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EDITORIAL: Texas shows how California can solve its housing problem

California is infamous for its sky-high housing prices. Evidence from Texas suggests applying the law of supply and demand would help alleviate that problem.

Houston and Dallas have grown rapidly over the past decade. Their metro areas have a combined population of 14.5 million. The Los Angeles metro area has a population of 13.3 million.

The Texas cities, however, don’t face anywhere near the housing crunch that L.A. does. The median home price in Houston is $250,000. In Dallas, it’s $260,000. In L.A., it’s $618,000. There’s a similar pattern for apartment rents. The average apartment in Dallas and Houston is around $1,300. In L.A., it’s more than $2,800. This data comes from American Enterprise Institute scholar Mark Perry.

If only L.A. could figure out what Houston and Dallas have done to create a vibrant and affordable housing market.

But as observers have been pointing out for years, one piece of the puzzle is simple. In contrast to L.A., Houston and Dallas allow builders to build homes. Last year, Houston issued 57,000 building permits for new housing units. In Dallas, that number was 62,000. Just 31,000 permits were issued in L.A. Combined, Houston and Dallas built 8.2 new housing units for every 1,000 people. In L.A., the ratio was 2.3 per 1,000.

It may be difficult for the progressives running the People’s Republic of California to comprehend, but ignoring the basic concept of supply and demand has consequences.

It wasn’t always this way. In the mid-1950s, California built around 160,000 new single-family homes a year. But between 2008 and 2016, California didn’t build more than 60,000 single-family homes a year once. Builders now routinely must battle restrictive local zoning codes and oppressive state building regulations.

Even when developers do manage to build homes, government mandates artificially boost their prices. Last year, researchers from Chapman University found regulatory fees boost the cost of a new house by $50,000 in California. That’s two-and-a-half times as high as the average in other states.

On Wednesday. California Gov. Gavin Newsom signed a bill restricting the ability of local government to stop new housing projects by burying them in red tape. It caps fees and prevents local governments from instituting population and housing limits. That’s a tiny bit of progress. Unfortunately, it won’t be enough of an improvement to counteract the damaging and preposterous rent control bill Gov. Newsom signed Tuesday.

If California officials want to solve the state’s housing problems, they need to embark upon a quick fact-finding mission to Texas.

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