Published in the Journal of Housing Economics, Vol. 6, No. 1, pp. 81-91.
Notes:
Descriptors:
Zoning Regulations. Down zoning. Building permits. Land use controls.
Abstract:
This paper examines whether a more restrictive zoning ordinance actually reduces construction of new housing. At first, this may seem a trivial issue: Why else would a zoning board make the ordinance more restrictive? It is possible, however, for landowners to circumvent the zoning law. For example, they can subdivide their land before the zoning change occurs; they also can bargain with the local zoning officials and offer side payments, also known as exactions, for the right to develop their land. This paper examines a famous case of agricultural downzoning in McHenry County, Illinois. Although the number of building permits issued did not fall immediately, in the long run the number of permits issued by the county was significantly reduced. This suggests that developers were able to anticipate the zoning change and subdivide their land before the change took effect.
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