The housing market is just like any other economic market; it is determined by two major forces – demand and supply. Due to high migration experienced by urban centres, we often see that there is a high demand for housing in cities. This inevitably bids up the price of housing in urban areas. However, zoning laws worsen the affordability of housing in urban areas by imposing FAR restrictions and constraining the supply of land. Zoning laws are regulations that dictate how land can be used and developed in a particular geographic area. These laws typically divide land into zones or districts and establish specific guidelines for the types of structures, activities, and land uses that are permitted in each zone. Land, which is already a scarce and an immovable natural resource, becomes much more scarce due to zoning, because it cannot be efficiently and fully utilised to its value.
Zoning can be classified into three broad types: regulations on density, allowable use and lot size. Density zoning restricts the amount of population and buildings that can inhabit a given piece of land and is constrained using height limits for buildings and floor space limits. Allowable use zoning restricts the quantity of land available for a particular use (industrial areas, residential areas), while large-lot zoning restricts urban sprawl into areas that are of agricultural and environmental importance. Coastal Regulation Zones guidelines given by the Ministry of Environment, Forests and Climate Change are an example of Allowable Use and Large-lot zoning. This article focuses on the zoning regulations on the density of structures in a given piece of land and how they can adversely impact the affordable housing available in a particular urban space.
The density of structures is measured using the Floor Area Ratio in India. The Floor Area Ratio, also called the Floor Space Index, is the total area of all the floors in a particular structure divided by the size of the land on which the structure is built. In most cities, along with height limits, FAR limits are also used to constrain density in a particular area. Housing prices are very gravely affected by FAR constraints because the supply of housing is highly inelastic. The availability of land does not increase as much as the population influx of urban areas. Therefore, an inelastic supply curve and an ever increasing demand increases the price of housing more than the quantity when compared against an elastic supply curve. A further limiting of supply due to zoning can hamper the housing market’s affordability.
Due to the FAR restrictions and height limits, urban cities are forced to expand and spread to provide for the increasing demand. The size of cities in India has been expanding rapidly to accommodate the increasing urban population. This unintended urban sprawl leads to higher commuting costs and public infrastructure costs. According to Breuckner & Sridhar (2012), relaxing height limits for a typical city in India can lead to an aggregate welfare gain of 106 million Rs. for a typical Indian city. Sridhar (2010) also predicts that due to the height limits in Central Business Districts of the major cities of India, a phenomenon called population suburbanization is happening where the limited supply of housing is pushing people to the periphery of cities. Thus, the rules and regulations implemented in the central business districts have affected people of all income groups and shifted them away to suburban areas.
According to the Bangalore Development Authority’s Comprehensive Development Plan (CDP) of 1995, a high rise is defined as a building with a height structure of 15 metres or more. The master plan was later amended in 2005, this was adjusted to 24 metres. The Karnataka Town and Country Planning (KTCP) Act mandates that the CDP for Bangalore be updated every ten years. According to BDA authorities, a No Objection Certificate from the fire department is only necessary for structures taller than 24 metres.
However, Bangalore has been growing more laterally than vertically. While many Indian cities grew denser over time, Bangalore has retained lower density. The density of Bangalore is 400 persons per hectare, which is even lesser than the density of Ahmedabad which is at 700 persons per hectare. The city is rapidly growing spatially, consuming agricultural hinterlands for residential purposes. This urban sprawl leads to greater pressure on public transport and infrastructure facilities. The extra commuting cost caused by the FAR restrictions in Bangalore is estimated at 4-5% of the income of an average household in Bangalore.
On the other hand, the building height limits for Ahmedabad are being relaxed gradually to accommodate the changing environment in the market. For example, during the Kutch earthquake in 2001, Gujarat's height restriction was 45 metres, but it was later lifted to 70 metres (22-23 storeys) in 2017. Again, in 2020, the new regulation introduced based on public comments and complaints, permits builders to build as high as they want in five cities: Ahmedabad, Gandhinagar, Surat, Rajkot, and Vadodara. The necessity for vertical expansion arises from the fact that cities' horizontal development requires additional land, which is becoming increasingly expensive in present days.
Vertical Expansion has also improved the affordability of housing in Ahmedabad when compared to Bangalore. The Affordability Index shows that the housing in Ahmedabad is at 20% of the aggregate income generated by the city, while the housing in Bangalore is at 25%. This demonstrates that even in the face of high prices and limited land availability, relaxing regulations such as land-use zoning for residential use, FAR and building and construction standards can increase the supply of affordable housing in a way that addresses the need without sacrificing quality or safety.
Overall, this article examines the impact of zoning laws on affordable housing, highlighting the negative impact these regulations can have on the availability of affordable housing. However, it also notes the importance of zoning laws in ensuring safety standards and preventing overcrowding. While zoning laws can limit the supply of affordable housing by restricting the type and density of housing that can be built in certain areas, they serve an essential role in regulating the built environment and protecting the health and safety of residents. Zoning regulations help ensure that buildings are constructed to meet certain standards, such as fire safety codes and building codes. Therefore, although there may be a negative impact on affordable housing due to zoning laws, it is important to recognize that these regulations serve a vital purpose in maintaining safety and quality standards in our communities. Any efforts to reform zoning laws and increase the availability of affordable housing must be balanced against the need to maintain safety and protect public health.
Twinkle Adhikari
