Thomas Sowell

Where can you make $2,000 a day, with no real effort? In San Mateo County, California.

 Before you start packing your bags to head there, you should know that the average homeowner in San Mateo County saw the value of his property increase by $2,000 a day over the past month. The median price of a single-family home in the county reached $896,000. But, if you don't already own a home in San Mateo County, you don't get the two grand a day.

 Someone from outside California might think that people must be building a lot of new mansions in San Mateo County. But, in fact, there is very little building going on there because most of the county is off-limits to building. These bans on building are known by the more politically appealing name of "open space" laws.

 These housing bans are the reason for rising home prices.

 As for mansions, there are very few of those in San Mateo County. There are some nice homes there and many very modest homes. They just cost the kind of money that people pay for mansions elsewhere across the country.

 Who can afford to live in such a place? Fewer people apparently. The population of the county declined by about 9,000 people over the past four years.

 Who's leaving -- and who is coming in? By and large, young adults who have not yet reached their peak earnings years are finding it harder to afford housing in San Mateo County and in other such counties up and down the peninsula from San Francisco to San Jose. So they are leaving.

 Schools have had to be closed because there are not enough children. The number of children is declining because people young enough to have school children are increasingly unable to afford the sky-high housing prices in communities that ban the building of housing.

 People who are sufficiently affluent can afford to move into places with severe restrictions on building. Those who bought their homes years ago, before these housing restrictions were enacted, are able to stay while the value of their homes rise.

 Among other things, this means that many young adults cannot afford to live near their parents, unless they actually live in their parents' home. This isolates the elderly from their children, which can be a growing problem as the infirmities of age set in and their contemporary friends die off.

 None of this just happened. Nor is it a result of market forces. What has happened essentially is that those already inside the castle have pulled up the drawbridge, so that outsiders can't get in. Politically, this selfishness poses as idealism.


Thomas Sowell

Thomas Sowell is a senior fellow at the Hoover Institute and author of The Housing Boom and Bust.

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