When it comes to cars, broccoli and many other things, people seem to have an appreciation for the economics of supply and demand. When it comes to housing, some people believe that supply and demand doesn’t work right.

Research into economic beliefs may give us some insight into what goes on in the debate over housing in Bend.

This week, the Bend City Council is going to vote on a 10-year property tax exemption for a development with 199 residential housing units at 105 NE Franklin Ave. That’s in the area where the Les Schwab Tire Center used to be.

The tax exemption can apply if a development has residential housing, is located in certain areas of the city, does eligible green things and more. The eligible green things for this project include a high green building standard — platinum — native and pollinator friendly plants for landscaping and 50% of the parking spaces will be set up with the wiring so they can have EV charging.

The Bend City Council has to approve the tax exemption as well as get some support from other taxing boards that would be impacted by the tax exemption — the Bend-La Pine Schools, the Deschutes County Commission and so on.

There are many arguments about housing and tax incentives. And we are narrowly focused on just one of them that crept into some of the discussions about this tax exemption: people’s attitudes about economics when it comes to housing.

Economic research shows that people have a general understanding of the basics of supply and demand. If there’s a disruption in supply, as there was during the pandemic, people understand that cars were going to be more expensive and harder to find. If there’s a drought, broccoli may be more expensive.

People know housing is expensive and scarce in Bend. Some people still don’t want more housing to be built for many reasons. They want to keep Bend smaller and/or keep the costs down of more required infrastructure and public safety if Bend grows. Also, many of the people who stand to benefit from more housing in Bend may not live in Bend now.

But there are also people who blame developers for high housing prices. They don’t necessarily believe that more housing will ever lower prices.

In fact, there’s economic research into people’s attitudes that shows that there’s “a very strong tendency to blame housing providers (developers) for high housing prices….(T)he mass public see high housing prices and rents as caused by putative bad actors’ malevolence, rather than development restrictions and impersonal market forces… (T)hese preferences and beliefs do not translate into strong support for land-use liberalization. Part of the reason appears to be that most people do not think that even a large, exogenous increase in the size of their metro area’s housing stock would bring down rents or home values.”

OK, we did just try to condense more than 45 pages of economic argument into a few paragraphs. Problematic, to say the least. You can read the paper yourself here: tinyurl.com/econhousing.

We aren’t saying there aren’t differences in housing economics. We are saying there can be differences in economic beliefs when it comes to housing and that those trickle into the debate in Bend.