A new study from the Mercatus Center documents encouraging progress on housing reform so far this year. The scope and pace of the reforms are greater than last year, which was covered in previous Mercatus surveys (which I discussed here ). The following is a summary from authors Eli Kahn and Salim Furth:
Last year, we reported on the accelerated pace of national-level housing supply reforms, with major victories in four states and the introduction of laws across the country. This year, state legislatures are keeping pace, considering 263 separate bills that would help reduce regulatory burdens on residential construction, in areas ranging from accessory dwelling unit (ADU) permitting to building code reform. Now that most state legislatures have adjourned, we can take stock of this year’s successes and failures:
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In the first six months of 2024, states enacted 50 housing supply bills, compared with 30 in the same period in 2023.
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In the past 12 months, 20 states have enacted 65 housing supply bills (see Figure 1).
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Several states that had previously enacted major housing supply bills, such as California, Florida, and Rhode Island, continued to advance legislation that built on or refined their previous reforms.
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Colorado and Arizona are making a comeback this year, enacting major housing plans after public failures last year.
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Hawaii and Maryland, two higher-cost states, are strong in the zoning reform game.
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A new trend this year is building code reform. Five states have taken steps to allow “single-staircase” multifamily building designs up to six stories.
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Lawmakers in Vermont and Kentucky took the opposite action, reversing housing supply reforms. Another counterproductive tactic emerged in 10 states, where lawmakers introduced bills to ban institutional investors from buying single-family homes. However, none of these bills passed.
This is all good news except for the last item on the list. Of particular note are Arizona and Colorado, two large states that enacted major reforms this year after failing last year. However, as the authors recognize, there is still much work to be done. Exclusionary zoning still severely increases housing, prevents millions from “moving to opportunity,” reduces economic growth, and limits property rights.
Still, it shows that the cross-ideological YIMBY movement continues to gain ground in many places. At the same time, it is also important to remember that NIMBY opposition to housing deregulation also cuts across ideological lines, with studies of public opinion on the subject yielding mixed results depending on framing and question wording. Survey data shows that many harmful “populist” supply restrictions also enjoy considerable public support. The restrictions on corporate housing investment described in the Mercatus study may be one example. They have attracted support from many on the left and some on the populist right, such as Republican vice presidential candidate J.D. Vance.
Elsewhere, I have argued that most exclusionary zoning is unconstitutional because it violates the Takings Clause of the First Amendment (see also post on Atlantic), and the YIMBY movement should combine litigation and political action. Successful social movements of the past have shown that these two approaches can accomplish more together than either approach alone. The optimal mix of strategies may vary from state to state.
