Building More Housing Reduces Displacement in Californian Cities — With Limits
New Evidence from LA and SF Shows When It Works
Karen Chapple and Taesoo Song's research "Can New Housing Supply Mitigate Displacement and Exclusion?" brings data to the housing debate. Their findings: Market-rate development improves affordability and can reduce displacement, but success depends on scale and local conditions.
The big picture: Does building more housing help or hurt vulnerable residents? Using comprehensive data from LA and SF, the study provides nuanced evidence about what happens when cities build.
Market Comparison (2010-2019)
LA vs SF Market Conditions
Housing price appreciation: 54.1% vs 58.5%
Rent appreciation: 39.1% vs 41.1%
Median home prices: $697,200 vs $1,217,500
Median rents: $1,554 vs $1,959
Population growth: 4.8% vs 9.5%
Housing Production
LA added 82,458 units (5.8% growth)
10.9% were subsidized
SF added 29,686 units (7.9% growth)
23% were subsidized
30.9% of subsidized units were inclusionary
Market-Rate Housing Impact (100+ units)
In Los Angeles
Short-term benefits
2% decrease in displacement
10% increase in access
Strongest in affluent areas (24% less displacement)
In San Francisco
Mixed short-term effects
14% increase in displacement
15% increase in access
Benefits faded after 5 years
Subsidized Housing Effects
Los Angeles
Reduced out-migration: 5% short-term, 3% long-term
Increased in-migration across most neighborhoods
Less effective in high-appreciation areas
San Francisco
Reduced out-migration: 16% short-term
Mixed long-term impacts
Inclusionary units:
11% increase in out-migration short-term
25% increase in in-migration short-term
100% subsidized:
4% reduction in out-migration (consistent)
6-7% increase in in-migration
Key insights
The research reveals that development scale is crucial, with meaningful impacts only emerging at 100+ units. Market context proves to be a defining factor, as demonstrated by the stark differences between LA and SF outcomes. While market-rate and subsidized housing show benefits, they also display clear limitations, particularly in hot markets. Notably, San Francisco's inclusionary zoning policy showed concerning results - units in mixed-income developments increased displacement by 11%, performing worse than 100% affordable projects, which reduced displacement by 4%. This suggests inclusionary requirements accelerate neighborhood change compared to traditional affordable housing. The study found that effects vary significantly by neighborhood type and tend to diminish over time. Notably, household characteristics like age, family status, and residence length often influence mobility more than new construction.
Policy implications: Cities need to implement comprehensive strategies to build more housing of every type, especially market-rate housing. Successful housing policy requires intervention at multiple levels without getting in the way of building both market and subsidized housing, from local anti-displacement measures to state and federal action on systemic inequities. The research suggests preserving affordable housing stock may be as important as new construction in stabilizing communities.
Research Methodology
Used Consumer Reference Dataset (CRD) from Data Axle
Analyzed household-level mobility data
Tracked both in and out-migration
Controlled for demographic and neighborhood factors
Examined impacts at block group level
Studied both 1-year and 5-year effects
Future Research Needs
Longer-term impacts (beyond 5 years)
More market contexts
Policy combinations
Neighborhood-specific factors
Role of tenant protections
Impacts of different building types and scales
Effects of local policies and regulations
Bottomline
While new housing construction helps with displacement and exclusion, it is insufficient. Cities need comprehensive strategies that combine multiple approaches (including building more housing) and account for local market conditions.