The Metropolitan Washington Council of Governments (COG) set an ambitious goal to build 87 housing units daily, aiming for a total of 320,000 units from 2020 to 2030, to combat Washington D.C.’s growing housing crisis and support the region’s expected population growth.
However, in the first three years of the bold plan, the city and its surrounding neighborhoods have built roughly 60 units per day. They are now facing a deficit of over 40,000 units.
The Urban Institute, a nonprofit research organization, recommended that half of D.C.’s new housing should be affordable for households earning 80 percent of the neighborhood’s median income. This median income serves as a benchmark for what the average person in the area can afford, ensuring that housing remains accessible not only to average-income households but also to many low-income residents.
However, instead of D.C. constructing half of their homes with this affordable benchmark, less than 20 percent of newly constructed homes have met that mark. Within the District of Columbia, 16 percent of new housing has been considered affordable. No housing has met that benchmark in Charles County and Manassas City, which surround D.C.
Courtney Battle, executive director of HAND, a D.C.-based housing advocacy organization, said the housing shortage disproportionately impacts people of color and low-income workers, perpetuating missed opportunities for these residents to achieve sustainable income and economic stability for themselves and their families.
Root Cause: Restrictive Zoning
While D.C.’s most urban centers have largely met their housing targets, less densely populated areas struggle to keep pace. According to Leah Hendey of the Urban Institute, this disparity is rooted in zoning laws that restrict density in many parts of the city.
“There is a lot of land where greater density is not allowed,” she said.
According to a Brookings Institute study, neighborhoods with the most restrictive zoning laws have failed to build new housing.
The study found that supply can keep up with demand in D.C. communities with high-density zoning, such as places with large apartment buildings. When housing prices rise, so does the area’s housing. However, in neighborhoods with restrictive zoning or places with single- or double-unit homes, housing price increases do not correlate with housing development increases. Supply and demand do not match each other at all.
How Restrictive Zoning Laws Impact Supply and Demand
Zoning laws have existed across the country to restrict the construction of high-rises and multi-unit homes. Many of those laws, for example, restrict developers to only build single-unit homes. The goal is to build smaller, quieter neighborhoods for single families.
However, these laws can have devastating impacts on homelessness. By preventing the construction of homes that would house more people, developers cannot keep up the supply as the population of cities increases. Demand outweighs supply, prices skyrocket, and homes become unaffordable for low-income families and individuals.
D.C.’s notoriously strict zoning laws have prevented the necessary supply of homes to meet its growing demand. In 2023, the D.C. area issued 20,509 new housing unit permits. For the majority of the regions in the D.C. area, the number of permits available dropped compared with 2022, even while the population continued to increase.
According to an analysis by the Post, all those available permits will likely not be used to construct new units. Even with the available permits, they will fail to meet the necessary demand.
The Affordable Housing Credit Improvement Act in the Senate would provide tax credits for developers building low-income housing. This would ease the financial burden on developers and encourage more low-income housing. Additional local legislation in D.C., Maryland, and Virginia aims to dismantle restrictive barriers that slow housing construction.
Yet, despite these efforts, restrictive zoning laws remain a significant obstacle. Legislation must address zoning laws to address the root cause of the housing shortage.
Success in Building Affordable Housing: Changing Zoning Laws
On the other hand, cities like Minneapolis have successfully provided affordable housing for its residents by changing their zoning laws. In 2017, the city started to allow denser housing developments. For example, it started to allow the construction of two—and three-unit homes in neighborhoods previously restricted to single-family homes.
Five years later, in 2022, Minneapolis had increased its housing supply by 12 percent. The construction of mid-sized apartment buildings, each holding at least 20 units, was the biggest factor in this increase.
While rents in Minnesota rose by 14 percent in those five years, in Minneapolis, they rose by only 1%. Considering inflation and rising wages in the city, even though prices increased slightly, the relative affordability of housing in Minneapolis increased dramatically.
It’s Time to Reform Restrictive Zoning Laws
With evidence that changing zoning laws can reduce housing costs, D.C. must seek to address neighborhoods with the most restrictive zoning laws. Without these changes, D.C.’s ambitious goal to build more housing will continue to fall short. It’s time to support housing developers by reforming zoning laws, making it easier to build affordable housing, thereby reducing housing costs and ensuring more people can find homes in the nation’s capital.
