Inclusionary Zoning Affordability Audit
City of Chicago, Dept. of Housing · Chicago, IL, United States · 2018
Summary
Chicago's analysis of its inclusionary zoning ordinance found that the affordable unit requirement, combined with density bonuses that allowed developers to build more total units, produced meaningful affordable supply without depressing overall residential construction. The evaluation used a synthetic control comparison against cities with similar market conditions that did not adopt inclusionary requirements. The finding runs counter to theoretical predictions from real estate economics, which suggested requirements would depress supply. The density bonus appears to have offset the cost burden effectively.
Research question
"Does requiring affordable units in market-rate developments increase affordable supply without reducing overall production?"
Methodology
Intervention
20% affordable unit requirement for developments receiving city subsidies; density bonuses offered as offset
Assignment
Policy implementation with pre-post comparison and synthetic control
Sample size
All permitted residential developments 2015–2022
Primary outcome
Affordable unit production; total permitted units
Effect estimate
Affordable units produced: +1,200 units above baseline; total production unchanged relative to synthetic control
Decision
Program continued; requirement extended to non-subsidized large developments
Result
Positive
Affordable units produced: +1,200 units above baseline; total production unchanged relative to synthetic control
Evidence strength
Limited
Observational or pre-post design; correlation not necessarily causal.
Replication status
Partially replicated
Institution
City of Chicago, Dept. of Housing
Location
Chicago, IL, United States
Year
2018
Policy area
Housing
Mechanism
Default