Effective Zoning Reform Isn’t as Simple as It Seems

Yonah Freemark and Lydia Lo | Bloomberg

The Biden Administration’s Housing Supply Action Plan, unveiled last week, aims to help close America’s shortfall of almost 4 million housing units and subdue the nation’s skyrocketing home prices. At the top of its list of action items is a promise to provide federal grants as a reward to communities that alter land-use policies to promote density, an approach the administration is already piloting.

But identifying the land-use policies that most effectively add housing is harder than it seems. Mounting evidence indicates that one-off reforms such as eliminating single-family-only zoning aren’t adequate. To make meaningful progress in building homes, municipalities have to do more.

The Biden plan doesn’t detail how it will determine which types of policies will make a community eligible for these federal grants. But to meet the administration’s housing goals, we recommend it require that local governments seeking grants both show that their zoning changes are actually producing additional housing units, and also that their reforms include the full array of land-use policies that affect housing affordability.

The requirements for these zoning reforms must be tailored to different jurisdictions’ unique circumstances, because a one-size-fits-all strategy won’t be effective or equitable.

The Limits of Zoning Reform

The most popular land-use reform strategy now discussed is changing zoning rules to allow for the construction of small-scale apartments. That’s a good step forward — but it will not increase access to housing unless those units get built.

Consider the example of Minneapolis, which voted to effectively eliminate single-family zoning citywide in 2019, allowing landowners to build two- and three-unit apartment buildings on land previously off limits to anything other than individual homes. This change to base zoning — the use and form restrictions that determine what can be built as of right — expanded the permitted variety of buildings and density of units.

The policy was lauded by scholars, policymakers and the press, who pointed to the rule change as a key mechanism to increase housing construction, reduce costs of living and ease residential segregation.

Unfortunately, evidence thus far points to little progress in achieving any of those goals — at least as a result of this policy. Between 2018 and 2021, according to city data, permits for small apartment buildings doubled, but only to 81 total housing units in those types of structures — a tiny figure in the context of the city’s 180,000 households. At the same time, prices for single-family homes on lots affected by the zoning change increased, though outcomes varied by neighborhood.

There are several explanations for these results. In much of the city, these small apartment buildings, even if technically allowed, were required to be less than three stories tall and have small overall square footage, limiting the desirability of potential new apartments. And assembling financing for these types of structures is notoriously difficult.

Eliminating single-family zoning isn’t enough if disgruntled neighbors can hold up construction on three-unit apartment buildings through months of public review.

Drawing attention to these middling effects does not invalidate Minneapolis’s reform. Zoning rules limiting construction to just single-family homes are inherently restrictive because they make many neighborhoods — often those with the best-funded schools and best access to jobs — unaffordable for people who can only cover the cost of an apartment. They arbitrarily limit new construction to small areas, even when demand for housing has risen and the supply has not kept up. In too many communities, this has led to increased segregation and inequitable opportunity for people of color. Thus, reforms that eliminate single-family zoning should be replicated.

But other, less-prominent changes Minneapolis made in the previous years were much more effective in increasing the city’s housing stock. The city legalized accessory dwelling units in 2015, eliminated parking requirements near frequent transit service in 2015, and dropped parking requirements citywide in 2021, making it cheaper to add apartments outside of downtown. As a result, the number of housing units permitted in Minneapolis doubled from 2015 to 2020. More than 90% of new units were in large buildings with at least 10 units.

Minneapolis shows that eliminating single-family zoning alone — or altering other forms of base zoning — is not a silver bullet to increasing housing supply. Such changes are a small part of a wider transformation needed to improve communities’ land-use regulations to support housing production.

Thinking Bigger and Broader 

Rather than solely predicating federal grants on a potentially ineffectual checklist of potential zoning reforms, Washington should consider requiring that jurisdictions demonstrate how land-use policies have actually increased housing production.

Towns, cities and counties trying to win federal grants should also show that they have a framework for developing reform strategies that go beyond base zoning and address all elements of land-use policy that affect housing affordability and equity, including:

  • flexibility measures allowing cities and towns to provide relief or exemptions to certain developers but not others;
  • requirements, exactions and incentives, which are all tools used to promote certain types of development over others;
  • administration rules that govern zoning policy; and
  • procedures, such as the review and appeals processes used to make choices about advancing projects.

Eliminating single-family zoning isn’t enough if disgruntled neighbors can hold up construction on three-unit apartment buildings through months of public review. Allowing more types of housing to be built isn’t enough if unreasonable impact fees or parking requirements on new housing makes financing projects infeasible. Aligning all elements of land-use policy is necessary to make meaningful progress.

At the same time, requirements for outcomes and reforms should be tailored to jurisdictions’ local conditions. Much of the real-estate market responds not just to land-use regulations, but also to factors outside local government control.Cities are changing fast. Keep up with the CityLab Daily newsletter.The best way to follow issues you care aboutEmailSign UpBy submitting my information, I agree to the Privacy Policy and Terms of Service and to receive offers and promotions from Bloomberg.

A federal grant requirement that local jurisdictions show that their land-use policies are working to add housing stock and are addressing the full spectrum of issues related to housing affordability shouldn’t be prioritized in jurisdictions with declining housing markets or nonexistent demand — places that still need federal support. But it should be applied muscularly to communities with high demand and strong real estate markets. That means requiring the wealthiest suburban communities and low-density neighborhoods within towns and cities to accommodate more construction, because those are the places where there is demand for the new units that will ultimately help resolve the nation’s supply crunch.

Altering the wide array of land-use regulations will take time. No community can address each of these issues in a single step, and certain communities may need encouragement or even mandates from regional or state governments to ensure their zoning regulations don’t hinder housing construction. But with effective policies, the federal government can spur local jurisdictions to improve the full breadth of their land-use regulations to promote new development and advance housing affordability.


When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email experts@adviseandconsult.net.

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