Renters, Supply, and What These Amendments Deliver

Most of what this site has published about the 4a and 5b amendments speaks to homeowners. We have written about property values on adjacent streets, the school-tax base, the fiscal math on a single church lot, and the assessment rules that govern a for-sale townhouse. That framing leaves out a large part of the borough. In Narberth, 894 of 2,001 occupied homes are rented, roughly 45 percent of all households.¹ The strongest argument for the amendments is aimed squarely at those households. So here we state that argument, then test it.

The argument for the amendments

Rents rise when demand for an area outruns the housing available. The Main Line has strong demand and tight supply. Current zoning tightens that supply on purpose, and more than the amendments would: larger minimum lot sizes, higher parking minimums, lower height limits, and a restrictive conditional-use process. All of them limit how much housing gets built and raise the cost of what does. Loosen those rules near a rail station and a developer can build more units at a lower cost per unit. That is the mechanism the amendments’ supporters have in mind.

The counterintuitive part concerns who benefits. A new building near the station rents at the top of the market. Its tenants come from somewhere, leaving other homes empty. Someone moves into each of those, vacating another in turn, and the chain of moves runs down the price ladder. Economists call this filtering, and the recent evidence for it is stronger than the older literature suggested:

• Evan Mast tracked the address histories of 52,000 people who moved into new market-rate buildings in large cities. Following the chain of who-moved-where, he estimates that building 100 new market-rate units moves 45 to 70 people out of below-median-income neighborhoods and 17 to 39 out of bottom-quintile neighborhoods, with almost all of that effect landing within five years.²
• A companion study of large new apartment buildings in low-income areas found that the new buildings cut rents in nearby existing units by 5 to 7 percent, relative to comparable blocks, and that they slowed rent increases rather than setting them off.³
• A Helsinki study following moving chains reached the same city-wide conclusion.⁴
• A review by the NYU Furman Center, weighing the objections directly, concluded that added supply eases affordability even when the new units themselves are expensive.⁵

The parking rule fits the same logic. A structured parking space costs a developer tens of thousands of dollars to build. Require fewer of them and each unit costs less to deliver, which can mean more units, lower rents, or both. Location matters too. A household next to the station can own one car instead of two, or none, which lowers the combined cost of housing and transportation that a renter pays each month.

Restrictive zoning protects the asset values of people who already own homes by keeping new supply out. Renters get none of that protection. When opposition to new housing is framed around property values and neighborhood character, part of what it protects is the incumbent owner’s balance sheet. A renter is entitled to point that out.

Where this argument is right

The filtering mechanism is real and, now, well documented across several cities and methods. The transit logic is sound: in pure land-use terms, land next to a regional rail station is close to the best place in the borough to add homes. The equity critique has force, and homeowners making the case against density should be honest that their own asset values are part of the argument. Narberth’s own resident survey found decent support for accessory dwelling units and for gentle, ownership-scaled infill, both of which add lower-cost supply without the harms residents objected to elsewhere.⁶ A renter reading this site is owed that much before we turn to objections.

Where the argument breaks down for these amendments

Three problems separate the general case from what these specific amendments can deliver in Narberth.

The evidence is about scale, and Narberth has none to offer. Mast studied new construction in large cities. The nearby-rent study looked at large apartment buildings in urban neighborhoods. Those markets absorb thousands of units a year, and the measured effects follow from that volume. Narberth covers half a square mile. Our own earlier analysis put the plausible yield of these amendments at 50 to 200 apartment units across all qualifying parcels over a period of years.⁷ Set that against a regional housing market of many thousands of units and the resulting contribution rounds to nothing. Filtering that moves 45 to 70 people per 100 units is a real effect at city scale and an invisible one at borough scale. The borough has claimed an affordability benefit but has not put a number on it. The real number is small.

The filtering benefit is regional and diffuse; the costs are local and concentrated. Grant the filtering argument in full and it still describes relief spread thinly across an entire regional market. No individual renter on Sabine or Iona should expect their own rent to fall because a building went up near the station. The costs point the other way. Overflow parking lands on specific blocks. The added vehicle trips⁸ that each new household generates land at the railway crossings and the constrained side streets. The per-household school-tax shortfall, because apartments pay lower school taxes, lands on the Lower Merion tax base, which every property owner in the district funds through millage.⁹ On the ledger, the filtering benefit sits on the positive side but dissolves into a nine-county average, so Narberth captures only a sliver of it. The costs sit on the negative side, and Narberth bears them alone.

The units are expensive, and the near-term risk to Narberth’s current renters runs the wrong way. New one-bedrooms near the station rent for more than $2,600 a month.¹⁰ They do not house lower-income renters directly, and filtering reaches those renters slowly and indirectly, if it reaches this small a market at all. Meanwhile, by-right redevelopment changes the calculus for the older, cheaper rental buildings and rental houses that make up much of Narberth’s naturally occurring affordable stock. A developer who can build a market-rate building by right on a lot that today holds older two to six-unit¹¹ rentals has a reason to buy it, empty it, and replace it. For the household living in that older unit now, the near-term result is not a cheaper apartment down the filtering chain. It is a notice to vacate. The long-run regional benefit that the studies describe and the near-term risk to a specific Narberth tenant are two different things, and the supply argument as usually presented mentions only the first.

The savings flow to owners, not renters. Cutting the parking minimum lowers what a developer spends, but nothing in the amendments passes any of that saving to renters. The amendments ease the rules for building units aimed at households earning 80 percent of area median income, a threshold the borough’s own packet puts near $80,000 for a single earner, which many would not call low income. They do not require those units to rent for less. The saving shows up instead as a higher price for the land: our valuation of 198 Elmwood found that the value the amendments create would accrue to whoever owns the parcel, not to future tenants.¹² And because the affordable set-aside is pegged to 80 percent of area median income for the whole Philadelphia region, a figure the borough’s own packet placed above six figures, even the units labeled “affordable” miss the households most burdened by rent.¹³

What would help a renter in Narberth

If the goal is to help the 45 percent of Narberth households that rent, the tools that do it are not the ones in front of Council.

Protect the existing cheaper stock. The older rental buildings already housing lower-income tenants are the borough’s real affordable housing, and by-right redevelopment puts them at risk.¹¹ Anti-displacement provisions and limits on tearing down occupied lower-rent buildings protect renters where they live now.

Set affordability to local need. A set-aside tied to a regional median that clears six figures reaches the wrong households. Deeper income targeting, like that of Philadelphia, on more units, tied to what Narberth renters actually earn, would reach households that the current proposal (10 percent of units at 80 percent of area median income) does not.

Add to the supply that residents already support. Accessory dwelling units and ownership-scaled infill drew majority support in the borough’s own survey. They add lower-cost homes without concentrating parking, traffic, and school costs on single blocks. Mixed-use in the 5a and 5b commercial corridors, also supported in the survey, puts housing where the infrastructure and the vacant storefronts already exist.

Quantify the claim or drop it. If the borough believes the amendments will lower rents, it should say by how much, for whom, and on what evidence, for a market this size. An affordability rationale that cannot survive being turned into a number does not belong in the case for a permanent zoning change.

The bottom line

The supply-side case is correct in general and weak as applied here in Narberth. Building more housing does ease rents across a large market, and the research proving it is worth taking seriously. A half-square-mile borough adding a couple hundred market-rate units over several years is not a large market. A renter in Narberth deserves the genuine version rather than the flattering one:

• These amendments will not lower your rent. The units they label “affordable” cap the income of the tenant, not the rent the developer can charge.
• The affordable units are few, and their income limits are set high.
• By-right redevelopment of existing rental sites, which these amendments allow, could raise your costs or force you out of Narberth entirely, long before any filtering benefit arrives.

The people who rent here are a real constituency in this debate, and the policy that would help them is not the policy on the table.

Thanks for reading.

Our Narberth, Inc. is a Pennsylvania nonprofit civic organization engaged in research, public education, and community advocacy on land use and zoning in Narberth Borough. Nothing here is legal or financial advice. We welcome challenge to any figure or source in this piece.