The actual solution is to repeal the morass of regulatory restrictions on housing that have been put in place since 1960.
Per 1,000 residents, only 2.68 houses were built in San Francisco between 2010 and 2020, compared to 12.66 houses between 1950 and 1960.
For New York, only 2.38 houses were built per 1,000 residents between 2010 and 2020, compared to 8.88 houses between 1950 and 1960.
Regulatory restrictions imposed on housing in San Francisco and New York since 1960:
San Francisco:
- 1960: City Planning Code (Zoning Ordinance) - Established zoning districts with specific regulations on use, density, building types, minimum lot sizes (e.g., 2,500 sq ft for most, 4,000 for R-1-D), and one-for-one parking requirements per dwelling unit, restricting housing types by enforcing low-density controls and increasing development costs through compliance and parking mandates.
- 1970: California Environmental Quality Act (CEQA) - State law requiring environmental impact assessments for projects, significantly lengthening permitting times (often adding years due to reviews and litigation) and increasing costs for housing development through extensive studies and potential mitigations.
- 1978: Comprehensive Rezoning and Adoption of RH (Residential House) and RM (Residential Multi-family) Districts - Reduced zoned capacity for housing on the city's West Side, making thousands of multi-family properties non-conforming, restricting allowable densities and types of housing, which limits supply expansion.
- 1979: San Francisco Residential Rent Stabilization Ordinance (Rent Ordinance) - Imposed rent controls on multi-family units built before June 1979, limiting annual rent increases (typically 2% or less), which can increase overall housing costs by reducing incentives for new construction and maintenance, indirectly restricting supply.
- 1979: Condominium Conversion Ordinance - Limited annual conversions of rental units to condominiums (initially 1,000, later 200 for 2-6 unit buildings), preserving rentals under rent control but restricting ownership housing options and potentially increasing costs by limiting market flexibility.
- 1981: Residential Hotel Demolition and Conversion Ordinance - Prohibited demolition or conversion of residential hotel units without one-for-one replacement or in-lieu fees to an affordable housing fund, increasing costs and permitting times for redevelopment projects involving such properties.
- 1985: Office Housing Production Program - Required large office developments (25,000+ sq ft) to provide affordable housing, donate land, or pay fees based on new employees, linking commercial to residential mitigation, which raises costs and can lengthen approvals for mixed projects.
- 1986: Proposition M (Office Development Limit) - Capped annual office space approvals and introduced a competitive "Beauty Contest" process prioritizing affordable housing and neighborhood preservation, lengthening permitting times and increasing costs through required community benefits.
- 1992: Inclusionary Housing Policy - Mandated 10% affordable units in planned unit developments or projects needing conditional use permits outside redevelopment areas, increasing development costs by requiring set-asides.
- 2002: Inclusionary Affordable Housing Ordinance (Planning Code §§ 415, 419) - Required 15% on-site or 20% off-site affordable units (or in-lieu fees) for projects of 10+ units, directly raising building costs and potentially restricting project feasibility.
- 2010: Revisions to Inclusionary Housing Policy - Adjusted post-Palmer decision to favor fees over units, increasing costs for developers not building affordable housing on-site, which can deter middle-income projects.
- 2012: Housing Trust Fund (Proposition C) - Captured revenue for affordable housing but reduced inclusionary obligations by ~20% for some projects while capping others, potentially increasing costs for non-qualifying developments.
- 2013: Condominium Conversion Ordinance Amendment - Allowed ~2,200 TIC units to convert with fees up to $20,000 per unit to an affordable fund, but imposed a 10-year moratorium on further conversions, restricting housing type changes and adding costs.
- 2016: Amendment to Inclusionary Affordable Housing Program - Voter-approved increase from 12% to 25% on-site affordable units, deemed economically infeasible by studies, raising development costs and potentially reducing overall housing production.
- 2016: Amendment to Planning Code for Legalization Program - Required Conditional Use Authorization to remove unauthorized units, adding discretionary reviews that lengthen permitting times and increase costs.
- 2017: Executive Directive 17-02 - Mandated additional coordination and deadlines for approvals, which, while aiming to streamline, can extend permitting times for complex projects due to heightened administrative requirements.
New York City:
- 1961: New York City Zoning Resolution - Overhauled zoning to emphasize low-density districts (60% of residential lots in lowest categories, 12% single-family only), imposed parking and open space requirements, and created manufacturing zones prohibiting residences, restricting housing types, increasing costs via parking mandates, and limiting adaptive reuse.
- 1969: Rent Regulation Laws (State and City Rent Stabilization) - Instituted controls on rents and evictions, making it costly and time-consuming to demolish or redevelop regulated buildings (tenants can demand high buyouts), reducing supply and increasing development costs.
- 1974: Amendments to Rent Regulation Laws - Extended protections to post-1974 buildings under certain conditions, further complicating demolitions and renovations, raising costs by making land assemblage infeasible and limiting new housing supply.
- 1975: State Environmental Quality Review Act (SEQRA), Implemented Locally as City Environmental Quality Review (CEQR) in 1976 - Required environmental reviews for discretionary projects, adding extensive analyses, potential litigation, and delays (often years), significantly lengthening permitting times and increasing costs.
- 1977: Ground Floor Use Regulations for High-Density Neighborhoods - Mandated 50% of ground floors on major streets for specific retail/restaurant uses in post-1977 buildings, restricting flexible mixed-use designs and increasing costs for housing in such areas.
- 1980s: Residential Conversion Rules for Obsolete Nonresidential Buildings - Limited conversions to pre-1961 (later extended to 1961-1977) buildings in specific areas, restricting adaptive reuse for housing and adding costs through narrow applicability.
- 1981: Retention of Stricter NYC Building Code (Non-Adoption of State Uniform Code) - Maintained unique, more stringent code requirements, increasing construction costs due to specialized materials and complex enforcement, while potentially delaying permits.
- 1987: Quality Housing Zoning Text Amendments - Imposed contextual requirements in medium/high-density zones (R6-R10), limiting density and design options, making cost-effective projects harder and restricting housing types.
- 1989: Lower Density Contextual Zoning Amendments - Reduced density by nearly 50% in R3-R5 zones, enforcing height, setback, and type limits, decreasing multi-family production and increasing costs in medium-density areas.
- 1989: Attempt to Raise Taxes on Vacant Land - Proposed higher taxes to spur development, but increased holding costs, potentially deterring or raising expenses for housing projects on such land.
- 1991: State Requirement for Residentially-Zoned Vacant Land Tax Classification - Kept lower tax rates for vacant land outside Manhattan, reducing incentives to build and indirectly increasing housing costs through delayed development.
- 1996: Local Law 37 (Third-Party Transfer Law) - Authorized city transfers of tax-delinquent properties, adding complexity to land acquisition for housing, lengthening times and costs especially with condemnation.
- 1999: Sprinkler Requirement Law - Mandated sprinklers in buildings with 4+ units or renovations costing 50%+ of value, directly increasing construction and renovation costs.
- 2002-2013: Bloomberg Administration Neighborhood Rezonings (Including Downzonings and Contextual Rezonings) - Decreased development capacity in some areas and limited potential via contextual rules, restricting types and slowing construction in high-demand neighborhoods.
- 2005: Greenpoint/Williamsburg Rezoning - Retained high retail parking requirements in parts, necessitating large garages in apartment buildings, raising costs and deterring housing.
- 2007: Increase in Minimum Size for 421-a Tax Incentive - Raised threshold from 3 to 4 units for eligibility, making smaller multifamily projects less viable and increasing relative costs.
- 2016: Zoning for Quality and Affordability (ZQA) Update - Modernized provisions but failed to boost density significantly, maintaining restrictions on housing types in low-density zones and adding regulatory complexity that can extend permitting.
- 2018: Special Permit for New Hotels in Light Manufacturing Districts - Required permits with union conditions for hotels, deterring construction and limiting reuse of surplus hotels for housing, increasing conversion costs.
- 2019: Amendments to Rent Stabilization Laws - Applied stabilization to some market-rate units under 421-a if rents fall below thresholds, reducing developer incentives for new rentals and increasing costs in middle-income areas.