Liberalizing regulations surrounding minimum lot sizes would increase housing supply, improve affordability
NEW YORK, NY – Ever since Covid-19 sparked the work-from-home revolution, there’s been no shortage of news coverage of the mass exodus of remote workers from the Big Apple. But despite the headlines, the lapse in demand for housing in the New York City metropolitan area has been short-lived: the city’s affordability crisis has come roaring back. In a new issue brief for the Manhattan Institute, M. Nolan Gray, a researcher with the University of California, Los Angeles, and noted city planner, argues that misguided policies surrounding minimum lot sizes contribute to the city’s housing shortage and resultant affordability woes. Reforming minimum lot-size regulations to allow for more homebuilding offers a viable and urgent path forward for reversing housing costs for those who live in and around New York City.
Minimum lot-size requirements specify that all lots in a given area must be at or above a specified size; as a result, homes are forced to sit on lots larger than what the market might otherwise demand, thereby reducing overall housing production while raising prices for those housing units that are produced. In the New York metropolitan area, the problem affects suburbs, towns, and villages that surround the city, each subject to their own unique, and in many cases anachronistic, zoning codes. Surprisingly, the problem affects New York City proper, as well; while the city is not known for single-family housing, the shares of its five boroughs allotted for single-family zoning and duplex zones add up.
Such regulations in metropolitan New York contribute to the Mid-Atlantic region’s reputation for having the second-highest median lot sizes in the country—lot sizes which are nearly 60% above the nationwide median. To reverse this trend, increase housing supply, and ease prices, Gray suggests policymakers on the local level should lower lot-size minimums and allow developers to experiment with small lot infill and compact suburban subdivisions that might better suit consumer preferences. At the state level, policymakers should adopt ceilings on the minimum lot sizes that local governments may impose, tying these rules more closely to valid health and safety considerations. As the city recovers from the Covid-19 pandemic and shifting geographic realities, the need for an era of housing affordability is greater than ever; by easing minimum lot-size regulations, New York City can meet housing demands for the talented families and individuals that works in and around it.