Lorena Gonzalez moved in with relatives, sharing a bedroom with her 18-year-old son, before finding an affordable apartment in the San Francisco suburb of Burlingame. Before that, Gonzalez rented an apartment far from work, sometimes requiring a three-hour commute.
“I work in the city, and the commute was a real pain,” says Gonzalez, who works as a radiology technician assistant at a San Francisco hospital.
That all changed this year when Gonzalez bought a two-bedroom unit in a new workforce housing project. She paid $2,049 for her home and estimates she would pay more than twice that to live in a market-rate apartment in a similar location.
Gonzalez lives in Eucalyptus Grove, a new workforce housing project built by CRP Afforable Housing & Community Development. Units in this project will be awarded in a lottery to applicants who make less than 70% of the Bay Area median income. The large number of applicants indicates the tight housing situation in this area.
“For 69 apartments, we could easily get 3,000 applications,” said Paul Salib, CEO of CRP Affordable Housing.
The Burlingame project is part of California’s effort to increase housing by increasing housing density near transit stops. This is just one initiative reflecting a national trend of rethinking zoning and building codes to promote housing supply. In Massachusetts, housing affordability advocates want to encourage housing construction by reducing minimum lot sizes. In Florida, a state law that overrides local government objections has led to a flurry of affordable rental housing development.
States’ moves to roll back regulations on new development reflect a harsh reality. Home prices in the United States are breaking record after record, and housing affordability has emerged as a hot political topic. Economists and housing advocates agree the answer is more housing and more housing supply. However, building a house is not easy. Land is in short supply in the nation’s most expensive housing market, and thousands of local governments that can argue with new development tend not to welcome new construction.
“There are no silver bullet policies to solve affordability,” says Brad Hunter of Hunter Housing Economics. “But there are things local authorities can do to make it easier for house builders to deliver more homes.”
Amy Tomaso, vice president of Ivory Innovations, an affordable housing nonprofit at the University of Utah, said home builders often have to go through “excessive” approval processes. “There are too many regulations. There is too much red tape.”
But many states and cities are trying different methods to encourage construction. When it comes to boosting housing supply, Tommaso says, “Now is a good time.”
The root of the housing shortage
For decades now, NIMBYism, an acronym for “not in my backyard,” has defined development patterns. Americans love their homes, but they aren’t necessarily enthusiastic about new developments nearby. (Pro-development reactions are known as YIMBYism or “Yes, in my backyard.”)
The tendency to say no to new development is reflected in the fact that new home construction has fallen off a cliff over the past 15 years.
“Where did all the houses go? The answer is that they weren’t built at all,” Ezra Klein and Derek Thompson wrote last year in Abundance, a book that drew new attention to the housing shortage.
result? According to Harvard University’s Joint Housing Research Center, 50% of renters and 24% of homeowners in the United States spend more than 30% of their income on housing, a level the center defines as “cost burden.” The squeeze is especially acute in high-priced markets such as Northern California. In Silicon Valley, the typical home price in the third quarter of 2025 was $1.9 million, according to the National Association of Realtors. It sold for $1.3 million on the San Francisco and Oakland markets.
One reason home prices in Northern California are approaching $2 million is that it’s nearly impossible to build new homes in the region for a variety of reasons, including a lack of available land.
But Klein and Thompson primarily blame restrictive zoning policies for holding back supply. They trace California’s tightening housing prices back to 1971, when city officials in the San Francisco suburb of Petaluma moved to oppose economic growth by restricting building permits. The Petaluma plan withstood court challenges and was adopted by other municipalities. As a result, the pace of home construction in California has slowed. In 1988, California developers received permits to build about 250,000 private housing units, according to U.S. Census Bureau data. However, this annual figure is at a high level. These days, California municipalities issue approximately 100,000 building permits per year.
result? Home prices continue to rise, and some people are seeing their prices skyrocket. California’s population peaked at 39.6 million people in 2020, according to U.S. Census data. In 2022, that number decreased to 39.1 million, but in 2025, the population returned to 39.4 million.
To reverse the ongoing effects of the Petaluma project, California officials are seeking to increase housing supply. One such move was legislation that encouraged the development of accessory dwelling units, backyard apartments, that could house families or rent to tenants. Then, in October 2025, Gov. Gavin Newsom signed legislation that allows for increased density and reduced height restrictions near transit stops.
Salib calls the new initiative “a great example of public-private partnership.” Incentives for development near public transit have allowed CRP Affordable Housing to build higher density than would otherwise be possible in Burlingame. “We can build higher,” he says. “This project would not have been possible if the eight-story building had not been approved.”
Gonzalez considers himself lucky to have found a location that works for his budget and commute. “I feel very blessed because I have struggled for a long time to find a place,” she says.
Of course, restrictive zoning laws are not limited to California. In New York State, only single-family developments are allowed in Westchester County. In Greenwich, Connecticut, the minimum allowable lot size is so large that, predictably, only wealthy homebuyers are able to purchase real estate. These policies reflect existing homeowners protecting their interests. If restrictive zoning keeps the housing supply in short supply, increases in property values for those who already own homes are almost guaranteed.
Massachusetts’ approach: “Legalize starter homes”
Efforts to remove obstacles to homebuilding are also underway on the East Coast. In Massachusetts, housing advocates aim to increase affordability by allowing people to build on lot sizes as small as 5,000 square feet (about one-ninth of an acre). The Legalize Starter Homes committee is collecting signatures in hopes of bringing the initiative to voters later this year.
“Studies show that Massachusetts’ large minimum lot size requirements raise home prices and reduce new production,” said the commission’s chairman, Andrew Mikula, in a recent Boston Globe article.
The median price of homes sold in the Boston area in the third quarter of 2025 was more than $800,000, according to the National Association of Realtors. This is almost double the national median.
Boston’s high home prices are due in part to the limited supply of housing. Like most coastal cities, the Boston area has little land available for new development. On the demand side, large metropolitan areas have many high-wage workers competing for housing. The Boston area is home to prestigious universities such as Harvard University and the Massachusetts Institute of Technology, as well as major companies in the biotechnology, pharmaceutical, and consumer products industries.
On the other hand, many municipalities have minimum requirements for the area on which a single-family home can be built. Mikula and other housing advocacy groups’ proposal would force Massachusetts cities to allow single-family homes to be built on lots as small as 5,000 square feet, a footprint Mikula says is as small as the surface area of a basketball court.
This rule applies only to facilities served by public water and sewer lines.
“We just want to level the playing field across generations,” Mikula tells Bankrate. “People making $200,000 a year shouldn’t have to move to Rhode Island to buy a home.”
Mikula pointed to a similar measure enacted last year in Maine, which also imposed a minimum lot size of 5,000 square feet. If the measure reaches a statewide vote, Mikula predicts it will pass — 78 percent of Massachusetts voters support such a move, according to a survey by the Starter Housing Legalization Committee.
“We decided on the minimum lot size in part because turnout was so high,” says Mikula.
Live Local drives development in Florida
During the pandemic, Florida experienced a population boom and soaring rents, making it difficult for working-class residents to find affordable housing. The state responded with the Live Local Act of 2023, a law aimed at boosting housing supply by relaxing regulations on new development.
As long as the developer includes units dedicated to residents making less than 120% of the area median income, the project will be approved at the maximum height and density allowed in a given area. In many parts of the country, workers earning moderate wages are classified as the “missing middle,” where housing options are scarce.
Income levels and rent limits are complex and reset annually by the Florida Housing Finance Corporation. As an example, tenants making just under 120% of Miami’s median income will receive about a 20% discount on their rent. In the planned Live Local project in Miami’s Omni District, market rents for one-bedroom units will be $3,426 a month, said developer Liam Clae of SF QOZ Fund. But a single tenant making $100,000 a year (just under 120% of Miami-Dade County’s median income) would pay $2,788 a month.
Clae wants to build 576 units in a building near Biscayne Bay. Without Live Local’s density enhancements, the project could be approved for 425 units.
“Live Local has inspired a lot of developers who wouldn’t otherwise do multifamily,” says Krahe.
One benefit for developers is that Live Local allows developers to gain approval without a public hearing. This means NIMBY neighbors won’t be waving placards, wearing custom T-shirts, or threatening to run against city officials in the next local election. Dealing with the challenges of neighborhood opposition, developers and authorities have long been reluctant to propose or support new development, which is a major cause of today’s housing shortage. But these new regulations offer a workaround.
“There has been no backlash from the community,” said Michael Wall, president of Coral Rock Development Group. Coral Rock Development Group has completed two projects under Live Local and is developing another.
In addition to simplifying the approval process, Live Local is also seeking tax subsidies that would financially enable developers to offer below-market rents.
Coral Rock Development Group took advantage of this. The company has built live local developments in the South Florida cities of Hialeah and Coral Springs, and is working on another development in Miami. The Coral Springs project includes 153 rent-controlled units and is 99% occupied, according to the developer.
While Coral Rock Development Group’s projects focus on rental units, some developers building under Live Local also include a mix of rental apartments and condominiums for sale, Wohl said. In both cases, the new units are providing supply to a housing market that desperately needs it. He says affordability challenges are a “crisis” for South Florida’s middle-income workers.
Former Miami City Commissioner Ken Russell says Live Local addresses some parts of the housing crisis, but is far from a comprehensive solution. A minor backlash has led to local governments rejecting some Live Local projects, prompting lawsuits.
“Some of these are high-density, high-intensity projects that are not right for the community,” Russell said.
One example of that conflict is occurring in Fort Lauderdale, a suburb of Hollywood. There, a developer and the city are battling over the legality of a proposed waterfront project that would be more than twice the height of surrounding buildings.
An alternate reality: The new developments under Live Local are tailored to an upper class of middle-income workers, as evidenced by the $2,788 monthly rent for a one-bedroom unit. “Workforce housing is a misnomer,” Russell said. “This is not aimed at blue-collar workers.”
Alfonso Costa Jr., chief operating officer of Florida developer Falcone Group, says this is by design.
“When you think about the missing intermediate supply that exists in this country, for households that make 80% of area median income to 120% of area median income, there hasn’t been a program traditionally or historically to encourage the private sector to actually leverage resources to contribute to that supply,” he points out.