A wave of zoning law changes could have a huge impact on investors and housing — here’s what you need to know
USA face The housing deficit is approx. 3.2 million units, the situation is particularly severe in urban areas such as New York. This is one reason potential homebuyers are finding it increasingly difficult to find a home Affordable Housing.
This has resulted in many cities and communities Consider changing strict single-family zoning restrictions, which one related Home prices are high, rents are soaring, and new housing starts are down. Many see reversal of widespread restrictions Multifamily Cross-city construction as a solution to the affordable housing crisis.
Zoning changes often face resistance from existing homeowners because many Fear There is a sudden drop in home equity, the rise of new skyscraper apartment complexes, increased traffic congestion, and rising crime rates. But transformed into “Tap density,” which would allow four-plex or smaller multifamily buildings and accessory dwelling unit (ADU) to be built It is possible to increase housing supply and affordability on land currently zoned for single-family residences without significant negative impacts to existing homeowners.
Duplex makes a difference in Palisades Park
town Palisades ParkNew Jersey has been building duplexes to replace older single-family homes since the 1980s, when an influx of Korean immigrants increased housing demand in the area. While the town’s zoning laws allow for the construction of two units home Since 1939, developers have begun implementing this strategy on each parcel only when the demand for new construction made it a profitable move.
The advantage of this density change is that when It does not require local government subsidies or complex planning compared to building large apartment complexes. However, it makes sense that replacing a single-family home with a duplex would double the size of the home over time. housing supply. Palisades Park’s population has grown 40 percent since 1990, far outpacing the growth of the New York metropolitan area as a whole, and the resulting economic activity has revitalized the town’s Main Street.
Since duplexes often replace dilapidated houses, their construction more than doubles the value of each lot. This leaves Palisades Park with less property tax Tax Rates Over Decades — Residents of neighboring Leonia, where duplexes are illegal, paid twice as much as Palisades Park residents last year.
The town’s vibrant culture also makes it a desirable place to live, which may be why the community’s median home sales price in March was $950,000. redfin tuna.
a meaningful change housing supply But it takes timeand If approximately 2% of available and desirable land is redeveloped each year, it could take many years for Palisades Park to become a town composed entirely of duplexes. A local sociology professor said that despite gradual and subtle changes in density, some long-time residents are unhappy with the area becoming less green and more crowded.
Still, the current mood among residents of Palisades Park, a neighborhood far removed from the hustle and bustle of New York City, is generally positive. While some suburban politicians claim looser zoning restrictions will lead to overcrowding similar to New York, it’s clear the changes in Palisades Park aren’t that drastic and the flexibility of zoning laws is still proving to be a benefit to the community.
Wave of zoning changes in cities and states
At least three quarters Residential land in most cities is zoned only for single-family housing, preventing developers from building enough multifamily housing to meet the nation’s demand. As a result, many cities are reconsidering whether to implement strict zoning laws, The original purpose is arrive perpetuating apartheidmay be an unnecessary obstacle.
For example, California passed Many new policies Require localities to allow ADUs and reduce barriers to development. Colorado too Consider legislation This would allow the construction of accessory dwelling units in many areas. Advocates recognize ADUs as a means of providing more affordable housing to more people while also It also gives homeowners the opportunity Collect rental income and offset rising housing costs.
Since 2017, city of Minneapolis has been reforming its Zoning rules, making it possible (and cheaper) to build apartment complexes. These changes resulted in a 12% increase in housing supply compared to the past five year period Rents are stable relative to the rest of Minnesota.
University of California, Berkeley Zoning Reform Tracker The tracker shows the status of zoning reform initiatives across the country from Albuquerque, New Mexico, to Washington, D.C., where more than 45 cities have approved ordinances allowing for ADU reform. The interactive map makes clear that these efforts are happening in red states and blue states alike.
Cities have taken different approaches, but most reforms focus Allows for light touch density. As evidenced by the booming Palisades Park, these policies are more likely to provide a compromise between building new housing and preserving the character of local neighborhoods.
Still, some attempts at zoning reform have made progress be met There was strong resistance from homeowners. A group of homeowners in Austin, Texas, File a lawsuit Opposition to the city led a judge to block several efforts to create denser housing that would meet affordability requirements.
Zoning reform is worthwhile, but it is a challenging and incomplete solution
In addition to zoning regulations, obstacles Prevent urban residential development. For example, authorities may delay zoning changes to review the environmental impact of new construction. this is common practice Suburbia was implemented in the 1970s to prevent new development.
Some requirements, such as building and fire codes, have evolve into Put a greater burden on developers. The approval process is often lengthy and, When combined with license fee High construction costmaking many projects economically unfeasible.
Encourage new constructioncities must streamline these processes. more importantly, reforming local zoning regulations may not affect development if there are other restrictions. Significant increase in demand for housing supply scrutinize Every limit This can hinder progress, such as minimum lot size and building size requirements. Minneapolis, for example, would have to waive parking requirements for zoning reform to work.
Even in the city of Houston Not yet promulgated Zoning laws, inflexible requirements and workarounds major obstacles. Homeowners opposed to increased housing density have found ways to prevent it community development Even without zoning code. Residents can vote to designate their community as historic district And to enforce building restrictions in this way, wealthy communities often impose private deed restrictions. Used by the Houston City Council “Buffer” Ordinance and other control rules what type of development Allowed in some areas, Essentially Create land use zones.
Over the years, Houston has made changes and increased construction of new buildingsHowever. According to reports, a policy of reducing minimum lot sizes led to the construction of more than 34,000 townhouses in high-demand areas from 2007 to 2020, expanding residents’ access to affordable housing. seat. The Houston Land Bank is converting tax-delinquent properties into affordable housing.
the process of Redeveloping a neighborhood, whether zoned for single-family homes or plagued by other burdensome restrictions, also takes time. It took Oregon years to through legislation This will allow Building properties of up to four units across the state and requiring cities to comply. Even with the new law in place,only one small Every year there is a portion of the land that is ripe for redevelopment.
The city of Portland estimates that new zoning laws will allow about 5,000 additional homes to be built in formerly single-family zones over 20 years. Gov. Tina Kotek has long acknowledged that zoning reform will gradually have an impact Housing affordability.
But even if progress is slow, reversing outdated zoning restrictions and related barriers will be worth it. Local governments have little control over high mortgage rates and rental inflation, but they can easier to build.
more than 83,000 ADUs Permits were granted in California due to reforms that lowered the cost of ADUs and simplified the ADU construction process. This is just a drop in the bucket compared to before 3.5 million new homes The state expects to need it by 2025, but despite this The number of ADUs allowed has increased by more than 15,000% in a few years. Freddie Mac The units were found to cost less than a third of the area’s median home price. In California, most new apartments are affordable to middle-income earners— Report states that “ADU legalization sparked an affordable housing boom at no cost to taxpayers.”
bottom line
Most cities have a community of homeowners who advocate maintaining strict zoning policies. they are called NIMBY (which stands for “Not in my backyard”). The impulse to protect a neighborhood’s character is understandable, but feared consequences are often overstated and benefits overstated. be ignored.
Zoning reform doesn’t require the rapid bulldozing of parks and playgrounds. It just gives developers more choices when renovating dilapidated buildings to meet the housing needs of other residents. Strive to achieve light touch density, Although progress is slow and inherently inadequate, it could reduce unnecessary burdens faced by developers and facilitate an increase in housing supply over time.
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