Upzoning Chicago: Impacts of a Zoning Reform on Property Values and Housing Construction

2019/01/29 by Yonah Freemark · 1 voice · 4 citations
Economics, Econometrics and Finance · Social Sciences · #Economic and Environmental Valuation #Housing Market and Economics #Urban, Neighborhood, and Segregation Studies

paper · doi:10.1177/1078087418824672

openalex publication_date 2019/01/29 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/25

Abstract

What are the local-level impacts of zoning change? I study recent Chicago upzonings that increased allowed densities and reduced parking requirements in a manner exogenous of development plans and neighborhood characteristics. To evaluate outcomes, I use difference-in-differences tests on property transaction prices and housing-unit construction permits. I detect significant, robust increases in values for transactions on parcels that received a boost in allowed building size. I also identify value increases for residential condominiums, indicating that upzoning increased prices of existing housing units. I find no impacts of the reforms, however, on the number of newly permitted dwellings over five years. As such, I demonstrate that the short-term, local-level impacts of upzoning are higher property prices but no additional new housing construction.

Citations

• A New Measure of the Local Regulatory Environment for Housing Markets: The Wharton Residential Land Use Regulatory Index
• The effect of land use regulation on housing and land prices
• The causes and consequences of land use regulation: Evidence from Greater Boston
• The City as a Growth Machine: Toward a Political Economy of Place

Cited by

• Making housing affordable? The local effects of relaxing land-use regulation
• Housing, urban growth and inequalities: The limits to deregulation and upzoning in reducing economic and spatial inequality
• Do new housing units in your backyard raise your rents?
• YIMBY [wikipedia]

Discussions

• That means everyplace can be upzoned. Upzoning doesn't get cheaper housing, it's a boon to developers at the expense of residents. According to research "upzoning increased prices of existing housing [bsky, 0 points, 1 comments]

Related

• Zoning Change: Upzonings, Downzonings, and Their Impacts on Residential Construction, Housing Costs, and Neighborhood Demographics
• Making housing affordable? The local effects of relaxing land-use regulation
• Exploring the Impacts of Zoning and Upzoning on Housing Development: A Quasi-experimental Analysis at the Parcel Level
• Why Are Regulations Changed? A Parcel Analysis of Upzoning in Los Angeles
• Upzoning and Single-Family Housing Prices