New Article: “Downtown Condos for the Rich: Not All Bad”

New Article: Michael Lewyn, Downtown Condos for the Rich: Not All Bad, 51 N.M. L. Rev. 400 (2021). Abstract below:

Through a survey of the academic and popular literature as well as a review of relevant data, this Article suggests that the growth of high-end condominiums is likely to increase supply and hold down costs for local residents. Part I of the Article discusses the background of the debate, including the increased popularity of downtown life, the explosion of urban housing costs in some cities, and the growth of high-cost condos. Part II critiques the claim that the growth of high-end condos will fail to lower housing costs and suggests that this claim is wrong because (1) at least some of these condos are purchased or rented by local residents; and (2) even if this was not the case, these condos might lower housing costs by shifting demand away from older housing units that might otherwise be purchased by out-of-town investors. The Article further demonstrates that even if out-of-town investment has increased housing demand, a vacancy tax would limit this demand more effectively than restrictive zoning. Finally, Part III discusses other externalities allegedly caused by these condos and argues that those externalities do not justify limits on condo construction.

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