How Do Developers Respond to Land Use Regulations? An Analysis of New Housing in Los Angeles
Abstract
There is strong evidence that land use regulations constrain housing production. We know less about how real estate developers respond to specific zoning provisions. I compare the characteristics of new multifamily housing with baseline land use regulations in two sets of rail station areas in Los Angeles. I supplement this building-scale analysis with expert interviews. I find that developers were most sensitive to density restrictions and parking requirements. The average development in the Vermont/Western area had 112% of the maximum allowable residential density and 94% of the minimum required parking. Koreatown’s average development had 99% of the maximum density and 88% of the required parking. But, there was variation by area and whether a building was affordable or market rate, apartment or condominium, and by development size. Additionally, regulatory implementation can matter as much as the written regulations themselves. I recommend that cities take an evidence-based approach to reforming regulations and implementation processes.
