America's Two Housing Markets


Imagine that, on top of all our other problems, the United States had a shortage of pickup trucks. While many pickups are purchased for recreational purposes, they also play vital roles in construction, farming, forestry, and other industries. The impacts of a shortage could reverberate throughout the economy.

A California politician says he has a solution to the pickup shortage: Simply buy old pickups, scrap them, and use the materials to build subcompact cars such as the Chevrolet Spark or Mitsubishi Mirage. Full-sized pickups typically weigh twice as much as subcompacts, so this program could flood the market with two or more vehicles for every one that is scrapped. That would have to reduce the price of pickups, wouldn’t it?

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The Chevrolet Spark is one the least-expensive cars in America, but with less cargo room than the cab of most pickups, it can hardly be mistaken for a light truck. Photo by General Motors.

Of course not. Subcompact cars have their place, but they are not going to provide an adequate substitute for trucks capable of carrying bales of hay, cords of firewood, or tools and materials for building a house. The markets for the two kinds of vehicles do not overlap, so having more of one won’t influence the price of the other, but scrapping pickups would only make the remaining ones more expensive.

Single- vs. Multifamily Housing Markets

No one would confuse subcompact cars for pickup trucks. Why, then, do people think that tearing down 2,200-square-foot single-family homes to make room for 1,100-square-foot apartments will make single-family homes more affordable? This is, in essence, what the movement to ban single-family zoning calls for. Clearly, many people supporting this movement fail to realize that, just as the market for subcompacts is completely different from the market for pickups, the market for multifamily housing is different from the market for single-family homes.

There are several reasons why people prefer single-family homes. Such homes provide greater privacy and residents are less bothered by noise, cooking odors, and other impacts from their neighbors. Yards offer places for people to garden and play areas for children and pets. Low-density neighborhoods have less auto traffic and congestion.

People also sense that neighborhoods of single-family homes have less crime than higher-density neighborhoods. This is not because people who live in multifamily housing are more likely to be criminals but because multifamily housing is more likely to be attractive to crime.

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Randal O'Toole, the Antiplanner, is a policy analyst with nearly 50 years of experience reviewing transportation and land-use plans and the author of The Best-Laid Plans: How Government Planning Harms Your Quality of Life, Your Pocketbook, and Your Future.