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How Suburban Sprawl Poses a Challenge for the U.S. Economy

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Land Planning

How Suburban Sprawl Poses a Challenge for the U.S. Economy

Suburbs are sprawling again, but a lack of buildable residential land is pushing lower-income Americans out of the housing market


February 2, 2022
suburban home sprawl
Image: Stock.adobe.com

In 2021, single-family housing starts increased to 1.123 million, the highest gain since 2006, but prospective home buyers are still finding few options in regional markets where restrictive zoning codes are limiting housing supply, CNBC reports. Low land supply has resulted in significant price hikes for builders, reducing the production of multifamily units and affordable housing. Current zoning laws date back to 1930s-era guidelines from the Federal Housing Administration, but modern-day housing stretches beyond just single-family lots and requires additional land for multifamily units.

Strict zoning laws favoring single-family homes have limited the supply of land available for multifamily construction and hampered production of more affordable housing. With land limited for multifamily projects, the price of that land has jumped and made those projects unaffordable for builders.

Today’s homebuyers are paying for past sprawl by drawing on credit to finance their lifestyles. Meanwhile, the cost of public infrastructure maintenance is weighing on depopulating towns across the country.

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