As construction has slowed in cities around the world, urbanization rates have increased, income inequality has expanded, and government investment has declined, causing cities to increasingly struggle with housing affordability. In this challenging environment, local governments in the United States and abroad are promoting publicly led development projects that integrate housing and transportation investments, with the goal of creating mixed-use and mixed-income neighborhoods. Yet policymakers promoting such projects face systemic barriers. They must overcome restrictive zoning policies, attract investment to low-demand neighborhoods, align project timelines across multiple public objectives, encourage resident support, maintain political commitment in the face of continuous electoral pressure, and work across levels of government.

In this paper, I show that cities can use strategies to overcome obstacles to increasing housing availability, including expanding use of public land, integrating transportation and housing investment planning, creating multistage public engagement processes, and reforming land use regulation. Approaches like these, implemented in the context of publicly led projects, can help localities respond to inevitable patterns of growth in a way that promotes social equity and increases environmental sustainability.

Why This Matters

Policymakers at many government levels acknowledge the need to increase housing availability and affordability, and private-market investors cannot accommodate enough new housing for those who need it. One fundamental problem is that local governments have enforced strict regulations that make it difficult to build new homes, such as zoning rules that limit new construction to single-family homes or that ban a mix of uses for buildings in largely commercial neighborhoods. These rules often constrain development in the most sought-after areas and impede construction. Competition for a limited number of units increases over time, raising rents and purchase prices. This problem—which occurs in both the United States and Europe—is particularly acute in some of the wealthiest cities and towns, which sometimes use exclusionary tactics to prevent new people from moving in. Although such rules rarely explicitly ban publicly subsidized or other affordable housing, they often have the de facto effect of preventing its construction. Many local and state policymakers have begun to acknowledge that strict zoning and building regulations impede construction and have worked to review and revise their zoning laws with the goal of accommodating new construction.

Higher-density zoning is particularly useful for encouraging private-sector investment and making room for publicly subsidized affordable housing. But the regulatory policies put into play by local governments are only one part of the complicated equation of city building. The pace of privately financed construction reflects whether there is private-sector demand for new investment in the first place. Poor jurisdictions often simply cannot attract investors for new projects. Even relatively well-off municipalities with accommodating zoning codes have been unable to attract enough housing construction to ensure affordability for all residents. And federal support for housing affordable to households with low incomes has declined in recent decades.

How I Did It

I set out to investigate the alternative approaches cities have promoted rather than relying on private investors alone through zoning change. I conducted interviews, engaged in site visits, attended convenings, and collected data to undertake a qualitative analysis of planning practices in six cities in the United States and Germany: Atlanta, St. Louis, Seattle, Berlin, Frankfurt, and Munich. Each city has either led the conception and implementation of integrated development projects or comprehensively planned projects that involve local governments selecting sites, creating development plans, and contributing to project financing.

What I Found

I find that publicly led housing projects hold promise to add to the local housing stock and reduce housing costs while encouraging social integration, reducing carbon emissions, and improving quality of life by concentrating investments in focus neighborhoods. They have been enabled by the following approaches:

• Strategically using publicly owned land to reduce the cost of providing affordable housing and to plan for a mix of uses from the start of project development. Atlanta is redeveloping city-owned land through its new Urban Development Corporation to create high-density mixed-income housing. In Berlin, the city government has acquired land at the city edge to create master development plans that support city growth.
• Integrating housing and transportation investments from the start of project planning. Seattle planning staff are working with the regional transit provider to fund new affordable housing in areas around a light rail line. Frankfurt is planning to extend a light rail line to provide service to its new housing development.
• Creating multi-stage resident engagement processes that enable plans to meet local expectations. In St. Louis, community leaders and other residents have played an essential role in identifying priorities for the development project. Berlin undertook a three-stage design competition with urban designers in dialogue with a jury of experts and residents to finalize plans for its new development district.
• Leveraging regulations that provide cities the tools to advance projects in the interest of housing development. The German cities used federally authorized policy that allowed them to freeze land prices once an area was identified for development. In Munich, the city took advantage of a policy that allowed it to cap rent increases in a target area to prevent gentrification and displacement even as it invested in neighborhood improvements.

Other cities considering how to expand housing construction through publicly led projects could consider implementing a mix of these approaches in the coming years.