Building Blocks for Housing Supply: Zoning and Land Use, Building Codes, and Permitting
By Olivia Barrow Strauss Vice President of Housing JP Morgan Chase Policy Center
Rising housing costs and limited affordable supply have put stable, accessible housing out of reach for millions of Americans, straining family budgets and weighing on local economies across both rural and urban communities. Housing is the single largest monthly expense for many families, with more than 21 million households spending over half of their income on housing. A strong economy starts in the neighborhoods where people live, and increasing the supply of accessible, affordable housing helps anchor families, supports jobs, and build wealth that can be passed to the next generation.
A driver of persistent housing affordability challenges is an underproduction of homes, particularly homes that are accessible for low- and moderate-income households. This segment of the housing supply has not kept pace with growing demand. And the scale of this supply shortcoming demands coordinated action by government, the private sector, and nonprofits to address this challenge in communities nationally.
In 2025, JPMorganChase launched a series of policy briefs highlighting state and local policies that help boost the production of more affordable homes and improve access to homeownership, starting with strategies that reduce regulatory barriers. We focus on three practical building blocks: (1) update zoning and land use rules to allow more types of homes—especially “missing middle” options like ADUs, duplexes, and small multifamily buildings, (2) modernize building codes to enable faster, more cost effective construction while maintaining safety, and (3) streamline permitting to increase transparency, speed up reviews, and reduce delays for new housing.
Reform zoning and land use rules to unlock “missing middle” housing
Local zoning and land use rules dictate what type and how much housing can be built in different areas. Understanding and complying with these rules can add time and cost to the development process and can also limit the number of homes that can built on any given piece of land, which impacts project financing. These costs are often passed through to renters and buyers in the form of higher housing costs, which makes it harder to deliver housing that is affordable to low- and moderate income households.
One fix that is gaining traction across the country is by right residential zoning, which means a housing proposal is automatically approved if it follows existing rules on use, density, and design. This removes discretionary reviews, cuts uncertainty, and shortens timelines. In Los Angeles, by right projects in a transit oriented program were permitted 28% faster than projects requiring discretionary approvals, with less variation in processing times, reducing carrying costs to deliver more affordable price points for residents.
California legalized accessory dwelling units (ADUs) by right on single family lots statewide. ADUs are small, secondary homes on the same lot as a primary home. They now account for about one in five new homes in the state, providing lower cost options in high cost, amenity rich neighborhoods. A decade of streamlining—consistent standards, simpler permits, and the removal of owner occupancy mandates—has driven a 334% increase in ADU permitting since 2016, showing how steady policy improvements can add up to meaningful supply gains over time.
Adjusting rules that limit gentle density can further boost “missing middle” homes like duplexes, triplexes, townhouses, and small apartment buildings. Two straightforward changes: reduce minimum lot sizes and rightsize parking requirements.
Houston’s multiyear lot size reform allowed more homes on smaller parcels and enabled extensive infill without raising housing costs; recent Texas legislation lowering minimum lot sizes in many cities aims to extend these benefits statewide.
Minneapolis eliminated or reduced parking minimums near frequent transit and then citywide, contributing to a 12% increase in the city’s housing supply over five years (versus 4% statewide) and holding rent growth to about 1% while comparable Midwestern cities saw larger increases, evidence that transit aligned zoning updates can improve affordability at scale.
Update building codes to enable cost-effective, safe construction
Building codes set safety and quality standards for homes. Though developed by the International Code Council (ICC), building codes are adopted, tailored, and enforced at the state and local level. More than 20,000 city, county, and state authorities have jurisdiction over building code enforcement nationally, creating a complex regulatory landscape overseeing homebuilding. One building code update stands out for its potential to reduce costs and make better use of limited land while maintaining safety standards:
Single-stair building code reform. For certain midrise buildings (e.g., three to six stories), building code reforms that enable use of a single staircase, combined with modern fire sprinklers and safety features, can reduce construction costs by an estimated 6 to 13% and make it easier to build on smaller lots. Research and international comparisons show no evidence of elevated safety risks when these buildings are designed with appropriate protections. Seattle’s longstanding “Seattle Special” building type shows how this flexibility can unlock small lot housing in walkable neighborhoods, and Texas recently updated its code to allow up to six floors (with up to four homes per floor) with a single staircase—following Austin’s local reforms—demonstrating momentum for practical code modernization that keeps people safe while enabling more homes where they’re needed most.
Streamline permitting to shorten timelines and reduce uncertainty
Even when zoning changes allow for more homes of various types to be built and codes are modernized, slow and unpredictable permitting can stall projects. Multiple overlapping reviews—transportation, water, and environmental—plus staffing shortages and limited coordination across departments can lead to inconsistent requirements and long delays. These delays raise costs and can terminate projects that already operate on tight margins, including affordable and mixed income homes.
States and cities are proving that better processes can speed up reviews without weakening environmental, health, or safety protections:
Florida set clear deadlines for permit decisions and created fee refunds when timelines aren’t met. In 2025, the state strengthened its rules to require decisions within 5 to 60 days—increasing development predictability and reducing timelines and associated carrying costs.
San Diego moved permitting online, dedicated staff to fast track programs, and launched targeted initiatives, such as Complete Communities Now for projects near transit and Affordable Housing Permit Now—to clear backlogs and set firm timelines. In 2023, the city permitted 9,700 homes—an 82% increase over the prior year and the most since 2005—with more than 2,000 affordable homes approved through the dedicated program in about seven days on average, showing how operational changes can help enable more affordable homes to be built.
Looking ahead
Reducing red tape across zoning and land use, building codes, and permitting can lower costs, increase predictability, and expand the types of homes that can be built to meet local needs. Implementation matters: policy changes must be translated into real projects, especially in high cost markets with tight land constraints. Additional levers—like modern construction methods, acquisition and financing strategies, and strong public private partnerships—also shape outcomes and will be covered in future work. JPMorganChase will continue to bring our business resources, data, and policy expertise to support evidence based solutions that expand housing supply and improve affordability for households across the income spectrum.
Olivia Barrow Strauss is the Vice President of Housing at the JP Morgan Chase Policy Center