The Housing Crisis Is Not About The Price of Buildings. It's About the Price of the Dirt Beneath Them.

A discussion post for the 62nd International Making Cities Livable conference in Potsdam, Germany, October 15-19, 2025

ABOVE: In spite of tripled housing units from 1960 to 2020 - far outpacing population growth - the city of Vancouver B.C. not only did not reduce housing costs, it saw the highest costs in North America. The lesson is clear: adding supply alone does not lower housing cost.

By Patrick Michael Condon

James Taylor Chair in Landscape and Liveable Environments

University of British Columbia

For more than four decades, urbanists like myself have tirelessly championed walkable neighborhoods, mixed-use developments, and communities of diverse incomes and backgrounds. We fought for places where children could walk to school, neighbors could meet over shared stoops, and housing didn’t come at the cost of one's mental health or financial ruin. And to some extent, we succeeded. Today, these ideas appear in planning documents across North America, their language absorbed into the bureaucratic vernacular of city halls.

Yet despite this apparent progress, the results have been devastatingly clear: we have failed.

Housing is more expensive, more unequal, and more elusive than at any time in living memory. Middle-income families are increasingly locked out of the communities they serve. The very idea of an affordable home near one's work, friends, or family has slipped out of reach for half the population. And during the crucible of the Covid-19 pandemic, this quiet disaster screamed into full view: how we organize our cities is not just inefficient—it is killing people.

So what went wrong? Is there malice behind our planning decisions? A conspiracy of developers and planners? I prefer a less cynical answer. The problem is not one of intention but of omission. For decades, we have chased shadows—tweaking form, scale, and use—while ignoring the single most powerful force in urban life: the price of land.

Let us call things by their true names. Land rent—the unearned income that accrues to landowners merely by virtue of owning a finite, immobile resource—is the root of our crisis. Cities grow, infrastructure is built, workers labor, businesses invest—and the lion's share of the resulting wealth is quietly siphoned off in the form of escalating land values. Whether you pay it to a landlord or to a bank in the form of a mortgage, land rent is a toll on civilization itself. It produces nothing. It absorbs everything.

This was not always so starkly felt. In the three postwar decades, the malign effects of land rent were temporarily subdued. Mass homebuilding, vast tracts of inexpensive land, and strong labor protections created a fleeting period when even a grocery clerk could support a family and buy a modest home. But in the past forty years—and most acutely in the last twenty—the machinery of rent extraction has roared back to life. In cities blessed with job growth and human talent, prosperity itself has become a poison. Wages rise, businesses thrive—and land prices soar beyond all proportion, consuming every gain.

This is not a paradox. It is exactly what Henry George foresaw more than a century ago: that progress, under conditions of land monopoly, does not lift all boats. It raises the tide and sinks the workers.

Urbanists today face a bitter truth. We have clung to the belief that by simply allowing more housing—by removing zoning barriers and permitting greater density—the market would heal itself. But the market cannot correct a pathology embedded in the price of land. When land is privately monopolized, every act of good—every new transit line, every new job, every permitted duplex—only inflates the underlying value of dirt. The landlord wins. The renter does not.

So what can be done?

The answer, as George taught, lies not in punishing wealth creation, but in reclaiming the unearned increment—the rise in land value that society itself creates. Cities like Vienna have shown that when land rent is captured for the public good—through social ownership, value capture, or public housing on publicly owned land—housing can be both abundant and affordable. It creates room for labor to flourish and capital to invest, without being strangled by parasitic rent.

The tragedy is not that the problem is complex, but that its solution is so boringly simple. We already have the tools. Zoning, development controls, land use planning—these are the legal levers we need. But instead of using them to tame land speculation and demand affordability, we have turned them into scapegoats. We blame “supply constraints” and “NIMBYs” for housing stress, when in truth we are misdiagnosing the disease. The culprit is not the refusal to build more units. It is the mechanical process by which land absorbs every benefit and leaves workers with the bill.

In this light, our housing crisis is not a natural disaster. It is the foreseeable result of public policies that have surrendered to private land interests. And yet the opportunity is immense. By restoring the principle that land should serve the people, not the other way around, we could reverse course. We could build not only more housing, but just housing.

Henry George died trying to teach this truth. That labor and capital are not enemies. Their common adversary is land monopoly—land rent that demands payment without work, innovation, or contribution.

Our cities do not suffer from a lack of buildings. They suffer from a lack of justice in how we allocate and price the land beneath them.

We can fix this. But only if we remember what we have forgotten. And only if we act with the moral clarity this moment demands. Our children—and their cities—are counting on us.

Professor Patrick M. Condon

James Taylor Chair in Landscape and Liveable Environments

ABOVE: Patrick Condon at the 61st International Making Cities Livable in 2024.

New book on housing equity https://www.ubcpress.ca/broken-city

Current initiative: https://designinganddemocracy.blogspot.com/

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More information on the 62nd International Making Cities Livable conference: https://www.imcl.online/potsdam-2025

Why We Need "Plug-and-Play Urbanism"

Making cities livable will require an optimum combination of standardization and customization, drawing lessons from other industries—and from natural systems.

ABOVE LEFT: Martin Cooper, inventor of the Dynatac 8000, shows one in 2007. (Photo by Rico Shen via Wikimedia Commons.) Right, an iPhone today, showing a pattern from the wiki companion to the book A New Pattern Language for Growing Regions (photo by the author).

NOTE: This is a discussion post for the upcoming 62nd International Making CIties Livable conference in Potsdam, Germany, October 15-19, 2025.

POTSDAM, GERMANY - Imagine that it’s 1983, and you are in the very young business of cellular telephones. The only unit available is the massive Motorola DynaTAC 8000x, a brick-like object that costs $4,000, takes ten hours to charge, and provides just 30 minutes of talk time—IF you happen to be in the very few areas that have cell coverage. 

How do you get from there to where we are today? How do you overcome the many formidable barriers to cost and availability, and get the economies of scale and standardization that you will need to become competitive with (and eventually overtake) land lines? You will need innovation, regulatory changes, and a willingness to standardize many elements (like computer chips) while customizing others (like design features). In time, the reductions in cost and availability will pay off, to the point that in 2025, 94 percent of Americans will have a cell phone, and whole continents (like Africa) will rely on them almost exclusively instead of the old land lines.

We could say that the challenge of making cities livable today is similar to the challenges of 1980s cell phones. Our successes, though individually impressive, still represent a small niche—perhaps a few percent of all settlements—and they're often not competitive against garden-variety sprawl, or economically viable in dysfunctional inner-city areas. Why is this still the case? What can we do about it?

First, consider almost any example of modern development -- most common, say, in a sprawling suburban neighborhood. All of the elements are plug-and-play modules that can be dropped in almost anywhere. The big box, the fast food pad, the garden apartment, the housing six-pack—they can work anywhere in the USA or increasingly, globally. Their cookie-cutter aesthetics is standardized too, often making their design approvals standard and rapid.

But that’s only the beginning of the story. Also standardized are their technical specifications, regulatory approvals, financing structures, and design systems from building to operations, allowing great economies of standardization and scale. McDonalds—love them or hate them—created a marvel of standardized, low-cost production, not only in their food products but in their buildings, and their kit-of-parts franchise system. 

We might conclude that these economies of scale and standardization are just destructive forces that we must reject. In their extremes, they certainly are destructive, and unsustainable. But there are two problems with the idea of rejecting them wholesale. First, at this point in history at least, these economies are what makes the world go around, and any hope of changing things has to recognize the necessity to compete with them. 

But second, and more fundamentally, economies of scale and standardization are not pathological human characteristics, except in their extremes. Fundamentally they are properties that are abundant in natural systems, including sustainable ones. Think of the billions of near-identical seeds made by plant species (economies of scale), or the limited genetic codes that generate them from just four chemicals (economies of standardization), for example. 

The real problem, as my colleague Nikos Salingaros and I have written about, is that in a healthy system, these economies need to be counter-balanced with economies of place and differentiation. In natural systems, economies of place (ecological structures) and differentiation (biodiversity) matter enormously. Too much of the wrong thing in the wrong place and you have a toxic condition. Too much of the same thing, and you have a monoculture, a system that is vulnerable to catastrophe. 

In urban systems too, it matters, say, whether our homes are near our workplaces (an economy of place), and whether our homes fit our own local family needs (an economy of differentiation). Too much of the wrong land use in the wrong place (functional segregation) and you get sprawl. Too much of one kind of structure and you are poised for disaster—like the 2008 housing mortgage collapse. 

In a sense, we could say that today we have a kind of “operating system for growth.” Some kinds of urban patterns will “plug and play” on this system, while others will not—just as we can’t run Mac software on a PC, say. This settlement “operating system” consists of all the elements that produce the urban forms around us: the laws, codes, standards, models, incentives and disincentives, and other institutional structures, formal and tacit, that shape our built environment. 

ABOVE LEFT: An ad for Shell Oil Company in 1937 lays out the blueprint for modern suburban development. Almost 90 years later, that model has reached world dominance, thanks to its plug-and-play economies - but now an alternate model is in view. Photos: Public Domain, Google.

The problem is that this model relies too much upon economies of scale and standardization: the “cookie-cutter” syndrome of every chain restaurant and every tract house looking the same, and creating the same maladaptive, toxic condition. But it is not just individual products that are the problem, but the entire system, with its inability to adapt to place and to generate diversity.

As we can begin to see, there are ways that we might get the best of both worlds, as natural systems do. Perhaps, for example, we might create standardized models of entitlement and finance, for fairly standardized “plug and play” building and place types. But then the local expression of these buildings might be created through unique façade changes that are a small fraction of the full building cost, and a minor aspect of the permitting requirements. Local residents might also work together with city agencies to create libraries of pre-approved design types, expressive of their local place and its diversity. This “win-win” approach to entitlement could overcome many of the formidable barriers to lowering cost and avoiding the divisive “NIMBY” battles, replacing them with something more like “QUIMBY” – Quality In My Back Yard.

One of the most important aspects of the “operating system for growth” is the way the flow of money works, often in hidden ways that are financially a bad deal for the public sector—that is, the taxpayers. As Joe Minicozzi and others have written, when the long-term return on investment for municipalities is assessed, sprawl infrastructure looks a lot less attractive financially than investments in compact walkable infrastructure. Too many developments extract quick profits at the expense of long-term benefits—what economists call “externality costs.” Charles Marohn has gone so far as to call this arrangement a “Ponzi scheme”—one that will catch up with us if we don’t reform its hidden financial transfers.

But to change the equation, innovative new financial tools will be needed. Some of these will involve tax policy changes, like new policies for land taxation. (There is a fascinating debate about so-called “Georgist” tax policy, for example.) There are other ways of directing funds to level the playing field, including grant programs for pilot projects, “feebates,” credits to system development charges, and other forms of “monetizing externalities” by the public sector.

But beyond public financial tools, we will need private tools too, including new investment instruments—for example, the “time tranche bonds” proposed by Christopher Leinberger. As Leinberger also points out, New Urbanists need to be able to package up real estate projects into simple investment vehicles, as alternatives to the highly standardized 19 types that exist in conventional suburban development.

There is a telling but overlooked line in Jane Jacobs’ classic The Death and Life of Great American Cities, talking about the importance of feedback mechanisms, especially financial ones, and the need for their reform. “In creating city success,” she said, “we human beings have created marvels, but we left out feedback. What can we do with cities to make up for this omission?” 

The answer is that we can patiently re-wire the “operating system for growth” to restore these healthy feedback systems. We can concede that the built environment changes slowly, and the systems that generate it change even more slowly—unfortunately much more slowly than software and cell phones. But they do change, as they did in the 20^th Century—and now they must change again, in the 21^st Century.

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EDITOR'S NOTE: A version of this post ran previously on the CNU Public Square journal. Our thanks to editor Rob Steuteville.

Building on "Collective Intelligence": Learning From Potsdam's Spectacular Postwar Reconstruction

The 62nd IMCL Conference will study the many important lessons of this stunning renaissance - including the genetic intelligence of revival architectures

ABOVE: The transition in Potsdam from a grim "modern" urbanism to the more humanist landscape of prewar Germany, as shown in a remarkable video by The Aesthetic City (click to view). New research shows that the older city in fact demonstrates a more "modern" scientific understanding of the best human environments and their characteristic geometries.

POTSDAM, GERMANY - From October 15th through 19th this year, the 40th Anniversary International Making Cities Livable (IMCL) conference will be held in this beautiful city, with an exceptionally rich history of urban and architectural patterns. The locale also offers a case study in the new scientific understanding of the power of evolutionary refinement, and the "collective intelligence" embodied in the best human environments.

The IMCL conferences are always focused on finding the best solutions to meet our urban challenges, from whatever source and whatever period. We do that by gathering to share knowledge at instructive and inspiring locales. Some of the best solutions will often be fresh and innovative -- but many of the best ones will have evolved through careful refinement over decades and centuries, arising from the complex workings of human collective intelligence. These solutions often take the form of rich and useful patterns, expressed in the most successful, well-loved and enduring places today.

But there is a peculiar idea circulating nowadays, one that is still dominant in too many circles -- that such patterns are no longer relevant, that they are laden with too much of the political baggage of the past, or they are simply not "authentic" to a "modern" era.

Let us call this idea what it is. It is idiocy. And it is disproven by a growing body of evidence.

New findings in the sciences demonstrate clearly that human environments, like other structures in the Universe, typically evolve, differentiate and refine over time. Through their structural evolution, and the actions of the distributed agents who serve as human contributors, these places grow more rich and more beautiful, and they expand their capacity to improve the well-being and health of people and place. They are not less sophisticated than most novel solutions: indeed, they are often more so.

Sometimes too, the beautiful and successful patterns of the past suffer catastrophes, and their memory brings discomfort. Sometimes they are associated with painful periods of history, and there is a temptation to forget about them, and to "move on." This has been the case in Potsdam, Germany, the beautiful royal city of Prussia built by and for Prussian kings and German Emperors prior to 1918. Following the city's near-total destruction in World War II, however, while there was a general desire to preserve a few museum pieces from its history, the rest of the city was to be replaced by more "appropriate" or "authentic" contemporary buildings. The results were... not satisfactory, by the judgments of most people.

This "modern" approach failed to recognize the embodied intelligence of the previous patterns -- not merely as historic relics, but as living patterns of what Kevin Lynch called "good city form." Instead of understanding how such structures could improve human life and health, planners and architects in Potsdam, as in other places, made a series of crude and catastrophic mistakes: too many cars and roads, too many cold blank buildings, too many fragmented, isolating, deadening places.

This was not collective intelligence, but collective stupidity.

ABOVE: The Alter Markt area today.

New research is demonstrating that, far from incorporating "backward" or "inauthentic" patterns -- as some architectural ideologues still claim -- Potsdam and other historic cities embody highly intelligent and still-useful patterns of human settlement, capable of enduring, and indeed of promoting human flourishing. While they may express particular stylistic or culturally unique symbolic characteristics, they also typically incorporate deeper universal patterns of life-enhancing environmental structure -- patterns that are not only still relevant today, but are essential in meeting our daunting urban and planetary challenges.

The fallacy that such places are "backward" and no longer "appropriate to our time" is easily disproven by the evident fact that such patterns, when revived, have produced some of the most successful and best-loved places in human history, even up to the present day. (Their ecological performance is often far superior too, which is not a coincidence.) The success rate of "modern" environments, by comparison is -- let us not mince words -- dismal.

Nor are these patterns only useful in reconstructing historic environments. They are also demonstrably beneficial in creating wholly new buildings and neighborhoods, applying the enriching capacities of traditional patterns and characteristics. (And of course, new expressions can always be added to the old -- as was always the case in the "fugue" of history.)

There is demonstrable and growing evidence that these patterns are superior, that they have salutary effects, and that to deny their benefits to our clients and the public increasingly appears to be -- to put it bluntly -- an unconscionable form of professional malpractice.

While the IMCL conferences share practical and research knowledge about making cities livable from around the world -- and embracing local architectures from local places -- one of the most valuable experiences of the IMCL conferences is the opportunity to learn from the locales where the conferences are located. In that sense, Potsdam is an especially fitting venue: it offers a "teachable moment" about the tragic events and miscalculations of its history, as well as the intelligent beauty of its patterns, and the opportunities for their revival.

As a case study, we will learn about Potsdam's sad fate during World War II, when the city became the target of devastating Allied bombing. Its beautiful Alter Markt square, with stunning architectural treasures (including St. Nicholas Church designed by Karl Friedrich Schinkel), was almost totally destroyed.

ABOVE: The Alter Markt after bombing.

Another form of devastation happened after the war, when the East German government replaced many of Potsdam's remaining beautiful historic buildings with "modern" buildings that could most charitably be called "expedient." While the older buildings reflected centuries of architectural evolution and refinement, the new structures followed the dictates of early 20th century architecture to "start from zero" (Gropius), to let "mechanization take command" (Giedion), and to redefine architecture as "machines for living in" (Le Corbusier). At best, such buildings served as gigantic sculptures, more attentive to the artistic prerogatives of the architects than to the needs and desires of the users and citizens. While such buildings are still often popular with architects, research surveys show that most non-architects find them ugly, uninviting, and even dispiriting. Evidence for the success of this regime, from a broader human point of view, can best be described as "unsatisfactory".

Indeed, recent research has begun to show that such buildings and settlement patterns are not merely unpleasant to their occupants -- they have a negative impact on the health and well-being of all who have to live in and around them. (We will explore some of this research evidence at the conference.) They also have an indirect impact on the health of natural ecologies, relying as they do on mechanized and functionally segregated systems including automobiles, highways, concrete infrastructure, parking lots, and many other ecologically disruptive structures. These places are much less reliant on pedestrian movement at more compact human scales, and they sacrifice the vital benefits of face-to-face interaction within inviting public spaces. (Slapping them into fragmented park-like settings seems to have only partially mitigating effects, and might constitute a form of "greenwashing".)

But in this light, the more recent history of Potsdam is inspiring. The city has entered a new chapter as a much more livable city, featuring a stunning revival of many of its historic buildings as well as new buildings built on traditional patterns. During the planning of these projects, there has been heated debate about whether this revival was "authentic" -- often pitting isolated architectural ideologues against larger citizen groups and professionals from outside the profession of architecture. The tide seems to be turning against the ideologues, who appear increasingly isolated. A proper assessment of the new research evidence -- not ideological cant, rigid habits or orthodox dogma from the previous century -- is long overdue. (Talk about those mired in the past!)

We will hear from some of the people who were responsible for Potsdam's renaissance, and learn from their challenges and successes. They include Thomas Albrecht, one of the architects of the transformation. We will have an opportunity to debate the issues and examine the actual evidence. (Certainly, let us invite those who defend the modernist status quo to present their case.) And of course we will learn about many other case studies and research findings from around the world, about how to meet our urban and planetary challenges in the ways we shape buildings (and thereafter they shape us) -- and in many other aspects of urban structure and building systems.

We will also hear from our hosts, including Bart Urban of The Aesthetic City (producers of remarkable videos like the one above). They are documenting the changing thinking about what is "modern" and what is universal and humane in our cities, towns and suburbs -- and how to make them healthier, more beautiful, more durable, more just -- and yes, more livable.

While there, we can also enjoy the stunning Sanssouci Park, a UNESCO World Heritage Site with many architectural and landscape treasures. A few of these treasures are shown below.

We hope you will join us for an exceptional gathering! https://www.imcl.online/potsdam-2025