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Does Smart Growth Lead to More Expensive Housing?
Looking at regulations in 11 metropolitan areas across the country, Cox found that smart growth guidelines account for more than 20% of new home costs, adding anywhere from $30,000 (Minneapolis-St. Paul) to $220,000 (San Diego). Furthermore, areas with the most restrictions are seeing faster increases to new home prices than those with more lenient regulations.
The result, Cox claims, is increased costs to developers and mortgage lenders and generally less affordable housing:
"More restrictive land use land use regulation also creates obstacles to people buying houses, requiring them to devote more money to housing than necessary and increases their vulnerability to losses in the event of a financial downturn."