic venues — for summer, perhaps in the area between Olympia and Athens, Greece. “There’s no reason, either environmental or economic, to argue for rebuilding the Olympic Shangri-La in a new place every four years,” he said.

 

Manville on Steep Decline in Bus Ridership

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The New York Times spoke to Associate Professor of Urban Planning Michael Manville for a piece on the trends behind the yearslong slide in bus ridership in many U.S. cities. In addition to demographic shifts and the changing nature of work, Manville pointed to the rise of Craigslist, which has made used cars easier to find and cheaper to buy. In California, he added, a state law granting driver’s licenses to undocumented immigrants may have reduced the pool of transit riders. Manville recommended making the true costs of driving more pronounced by raising prices for gas, parking and driving on congested roads, while building a system that gives advantages to public transit. “At the end of the day, we may never know what is driving this decline,” Manville said. “But I guarantee you that if you took a lane of Vermont Avenue in Los Angeles and gave it only to the bus, ridership would go up.”

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Manville on Public Sentiments Surrounding Transportation and COVID

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Associate Professor of Urban Planning Michael Manville was featured in a CityLab article on the COVID-19 pandemic’s impact on transportation ballot measures in the upcoming election. With transit ridership at low levels and many Americans out of work or working from home, experts are wondering how voters will respond to the transportation initiatives on the ballot. Manville said that it doesn’t necessarily matter if voters don’t plan to ride buses and trains anytime soon. He pointed to various transit measures that have passed in areas where the vast majority of enfranchised people drive. According to Manville, the promises of traffic relief, economic growth and environmental benefits can be more motivating for voters than the actual mobility services. “I think the bigger question now is whether the way people are experiencing COVID and the economic fallout has changed how they think aspirationally about their transportation system,” Manville said. “We just don’t know what that will look like.”

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Few Trying to Skip Out on Rent During Pandemic, Study Finds

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A new UCLA-USC study that took a deep dive into how Los Angeles County tenants are handling rent and finances during the COVID-19 health crisis was covered by media outlets including the Orange County Register. Since the start of the pandemic, landlords have argued that tenants who were shielded from possible eviction would refuse to pay rent, the article noted. In fact, while the study showed that many have struggled to make rent, most tenants have not used the pandemic as an excuse to take a rent holiday, according to the study conducted by scholars from UCLA Luskin’s Lewis Center for Regional Studies and USC’s Lusk Center for Real Estate. One factor measured in the study was the impact of direct assistance to renters who need it. The findings showed that tenants collecting unemployment insurance were 39% less likely to miss rent payments. The report’s findings were also highlighted in Courthouse News, Commercial Observer and Pasadena Now. 

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1 in 5 Tenants in L.A. Has Struggled to Pay Rent During Pandemic, Study Finds Thousands of renters are at risk of eviction with moratorium set to expire; tens of thousands more are in a deep financial hole

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By Claudia Bustamante

Twenty-two percent of Los Angeles County tenants paid rent late at least once from April to July, while between May and July, about 7% did not pay any rent at least once, according to a joint UCLA–USC report released today as a statewide eviction moratorium is set to expire.

The report documents the hardships faced by tenants during the COVID-19 pandemic, and it traces those hardships overwhelmingly to lost work and wages as a result of the economic shutdown.

Among households in the county that did not pay rent, either in full or partially, about 98,000 tenants have been threatened with an eviction, while an additional 40,000 report that their landlord has already begun eviction proceedings against them. California’s moratorium on evictions was scheduled to end Sept. 1, but at the last minute, lawmakers extended protections through Jan. 31, 2021. Federal action to protect renters from eviction at the national level through December 2020 has also been enacted.

The report by researchers at the UCLA Lewis Center for Regional Policy Studies and the USC Lusk Center for Real Estate analyzed data from the U.S. Census, as well as data from an original survey conducted in July 2020 of 1,000 Los Angeles County renter households. The survey, in particular, gave the researchers new insights into the circumstances facing renters. The study was authored by Michael Manville, Paavo Monkkonen and Michael Lens, all with the UCLA Luskin School of Public Affairs, and Richard Green, director of the USC Lusk Center.

“I think everyone understood, early on, that renters might be in trouble as a result of COVID-19 and its economic fallout, but conventional sources of data don’t give us a good window into whether renters are paying or not, and into how they are paying if they do pay,” said lead author Manville, an associate professor of urban planning. “We were able, by using data from a special census survey, and especially our own original survey of renters, to get a direct sense of these questions.”

The researchers first analyzed the U.S. Census Bureau’s Household Pulse Survey, a weekly survey that asked if renters have paid rent on time and if they think they will be able to pay the next month’s rent on time. This data was augmented by the UCLA Luskin–USC Lusk survey, which asked not only if renters paid on time but if they paid in full and if they were threatened with an eviction or had eviction proceedings initiated against them.

The study found that tenants have been facing unprecedented hardships during the COVID-19 crisis, substantially more so than homeowners. Overall, the study also found that most tenants are still paying their rent during the pandemic but are often doing so by relying on unconventional funding sources. The majority who pay late or not at all have either lost their work, gotten sick with COVID-19 or both.

Among the findings:

  •  About 16% of tenants report paying rent late each month from April through July.
  •  About 10% did not pay rent in full for at least one month between May and July.
  •  About 2% of renters are three full months behind on rent. This translates to almost 40,000 households in a deep financial hole.
  •  Late payment and nonpayment are strongly associated with very low incomes (households earning less than $25,000 annually) and being Black or Hispanic.
  •  Nonpayment is more common among tenants who rent from friends and family.

This crisis is particularly acute in the Los Angeles region and other high-cost cities, where an existing affordable housing crisis and an economic slowdown resulting from mitigation efforts to curb the pandemic intersect to threaten the stability of many households.

“Even before the pandemic, L.A. renters, especially low-income renters, were struggling,” said Lens, associate faculty director of the UCLA Lewis Center. And while most renters who miss rent have entered into some type of repayment plan, they’re not out of the woods yet.

“Nonpayment occurs disproportionately among the lowest-income renter households, so repaying back rent could be a tremendous burden for them,” Lens said.

The study also found that renters were suffering disproportionately from anxiety, depression and food scarcity, and they are relying much more than in the past on credit cards, family and friends, and payday loans to cover their expenses. One-third of households with problems paying rent relied on credit card debt and about 40% used emergency payday loans.

The prevalence of these nonconventional forms of payment, along with the incidence of job loss among tenants, suggests the importance of direct income assistance to renter households.

Tenants collecting unemployment insurance were 39% less likely to miss rent payments. Just 5% of households that hadn’t lost a job or fallen sick reported not paying the rent.

Co-author Green, director of the USC Lusk Center for Real Estate, said that although data show that most renters have been paying their rent, government policies can help strengthen the ability to do so.

“One of the main concerns among landlords at the beginning of the pandemic was that tenants weren’t going to pay their rent if they knew they weren’t going to be evicted,” Green said. “Not only have we not seen any evidence of this, but getting money in renters’ hands through unemployment insurance or rental assistance helps a lot.”

Co-author Monkkonen, an associate professor of urban planning and public policy, agreed.

Helping renters now will not only stave off looming evictions next month but “also prevent cumulative money problems that are no less serious, such as renters struggling to pay back credit card debt, struggling to manage a repayment plan or emerging from the pandemic with little savings left,” he said.

Across the state, most evictions were halted in April by the California Judicial Council, the state’s court policymaking body. The eviction moratorium was set to expire in June, but it had been postponed to Sept. 1 to allow local and state lawmakers more time to develop further protections, including the bill currently under consideration. Given the unconventional means renters reported using to pay rent, the new study says that policies that provide funds to renters could help mitigate a raft of evictions and homelessness that had been predicted by previous reports by researchers at UCLA and elsewhere.

The study was funded by the Luskin School, the UCLA Luskin Institute on Inequality and Democracy, the UCLA Ziman Center for Real Estate, the USC Lusk Center for Real Estate, and the California Community Foundation.

UCLA Study Cited in Essay on Why Movies Portray Developers as Evil

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A 2018 article about anti-development attitudes, authored by UCLA Luskin’s Paavo Monkkonen and Michael Manville, is mentioned by the Libertarian magazine Reason in an essay that focuses on the propensity of Hollywood to portray real estate developers as bad guys. The essay traces the movie trope of an evil developer as far back as Frank Capra and his Depression-era movies like the 1946 Christmas classic, “It’s a Wonderful Life.” That movie presents one of the best-known rich-guy villains in movie history: Mr. Potter. Such characters reflect circumstances explored by Manville and Monkkonen when they wrote about how the high cost of land and the complexity of regulations can make real estate development difficult. Reason quotes directly from the UCLA article, saying, “These circumstances could select for developers who are both affluent and out-of-step with conventional ways of behaving: Only deep-pocketed, hard-charging and confrontational people will be willing and able to lobby elected officials and get rules changed in order to build.”

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