How Local Zoning Rules Can Drive Up the Price of Housing Stock

Prospective homebuyers looking to snag a modest home for less than the price of a motor yacht might consider an unlikely tactic: Petitioning their municipal council.

Local zoning rules can have a significant effect on home purchases, with regulations often restricting the number of houses that can be built and thus driving up the price of remaining house stock.

The Austin American-Statesman reports this week on that city council’s intention to revisit local zoning rules; the paper says that the “last comprehensive rewrite to land use rules [in the city] was completed in 1984.” Current rules have restricted building practices within Austin itself, driving housing stock down and prices skyward.

As with many cities in recent years, bitter fighting in Austin has divided between advocates who want to see more housing in the area and residents who want to preserve the current housing density. A judge last year sided with the latter in a dispute over a revised zoning code, leaving in place current zoning rules.

The city council “is likely to revisit the rules in the months ahead,” the American-Statesman reports. Reflecting common proposals among housing advocates across the country, councilmembers are reportedly in agreement on at least a few provisions, including “increasing development along major corridors” and “allowing for more housing opportunities in mixed-used developments.”