Assuming that land and regulations historically equaled no more than 20 percent of a selling price of a house, Demographia, a St. Louis–based public policy firm, assigned to 11 markets a “Residential Land & Regulation Cost Ratio” to highlight how restrictive land policies are affecting home prices (see chart below).

Action Items

Wendell Cox, Demographia’s founder, believes the study’s findings can be useful to:

1 Civic and government officials, to evaluate the potential housing affordability impacts of proposed regulations;

2 Corporate relocation and recruitment departments, to identify locations with lower costs of living; and

3 Young adults, to identify where homeownership can be achieved eventually or quicker.

Metro Index* Added Cost@**
Atlanta 1.0 --
Dallas/Fort Worth 1.0 --
Houston 1.0 --
Indianapolis 1.0 --
Minneapolis/St. Paul 2.4 $28,700
Portlant 4.7 $59,300
Raleigh/Durham 1.0 --
St. Louis 1.0 --
San Diego 13.2 $221,000
Seattle 3.9 $51,400
Washington 5.7 $74,700

* Represents the price of land and regulation compared to historic norms. The base index is 1.0.

** For a single-family, detached 2,150-square-foot house.

Source: Demographia

Learn more about markets featured in this article: San Diego, CA, Minneapolis-St. Paul, MN, Dallas, TX.