For the last half-century, housing policy debates and proposals have been dominated by neoliberal, market-based ideas. But after decades of such policies, the United States faces a housing crisis. Property values have soared in recent years, putting housing out of reach for many people. Policymakers on both the right and left are looking for new, post-neoliberal solutions to many policy problems. In the housing context, a popular and scholarly consensus has emerged over the last decade that local zoning regulations are largely to blame for the country’s affordability crisis. The policy prescriptions that follow from this diagnosis seem obvious: loosen zoning limits, defang regulatory restrictions on growth, and free developers to meet housing demand.
In this Article, we argue that focusing exclusively—or even primarily—on loosening or eliminating zoning rules is misguided. What is needed is a recognition of the more fundamental, structural issues in housing markets, and a more creative and comprehensive set of policy responses. Yes, zoning in some places is a meaningful impediment to development. But the obsession with zoning is conceptually flawed, descriptively problematic, and potentially perverse. At the extreme, those who are laser-focused on zoning are falling back into a neoliberal paradigm that makes overly simplistic assumptions about markets.
Moving beyond neoliberal housing policy solutions will require embracing the reality that public policy choices and legal rules can channel market actors into pro-social, competitive behaviors or into extractive and problematic ones. Increasing the supply of housing and ensuring housing affordability requires market crafting and market shaping, not abdicating responsibility for—and regulatory control over—land use decisions.
A post-neoliberal approach would therefore expand the housing policy toolkit and take an all-of-the-above, comprehensive approach. An industrial policy for the housing sector, including public investment, procurement, and regulatory standard-setting interventions, could mean cheaper and faster homebuilding. Letting go of the neoliberal obsession with privatization could unlock the public’s role in housing provision so governments can increase housing supply directly and efficiently. Rather than embrace trickle down policies for the rich, Pigouvian-inspired taxes that target undesirable behaviors can help prevent constraints on supply. Finally, because regulations are market-shaping, policymakers can adopt antimonopoly and pro-consumer regulations, supply-side zoning rules, and macro-level regulations to disperse economic growth.
While neoliberalism’s descendants may have captured the conventional wisdom among elite commentators and scholars that deregulation is the primary objective in the housing sector, our examples show that a post-neoliberal approach is a viable alternative paradigm and that, at least in some areas, post-neoliberal housing policies are emerging from the bottom up.