Homeowners Saying “Yes, In My Back Yard”: Evidence from Israel
Tal Alster (Hebrew University of Jerusalem)
Renting or owning an apartment in the world’s most desired cities has become increasingly unaffordable, especially for low-income households and less-skilled workers. One of the main reasons is growing regulatory barriers to new construction. Many blame NIMBYism – opposition to new construction by existing homeowners who adopt a “Not in my back yard” position – as the driver of excessive regulation. Richard Florida calls them the ‘New Urban Luddites’, Edward Glaeser ‘The Entrenched’, and William Fischel ‘Homevoters’. The takeaway is similar: older and more affluent homeowners use their political power to prevent new housing from being built and profit from rising urban rents, and in the process economic growth and the mobility prospects of the poor are stifled. NIMBYism, historically considered a micro phenomenon associated mostly with suburbs, is now considered to have macro effects on entire urban regions.
But what if there is a way to harness the interests of the incumbent homeowners to encourage urban development rather than prevent it? In a new article published in Urban Affairs Review – "Homeowners Saying ‘Yes, In My Back Yard’: Evidence from Israel" – I argue that NIMBYism is not the sole expression of their self-interest, or even the dominant one. In Israel a mature system for the demolition and densification of existing residential buildings has changed the preferences and behavior of many homeowners, who now can directly benefit from the upzoning of their neighborhoods through deals with developers. Owners receive a new and larger apartment in the process, which increases their housing wealth and improves their living conditions. By 2019 these programs – termed in Israel 'Urban Regeneration' – were responsible for 19% of all new housing units, and 48% of units in the high demand planning district of Tel Aviv and its surroundings.
Table 1: Permits for new housing units and new urban regeneration (UR) housing units in Israel and the Tel Aviv District, 2017-2019
To explore the motives and perceptions of homeowners, I conducted a survey in the Tel Aviv area (n=202). My main goal was to test the hypothesis that owners’ support of or opposition to urban regeneration depends mainly on whether they perceive it as a feasible option for their own home—which in Israel is typically a condo in an apartment building. The findings confirm that homeowners who are optimistic regarding the chances of their building to undergo regeneration tend to strongly support it in their own street and neighborhood, and rarely express significant opposition. On the other hand, those who see little or no chance of regeneration of their building are much less supportive, and express considerably more opposition to regeneration projects in their local environment. This can be seen in more detail in the charts below, which divide owners into four groups defined by their answers to questions about their building’s eligibility for regeneration and the likelihood that it would occur. Differences between the groups are particularly pronounced in the case of “Outsiders”, owners who believe their building to be ineligible and very unlikely to undergo regeneration. Figure 1 shows that not only were the vast majority of them strongly opposed to regeneration in their building, but large proportions also took a NIMBYist stand in opposing it in their street or neighborhood.
Figure 1: Strong support and opposition to urban regeneration, by geographical scale and clusters of perceived feasibility
Based on the same pocketbook motives that drive owners to oppose construction of new homes in their nearby environment, I reasoned that support for regeneration by owners who see it as possible and likely would vary with the value of properties in their neighborhood. While higher property values motivate opposition to upzoning by homeowners in a typical US suburb, for owners in Tel Aviv optimistic about their building’s chances of regeneration, the higher the value of their home and hence the greater their potential gains from regeneration, the more they support it. At the same time, Figure 2 confirms that NIMBYist opposition on the part of pessimistic owners increases along with the value of their homes.
Figure 2: The effect of property values on strong support for regeneration of own building, by clusters of perceived feasibility (left), and the effect on strong opposition to regeneration of own neighborhood (right).
Notes: Apartment value is the average price (thousands of Israeli shekels per square meter) of apartments in the respondent’s neighborhood.
In a final step, my research analyzed planning objections representing the revealed preferences of owners in two contrasting circumstances: plans for regeneration of their own building, and plans for redevelopment of adjacent lots (the scenario associated in the literature with anti-development NIMBYism). I coded the objections for two large comprehensive plans promoted simultaneously in Tel Aviv, which apply to residential lots in two city quarters and were expected to add more than 13,000 housing units. I compared them with four site-specific 'spot zoning' plans located in the same two city quarters, that proposed to expand building rights for residential use by the addition of nearly 1,000 housing units. All six plans were published to permit objections and discussed in the same time period.
Table 2: Objections to residential plans in Tel Aviv-Jaffa's 3rd and 4th quarters, 2013-2017
The results in Table 2 show that owners' “objections” to the comprehensive plans promoted on their lots were predominantly focused on increasing the proposed extent of building rights. All 98 of them included demands for further upzoning of their buildings, and just two included downzoning requests. Meaning, the homeowners behaved similar to developers or landowners seeking further development and increasing the likelihood of regeneration.
Of the 31 objections to the small-scale plans, 13 were submitted by nearby residents. All demanded a reduction in building rights or even rejection of the entire plan. The rationales specified in these objections are familiar – congestion and parking problems, pollution, reduced exposure to light and noise from garbage trucks that were expected to accompany the proposed development. Among the 12 owners who submitted objections to the small-scale plans there is less unity than in the comprehensive plans, but a plurality called for further upzoning of their buildings.
The evidence derived from my research shows that given the opportunity to benefit from the densification of their building via urban regeneration programs, Israeli owner-occupiers in high-demand areas tend to adopt a “landowner” approach, supporting the regeneration of their own building and also to a lesser but still significant degree the regeneration of nearby buildings. This “Yes In My Back Yard” (YIMBY) sentiment runs counter to the well-documented NIMBYist tendencies of owners to oppose development at the micro level. Importantly, both the preferences expressed by Israeli owners in the survey and the behavior of those who submitted objections conform with the NIMBYist tendencies so prevalent in other countries. Those who cannot directly benefit from the government-initiated redevelopment schemes, as well as those who reside adjacent to proposed redevelopment projects, express opposition when asked and at least some choose to utilize their right of appeal in the form of submitting objections.
In addition to the theoretical implication that the sentiments of homeowners towards development are more complex and contingent than previous scholarship suggests, the findings of this research have evident policy implications. The successful Israeli attempt to mitigate transaction costs among homeowners and build a significant number of housing units via urban regeneration may well offer a feasible path to overcome local opposition to development. Given that incumbent homeowners are powerful political stakeholders, harnessing their self-interest in development might prove a more viable and efficient strategy than attempting to curtail their power.
Tal Alster is a doctoral candidate in the Department of Political Science at the Hebrew University of Jerusalem. His research examines housing policy at the local and national level, urban inequality and urban regeneration. He has also served as a housing policy advisor to municipalities and governmental agencies in Israel.