Trends in Regulation and Affordability in Select U.S. Metropolitan Areas and Communities

Mike Fratantoni
Edward Seiler
Jamie Woodwell
Mortgage Bankers Association

We connect land-use restriction changes in the last decade and a half to the contemporaneous evolution in housing supply and affordability for a diverse set of metropolitan markets across the United States through brief case studies. We further drill-down to the community level to examine patterns within metropolitan areas. Our study indicates that we need to think small, at least for the size of the market area, which is the right unit of analysis. While comparing metropolitan areas across the country can be informative, within-metropolitan area analysis, which holds constant commuting patterns, employment bases, amenities, and other important drivers of housing values, may be more illuminating when examining the impact of different regulatory approaches and changes. Data below the metropolitan level is harder to obtain and may not have the same number of transactions as at higher levels of geography. However, the results are much more likely to be applicable for informing local policymakers regarding the impacts of their potential regulatory actions on housing affordability.