Examining the Effects of Policy Design on Affordable Unit Production Under Inclusionary Zoning Policies

Problem, research strategy, and findingsEvidence suggests that inclusionary zoning (IZ) correlates with affordable housing and mixed-income communities; however, what effect the policy design has on affordable housing productivity remains unclear. In this study we investigated the relationship between policy features and average annual affordable unit production under IZ by using the IZ data set, which includes adoption year, standardized characteristics, and outcomes in terms of affordable unit counts for 27 U.S. states and the District of Columbia. Although the data set does not fully capture affordable unit production for all IZ policies or those produced from in-lieu payments, this study is by far the largest scale empirical examination of IZ outcomes. Findings indicated that jurisdictions with policies that were mandatory, older, covered the entire jurisdiction, or had more complex income requirements designed to reach lower income levels had significantly higher production of affordable units. The top 15% of high-producing policies disproportionately consisted of policies that created affordable rental units, covered the entire jurisdiction, and had more complex income requirements. In addition, longer affordability terms were not associated with lower affordable unit productivity in our regression models.Takeaway for practiceOur analysis identified common traits in IZ policies that produced at least one affordable unit as well as high-producing policies. These commonalities generally support enacting more stringent IZ policies with some flexibility in terms of the income levels served for greater affordable unit productivity. Limitations revealed in the data set suggested that local jurisdictions should better track affordable units to gain more information about what works. Considering that IZ policy design varies greatly, planners and policymakers must consider local housing market conditions relative to findings in this study as well as state and local regulatory environments when designing IZ policies.