The smart growth bailout?

None of this is to suggest that smart growth has only negative ramifications. To the extent that smart growth removes barriers to the development of higher density housing or less costly housing where it is demand is a good thing. But the land rationing policies proposed under “smart growth” clearly have reaped a very bitter harvest.

The end of this catastrophe may be in sight (or it may not be). Housing prices, particularly in the inflated markets, have started to fall. This is true not only in the United States but in other highly regulated markets such as the United Kingdom, Australia and New Zealand (PDF 768KB).

Yet the bottom line remains: without smart growth’s land rationing policies, the severe escalation in home prices would never have reached such absurd levels. But the disaster in the highly regulated markets will be with us for years. The smart growth spike in housing prices turned what might have been a normal cyclical downturn into the most disastrous financial collapse since 1929.

Now the taxpayers are being asked to bail out the mess that smart growth advocates, no doubt inadvertently, have created.