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It’s 2030, and the US has finally overcome its decades-long housing shortage. The journey to this future in which home ownership is within reach for millions more Americans began not at the construction site, but in local government offices.
The housing crisis
Americans are being zoned out of home ownership.
For more than a century, the nation’s local zoning and land use policies—rules that dictate what can be built where in a neighborhood or city—have prioritized the construction of single-family homes over more affordable multi-unit buildings. This has driven down the supply of affordable housing, contributing to a nationwide shortage of at least 4 million homes.
“Restrictive zoning is the primary culprit,” Alex Horowitz, the director of Pew’s Housing Policy Initiative, told NPR. “It’s made it hard to build homes in the areas where there are jobs, and so that has created an immense housing shortage.”
If restrictive local policies are a major driver of the housing shortage, it’s possible that we could end it by changing these policies. To find out what that might look like—and why it won’t be easy—let’s explore the past, present, and future of residential development.
Where we’ve been
About 10,000 years ago, humans finally got good enough at farming that they could start storing food and having bigger families. Their settlements grew in size, and rather than everyone farming or raising livestock, some people could work as artisans, toolmakers, and traders.
As villages grew into cities, it became necessary to put more thought into how they were laid out. For ancient Greeks, this meant establishing different “zones” for different uses: residential zones for homes, sacred zones for temples, and public zones for markets and social gatherings.
This approach helped the Greeks optimize the use of land, made navigation easier, and even improved their quality of life. Residents didn’t have to worry about living right next to noisy industrial operations, for example, and because cemeteries were only permitted outside city walls, locals’ risk of contracting diseases from decaying bodies dropped.
By the time of the Roman Empire, city planners were not only dictating what could be built where within a city, but also establishing rules for the buildings themselves, often to improve the lives of residents—the mutli-unit “insulae” that served as homes for many lower-class citizens, for example, could only be so tall in order to lower their risk of collapsing and killing residents.
Fast forward about 1,900 years.
During the Industrial Revolution, people flocked to US cities in search of jobs, causing the populations of urban areas to skyrocket. This rapid urbanization gave birth to the first official zoning rules in the US, which established distinct residential and industrial districts within cities.
These early zoning policies were largely justified as ways to improve public health and safety, just like they had in ancient Greece—residents could enjoy fresher air if they lived separately from factories, officials argued—but many were designed to keep lower-class residents, who were often racial and ethnic minorities, from moving into middle-class neighborhoods.
Some laws achieved this by zoning neighborhoods for only single-family homes so that residents wouldn’t have to worry about living next to multi-unit buildings filled with members of the lower classes. Others explicitly prohibited people of one race from moving into a neighborhood dominated by another—even though the Supreme Court banned race-based zoning laws in 1917, legally enforced racial segregation persisted in the housing market for years.
“When we defer to every single specific area, NIMBYism is allowed to run rampant.”
Emily Hamilton
Over the next few decades, the number of cities and towns with zoning ordinances surged, and by 1950, it was a standard part of urban planning. These laws are still ubiquitous and still often used to prevent the construction of relatively low-cost housing, like apartment buildings or single-family homes on small lots, because current homeowners don’t want to live by them.
“People might agree that they need housing citywide or regionwide, but nobody wants to see increased traffic or more people parking on the street in their specific little area,” Emily Hamilton, a Senior Research Fellow and Director of the Urbanity Project at the Mercatus Center at George Mason University, told Freethink.
“And so when we defer to every single specific area, NIMBYism [“not in my backyard”] is allowed to run rampant, and we end up with serious regionwide and nationwide underproduction,” she adds.
Where we’re going (maybe)
Zoning and land use regulations aren’t the sole driver of America’s housing crisis (labor shortages and the high cost of building materials are contributing factors), but addressing their role in the crisis could go a long way toward alleviating the problem.
The most straightforward way to prevent restrictive policies from hindering the construction of new housing is (obviously) to change them, and this reform is already happening in certain parts of the US. Minneapolis, Minnesota, added 12% to its housing supply between 2017 and 2022 largely thanks to a series of policy changes that included reduced lot size requirements and the elimination of minimum parking requirements.
Houstin, Texas, is one of the few places in the US that doesn’t have zoning codes—any parcel of land in the city could, in theory, be used for residential, commercial, or other types of construction—but it does have codes and ordinances that regulate the building process. Up until 1998, for example, the minimum lot size requirement for residential construction was a massive 5,000 square feet. That year, though, the city council chose to reduce it to as little as 1,400 square feet, and the impact has been significant.
“They’ve seen tons of small-lot, single-family construction as a result: 80,000 small lot houses have been built across the city,” Hamilton told Freethink. “In part because of that—it isn’t the only reason—they have the lowest median house price to median income [ratio] among SunBelt cities.”
“These anti-democratic ways of decision-making … lend themselves directly toward not approving housing.”
Emily Hamilton
A handful of other cities have reformed their own zoning and land use policies, but to end the housing shortage, reform needs to become the norm, and according to Toccarra Nicole Thomas, director of land use and development at the DC-based nonprofit Smart Growth America, ending the practice of having public officials approve new residential construction projects that meet zoning regulations should be at the top of the agenda.
“The number one zoning reform that would help is to allow building ‘by right’ for every house—in other words, builders and developers can just get a permit at the county office and start building, instead of having a discretionary review and public comment for every project,” Thomas told Urban Land.
This can cut construction costs by saving developers from having to pay for lawyers and experts to plead their case for a new project. It can also speed up construction, minimizing the amount of time a developer might have to pay interest on the cost of building materials—addressing one of the other barriers to construction—and those savings can then be passed down to homebuyers.
Another benefit of “by right” development is that it reduces the opportunity for NIMBYs to block a construction project. For example, even if it meets current zoning policies, local officials could still decide to kill a project if enough people oppose it during the discretionary review process.
Having more people who are in favor of new residential construction projects at planning meetings could counter the impact of NIMBYs, but the types of people most likely to support affordable housing are underrepresented in local political discourse.
“There’s actually great political science research showing that the people who go to those meetings are older, wealthier, whiter than the demographics of the communities as a whole, but they tend to be the loud voices and tend to have more anti-growth feelings than the community as a whole,” Hamilton told Freethink.
“These anti-democratic ways of decision-making in terms of favoring who chooses to go speak about land use decisions in public meetings both lend themselves directly toward not approving housing, rather than approving housing, and also, I think, give elected officials the wrong impression about what their community wants to see,” she continued.
“State governments are increasingly putting some guardrails on local zoning authority.”
Emily Hamilton
People who would benefit from more affordable housing often don’t have the means to attend planning meetings due to barriers such as unreliable transportation or a shortage of free time.
A growing YIMBY (“yes in my background”) movement driven by groups such as Smart Growth America, California YIMBY, and the YIMBY Alliance aims to help make the voices of underrepresented demographics heard within local government. In some places, the housing shortage has gotten so bad that state officials are also stepping in to encourage more affordable home construction.
“State governments are increasingly putting some guardrails on local zoning authority,” Hamilton told Freethink. “The smaller geographic area that we have where these decisions are being made, the more bias there is toward restricting housing rather than building housing, but when you have a bigger polity that you’re considering at a time—like a state rather than one suburb—the benefits of housing construction are weighed on a more even ground with the costs.”
California, for example, passed SB 9 in 2021, giving land owners in the state the right to split a single-family lot into two lots and build either two houses or a duplex on it. Some cities responded by creating building standards that made it all but impossible to get projects approved, so in 2023, the state then introduced SB 450, a law that restricts local governments’ ability to deny housing proposals. That law went into effect on January 1, 2025.
“I think it’s promising that we’re seeing state policy makers come in and say, ‘Hey, local governments, you’ve got to approve a little bit more housing and less expensive types of housing,’” says Hamilton. “Local governments get their authority to regulate land use in the first place from their states, so there’s a very strong legal and political case that they should be doing this.”
“Without decisive, sustained federal action, this crisis will only deepen.”
Mike Kingsella
The federal government has the power to encourage zoning and land use reform, too, if in less direct ways. The bipartisan Build More Housing Near Transit Act introduced in 2023, for example, would give priority to grant applications for transit projects from cities that are zoned to allow for the construction of affordable housing near transit stations.
With a new administration about to take office, though, it’s unclear how and to what extent the federal government might try to encourage zoning reform in the coming years. In August 2020, then-President Donald Trump said he was against interfering in local zoning issues, but in a July 2024 interview with Bloomberg, he called zoning “a killer.”
However, Up for Growth, a nonprofit focused on solving the housing crisis through data-driven research, believes action from the top is the only way the US will be able to undo the problem caused in large part by more than a century of restrictive local housing policies.
“Congress must act swiftly on a bold housing supply agenda,” CEO Mike Kingsella said in October 2024. “We must encourage localities to eliminate outdated and artificial barriers, invest in innovative building technologies, fund community-serving infrastructure, and prioritize resources for the production and preservation of affordable homes.”
“Without decisive, sustained federal action, this crisis will only deepen,” he continued. “This is about more than housing—it’s about securing the future of our nation.”
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