Funded on December 1, 2020

The US is facing a housing affordability crisis that continues to exacerbate economic and racial inequities. Inclusionary zoning policies (IZ), which require real estate developers to include below market-rate units in new housing projects, and rent control regulations, which place caps on rental price increases, have reemerged as potential solutions to the housing affordability crisis. However, rent control and IZ policies are complicated and controversial. Studies generally find that rent control decreases rents for tenants in controlled units, but that these benefits may be offset by greater costs in the uncontrolled rental market. Likewise, while there is some evidence that IZ policies can provide economic opportunity for residents with low incomes, critics argue that they also reduce the overall supply of housing and serve as a short-term solution to the larger problem.

The Urban Institute, in partnership with researchers at Oakland University and Old Dominion University, is undertaking a study to estimate the effects of different rent control and IZ regulatory schemes in various cities and neighborhoods. To do so, the team will:

  1. generate the first cross-city panel dataset of rent control and IZ reforms and
  2. estimate the effects of different types of reforms on measures of housing affordability and access to opportunity for people with low incomes and people of color.

Based on these comparisons, the research team will provide evidence for policymakers on which types of rent regulations and IZ laws best increase access to opportunity for both tenants of affected units, and for tenants with low incomes and people of color in uncontrolled units.  

The findings from this study will directly inform not only whether rent control and IZ policies increase the supply of affordable housing and increase access to opportunity-rich neighborhoods for residents with low incomes and people of color, but also which types of regulatory regimes work best to achieve these outcomes. The findings will also help inform cities on how to design regulations by providing evidence on which components, if any, of the regulations are most effective at improving outcomes.