Illinois Governor Proposes Statewide Zoning Reform
What happened
Illinois' governor has floated proposals for statewide zoning reforms aimed at addressing housing affordability. While the immediate impact on downtown Chicago multifamily operations is not yet clear, the move signals a potential long-term shift in state-level housing policy that could influence future development and supply.
Why it matters
- The proposal, named the Building Up Illinois Developments (BUILD) plan, is a response to a University of Illinois study indicating the state has a shortage of 142,000 homes and will need to build over 225,000 new units in the next five years to meet demand. - The plan aims to legalize a variety of "middle housing" types statewide, including duplexes, triplexes, four-flats, and accessory dwelling units (ADUs), often called "granny flats". - It would significantly limit local government control by establishing a tiered framework permitting multi-unit housing on any residential lot larger than 2,500 square feet. The number of allowable units would scale with the lot size. - To support new construction, the proposal includes $250 million in funding, with $100 million for middle housing construction, $100 million for municipalities to address infrastructure hurdles like sewer improvements, and $50 million for down-payment assistance. - This state-level push follows a period where Illinois home prices increased by 37% over five years, while the number of active home listings fell by 64%. - Historically, zoning in Chicago has been used to "downzone" neighborhoods and prevent the construction of denser, moderately priced apartment buildings, such as the once-common "four-plus-one" style buildings. - A study of previous upzoning efforts in Chicago found that the policy led to a short-term increase in the property values of affected parcels but did not immediately result in an increase in the number of new housing units being built. - The average rent for an apartment in the Gold Coast is currently $2,519, which represents a 4% increase compared to the previous year.
Key numbers
- - The proposal, named the Building Up Illinois Developments (BUILD) plan, is a response to a University of Illinois study indicating the state has a shortage of 142,000 homes and will need to build over 225,000 new units in the next five years to meet demand.
- It would significantly limit local government control by establishing a tiered framework permitting multi-unit housing on any residential lot larger than 2,500 square feet.
- This state-level push follows a period where Illinois home prices increased by 37% over five years, while the number of active home listings fell by 64%.
- The average rent for an apartment in the Gold Coast is currently $2,519, which represents a 4% increase compared to the previous year.
What happens next
- The proposal, named the Building Up Illinois Developments (BUILD) plan, is a response to a University of Illinois study indicating the state has a shortage of 142,000 homes and will need to build over 225,000 new units in the next five years to meet demand.
- The plan aims to legalize a variety of "middle housing" types statewide, including duplexes, triplexes, four-flats, and accessory dwelling units (ADUs), often called "granny flats".
- While the immediate impact on downtown Chicago multifamily operations is not yet clear, the move signals a potential long-term shift in state-level housing policy that could influence future development and supply.
Quick answers
What happened in Illinois Governor Proposes Statewide Zoning Reform?
Illinois' governor has floated proposals for statewide zoning reforms aimed at addressing housing affordability. While the immediate impact on downtown Chicago multifamily operations is not yet clear, the move signals a potential long-term shift in state-level housing policy that could influence future development and supply.
Why does Illinois Governor Proposes Statewide Zoning Reform matter?
The proposal, named the Building Up Illinois Developments (BUILD) plan, is a response to a University of Illinois study indicating the state has a shortage of 142,000 homes and will need to build over 225,000 new units in the next five years to meet demand. The plan aims to legalize a variety of "middle housing" types statewide, including duplexes, triplexes, four-flats, and accessory dwelling units (ADUs), often called "granny flats". It would significantly limit local government control by establishing a tiered framework permitting multi-unit housing on any residential lot larger than 2,500 square feet. The number of allowable units would scale with the lot size. To support new construction, the proposal includes $250 million in funding, with $100 million for middle housing construction, $100 million for municipalities to address infrastructure hurdles like sewer improvements, and $50 million for down-payment assistance. This state-level push follows a period where Illinois home prices increased by 37% over five years, while the number of active home listings fell by 64%. Historically, zoning in Chicago has been used to "downzone" neighborhoods and prevent the construction of denser, moderately priced apartment buildings, such as the once-common "four-plus-one" style buildings. A study of previous upzoning efforts in Chicago found that the policy led to a short-term increase in the property values of affected parcels but did not immediately result in an increase in the number of new housing units being built. The average rent for an apartment in the Gold Coast is currently $2,519, which represents a 4% increase compared to the previous year.
