Why Normal Homes Stopped Getting Built | How It Runs Ep 3

Tanveer Nadeem: People feel like they're locked because they're stuck in a 30 or 3% mortgage when they're all, you know, if they move, they lose it and they get to a six and a half percent mortgage or whatever it is. That's one of the many problems with missing middle effectively being banned. We've ⁓ undermined our ability to build communities that are and keep identities of communities, which I think is actually a great thing in America. I think identity practice is to be celebrated and identity practice. politics, which is very different, is to be sworn. But it was pretty typical to discount this like kind construction at fifty percent, ⁓ which if it costs you a hundred percent to build it and you can only value it at fifty, and then you can only borrow seventy percent of that, you'd you're dead in the water unless you're a ⁓ on a trust fund or in credible savings. So that's something we gotta fix. I think the the best thing any practitioner can do young or otherwise is read the damn zoning code. Welcome. This is Michael Walliser. This is how it runs. On the show today, I'm privileged enough to have Aaron Lubeck. They've s he spent two decades doing something most of us have never have done until it directly affects our lives. Figuring out why it's so hard to build normal, affordable houses in a normal neighborhood. He is a designer, builder, and developer based right here in Durham, where he leads the Rocket Shop, a residential design firm focused on building community, not just buildings. He's the author of Green Restorations, Sustainable Building and Historic Homes. He taught sustainable building at Dukes Nicholas School. And back in 2012, he built Durham's first net zero energy home, tucked seamlessly in historic neighborhoods, so you never even know it. These days, his focus is shifted upstream to the zoning codes and policies that quietly decide what kind of housing is even allowed to exist in the first place. He's the founder of Southern Urbanism, a think tank dedicated to better city building across the South, and he spent years pushing for what's called missing middle housing. These are the duplexes, cottage courts, and small lot homes that used to be normal and have somehow become nearly impossible to buy and build. Aaron, welcome. Thanks for having me. Looking forward to the conversation. Absolutely. So, really, you know, ⁓ it's an honor to have you on, man. And I know, you know, we've chatted in the past. One of the biggest reasons why I was excited to have you here is all across the real estate industry, you hear people talking about inventory problems and affordability problems. And at the same time, you know, we have large track builders building stuff. It's not that we don't see permits getting pulled. But it's the people who aren't finding housing where they need to actually live. Do you have any insights on that? Yeah, dude. There's I mean, there's a lot going on there and certainly zoning has been something I've been on a high horse about for a long time. ⁓ you know, Euclidean separations and large lot large, you know, minimum lot size and large minimum ⁓ widths and parking requirements and special permissions, all these things are pervasive throughout the country and have been for, you know, our lifetime. The biggest thing was more of like a a local ⁓ a more recent phenomenon that I think I'm sure you've probably seen as well. You know, the interest rate jumped as a consequence out of COVID. One, you know, partially because we just went too damn long before raising interest rates and partially we flooded the market with money. That really had some perverse consequences for localism, for urbanism, ⁓ and for affordability. The biggest thing is that people are locked in their homes. ⁓ so many people have, you know, 3% rates, 3.5% rates were when they want to move because they want to downsize. I became an empty nester on Saturday. Like I I'm in this mode now where I at least are thinking about it, even though I love where I live. ⁓ congratulations. Yeah. Thank you. I appreciate it. ⁓ but that you know there's a normal churning of where people move to retire, or they downsize, or they move s you know to be closer to their grandkids or whatever, and people feel like they're locked. 'Cause they're stuck in a 30 or 3% mortgage when they're all you know, if they move, they lose it and they get to a six and a half percent mortgage or whatever it is. What that ⁓ that created a huge imbalance between the supply of existing homes, which tend to be a little bit more urban, and new homes, which are o out in the sticks, particularly here in the triangle of North Carolina. So I think the the flooding of the market with with you know. too much cash in COVID was a boon to the s you know institutional tract suburban home builder and a real bad day for those of us who love the city, ⁓ love walkable neighborhoods, love, you know, neighborhoods that have mature trees and all that stuff. And I feel for people who are like where I was 20 years ago starting a family and wanting to be in an urban area, there's fewer options now. There just are and they're harder. So people who really want to live in the city are forced not to because interest rates and supply ⁓ are just creating a challenge. We're just not, you know, we're not building urban neighborhoods, we're not building new urban neighborhoods, we're not building historic neighborhoods, which sounds ridiculous at face value, but I think we should. So no, that's more than fair. And interestingly enough, one of the you know, ⁓ one of the values that a lot of people associate with Durham. Is that they can wake up and walk to the store, walk to brunch, you know, and th there's bike pads, there's up parks. And then when you look at some of the new product that's going in, none it's all drive only. And you're like, yeah. Well, and there's a couple of things that I mean, we could unpack 751 South, which I think is a fant a f really phenomenal story, because it was in many ways Durham's only walkable new urban community, and I'm pretty sure it will be its last because of the hell. The developer was put through to just get it entitled. It was about 10 years of legal work just to get it done. And it promised a central ⁓ commercial core, which still has not been built for various reasons, but has it has a really great land plan. If you haven't been down to it, I recommend going. Tony Cease worked on it here in Durham, so did Dan Jewell. ⁓ and it has it's it's beautiful architecture, small lots, big front porches, a mix of townhomes. Which aren't my favorite there, although there's some new ones going up that are pretty good. But just kind of new urban homes in a pretty good location and it's they've sold out very quickly. It's got a great little ⁓ community center and so forth. But ⁓ we you know, that is really hard to do. And I think there's a there's a a lesson that's not talked about enough is that builders, particularly the ones who want to do better and are who are inherently local, like no one's coming down from DC or Atlanta to come to North Carolina to build a beautiful new urban community. They're inherently local. We remember that stuff. I mean, we remember how ⁓ the developer there was treated with some absolute nonsense in that process. And for the people who could and would build walkable communities, almost all of them, to my knowledge, all of them, are gonna say, I'm not going through ten years of that. Like even if I could make a windfall, even if I could build a best play like life is short. I'd rather play catch with my kid. I'm just not doing it. And so there's a long tail of how the local talent was treated that has a irreparable ⁓ effect on what gets built. And I think it's really bad in college towns and underappreciated. No, that's very fair. You know, ⁓ one of the things you touched on is j I I was ⁓ at the NAR legislative meetings in time to announce the new Road to Housing Act ⁓ up in DC. And one of my you know I had a couple questions around it and you know you know something that Chris and I had also discussed is Just because they changed some of these federal regulations doesn't mean that the independent builder, the person who's actually gonna put this on their cap table or balance sheet, has any interest in moving forward with it. So you know, when when when people come to you as a designer and a planner, that's that's the very first perception that and if someone's lucky enough to end with you as opposed to someone who's saying, Nope, I'm gonna need eight acre lots and townhomes and splitting it up, you know, how many boxes do you fit? I if you have someone who's actually interested in building a sense of community, you're very you know, your your not just anecdotal but lived proof is hey, look it, that there's a very long battle forward and all the local municipalities have to get behind it and build that community trust that if you do put forth the effort of designing down this path, that there will be an outcome or an end result. Because changing legislation is a federal level, kind of. I I consider it irrelevant. I mean part partially it's just like I I'll wait and see, but and I I haven't really dug into the legislation as much as I should. But usually it's when I see things written in vague words like, ⁓ it will encourage better reform to maybe get more housing, it's like that's never gonna make any difference in my life. But and and often, particularly at the federal level, 'cause it's so vibes based and not based on the you know, you yeah, if the if the car the engine is broken, you gotta get under the hood. And figure out what's going wrong. And you can just tell it's really, really rare to find a politician who's ready, willing, and able to do that. And so what ends up happening is people throw money at the problem. And more often than not, in ⁓ big, dumb approaches to housing reform, they end up funding the people who created the problem. And so you just create more of the problem. So that's my default expectation of what will happen with the federal legislation. In fairness, there's There's a potential that it goes a little bit of the way of the the California Yimbi movement, which is really the origin of the Yimbi movement, which is a top-down solution to a top-down problem. ⁓ I think that is antithetical to the way that we do ⁓ construction and reform and governance in the South, which is more grassroots, individualized, kind of scrappy incrementalism. ⁓ but as cities are becoming more sclerotic, less functional, and having creating affordable housing problems where none should exist, we're starting to see state preemptive work. And some of it good, but definitely the preference would be like, it'd be great if we just fix that at the local level, or if our builders or property owners or citizens, in the case of ADUs, just had the right to build some decent housing when they want to build some decent housing for grandma or their kid or whoever. And so I, you know, th there there can be some good top down reform almost always. It's not in What has to happen, it's actually imposing a restriction on local governments to pre prevent things from happening. And that's often misconstrued by like the American Planners Association often misrepresents that. The municipal leagues often misrepresent that. ⁓ Look, local governments can't tell people that they can't build a granny flat anymore, just can't do it. ⁓ that's gonna be the next few years of reform. Well, ⁓ hearing that from your mouth gives me some hope that there, you know, that something positive will come from it. Sure. ⁓ the I had a phrase pop through my little A D D brain, and that is like the lashings will continue until morale and the beatings will continue. Yeah. I think there is some of that, and I s I know that there's sort of there's some old school ⁓ sort, you know, bro broad brushing as left planners that really like thrived in the central planning world where people with high credentials and, you know, low experience get to dictate where everything goes. And it's sort of like a Sim City approach to the world. You just think like, ⁓ you get a software and you get to say, Michael gets to build things over there and Bob gets to build things over there. That's not really how the world works. But that, ⁓ A lot of local planning has been top down. ⁓ very you know, a lot of Euclidean zoning was pre zoning land before it had any use or even stripping rights after it was built, which is very centrally planned. ⁓ that crowd who believes in that system has had a pretty rough decade because of the YMB movement and I do think that they f they kind of feel like, well, the beatings are gonna they're people are telling them the beatings are gonna continue until morale improves. Yeah. No, that's ⁓ That strikes home, man. It's it's something that I you know, I I as I mentioned earlier, I know I've spoken with you on on my version in an attempt ⁓ to to see where this would go. And it's it it gives me hope that something positive is gonna come out the other side. How do you ⁓ y you know, you mentioned statewide ADU reform. Do you like have any insights on on what you think that that will do as far as governments and laws? And then a second part of that would be How much public adoption are you seeing even right now as it's becoming more accepted in different areas? Yeah, it's got two two different issues. I mean, I think the the public adoption is really citizens deciding to build a bedroom and you know in a kitchen in their backyard. And that really happens at the most personal personal levels, typically at family dining room tables between spouses, right? Rather than with a planner or your state senator. Right. ⁓ at the the state level. ⁓ my understanding from my design partner Jen Truman, even though there's been some celebration that the ⁓ ADU bill, I think it might be four nine five, was moving forward, it was basically watered down into nothingness. Like I think it has a threshold where it only applies to cities over a certain population. And at that point, those cities, you know, which is probably Raleigh and Charlotte or whatever, already have ADUs legal anyway. So statewide ADUs is not actually anything and it's totally ⁓ a vibes based ⁓ thing. Speaking of which I was working on a ⁓ reworking the North Carolina state motto. Do you know y you know what it is? ⁓ yeah. So I have a fun translation for the and that is ⁓ It is. It's easier to do e easier to seem than to be, I think is a closer transaction. ⁓ but my my translation to that is don't talk about it, be about it. Yeah, that's right. ⁓ so we could we could go on and on of that, but I I redid the seal ⁓ via AI art this morning just to because there is so much of that legislation where it's just like, Okay, that's a statement that's totally meaningless, so it's to be rather than to or to seem rather than to be. And it's like, you know, w when people call the That should be called out by all the practitioners and all the journalists and all the advocates, whether you want ADUs or not, we should say, like, okay, like passing a law that literally doesn't change anything. Let you know, let's not do that. Like and yeah, and I and almost certainly ⁓ I exp maybe maybe City Builder will cover it, but I doubt any journalist in the state will actually cover what it was, which is nothing. ⁓ anyway, it's I I do think, you know, so let's talk about the Lillingtons and Sanfords and, you know. ⁓ impoverished Appalachian cities, why on earth anybody would restrict somebody from building a shack for grandma in the backyard or for all for an Airbnb unit. Who cares? ⁓ is beyond me. And it's I think it's anti-North Caroline and anti-American and anti-human and so forth. So I do hope those come up. I mean we see, we'll get into it. I know ⁓ there's so many people who want to build ADUs for policy reasons. ⁓ people Who ready and willing can't because they can't get lending on it, ⁓ which I think is a complete own goal of ⁓ the G S E underwriting. Fanny and Freddie underwrite their pot their products. They're not very friendly to detached accessory dwellings. And Portland did a study, it's probably ten years old now, 'cause they just had a huge boom of ADUs out there. More ADU permits than detached single family homes in Portland. ⁓ wow. And I think LA's the same, if I'm not mistaken. So there's a like can't understate what a boom it is. but they they noted it really the only people who were building ADUs were people who could afford to do it in cash. And so it became, I don't I wouldn't call it like the rich get richer, because I think so many people do it for personal reasons. Some do it for their own home office or a place to do yoga. It doesn't mean that it's like a housing unit to maximize profits, which is fine. but I I the fact that So many people wanted to do it and they couldn't because they can't get financing. usually cause ADUs are are are discount or detached structures are discounted by the appraisal industry. Back when I really dug into it, it was pretty typical to discount this like kind construction at fifty percent, ⁓ which if it costs you a hundred percent to build it and you can only value it at fifty and then you can only borrow seventy percent of that. you you're dead in the water unless you're a ⁓ on a trust fund or in credible savings. So that's something we gotta fix. I don't think it's that hard to fix, but I also don't really know anybody who's working on it. No, one of the things you mentioned is like ⁓ a hundred percent, you know, it like kind costs to build, but what I'm seeing in a lot of ADUs is like ⁓ a hundred and seventy five or two hundred percent cost to build ADUs in some cases. ⁓ per square foot it wouldn't shock me, just because they're so small and ⁓ and again, under a certain square footage, the dollar per square foot is just like not a useful metric because if you're building a six hundred square foot unit, you still got the kitchen and the bathrooms and permits and whatever else. ⁓ but yeah, it wouldn't shock me. And I know, you know, there's all sorts of people trying to innovate here. I think, you know, stock plans are a big part of it. So you don't to spend thirty grand on a set of construction drawings for a hundred and fifty thousand dollar building. ⁓ you know, we license plans for fifteen hundred to two thousand bucks usually and then the, you know, whatever customization it's incidental to it. I know that there's some prefab stuff which I think has been hit and miss with their success, but just certainly from a if you can access the space just to like, you know, it's difficult to stage for ADUs. It's just difficult construction to get materials back there and run lines and everything's sort of tight in Manhattan like with just running a sewer line and so forth. ⁓ and I think like Barry Bialik, who he Barry's a guy you gotta have on your show. ⁓ he's a journalist turned ⁓ brewery owner in Asheville. He owns the Thirsty Monk and now he builds the majority of Asheville's affordable housing. He actually builds and he does he does wall paneled construction. ⁓ so he builds the walls in the factory, brings them out to the site already assembled or or the wall assembled, and then he dries in with the roof and everything in a day or two. And he's ⁓ building more in Durham ⁓ here and ⁓ and so that's that's a possible way to get ADUs done less expensively too. But I For the most part, I think we've all learned that, you know, stick building's still the cheapest, typically. Like all the the people to build a better mousetrap have mostly failed. ⁓ and it's really a financing issue. I d I think people if they could you know, depending on what you get for an ADU, I've seen them as cheap as eighty grand, I've seen them as much as four hundred grand. the issue is not the cost, it's the financing. I mean people People can kind of, you know, shoehorn into what size they need, but there are people who are qualified, ready, high credit score, jobs, you know, you know, all the stuff that you need. They just can't get a loan because there's no underwriting ⁓ product for them. And it's been like this for you know, ⁓ probably since two thousand eight. Yeah. All right. Yeah, you you ⁓ I I think that shines on something that I I actually had a discussion with another broker during lunch and we were talking about like financial redlining and I realized that that's like ⁓ redlining is a is a taboo word. We you know we we said that we fixed that. However, when you look at it, when someone's able to build a granny flat in the backyard or to build an office or whatever that is that they need to get them away, if that does buy them the ability to even work from their, you know, work from their house instead of having to commute 30 minutes to and from the office, whatever that is. That that in and of itself creates a barrier to that lifestyle or change or future earnings, whatever that might be. Yeah. That without having that cash, that you don't have that as an option. It hurts families, it hurts, it it undermines community wealth, which we think of somebody in the building a house in their backyard doesn't add community wealth, but it really does. ⁓ Chuck Chuck Morone talks about this is that all the property in your city should be seen as a mutual fund for all the city, all the citizens of your city. And whether you're a billionaire or homeless, you still benefit from that tax base because it's all the parks and services and police and schools and whatever. And so when somebody builds a two or three hundred thousand dollar house in the backyard with no subsidy and no cost to the city, but ends up creating a thousand or fifteen hundred dollars a year into the tax coffers. While providing housing, while creating a wealthier family that then can participate in civic stuff, while that city that citizen invests in the city so they feel more vested in it, whether because they're actually providing for other human beings or they're actually literally more invested in it, all these things are kind of unquantifiable. So it's not just like, hey, does the performer work? It's there's just this slew of societal benefits that come from citizen builders, ⁓ incremental builders. And this is sort of the most personal and humanizing is somebody who's not a builder building a house in their backyard ⁓ for the benefit of their community. I mean, and it's ⁓ it's it's you can almost kind of extrapolate what does the city look like with a hundred of these or a thousand? Like just what is how does society change and how does that interaction work? Like friends of mine built one of Durham's first duplex ADUs, one of the few cities in the country where you can do a duplex ADU, right in the middle of Trinity Park. you know, one of the wealthiest neighborhoods right next to Duke University. And there's two five hundred square foot units there on a beautiful street where the homes are probably a million dollars or so, plus minus. And so there's two people who can live in an amazing neighborhood close to coffee shops, close to downtown, close to Duke, that could have never happened had they not done that. Again, you can't put a you can't put a price or a value on it. There's a qualitative thing that matters. Yeah, and and so that that brings up ⁓ another another feature of that. And when you look at the classic American dream of being able to like overall raise your economic status over time and that that that economic migration that we say is the American way, there's been several studies that say people who lived in economically diverse neighborhoods have higher levels of ⁓ upward economic movement because you get access to the person who owns the store. You get access to Yeah. Yeah, I mean this this was a there's a really great book that you'd love called The Paradise of Small Homes. I think it's called Paradise of Tiny Homes. I think it's Paradise of Small Homes. Brilliant writer out of Portland goes through ten different cities in America and and talks about how, you know, Philadelphia had Trinity houses, there were alley houses, ⁓ Los Angeles has ding bats, which are horrifically ugly, but like were Los Angeles' affordable housing thing. ⁓ ⁓ Portland had duplexes, Chicago had three and six or the triple decker in Boston, Chicago had six flats. I think they used the example in Chicago, so many of these were built in ethnic neighborhoods where there was exactly what you talked about, the wealthier member of the Italian family in Dorchester, Massachusetts, the Jewish family in Chicago, they'd own the building, but they'd lived there. Like this was kind of what's what's less common now. Although in with the ADU situation it kind of It's still very lived there. ⁓ less wealthy members of their community who were perfectly functional. We're not talking about destitute people, although that could happen too, also lived in the building. The the more privileged people supported them and and then there was a sort of symbiotic relationship to lift uplift the communities. This was how generations of immigrants assimilated into America on this this plan. So it gets into sort of ⁓ I don't want to jump the gun into the missing middle conversation, but that's one of the many s ⁓ problems with missing middle effectively being banned. We've ⁓ undermined our ability to build ⁓ communities that are are and keep identities of communities, which I think is actually a great thing in America. I think identity practice is to be celebrated and identity politics, which is very different, is to be scorn. But but to have, you know, a little Italy in a Chinatown or in in Asheville, a river arts district, doesn't have to be an ethnic nationality. There's people who have a practice or a hobby or a profession or a culture or a nationality or ⁓ an a an activism or something. You can create communities that aggregate together and create sort of betterment for that micro community, but also the communities adjacent who kind of might not be a member of that community but benefit from being around it because you can go on a date and go to hang out in the in their community or go to their, you know, art show or their the the diner or bar that's just sort of interesting to be around. And so through the last fifty to hundred years of sort of Euclidean separated planning and car dominated sprawl, ⁓ we've gotten rid of all that. It's not really possible to aggregate a community. And a lot of these fights for urbanism and, you know, property rights are about the ⁓ the right to build these communities back for people who want to. Yeah, communities that once existed. And I think that's ⁓ a place where we get lost sometimes is people, you know, in conversations, I've had people be like, Why are you trying to reinvent how all of this works? And my reply is like, Have you ever visited anywhere outside of the US where you know infrastructure is more than 100 years old? Like, this is how communities exist. Yeah. The guy who owns the bakery lives there. You know, the guy who owns the the the faux shop on the corner also lives there, you know. And at the same time, you mentioned like the comic commingling of either ex either inside that community or externally, is because people of d varied economic classes would also have their own relationships. And so if you you're able to take one community that has commingled economic statuses, and by giving one person access to the top over here, their network also inherently gains a second tier access. And so there's huge knock on benefits even beyond just that neighborhood itself. And ⁓ and we've missed a whole lot of that. We We did a good job ⁓ succumbing to I I I say this with a heavy heart only because I am a car guy. I love cars. but we so succumbed to a lot of lobbying that ⁓ driving distances would become irrelevant when we could travel a hundred miles an hour everywhere. And you know, ⁓ in order to get a hundred miles an hour all the way across the state, you have to pull those a couple of communities and Inevitably we wonder why how we lost the sense of community and it's like that. That's right. Yeah. There's there's a great book by Matthew Crawford called Why We Drive. Are you familiar with it? ⁓ I'm not, but I'm now adding it. I'm taking the reading notes list as we do. Even as somebody who's not a car guy, like I I'm mostly indifferent towards cars. I'm not like opposed to cars. I certainly benefit from cars like almost all Americans. ⁓ but this is an amazing essay because it's so contrarian, like all of the, you know. literature out there is cars are bad, suburbs suck, you know, walkability, blah, blah, blah. which mostly I subscribe to. But, you know, but it dismisses like, hey, I do use my car. Like I like taking my kid to the baseball game and it would kinda suck if we have to bike there and it like it's you know, it's efficient and all these things. but he gets into there's a again, on the qualitative thing, which is always discounted in the modern world, the personal agency that comes with driving. that you can actually you can go on a road trip and you can just get out of the city and and see things and it's the the ability to kind of drive a machine and the the self worth and agency that you get from that is actually pretty remarkable. He also talked about the generation really before ours, because I think we're probably at the similar age. Guys who grew up in the seventies, they freaking tinkered the cars, man. And like that and it kinda everybody did. You didn't have to be a gearhead. You you just ended up drinking a beer and tinkering with the car. And if you grew up in the eighties, he ⁓ Crawford talks about, you know, now the car just has an idiot button that says you gotta take it in for service and you couldn't work on it if you wanted to. And so for a while, the nineteen seventies cars sold for more than the nineteen eighties because guys had this urge to tinker and make it a little bit better and can it kind of it's a competitive thing, but it's also ⁓ it's a betterment thing. It's a quest for to try to, you know, improve the world or or machines and so forth. And so he says there's something lost when, you know. One, you know, you lose the stick, you lose the ability to fix the car, now it's gonna be self driving, like there's something that's just lost about humanity if everything's done for you. Like at certain point, what's what are we doing here, you know? And ⁓ you know, it gets to it like it's around the corner. Like we already have like you'll be driving through Manhattan with a driverless car and it's gonna the car is gonna say, Michael, we know you were looking at those boots ⁓ at, you know, Bath's Pro Shop and they actually have some available around the corner. Would you like to stop? And There's a creepiness to it that's just like, you know, not to be Ron Swanson about it, but you kinda wanna throw the whole thing in the trash. Yeah. I will say, ⁓ full self drive is pretty impressive. The people who doubt it, I think, should experience it. ⁓ but it does feed into the bubble concept, right? If we live in these disparate suburban environments where we get out of our house bubble NAC into a car bubble where we don't even have to interact with anyone else. Like the amount of road rage that we have, ⁓ Towards others just by being in a car versus walking down a sidewalk. There's I I I I fail to pull up the study now, but there is that I I I read about it in New York Times, I believe, and it was talking about how you can walk down a sidewalk in sever semi-close vicinity of people, and people will pause, slow down, work through their work their way through. However, you put people in a car and it's like, hey, we've got a gun. Yeah, it's I mean Jane Jacobs called it the sidewalk ballet, right? And you just have these these spontaneous interactions. That make a city. And it's it's the reason why New York is so exciting to go to. You just never know what you're gonna run into. Around every corner, it's just interesting, ⁓ not boring. And that's and there's a there's a drive and sort of ⁓ you know, an energy that comes to it and excitement about humanity when when everything is perfectly predictable and perfectly safe and nothing unpredictable could happen, life's flattening and kind of dead, and you know, ⁓ the at its extreme, which it's unfortunately pretty normal right now that what we're seeing with ⁓ loneliness and deaths of despair are very real. They're they're hitting our young men more than anybody. ⁓ there's a purposelessness towards life when you take away agency, particularly of young men. And we're seeing that show up in in drug deaths and suicides and so forth. And I think so Crawford, I don't know if he ties this directly, but like you can only take away so much agency. You can't fix the engine, you can't drive the car. You can't say this, you can't say that. You have to you're put in a box. It it's depressing. And ⁓ I you know, I think we have to look for those those little ⁓ spaces where we can be alive and human because the modern world is just taking away those opportunities at every turn. I do believe that. Yeah, no, I it's it's something that ⁓ just as far as technology and research goes, we've we've seen a couple different ⁓ Anecdotes of the same thing of like, hey, great, even if ⁓ I I'll touch slightly on the subject, but like even if AI isn't gonna take your job, someone using AI will take your job and it's like, okay, great, every people are gonna be more efficient. Where are the next people that we're training how to have that agency going to get those skill sets? Like, when are they going to look at CAD drawings? When are they going to have to meet and shake people's hands and drop stuff off and get to know what that means to have community and business and ⁓ and as someone who works in this, like I get it, there's a bunch of advantages. But also we need to think about how are the people who don't already have some of the skill sets and don't who already have the portfolios, how do they get that? You know, how do they move up to the I think it's changed a lot since we when we I was in college in the mid nineties. And back then it felt like ⁓ actually it's another book that Matthew Crawford writes that ⁓ is really my favorite called Shop Classes Soulcraft. It's based around the thesis that most most of kids our age were told by their parents, hey, you gotta go get a college degree, because if you don't get a college degree, you're gonna have to work with your back and not your brain. Like that was basically what we were sold. And Crawford's kind of pointing out, like, hey, not only is that not true, but in many ways the opposite is true. Like the people with the boats go into the lake on the weekend are the H V A C guys and the plumbers. You know, and and there are many people, I mean, I think a lot of this DA movement or I'm sorry, DSA movement is, you know, what's been termed downwardly mobile people who grew up privileged, went to elite schools, were promised they would have great elite jobs and they're doing worse than their parents and they're jaded because they were sold a bag of goods and the plumber and the H V C guy make more than them. So ⁓ I think there's the ⁓ the idea that, yeah, the tradespeople have agency and you know, that that we need to ⁓ in the modern world, the people who are doing welding and doing artwork ⁓ are gonna be the ones that ⁓ have more value because they can't be AI'd out really. And that's changed since the nineteen nineties. I mean the nineteen nineties I think the trades guy made less and the the person with a mediocre degree from a mediocre college made more. It's just not the case anymore. ⁓ and the me the mid mid mostly an undergraduate degree prepares you to be middle manager at some corporate entity and that's at risk of being AI AI'd out. So I, you know, I think anybody going to college now should have should think long and hard about what they're trying to do. ⁓ because the certainly the trades are relatively AI proof. ⁓ there are some other businesses that really aren't. I think ⁓ or I think lawyering is really under threat of AI. Obviously journalism I think is under threat of AI teaching. ⁓ so forth. ⁓ so this this is I want to play a counter argument to your journalism might be affected by AI. I think that news is entertainment ⁓ is probably at risk. However, actual journalism is I feel like less likely to be influenced by it because it requires someone to be critical and come up with a unique idea. If you're talking about functional research, AI is great. it can regurgitate information incredibly well. Like for all of the news channels who are a A P press news regurgitator, they're probably at risk because you can tell that same story twenty five different ways and target it against your audience. Great. But actual journalism, I think Possibly a lot of people who are only making news because that's their only path forward in the current industry, ⁓ are going to go to actual journalism and research and discovery. And the same as we're seeing an increase in like this long content, you know, kind of podcasts and interactions like this. Everyone predicted that, you know, Instagram shorts and TikTok would just drive people down an infinite cliff. And we've seen kind of a case shape bif bifurcation in that as well. You're you're seeing YouTube videos that are two hours at a time now. Yeah. So there's a couple things there. Yeah, I we think we agree that like traditional these are the facts, this is what happened. Journalism is just torched. Like it's done. Anybody going into that right now is an idiot. Like that is you can ch you can train an AI now to go listen to a YouTube city council meeting and can summarize it pretty well. you know, they ⁓ to put a pen in this, ⁓ Duke University's Sanford School, which kind of has a journalism little wing of it, ⁓ c did an experiment in this last year. And they have a student publication covering Durham called the Ninth Street Journal. And so they did the 10th Street Journal, even though that's not an actual street in Durham, ⁓ that was only AI. And they they were pretty open about it. They're like, this is early AI. And we're like, we're gonna see what happens. We're gonna we're gonna at least check what the AI comes up with for factual accuracy, but we're like, we're really not writing it and and see what happens. And it was like, it was boring. Right. But like local news pretty much is born. It's like, hey, this is a rezoning that came up. This business is about to open. This person won the softball league. I whatever. I don't know if they had that. But it was it was the kind of thing you could flip through for three minutes a week and be like, ⁓ that's kinda interesting. I could talk to my spouse about that at dinner and feel like I know what's going on. ⁓ it was so obvious to me after reading Tenth Street Journal, like local journalism is torched. Like there is no need for a human to do and there's no ability or space for a human to do that anymore. So there's a we differ somewhat on like what the definition of then journalism is. There's I think that they're what you were describing, I would describe as as opinion pieces and people actually making cases and so forth. ⁓ some people don't fit that under journalism necessarily, but certain certainly ⁓ news as entertainment often is that case making. Certainly a Fox News or MSNBC is doing that at the the national level. I'm incredibly bullish on the Substack rev revolution. ⁓ Which is ⁓ and I would I would double down on what you're saying more specifically. Podcasts like this and Substack have a huge differentiator from the J School kid who may or may not have any expertise but is just writing every week on something. The Substack in this podcast has people who know what they're talking about. It's first person storytelling. So that's new where you have people who are in the trenches, who are vested, who have real-world experience. And there's a mess of it out there because there's so much of it now and you have to, you know, filter through noise and so forth. But you can you can get a lot closer to the truth through first person storytelling. It's actually as messy and at times crappy as Twitter is. For most of the last 10 years, when something big happened and you wanted to get the what happened quickest, Twitter would probably have it. It has some BS too, but you could get to the thing. And partially because it was first person, it was people who were there who are direct to consumer. ⁓ and and telling it. So I I think that that's the bullish thing that I'm on. And the the the j local journalism where you're paying somebody to kind of synthesize news, I don't think it's sustainable anymore. ⁓ it happens in some instances where like actually Asheville's got a pretty interesting ⁓ one where they aggregated a couple of old school journalists who get paid. They just did a story that I was quoted in for the single stair bill in North Carolina. But it's like good journalists who have the ethics and the know how and they crunch difficult stories and they crave the difficult stuff. ⁓ but that's all like sort of funded by foundations and individuals. But like the advertising model, the activist weeklies are I not a business I'd want to be in. Yeah, no I agree. I I I do agree we're on the same page there. ⁓ and yeah your sub stack is great. There there are several people whose ⁓ who I regularly try and follow I get your I get the newsletter as well. I don't know how directly behind that you are. Which one is that? The ⁓ the urbanism. It's the ⁓ hold on one second. City Builder or Southern Urbanism? City Builder, yes. City Builder's Jen, ⁓ which is a C four that's got that's really exploded in the last year since it started. ⁓ I think has probably pushing four thousand subscribers now. But ⁓ I'm really proud of what she's done with that. And a need to kind of there isn't Most states have a pro housing voice and North Carolina didn't. And so that's quickly becoming that. And it's been very active in a lot of positive conversations. And J Jenny should have one for sure. I mean, she's a great interview. Awesome. I yes, I'll have to keep that in mind. Yeah, and that's ⁓ a little touch on what we're doing. That's that's the blogs and long form content is the other reason that we built that into our operating platforms for brokers, is just because we see a whole lot of people like, Yeah, I made TikTok and Instagram videos all day and you're if someone saw it once, they can't even find it again. Like, where is all of this work that you're putting in going? You're much better off sitting here and being like, I woke up and I went to coffee in this place in this neighborhood. This is what it costs. This is where I drive to. This is where the park is. This is what the pool is. This is how busy it is at the pool. And like if you're the expert in a given area, people will will follow that. You know. Yeah, I think that's right. Yeah. Yeah. It's it's there's it's an old phrase by a mentor of mine, Monty Anderson. Who's one of the founders of the Incremental Development Alliance, and his old fra catchphrase is find your farm. And the we talk about a lot in training, but your farm, whether you're a realtor, a builder, or whatever, should be an area definable enough that you're the expert in it. And it can be geographic or it can be a type, or maybe you specialize in ADUs or you know, Main Street buildings or whatever, or you specialize in Garner, North Carolina. But whatever it is, if there's other people who are know more than you, then shrink your farm. And so, and if you it doesn't take too long to establish it, I mean I've coached a lot of young career folks who are kind of near it. And I'm just like, find the thing that within six months you can establish yourself as the expert. I don't care, it could be duplexes in apex, whatever. Meaning that in 12 months, if somebody has a question about that, they're like, ⁓ no, you gotta call Jimmy. Jimmy's the duplex guy in Apex or whatever the farm is. It's just not hard to find what that is because you can just kind of Create any sort of combination of geography or housing type or whatever. And then you can be the guy. You know, that then we got that all the time when when I started with Trinity Design Build, and we were sort of the historic restoration contractor who also spoke green building. And this was in the earlier days of modern green building movement. ⁓ And so because people knew that. If they, you know, we had ⁓ progressive Duke professors who were taking on all the many, many old houses that were un renovated in Durham twenty-five years ago, twenty, twenty-five years ago. You know, we might not get the work, but we were gonna get a call. Right. Yeah. So so and I think that's what any young person should look for. Like just become the best at something. And it and and it's not hard to if you don't have any skills, just shrink the box and tell, you know, read everything in that space. Or you're in a market, know everything that's for sale in that market. It's just it's just work. It's not like it's all that difficult to do. Yeah. No, that's absolutely true. ⁓ that's absolutely true. I if I could, if I could go on to like I realize you've dedicated your a lot of your career like to this kind of triangle market. Do you mind if I ask what you know what what kept you focused here? Yeah. ⁓ I know there's some other places in the country that you've mentioned have had kind of this resurgence. a revitalization of you know the kinds of communities that you're interested in building. But what what ties you so much to this region and makes you want to push it forward here? Yeah, it's a great question. I've lived in a a lot of different places. I kind of grew up as a professor's kid. So I was ⁓ you know hopping around. My mother was a late blooming academic. So we went to grad school and fellowship and tenure track and all that. So I've lived in seven college towns, which is kind of nuts. and ⁓ Raleigh Durham always felt like home. I grew up partially in Chapel Hill. ⁓ lived in Ann Arbor as well, which is it's extraordinary town. ⁓ but this always felt like home and I you know I my family roots date here back to nineteen eighty-four, ⁓ which is, you know, a long time ago now. ⁓ but I've loved the the spirit of it. I loved, you know, the state motto which we were joking about before the call. ⁓ that it's really there's a practicality to being a North Carolinian North Carolinian traditionally. It's like we actually do the stuff. We're not about vibes. I think that in many ways that was a ⁓ a cheap shot at our northern and southern neighbors, which were always a little bit more highfalutin. We were the backwater that that ⁓ was more fragmented and didn't have grand plantations and everything. We were, you know, through through the Civil War ⁓ and revolutionary area, we we were just kind of didn't have enough mass to be anything that was big. And I appreciate that about North Carolina. It's one of the reasons the triangle is a great place to practice. ⁓ is that fragmentation? ⁓ because we're not one big center, I think that's actually a great benefit. ⁓ that keeps, you know, a big received like New York or Chicago, what they've gone through become almost unmanageable because they keep doing big, dumb things because they're big, dumb cities. And we're just not capable of doing that because it requires coordination of 17 different entities. And actually that's a good thing because it leaves the the ability to build the city back to the people. To the citizens and and like it or not, that's how North Carolina was built. I think that's how North Carolina will continue to be built. And it's just a great opportun you know, to work in a place that is growing is really great. I have friends that rehab houses in Detroit and Buffalo, which for the most part aren't growing. It's a different game. There's amazing homes to rehab, but you know, to have an economy that's sucking wind is just harder to work. ⁓ so that that there's it's a blessing to have an an endless flow of people coming here who see the same things that me and you see that they love it. It's great universities, great nature, ⁓ great people, relatively affordable. And so just to have the energy and demand is a blessing and then that creates an obligation to, you know, create better places, which is what it's all about. No, that's huge. And I One of the big draws for me as well is like even if you look just here in the triangle and before you even go to the triad, having ⁓ kind of like you were saying, a few balanced ⁓ municipalities, all with kind of their own equal levels of force or their own ⁓ value to bring to the conversation table, keeps us from doing big dumb city things, you know? And because you have the different incentive bases, you have the different power struggles, and that push and pull is kind of the basis of democracy. It's not like Knowing what the right answer is. Yep. Yeah. And everyone's kind of vying for that boundary. Who has excess utilities? You know, you look at what like Sanford and Lee County did, right? They way overbuilt on their water supply and then they're like they use it as a negotiation tool for everyone around them. They're like, Oops, we have a bunch of extra water. Who would like to develop? ⁓ conveniently we can help you with that. Yeah. So you know, it's what it's about. I mean, it we get down to it. I mean, it's sort of this the old story of capitalism. Like you have to i in in the sense that it turns on its head from the stereotype of it, it's this it's the most selfless of the systems because you have to provide something of value for somebody else. Otherwise you won't eat. So you know, Lee County provided something that other people needed and it's like, Well, we're here, like we it'll cost you, but like we did this because we thought it was smart and Happy to help and let's do it together. Yeah. And now we can bring value. Very good. ⁓ yeah. Aaron, this is phenomenal. I ⁓ I do have one last thing, and that's just just for the benefit of the listeners. I'm gonna touch on you can you can t answer it however you want, but like as someone who's in the real estate market today and they're interested in, you know, what they should be doing, what's the first thing that they should do in understanding like what about ADUs or the real estate market or development market? Should they be asking that they haven't yet asked? And then also like what effect do you think you see ⁓ kind of like zoning taking place and some of these zoning ch ⁓ changes that are taking place? How do you think people should be positioning themselves or thinking about their longer term ⁓ output because of some of those? And I realize that's a little bit of a crystal ball, but sure, and and two questions. I mean, I think the the best thing any practitioner can do young or otherwise is read the damn zoning code. I mean I'm shocked how few people have. ⁓ it's an awful read. It's ⁓ if you struggle to sleep at night, it's great to have by your bed because it'll help you snooze. But you know, it is the rules that govern what we do. ⁓ and I've seen ⁓ the vast majority of clients we have are probably about half are professionals and half are, you know, just you know adjacent to the profession or just ⁓ citizens try wanting to build housing, have never read the zoning code. I mean, cover to cover, ours probably takes eight hours to read. You can probably understand seventy to eighty percent of it just with normal reading comprehension, and the rest you can ask questions about and generally figure out what you could b how big an ADU, what are the setbacks, what are the height restrictions, is there a parking requirement, all those things. But I've been amazed that I my guess is the vast minority of planning commissioners have ever read their zoning code, which they are ts are tasked with passing judgment on on a monthly basis. ⁓ I bet a substantial number of the planners that are working in North Carolina ⁓ have not read their zoning code, which is mind boggling as well. But we see things all the time that, you know, ⁓ we're told we can't pull a permit because of XYZ and we're like, we have to point out in the planning code, no, it's not actually what it says. Here's what it says. So read it. ⁓ it will allow you to be a more ⁓ professional professional and you'll be able to see opportunities where no one else can. And ⁓ that's I think a big part of ⁓ you know, progress. I've totally forgotten your second question. ⁓ No, you're all good. ⁓ can I segue on this a little bit just because I wanted to say Durham's UDO, the interactive downloadable UDO is great to be able to go through and it allows you to chart between different things. I realize that like Wake County ⁓ doesn't I I'm not as much of a fan of Wake County or Chapel Hills, but are there other similar resources for Outside of Durham do you think match the Durham County ZDO? Well, it's about to change too, because there's about to g there's they've been working for the last two years on a rewrite. So I and I how it's accessible how it's accessed, I don't know ⁓ what's being planned. I know I mean that you can download a PDF, but there's also just like the you know, the web pages that I think is what you're talking about. It is helpful because it's sort it's relatively searchable and I've kind of got a booked mark to you know, chapter seven is eighty percent of what we use, so I can get to it pretty quickly and so forth. ⁓ So I don't know. I mean, I think that there's a there should be an obligation to radically simplify zoning. And basically nobody's doing that. Like we're there's some things in the new zoning code here that I really like. There's some things that I don't, but not you know, it it was 16 pages in 1927, and it's probably a thousand to two thousand pages now once you count all the ancillary books and so forth. And so I do think at some point there will be a radical effort to simplify zoning that will succeed, but we're not we're not there yet. And they're they're too big and bulky for sure. Yeah. And the what was that second question? Give it to me again because I had a thought on it. ⁓ so the first one is if they're running a business, what do they need to do ⁓ in order to better educate themselves or understand what they're doing? And then the one that you I think you did answer was about zoning. Yeah, I d ⁓ I think or to to prepare for what's happening in North Carolina, I mean our practice, the vast majority of clients that we have are designing some form of like commun intentional community oriented pocket neighborhood. ⁓ those can work at any ⁓ section of the transect, which is a new urban principle for like T six is downtown urban, T one is rural, most suburbs are like T three, walkable communities, T four. But you can design a pocket neighborhood of typically four to sixteen homes around some common amenity. can be a grassy field, could be a soccer field, could be a you gazebo, could be a French bread oven or whatever. More and more people are doing that. And I think ⁓ in this modern world where we're so disconnected, we're I I used to talk about loneliness and think that it was a trite topic, but now I really believe that there are so many people who are craving connection. And from Instagram to TikTok it separates us and people want to be around humans and live again. ⁓ That desire, that demand coupled with a supply that's now coming online through a series of statewide and local zoning reforms is really where there's going to be a lot of development opportunity. I think it's a great thing. I mean, this is just definitionally higher quality development. ⁓ there's a long history of building these communities. We give out to our clients, I think I gave one to you, Michael, ⁓ Ross Chapin's book, ⁓ Pocket Neighborhoods, because it basically describes the history of them. They're just beautiful places and they're slightly different from Denmark to Seattle to Los Angeles. ⁓ but they're they're just high quality, affordable, lovable places. ⁓ I think that's where we're getting back to. I don't expect, you know, production builders to buy into it, but ⁓ infill stuff, ⁓ s local local folks, I think that there's just an incredible opportunity to build better places that are attainable, affordable, ⁓ possible. that that's gonna be our future. No, and that's awesome. I if I'm hearing you correctly, that also means that there's going to be a resurgence in demand for that local independent builder or developer as well. So for other people who are within the industry who have insights, there's going to be access for them to actually carry more weight and value within their community. awesome. Awesome. Well, ⁓ guys, everyone, I think this is how it runs and we look forward to seeing you next time. For now, thank you very much. Thanks, Michael.