Housing price effects of growth regulations: a concise taxonomy

Abstract

Growth regulations seek to influence urban development in ways that would reduce sprawl, pollution and environmental degradation. Prior to the Great Recession, such regulations were increasing in popularity in the USA. In fact, in a 10-year period before this recession, over 100 cities, counties, and states adopted growth regulations. After a brief hiatus during the Great Recession, interest in growth regulations in the USA is on the rise again. International interest in growth regulations is also increasing. In this paper, I review theoretical and empirical evidence on the effects of growth regulations on housing prices, and use it to develop a taxonomy of these effects. Given the long enduring debate about the housing price and affordability effects of growth policies, and the scarcity of rigorous research to inform it, more work in this area is warranted. Future researchers can learn from the pitfalls of past research. Using this taxonomy as a guide future researchers can construct more accurate accounts of effects, provide better guidance for future policy efforts, and help bridge the distinct discord between opponents and supporters of growth regulations, whose differences right now are grounded as much in philosophical orientations as in methodologically unsound research.