- Economists and housing experts overwhelmingly agree that
zoning reform is one of the best ways to make homes more
- Experts believe local jurisdictions need to streamline and
ease the approval process for new affordable housing.
SEATTLE, March 8,
2023 /PRNewswire/ -- Relaxing zoning rules is one of
the best ways to address the nation's ongoing housing affordability
crisis, according to an independent panel of economists and housing
experts polled in Zillow's Home Price Expectations (ZHPE)
Survey1. Zoning reform, which would allow more housing
within existing neighborhoods and growing communities, was ranked
as one of the most effective means to address affordability by
73% of those surveyed.
"It seems straightforward: We need to build more homes," said
Dr. Skylar Olsen, Zillow's chief
economist. "Changes through policies like modest densification will
give us more 'at bats' to create density and help communities stay
livable for everyone. Without a huge injection of new homes in the
near future, affordability will continue to be a challenge for many
— especially for first-time home buyers."
Housing affordability remains a defining feature of the U.S.
housing market. The latest Zillow® data
shows that while monthly mortgage costs are now just under
$1,600 for a typically valued home
after a 20% down payment, payments are still 46% higher than last
January and $754 higher than before
the pandemic (January 2020).
One key driver of the affordability crisis is the chronic
shortage of new housing construction, which has not recovered from
the Great Recession, resulting in a 3.79 million–unit gap in home
production in 230 metro areas, according to a study released by Up
for Growth, a nationwide think tank that focuses on addressing
the country's housing shortage through research and evidence-based
"Restrictive and exclusionary zoning, artificial barriers, and
NIMBY opposition have combined to create an unprecedented and
persistent housing shortage," said Mike
Kingsella, CEO of Up for Growth. "Failure to address these
issues will create lower economic output and fewer opportunities
for everyone. Families and individuals will be forced to pay higher
rents, the equity gap will widen, and transportation costs will
rise as people are forced to travel greater distances for work and
Panelists were asked to select several policies they believe
would improve housing affordability and to rank the policies by
effectiveness. While changes to zoning was the clear favorite for
policy choice among panelists, the second-most-popular choice was
to encourage governments to approve and build affordable housing
more quickly, with 59% of economists believing it would be
effective. Other policy changes, such as converting downtown
commercial zones to encourage more residential use, providing tax
credits to incentivize new home construction and relaxing design
requirements such as parking mandates, received modest support from
the expert panel when compared to zoning reform.
Last year, Zillow conducted a nationwide survey of homeowners
and renters, and found overwhelming support for increasing housing
density in existing neighborhoods. Allowing even minimal
density through zoning reforms — for example, allowing a percentage
of single-family lots to house two units — would yield millions of
"There are no quick fixes for the housing affordability problem
in the U.S., especially at a time when demand for entry-level homes
far exceeds available inventory," said Terry Loebs, founder of Pulsenomics.
"Supply-side initiatives such as those recommended by this panel
may not be easy to implement, but they will be the most effective
means to durably improve homeownership affordability and market
1 This edition of the ZHPE Survey polled 117 housing
market experts and economists between
December 5 and December 15, 2022. The survey was conducted
by Pulsenomics LLC on behalf of Zillow, Inc. The Zillow Home Price
Expectations Survey and any related materials are available through
Zillow and Pulsenomics.
About Zillow Group:
Zillow Group, Inc. (NASDAQ: Z and
ZG) is reimagining real estate to make it easier to unlock life's
next chapter. As the most visited real estate website in
the United States, Zillow® and its
affiliates offer customers an on-demand experience for selling,
buying, renting, or financing with transparency and ease.
Zillow Group's affiliates and subsidiaries include Zillow®; Zillow
Premier Agent®; Zillow Home Loans™; Zillow Closing Services™;
Trulia®; Out East®; StreetEasy®; HotPads®; and ShowingTime+™, which
houses ShowingTime®, Bridge Interactive®, and dotloop® and
interactive floor plans. Zillow Home Loans, LLC is an Equal Housing
Lender, NMLS #10287 (www.nmlsconsumeraccess.org).
(www.pulsenomics.com) is an independent research firm that
specializes in data analytics, opinion research, new product and
index development for institutional clients in the financial and
real estate arenas. Pulsenomics also designs and manages expert
surveys and consumer polls to identify trends and expectations that
are relevant to effective business management and monitoring
economic health. Pulsenomics LLC is the author of The Home Price
Expectations Survey™, The U.S. Housing Confidence Survey, The
Housing Confidence Index, and The Transaction Sentiment Index.
Pulsenomics®, The Housing Confidence Index™, The Transaction
Sentiment Index™, and The Housing Confidence Survey™ are trademarks
of Pulsenomics LLC.
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