California’s housing crisis has been the subject of endless debate, legislation, and promises of reform. Yet, despite years of policy changes aimed at increasing housing production, the state has failed to meaningfully boost the number of homes built. A recent San Francisco Chronicle article titled “This California law was supposed to end single-family zoning. Three years later, it’s ‘just symbolic’” highlights the broader problem: much of the state’s housing policy has been performative rather than impactful.
The idea that zoning reform alone would significantly increase housing production is a politically convenient narrative. Advocates, lawmakers, and media outlets have often framed single-family zoning as the central obstacle to new development. However, as research consistently shows, the real problem isn’t zoning—it’s the escalating cost of construction, labor, materials, and regulatory hurdles that make housing prohibitively expensive to build.
Commentary: California’s Housing Crisis Demands More Than Symbolic Legislation Like SB 9
The Terner Center for Housing Innovation’s 2022 report details how rising construction costs continue to stall housing production. According to their research, the cost of wood, plastics, and composites increased by 110% over the past decade, while finishing costs rose over 65%. The cost of building a single unit of affordable housing in California has reached nearly $1 million in some cases—making even government-funded housing projects financially unsustainable.
A 2020 Terner Center study found that structured parking alone adds approximately $36,000 per unit, while impact fees in California cities are nearly three times the national average, reaching $23,455 for a single-family home and $19,558 for a multifamily unit. At the same time, rising interest rates have significantly reduced purchasing power, further discouraging development.
In short, the state’s housing crisis is largely driven by hard costs, not zoning. Yet, much of the political focus remains on symbolic zoning reforms, which, while important in some contexts, fail to address the core issue of affordability.
The Legislature and even media outlets like the Chronicle have consistently pushed the narrative that restrictive zoning laws are the primary reason California isn’t building enough housing. This has led to legislative efforts such as SB 9, which allowed for duplexes and lot splits in single-family neighborhoods but has had little impact on actual housing production.
Eric Filseth, a former Palo Alto city council member, summed it up in a recent Chronicle letter: “Nearly everything Sacramento has done ‘to boost housing production’ has been symbolic, which is why despite oceans of rhetoric, the rate of housing production in California has been essentially unchanged for a decade. The coterie of housing pundits is addicted to the politically convenient but false narrative that zoning is the broad obstacle.”
The focus on zoning reform over economic realities has distracted from more substantive solutions. Instead of addressing the skyrocketing costs of labor and materials or reducing bureaucratic hurdles that drive up construction costs, lawmakers have largely opted for politically palatable but ineffective reforms.
If California genuinely wants to increase housing production and improve affordability, it needs to take direct action on the cost side of the equation.
That means: Reducing Construction and Development Costs.
The state should follow the lead of AB 2097 (Friedman, 2022), which eliminates minimum parking requirements for developments near transit, helping lower costs.
It should go further in streamlining building codes and eliminating unnecessary local restrictions that mandate expensive materials or infrastructure. SB 897 (Wieckowski, 2022) made progress on this by reducing costly ADU requirements, but similar reforms are needed for larger projects.
Addressing Regulatory and Permit Delays: The permitting process in California remains one of the slowest and most expensive in the nation. AB 2234 (Rivas, 2022) aims to speed up permit approvals, but enforcement of deadlines is key.
Expanding “by-right” approvals for projects in high-need areas, as AB 2011 (Wicks, 2022) suggests, could cut project timelines by up to 30%.
Supporting Alternative Building Methods: Off-site construction and modular housing have been shown to cut costs by 5-20% and reduce building time by 20-30%. However, the industry needs better regulatory support.
Expanding mass timber construction, as Oregon has done, could allow for more cost-effective mid-rise housing.
Lowering Impact Fees and Financing Costs: Cities should reassess their impact fee structures to make housing development more viable. AB 2186 (Grayson, 2022) proposes state reimbursements for cities that waive fees on affordable housing—an approach that should be expanded.
High financing costs due to federal interest rate hikes exacerbate affordability challenges. The state should explore public financing models to lower borrowing costs for developers.
California, in short, needs to start moving beyond symbolism.
California has taken important steps to expand the legal footprint of housing, but without addressing economic realities, meaningful change remains out of reach. The state has enacted nearly six dozen housing laws since 2017, yet housing production remains stagnant. Why? Because policies that ignore fundamental cost drivers—materials, labor, fees, and regulatory delays—will never produce the volume of housing needed to meet demand.
Instead of more political theater, California lawmakers must take a hard look at the economic barriers to development. That means confronting the realities of construction costs, not just zoning, and implementing real solutions that make it financially feasible to build housing at scale.
The housing crisis won’t be solved by changing what’s allowed to be built—it will be solved by making it possible to build.
Hmmm. Just yesterday, the claim was that zoning was creating “the problem”. But today, the claim is that “. . . the real problem isn’t zoning—it’s the escalating cost of construction, labor, materials, and regulatory hurdles that make housing prohibitively expensive to build.”
Leaving aside for a moment that the author is apparently advocating to lower the wages of construction workers, gutting regulations which exist for a reason (as well as ignoring the tariffs which just went into effect), I found this reference the other day:
“People love to say housing is unaffordable, but millions of homes are being bought and sold every year. Prices aren’t the problem, expectations are. The market isn’t broken just because dream homes cost more than people want to pay.”
“People say, “It’s different now,” but that’s what they’ve always said. The real issue isn’t affordability, it’s expectations. People want bigger houses than ever and feel entitled to live in areas out of their price range.”
“A Pew Research Center survey found that 69% of Americans are “very concerned” about housing costs. People have always been concerned about affordability. That’s not new. What’s new is how affordability is being measured.”
“Housing has always been about trade-offs. If people couldn’t afford to live in a certain city, they moved somewhere else. That was just common sense. Now, people refuse to leave high-cost areas and then complain about prices.”
(The author also lists other factors to back his claim – including a lack of foreclosures, the drastically-increased size of an average house, etc.).
https://www.msn.com/en-us/money/realestate/unpopular-opinion-10-reasons-why-housing-is-actually-affordable/ss-AA1zK3aI?ocid=hpmsn&cvid=8f3b87a10ba143b6dd0539a6db2b1b04&ei=16#interstitial=1
https://www.msn.com/en-us/money/realestate/unpopular-opinion-10-reasons-why-housing-is-actually-affordable/ss-AA1zK3aI?ocid=hpmsn&cvid=8f3b87a10ba143b6dd0539a6db2b1b04&ei=16#image=1
“Just yesterday, the claim was …”
You don’t appear to understand that I like to throw out ideas – even ideas I don’t completely agree with in order to generate discussion and conversation (particularly on housing). Where I come down on this? Probably somewhere in between. But then again, my thinking on a lot of these issues changes and evolves over time.
“Housing has always been about trade-offs. If people couldn’t afford to live in a certain city, they moved somewhere else. That was just common sense. Now, people refuse to leave high-cost areas and then complain about prices.”
The so-called homeless have solved this age-old dilemma, along with their ultra-progressive blue-state enablers. Simply grab a bag of fentynal, grab and expensive tent from your nearby homeless advocate, and head for Venice Beach or San Francisco! You may not have a bathroom or even a bucket to s**t in, but you’ll have an ocean view residence that most Americans can only dream of.
” Instead of addressing the skyrocketing costs of labor and materials . . . ”
So you are going to somehow address costs to the point that new housing becomes ‘affordable’. Good luck with that.
Our former President (or whoever was running things) got us into mass inflation with his massive government spending bills, raising prices in a manner all economists regard as regressive (affecting the poor much more than the rich).
Our new President is going into mass tariff wars, which will raise the cost of many things, including wood from Canada, which is where we grow most of it now. So good luck with your ‘mass timber construction’. And with deforestation, along with increased wildfire risk to urban areas, do we really want to be encouraging more construction using wood?
He doesn’t like subsidized housing and doesn’t think fighting construction costs will work and doesn’t like build baby build – so what is Alan Miller’s plan?
Although the question wasn’t directed at me, I assume that “the plan” would be the same one that addresses inflation. Food prices, for example, have risen by approximately 24% from 2020-2024.
Not sure why anyone would think that housing costs would be immune to inflation (though unlike food, housing prices are now dropping in much of the country).
Immune to inflation? No. Far exceeding inflation is the actual state of things.
A few things I pulled up…
in 2022, the median price per square foot for new single-family detached homes rose by 18%, significantly higher than the 8% increase in the CPI during the same period. 
Additionally, the National Association of Home Builders (NAHB) reported that construction costs accounted for 64.4% of the average price of a new home in 2024, up from 60.8% in 2022. This marks a record high since the inception of the series in 1998, largely attributed to broad inflation in building material prices.
That means that construction not land costs are nearly two thirds of the costs for housing.
Regarding your 2022 citation, what is that a comparison to? (And wasn’t that also during the latter stages of the pandemic?)
In any case, those numbers are not a comparison to food prices, and are not correct according to multiple sources. Here’s one such source:
U.S. food prices rose by 23.6 percent from 2020 to 2024
Transportation prices grew the fastest across categories, with an increase of 34.4 percent between 2020–24, while housing increased at a similar rate as food, by 23.0 percent. (Feb 14, 2025)
https://www.ers.usda.gov/data-products/ag-and-food-statistics-charting-the-essentials/food-prices-and-spending#:~:text=U.S.%20food%20prices%20rose%20by%2023.6%20percent%20from%202020%20to%202024&text=Transportation%20prices%20grew%20the%20fastest,as%20food%2C%20by%2023.0%20percent.
As a side note, what do you suppose the increase in transportation costs added to the increase (less than 4% in your citation) regarding construction costs attributed to “building material prices”?
“Regarding your 2022 citation, what is that a comparison to? ”
That’s why its indexed to overall inflation.
In 2024, Construction Costs went up 6 percent as compared to a 2.9 for inflation overall.
Yeah, I recall that material costs rose quite a bit during the pandemic. Here’s what AI has to say about the increase in car prices during that period:
According to data from various sources, new car prices rose significantly during the pandemic, with an average increase of around 20-29%, meaning the average new car price is now considerably higher than pre-pandemic levels, with some reports stating an increase of nearly $11,000 per vehicle compared to before COVID-19 hit.
Key points about the increase in new car prices during the pandemic:
Percentage increase: Between 20-29% depending on the source.
Reason for increase: Supply chain disruptions, increased production costs, higher demand due to pandemic-related factors.
Current status: While prices have slightly decreased in recent months, they remain significantly higher than pre-pandemic levels.
So again, you have to compare material costs for just about everything (over a several year period), before concluding that “building-specific” materials costs rose more than other materials cost. As opposed to say, materials cost for everything else (e.g., cars, electronics, and all of the components of modern living).
Common sense would tell you that’s not really even possible (that materials costs would uniquely rise for one category, but not for others. Unless there was some industry-specific factor.)
There is not a global conspiracy to single-out materials costs which are used to build housing.
“There is not a global conspiracy to single-out materials costs which are used to build housing.”
I agree. Wasn’t trying to argue otherwise.
There was an anomaly for materials during the pandemic, primarily due to supply chain issues (as well as the sudden isolation imposed upon society, some of which had lasting impacts – such as telecommuting, which is now being partially reversed).
There was also a toilet paper anomaly.
And nowadays, there’s an egg anomaly.
I say blame Biden, or was it Trump? Maybe Zelensky.
Society may over-reacted to a virus that had a relatively low death rate. (Partly because they didn’t want to overwhelm hospitals.) Truth be told, there is always a cost-benefit analysis in regard to preventable deaths – whether or not it’s openly acknowledged.
Mass human die offs
Punt formation…
Mass human die-offs are guaranteed at birth (as are taxes).
Boomers, in particular, are getting ready to “punt”.