As housing prices recover from the Great Recession, municipalities across America are considering laws that will raise the cost of homeownership. The Wall Street Journal reports that cities like Philadelphia, Detroit and Atlanta are requiring developers to set aside some portion of their new units to sell or rent at below-market prices to low-income households. Like many progressive promises, this is a fool’s errand. These laws will reduce the cost of housing for targeted political groups if they increase the cost of housing for everyone else.
The concept, called “inclusionary zoning,” has been implemented by 886 communities, nearly 90% of which are in California, Massachusetts and New Jersey. While the intent of these laws is to increase the supply of affordable housing, history shows they increase the cost of housing and limit the supply of new affordable units.
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