Reduce Zoning Restrictions

Author: David R. Burton, Senior Fellow in Economic Policy

Affordability 101 · Chapter 4: Freedom to Build

Plymouth Institute for Free Enterprise

Topline

State and local zoning laws restrict housing supply and increase the cost of building homes.

Background

The first U.S. zoning law was adopted in New York City in 1916. After the U.S. Department of Commerce developed and promoted the Standard State Zoning Enabling Act (1924) and the Standard City Planning Enabling Act (1928), states rapidly adopted zoning laws. By 1930, 35 states had laws enabling local zoning ordinances. Now all do. Local zoning ordinances vary dramatically but have become increasingly restrictive, prescriptive, and complex over the years.

Action Items (Primarily State and Local Governments)

• State Zoning Enabling Acts should place specific, enforceable limits on how restrictive and prescriptive local zoning ordinances can be, particularly ordinance provisions that limit housing supply and raise costs.
• States should enact legislation that allows projects to proceed as a matter of right if they comply with established land use and building regulations, without the need for discretionary review or approval.
• Local jurisdictions should remove zoning restrictions that limit supply and raise costs, and target needlessly restrictive rules related to permitted density, floor-area-ratio limits, building height, minimum lot size, street frontage requirements, setback requirements, lot division, design standards, “inclusionary zoning,” and neighborhood plans or overlay zones that reduce a parcel’s feasible yield or buildable area. In general, objective development standards should replace discretionary standards.
• Federal policymakers should consider conditioning federal housing aid (over $50 billion annually) on state adoption of Zoning Enabling Act reforms that remove provisions that artificially raise housing costs.

How It Would Make Life More Affordable

• Reducing zoning restrictions would substantially improve housing affordability by increasing the supply of housing and reducing the cost of building new homes.

Related Model Legislation: By-Right Housing Development Act; FAIR (Fairness, Accountability, and Integrity in Rezoning) Zoning Act (relating to third-party zoning challenges); Property and Land Use Stability (PLUS) Act (restricts down-zoning without property owners’ consent); Private Property Protection Act (requires compensation for regulatory takings); Ending Housing Extortion Act (disallows the imposition of unrelated fees and conditions to procure project approval).

Bottomline

State and local officials who want more housing to be built should stop burying builders under voluminous, complex zoning restrictions.

This memo is part of Affordability 101, Advancing American Freedom’s playbook of 101 policy solutions to make life more affordable.

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