Making sense of vacant homes: Lessons for policymakers
Western countries may have millions of unoccupied dwellings, but not for the reasons one might think.
Originally published on February 7, 2022, on Apolitical.co.
- The problem: The ‘vacant housing’ narrative is often misunderstood and it is damaging to housing development.
- Why it matters: A solution is needed for the housing crisis happening in many western countries.
- The solution: Policymakers need to scrutinise the vacant property argument and increase supplies of all types of housing.
It’s no surprise that many western countries are experiencing housing affordability crises. Prices for homes in some countries have risen by more than 10% over the previous year, driven by a number of factors such as COVID-19-related changes in workplace preferences and supply shortages. To make matters worse, housing supply has not kept up with population growth — meaning that shelter in many developed countries is becoming increasingly scarce.
Two graphs from an article in The Economist, published on January 8, 2022.
Governments are beginning to recognise the impacts of supply on housing, and they are beginning to remove local planning barriers in jurisdictions such as California and New Zealand. But despite the growing movement to relax restrictive zoning rules, a common counter-narrative exists to fight housing construction.
In its simplest form, the claim is that western countries do not need to build more homes because they already have thousands (if not millions) of residential properties in cities that are owned but unoccupied, being held as such for speculative or investment purposes. Instead of relying on supply-side solutions, the ‘vacancy truther’ argument holds that countries could easily house at-risk populations if these empty units were either highly taxed or expropriated. This claim is often paired with homelessness statistics that try to link the two problems together.
A similar narrative exists in my home country of Canada, where social media personality Stephen Punwasi recently published an article on our 1.3 million vacant homes. While the vacancy truther narrative advanced by Harriot and Punwasi sounds compelling, it provides an overly simplistic view of census and geographic data. Policymakers need to scrutinise this argument.
Vacant housing: what and where?
There is some evidence that some properties in western countries are left vacant by owners as speculative or investment assets, but this phenomenon represents only a small fraction of national vacancy rates. For example, ‘vacant’ housing in the United States is loosely defined by the Census Bureau to include seasonal housing, homes that are on the market, and units that were recently sold/rented but do not yet have occupants.
Vacant housing by type of vacancy, compiled by Danny Edgel.
Speculative/investment properties would fall into the ‘Other’ group of unoccupied dwellings — but even this category has some caveats. Data analyst Darrell Owens points out that ‘Other’ housing includes homes that are under construction/renovation, are unfit/unsafe to have occupants, and were built as additional dwelling units such as granny suites. If measures were taken to tax all ‘Other’ housing, this approach risks targeting accommodations that are unlivable.
The timing of data collection matters too. Oh the Urbanity, an urbanist YouTube channel, notes that the Canadian data on occupancy is published in May of a given census year — shortly after the academic year has ended and most post-secondary students have moved out.
In addition to the oversimplification of established definitions, the vacancy truther narrative is also undermined by the geographical distribution of unoccupied dwellings. PhD student Danny Edgel recently published a US map that shows the counties with the highest concentrations of ‘Other’ vacant homes.
Map of ‘Other’ vacant homes by US county per 1,000 residents, created by Danny Edgel.
The bulk of these dwellings fall well outside urban cores where homelessness is most prominent, such as New York and California. And the counties with more vacancies are clustered in economically depressed regions such as the Appalachians.
A map of Canadian vacancy rates shows a similar phenomenon north of the border. Most of Canada’s vacancies are situated in remote communities or in cottage country rather than in urban cores where homeless populations are most likely to be situated. These considerations provide some important lessons for policy practitioners.
“ If politicians and civil servants can push back against dubious vacancy arguments, communities can become livable sooner than we might expect.”
Implications for policymakers
The housing crises faced by Western nations are multifaceted, but they can be fixed by increasing supplies of all types of housing. Unfortunately, NIMBYism relies on questionable claims to block development in favour of the status quo (often through the lens of ‘the character of the neighbourhood’). Government officials should recognise that homelessness is a sign of policy failure that must be redressed. But replacing a bad approach with an even worse narrative will not provide housing to those who need it most.
Policymakers can explore some immediate and long-term steps to fix this issue. At a national level, officials can better understand what actually makes up their ‘millions’ of vacancies. Better communication with statistical agencies can help practitioners explain the types of unoccupied dwellings and their distributions. Policymakers are welcome to pursue vacancy/speculative taxes to crack down on undesirable patterns of unoccupied housing (like investment properties), but their scope must not impact economically beneficial ones (like seasonal/student dwellings).
At a regional or local level, governments should recognise that eliminating all vacancies is neither desirable nor is it likely to solve chronic homelessness. Taxation measures to encourage occupancy can provide some baseline funding for shelters and public housing, but additional public investments are required.
And finally, policymakers at every level should recognise a simple truth: that more housing is needed in areas where people want to live. While local politicians often face significant pushback from NIMBY groups in their constituencies, coordination across different levels (including carrot-and-stick programmes to incentivise changes to local zoning rules) can help municipalities overcome these barriers, while also supporting communities in their pandemic recovery efforts.
Solving these crises will be a daunting task, but there is a seismic shift happening within housing policy circles to encourage denser and more affordable patterns of development. If politicians and civil servants can push back against dubious vacancy arguments, communities can become livable sooner than we might expect.
