Illinois Governor Proposes Statewide Zoning Reform

- 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.