Producing Affordable Housing in Rising Markets: What Works?

31 Pages Posted: 12 Oct 2016

See all articles by Lance Freeman

Lance Freeman

University of Pennsylvania

Jenny Schuetz

Brookings Institution

Date Written: October 11, 2016


As cities across the U.S. have rebounded from the Great Recession, an increasing number of households in urban areas are facing high rent burdens in order to remain in their current neighborhoods. Several policy options have been used to maintain or increase the supply of below-market rate housing, including inclusionary zoning, TIFs and other value capture mechanisms, and household-based subsidies such as vouchers. In this paper, we describe the problem of affordability in rising markets and review existing evidence on how well local policy approaches work. The most widely used policies, local inclusionary zoning and statewide “fair share” laws, have produced relatively small numbers of affordable units, and are therefore unlikely to substantially mitigate the effects of rising housing costs. More effective policies to develop and preserve affordable housing, particularly in high opportunity neighborhoods, will require increased public and private funding and political support.

Keywords: Housing Policy, Gentrification, Inclusionary Zoning, Land Use Regulation, State and Local Policy, Economic Opportunity

JEL Classification: H5, H7, R2, R3, R5

Suggested Citation

Freeman, Lance and Schuetz, Jenny, Producing Affordable Housing in Rising Markets: What Works? (October 11, 2016). Available at SSRN: or

Lance Freeman

University of Pennsylvania ( email )

Philadelphia, PA 19104
United States

Jenny Schuetz (Contact Author)

Brookings Institution ( email )

1775 Massachusetts Ave, NW
Washington, DC 20036
United States

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