By Gary Bennett and Hugh Gordon
In our column of Oct. 21, we discussed the overarching supply-and-demand cause for the nationwide affordable housing shortage and the role that single-family-only zoning plays in exacerbating this shortage.
In this column, we look at other limiting factors for building affordable housing and some possible solutions.
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Single-family-only zoning is one way local zoning boards limit how much housing can be built.
Many places also employ height restrictions. Some areas are zoned for multifamily buildings, but don’t allow any building over two stories high. This drives down supply.
Parking requirements are often written into zoning laws, too.
Many laws require two parking spaces for each unit of multifamily housing. A 100-unit apartment complex would need 200 parking spots. This usually means buildings of that size don’t get built.
Builders must lower the number of units to save space for parking, even in areas with effective transit systems. Those units become more expensive because the land is still the same cost to the developer. What could have been reasonably affordable units become units for those with higher incomes.
Another feature of many zoning laws is minimum lot sizes. Builders are legally required to allot land for each home, often a large amount.
These “exclusionary” zoning laws push builders to focus on bigger luxury homes instead of smaller starter homes or multifamily homes.
Zoning boards are essentially only allowing people who already benefitted from the wealth of this country — who built their incomes with access to high-opportunity jobs and education and generational wealth — to live in neighborhoods.
Historically, some of the first zoning laws in our country were engineered to block people of color, particularly Black Americans, from living in predominantly white neighborhoods. This was known as redlining.
Today, laws don’t explicitly mention race, but they continue to worsen segregation. In most municipalities, the more single-family zoning for a neighborhood, the whiter it is.
Shrinking the pot of new housing getting built, while demand keeps rising, drives up the cost of housing for everyone.
The old code phrase “changing the neighborhood character” gets thrown around.
People are confused when they hear that affordable housing is coming to their neighborhood. They say they don’t want giant apartment buildings.
And they’re right — not every neighborhood should have giant apartment buildings. But affordable housing is much more than that.
Even small gradual changes to zoning laws can have an impact.
For example, allowing smaller homes on smaller lots, or simply allowing duplexes, would double available housing in some areas. In recent years, cities like Minneapolis took the huge step of ending single-family zoning.
Increased automation of the construction process can help, too.
There’s some innovation now with modular construction and 3D printing, but productivity growth is slow. States can help by mandating that manufactured housing is permitted housing in any zoning code.
The federal government isn’t blameless, either. Many incentives have been written into the tax code to encourage home ownership over other asset classes as our country’s primary wealth-building mechanism.
Most American homeowners expect the sale of their home to finance a large part of their retirement. This means property values must be maintained at all cost.
The Biden administration is attempting to help at the federal level by tackling exclusionary zoning through a $5 billion program to give money to localities that remove exclusionary zoning policies. This is more than any presidential administration has done on this topic.
Help may be on the way from Congress, too. A bipartisan bill called the Build More Housing Near Transit Act has been reintroduced to encourage construction of new homes, including low- and middle-income homes, in transit-served, walkable communities.
The act would incentivize local governments to promote building new homes in and around transit corridors. The bill adds pro-housing policies to existing law, so local governments will be incentivized to make the following changes near transit corridors:
• Eliminate parking minimums
• Establish by-right permitting for projects that meet objective standards
• Reduce minimum lot sizes
• Create and preserve homes affordable to low-income households
• Raise or eliminate height limits
Ending America’s housing shortage will require real political willpower. And it will take people across the country taking a hard look at their own neighborhoods and understanding what gets built and who gets excluded, and how to make home ownership achievable for millions who are shut out.
Editor’s note: Gary Bennett is a retired marketing executive. Hugh Gordon is the association executive for the Frederick County Association of Realtors and has decades of experience in the real estate world, including 24 years as a mortgage banker. They are longtime Frederick County residents and members of Frederick’s Affordable Housing Council.
