Upzoning Modestly Increases Housing Supply and Affordability, Study Says

A new study by researchers at the Urban Institute finds new evidence that upzoning produces housing supply and reduces costs, while downzoning does the opposite.

2 minute read

April 9, 2023, 9:00 AM PDT

By James Brasuell @CasualBrasuell

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Sundry Photography / Apartment construction

A study published recently in the journal Urban Studies has produced “the first cross-city panel dataset of land-use reforms” to quantify the impact on housing supply and rents.

The study is behind a paywall at the journal, but from the study’s abstract, we can see that the study used machine-learning algorithms to search U.S. newspaper articles between 2000 and 2019, merging the data with U.S. Postal Service and Census data.

“We find that reforms that loosen restrictions are associated with a statistically significant 0.8% increase in housing supply within three to nine years of reform passage, accounting for new and existing stock,” according to the abstract.

The Urban Institute also wrote up the study for an article on their own website, providing further insight into the study’s methodology and findings. For example, the resulting increase in housing supply is greater at the higher end of the market, and the research finds “no statistically significant evidence that additional lower-cost units became available or became less expensive in the years following reforms.” 

Still, the benefits still manage to spread to other parts of the market, according to the study: “impacts are positive across the affordability spectrum and we cannot rule out that impacts are equivalent across different income segments.”

The study also found the converse to be true: “reforms that increase land-use restrictions and lower allowed densities are associated with increased median rents and a reduction in units affordable to middle-income renters.”

The new research is the latest in an ongoing debate, central to the political debate happening between pro-development political forces (i.e., YIMBYs) and those opposing developments, including both anti-displacement and neighborhood character protection groups.

Wednesday, March 29, 2023 in Urban Institute

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