[personal profile] ndrosen
On Friday, the Washington Post published a letter from my friend Walter Rybeck, who served in the Army in World War Two, and must be well into his tenth decade, but still has all his marbles. Here is the letter:

It's the land, not the houses

The July 2 Metro article "Poll: District gentrifiers blame themselves for driving up costs" implied that gentrification is the cause of the shortage of affordable housing. People thinking that doesn't make it so.

The first error was calling it a "housing" crisis. Similar to cars that lose value from the moment buyers drive away from the dealer, houses also decline in value over time, even when they're well taken care of. Of course, escalating prices and rents are genuine and serious. This is not because of the cost of the house but rather the cost of what the house sits on: the land. Land prices keep rising because of pressure from population growth. People also pay extra for locations that are made more desirable by improved public facilities and services.

However, a major cause of escalating prices is land speculation that creates artificial shortages of building sites. The crisis will persist until we stop fixating on housing and address ways to attain affordable housing sites.

Two hints to policymakers: Land speculation is fostered when land values are assessed and taxed too lightly. Land prices are deflated when robust land taxes are imposed.

Walter Rybeck, Silver Spring
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