The "Not In My Backyard" (NIMBY) phenomenon isn't born from malice. It's driven by older homeowners, who view their house as their primary retirement fund, acting out of self-preservation. They lobby for policies that increase their home's value, without considering the broader economic consequences.
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The belief that rising home prices create wealth is a dangerous illusion. Since you must buy another inflated property after selling, you don't actually gain anything. This collective myth primarily serves to lock out first-time buyers and stifle economic mobility for the next generation.
The most powerful voting bloc—homeowners—is financially incentivized to oppose new housing development that would lower prices. This political reality means politicians cannot address housing affordability without alienating their core voters, leading to policy stagnation and an intractable crisis.
The difference in home price trends between US regions is not about weather or jobs, but housing supply. States in the South and West that permit widespread new construction are seeing prices fall, while "Not In My Backyard" (NIMBY) states in the Northeast and Midwest face shortages and rising prices.
The common belief that people oppose new housing to protect property values is likely wrong. A more rational explanation is that residents are protecting their existing quality of life from negative externalities like noise and traffic. Pro-housing arguments should therefore focus on improving neighborhoods, not shaming residents.
Housing scarcity is a bottom-up cycle where homeowners' financial incentive is to protect their property value (NIMBYism). They then vote for politicians who enact restrictive building policies, turning personal financial interests into systemic regulatory bottlenecks.
As articulated by Donald Trump, the political goals of making housing affordable (increasing supply) and protecting existing home values are in direct conflict. Since homeowners are a massive voting bloc, politicians avoid policies that would lower prices, like deregulation, creating a permanent affordability crisis.
Drew Warshaw frames the "Not In My Backyard" (NIMBY) phenomenon as a rational, if selfish, economic decision. Incumbent homeowners are incentivized to restrict new housing supply because basic economics suggest that increasing supply could decrease the value of their primary asset: their home.
Homeowners and local governments block new development, creating artificial scarcity that drives up prices, similar to how luxury brands like LVMH restrict supply to increase value. This "LVMH-ing" of housing makes it unaffordable for younger generations and limits economic mobility.
The American housing market is increasingly inaccessible to younger generations. The median age of a homebuyer has hit a record high of 59, the same age one can access retirement funds. Even the median first-time buyer is now 40, indicating a systemic affordability crisis.
Politicians at all levels actively restrict housing supply through zoning and other policies. This is not incompetence, but a deliberate strategy to protect and inflate property values, which satisfies the large and reliable homeowner voting bloc, ensuring re-election at the expense of renters and future buyers.
