Earlier in May, local public radio station WAMU aired a lengthy three-part report on the collateral damage involved in house flipping in DC. Martin Austermuhle’s series offers a window into the nightmare for buyers of newly renovated homes – often converted from single family rowhomes into multi-unit buildings – who soon learn that their dream home is actually a nightmare of shoddy work and potentially illegal construction.
The three-part series focuses on buyers, developers, and the city’s regulatory response.
- Part 1: A Dream Home Becomes a Nightmare
- Part 2: For The Developer From Great Falls, A Great Fall
- Part 3: As Development Spreads Across D.C.’s Neighborhoods, Can Regulators Keep Up?
As horrifying as these stories are, Austermuhle correctly focuses on the challenges of enforcing the building code as the root cause of these problems, rather than the zoning code.
Small-scale development is an important tool in strong markets (like DC) to respond to demand for new housing. So many opportunities for small-scale urban development have already been regulated out of existence in American cities. The people buying these flips aren’t suckers taken by con men; they represent the market for additional housing in a city like DC.
Shoddy flips shouldn’t put those remaining opportunities for small-scale development in DC at risk, because the problem here is with building code enforcement and inspection, not with zoning. But whenever there is outrage, there is a strong urge for the city to do something, even if it doesn’t address the stated problem.
The zoning code is not the building code
Tales of illegal construction in flipped houses might stoke the fears of development opponents, but the problems described in the series involve errors in construction.
Too often, cities attempt to use the zoning code as a catch-all regulatory structure, encompassing economic development goals, social policy, etc. Part of this is out of convenience (I did have at least one proponent express support to me for DC’s recent zoning code changes in rowhouse neighborhoods due to the challenges in enforcing the building code – both for approvals and for construction inspections). I suspect part is also a confusion of the issues, thinking that because zoning deals with the city therefore zoning is an appropriate place for regulations about the city.
This series helps clarify the differences; Austermuhle correctly gives zoning only a cameo appearance.
Pop up limits
Even with the focus on building code enforcement, that doesn’t stop public calls to address development issues via zoning restrictions. However, it’s not clear that zoning would stop the flips. House flips are hardly limited to structures with the opportunity to increase the total number of units.
Enforcement matters: One example of shoddy construction also includes blatant violations of the zoning code. What good will modestly tighter zoning regulations do without basic enforcement? Perhaps zoning isn’t the root problem; enforcement is.
Building codes matter
While zoning codes often get the attention, this doesn’t mean building codes aren’t important factors in determining the shape of the city. Houston famously (or infamously) lacks standard, use-based zoning codes. However, Houston’s building code and other regulations still mandate many of the aspects commonly found in zoning codes: minimum on-site parking requirements, minimum lot sizes, etc. It’s not a regulation-free environment.
Even when the building code sticks to more traditional subject matter, there can still be a tremendous impact on the financial feasibility of certain types of construction. In February, Let’s Go LA featured a guest post from LA Architect Tom Steidl about local differences in LA’s high rise building codes that make Vancouver-style towers less financially feasible:
Towers in Los Angeles tend to have significantly larger floor plates than those in Vancouver and US cities that have embraced high-rise design. The primary reason for this isn’t differences in land use or zoning codes. It’s mainly building code and fire department regulations that require additional floor area be added to the core of the tower. In addition to making our towers more bulky, this added floor area increases construction cost and reduces affordability.
One of LA’s quirks (now removed from the code) was a fire department mandate for rooftop helipads. But, as Steidl notes, each requirement that reduces the efficiency of the floor plate adds to the total cost. High rises are already expensive to build and will only pencil out under certain circumstances. Adding costs on the margins only makes the developer’s pro forma more challenging.
The building codes matter. But, LA’s quirky code provides a cautionary tale on policy relying on high rises alone to absorb housing growth. As Payton Chung has written, achieving mass market affordable housing via expensive construction types is a challenge – particularly in DC.
A comprehensive approach to affordable housing in strong markets like DC and LA can’t ignore the key role of small-scale, low-rise development in providing affordably built housing. This means projects of the type taken on by house flippers; smaller scale projects that increase a single lot into 2-4 units.
Poor construction risks eroding confidence in small-scale construction that is vital to meeting housing demand. Likewise, a strong, predictable, and nimble team of inspectors needs to effectively enforce DC’s building codes to manage this period of change.
Lawsuits: the American Way.
Maybe they will help. Writing about some of the same flippers as Austermuhle (and working in parallel), Ian Shapira at the Washington Post notes that some of the same flippers have been sued by DC’s newly elected Attorney General. A more robust consumer protection watchdog can’t hurt, and could even help jump-start a more robust system of code inspections.