This works for most goods that people have to constantly buy new, but does not work in the housing market. The people that decide the zoning are the residents of the city. The residents of the city don't need to buy, so they don't care about the speculation price effect. In actuality, through price increases of the speculation, they are better off! So they vote for SFH zoning[0]. The warning is ignored.
If you introduce a land value tax equal to the value of the unimproved land, this will kill speculation, but also make it instantly impactful to the citizens that there is not enough supply. This will mean that the people able to change the zoning of the city will instantly see a reason to change the zoning, as better zoning means more supply means lower taxes.
If you introduce a land value tax equal to the value of the unimproved land, this will kill speculation, but also make it instantly impactful to the citizens that there is not enough supply. This will mean that the people able to change the zoning of the city will instantly see a reason to change the zoning, as better zoning means more supply means lower taxes.
We don't need no speculation.
[0]: https://news.ycombinator.com/item?id=32350657