Yes:
In December 2018, Minneapolis became the first U.S. city to eliminate single-family zoning through the Minneapolis 2040 Plan, a landmark reform with a central focus on improving housing affordability. This paper estimates the effect of the Minneapolis 2040 Plan on home values and rental prices. Using a synthetic control approach we find that the reform lowered housing cost growth in the five years following implementation: home prices were 16% to 34% lower, while rents were 17.5% to 34% lower relative to a counterfactual Minneapolis constructed from similar metro areas. Placebo tests document these housing cost trajectories were the lowest of 83 donor cities (p=0.012). The results remain consistent and robust to a series of subset analyses and controls. We explore the possible mechanism of these impacts and find that the reform did not trigger a construction boom or an immediate increase in the housing supply. Instead, the observed price reductions appear to stem from a softening of housing demand, likely driven by altered expectations about the housing market.
That is from a new paper by Helena Gu and David Munro. Via the excellent Kevin Lewis.
The post Did the Minnesota housing reform lower housing costs? appeared first on Marginal REVOLUTION.
