Marc Andreessen’s housing NIMBYism is losing ground.


Venture capitalist Marc Andreessen was arrested last week for engaging in housing fraud. Author of the 2020 manifesto “Time to Build,” Andresen is an opponent of NIMBYism. But when it came to his hometown of Atherton, Calif., Andresen signed a referendum opposing plans to convert nine lots and add 137 multifamily units. (The comment is written in the first person singular and written in Andreessen’s style, apparently composed by his wife.)

An anonymous e-mailer sent relevant documents and local press reports to me and, apparently, to the Atlantic Jerusalem Demsas. Her follow-up article shows Andresen’s hypocrisy in why state-level housing reform is needed, “Officials are influenced by NIMBYs, but they have a much larger constituency to care about and the power to address the cost of living and housing overcrowding.” Not only to answer and implement domestic needs, but also prices.

The incident proves even more. It shows that California’s state-level housing reforms are working — just not as fast as they should be.

In the year A law passed in 1969, two years before Andresen was born, required California cities to set out every eight years the need for housing in several income levels and specify where those homes would be built. The long, complicated and expensive process produced many hearings and documents but not much housing. It provided too many loopholes.

Cities can lower the number. They may identify theoretical areas in their plans, but when faced with real development proposals later, they impose delays and restrictions that require them to scale back the project, increase the sales price or rent, or abandon it altogether.

The “housing component” plans did not have to prove that future site owners were willing to sell. Cities face no consequences for obstructing new housing as long as they don’t pass the right act.

California has tightened its approval process for Housing-Elements plans, and cities face fines of up to $600,000 a month if they don’t come up with an approved plan. The state can review at any time whether the city is keeping its promises. If not, it may require streamlining development permits to maintain those commitments.

Cities that do not meet their obligations face fines of up to $100,000 a month. You may lose government funding. The state can even suspend their authority to regulate land use.

The process is still roundabout. Supply is far from allowing to meet demand. But housing advocate Nolan Gray said in an email, “At least a little liberalization is a useful clout to bring government oversight to an ineffective and restrictive local land-use regulation system.

The threat of government fines gives city officials political cover to loosen housing restrictions — like it or not. “I don’t want Atherton to change,” City Councilwoman Elizabeth Lewis said at the July 21 hearing. “It’s sad and sad to think that we’re going through this with the government.”

But Atherton has changed dramatically in the last few decades. The growth of Silicon Valley has made a city within four miles of Stanford University or Facebook’s headquarters highly desirable. The upper middle class people who bought a house there decades ago cannot afford it today. Addressing housing restrictions makes room for people who have them.

This fact seems to be lost on some long-term residents. Take one couple who objected to allowing local schools to buy nearby lots and build multi-unit housing for their employees. In 1987, they bought one of the most modest houses in the area for $370,000.

“If the mandate to build 345 units, including multi-family low-cost units, is implemented, Atherton will be dramatically changed forever,” said one woman who wrote. She bought the place for $255,000 in 1976. Zillow estimates the 3,820-square-foot home on 1.29 acres would sell for more than $10 million today.

Thanks to Proposition 13, these owners would pay $9,000 a year in property taxes, a fraction of the market-rate assessment. A new $1 million townhouse costs more in property taxes than the last single-family home sold 40 years ago.

Atherton, Gray said, “is an island of state-run housing allocations in one of the most productive regions on earth – there’s a huge demand for housing. The city will not be cheap.

But without zoning, he said, “you’d probably get a lot of seven-figure condos. That would be fine – every new unit allowed in an affluent place like Atherton would ease the price pressure on the market.

In a more pressing reality, California wants Atherton to add 348 new housing units over the next eight years, up from 93 in the current cycle. In the year Between 2015 and 2020, the city acquired 90 new units, including 54 affordable “accessory dwelling units,” or ADUs, otherwise known as granny flats, guest houses or garage apartments. The city hit the numbers for “very low income” housing but not for any other income category.(1)

Atherton added positions for direct domestic workers but not for young Stanford professors. If the new plan doesn’t do better, he faces severe penalties. Local officials are feeling the pressure.

Faced with anger at the prospect of sharing the area with the townhouse-dwelling riffraff, however, Atherton Town Council has revised its proposal. He avoided multi-unit housing, including 40 units, whose owners refused to sell (shades of the old housing-element Flimflam). The new plan still counts on a few multi-unit additions on school property.

In large part, it depends on two recent reforms that encourage single-family homeowners to add to their housing stock. One is a 2016 law requiring cities to adopt EDUs, which Atherton said will provide 280 new units. Another is a 2020 law that gives single-family owners two more rights: to build two units on their property and to split the lot into two, for a total of four homes. New construction is exempt from challenges under the California Environmental Quality Act, a tool that is frequently used to ban new homes.

With large lots, Atherton is ideal for this approach. The plan will expose 96 new units to allotments, including some that are already in the works.

In the Atlantic’s version of the story, the NIMBYs won: “Because of a few hundred rich people, the city remains only for the elite.” But this is not true.

For starters, it’s by no means certain that the state will approve the new plan. His assumptions are unrealistic and may require revisions.

More importantly, Atherton still needs to achieve his goals. The plan is no longer a mere ritual. If the projections don’t match reality, the city may have to allow some multi-unit developments. When voters complain, local politicians can blame the state.

And a major zoning change has taken place. Making places like Atherton suitable for ADUs, and especially for lot subdivision, is a huge undertaking. City planners identified more than 600 lots on the one-acre lot where the current home was built before the 1970-era demolition order. Over 1,800 new homes can be occupied during distribution.

In a town of less than 7,500 residents, this represents a huge potential. As Gray points out about the seven-figure condos, even expensive new homes are releasing supply elsewhere in the region.

California’s modest reforms have already pushed the nation’s most expensive city to embrace smaller, cheaper housing. Letting the NIMBYs out is a civics rite of passage. Once finished, it’s time to build.

More from other writers on Bloomberg Opinion:

• Want to save the housing crisis? Zoning: Virginia Postrell

• Can we avoid danger? The housing market says yes: Conor Sen

• The United States must bribe homeowners to accept greater density: Eduardo Porter

(1) In San Mateo County, including Atherton, a family of four earns $149,100, a couple earns $119,300, or an individual earns $104,400. For very low incomes, the limits are $93,200, $74,600 and $65,250.

This column does not necessarily reflect the views of the editorial board or Bloomberg LP and its owners.

Virginia Postrell is an opinion columnist for Bloomberg. She is a visiting fellow at Chapman University’s Smith Institute for Political Economy and Philosophy and the recent author of “The Fabric of Civilization: How Textiles Made the World.”

More stories like this can be found at

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