Development Approval Timelines, Approval Uncertainty, and New Housing Supply: Evidence from Los Angeles

53 Pages Posted: 26 Jun 2024

See all articles by Stuart Gabriel

Stuart Gabriel

University of California, Los Angeles (UCLA)

Edward Kung

California State University, Northridge - David Nazarian College of Business and Economics

Multiple version iconThere are 2 versions of this paper

Date Written: June 18, 2024

Abstract

We provide credible estimates of the effect of duration and uncertainty in local regulatory approval times on the rate of housing production. The analysis derives from a novel dataset of development timelines for all multifamily housing projects permitted in the City of Los Angeles between 2010 and 2022. As a lower bound, simply by pulling forward in time the completion of already started projects, we estimate that reductions of 25% in approval time duration and uncertainty would increase the rate of housing production by 11.9%. If we also account for the role of approval times in incentivizing new development, we estimate that the 25% reduction in approval time would increase the rate of housing production by a full 33.0%. Both the expected value and the uncertainty in approval times are salient to incentivizing new development. The results provide new evidence that local approval processes are a significant driver of housing supply and reinforce the notion that municipal regulatory reform is an important component of housing reform.

Keywords: local land-use regulation, approval timing and uncertainty, housing production JEL Classification: R31

JEL Classification: R31, R38, R52, R14

Suggested Citation

Gabriel, Stuart and Kung, Edward, Development Approval Timelines, Approval Uncertainty, and New Housing Supply: Evidence from Los Angeles (June 18, 2024). Available at SSRN: https://ssrn.com/abstract=4872147 or http://dx.doi.org/10.2139/ssrn.4872147

Stuart Gabriel (Contact Author)

University of California, Los Angeles (UCLA) ( email )

Edward Kung

California State University, Northridge - David Nazarian College of Business and Economics ( email )

Northridge, CA 91330
United States

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