Smart Growth a Bust?
Realtors and city planners are in love with “smart growth,” but their pet policy project may be one of the two main reasons (in addition to bad lending practices) that have pushed the housing market over the top here in Utah and around the country.
Why smart growth? Like most governmental restrictions or regulation policies, smart growth creates artificial scarcity and so changes the demand curve for housing. Don’t believe me. Take a look at recent article issued by SmartMoney. In the data chart it lists major metropolitain areas of which 4 Utah areas made the list.
Here’s the data:
- Logan: % overvalued = 17%
- Ogden: % overvalued = 17%
- Provo: % overvalued = 34%
- SLC: % overvalued = 30%
- St. George: % overvalued 53%
These are based off the median home prices as of Q2 2007. Unfortuately just another example of an interest group partnering with the government to sell Utahns a promise “affordability” and delivering just the opposite. All the while, realtors make record profits on the backs of hard working Utahns. I guess it’s just another classic example of what Burton Folsom terms as the political entrepreneurs working the system to line their own pockets, all the while portending to be “true capitalists.”
Maybe its time Utahns start doing a bit more homework to understand what conservative policy as it pertains to “smart” growth really looks like and start holding reatlors, developers and politicians accountable for the backroom dealing that is undermining a true free market in Utah.
