The Problem with Zoning Is Good Intentions

From good intentions to housing gridlock: How zoning spiraled—and how blank slating rebalances the system.

It starts with a good intention. A community wants to protect elementary school children by ensuring that a liquor store or vape shop cannot operate next door to a school. That makes sense. It is what Adam Smith called commutative justice—a principle focused on protecting people and their property from direct harm. In modern terms, it means “Don’t mess with me, and don’t mess with my stuff.”

But zoning rarely stops there. That single act of protection becomes the beginning of a slippery slope. Soon, zoning is used not to safeguard safety—but to preserve subjective preferences about architectural styles, lot sizes, or the “character” of a neighborhood. This slow expansion, often driven by well-meaning people with time and influence, leads to bloated zoning codes, expensive housing, and invisible exclusion. And it all started with a good idea.

This is the central paradox of American land use policy: the problem with zoning is not bad intentions—it is good intentions left unchecked.

To address this, we need a governance reset—a framework that periodically clears away accumulated rules and reexamines land use through the lens of safety, fairness, and flexibility. That solution is called blank slating. It is not about adding new layers of regulation, but about restoring freedom and accountability—protecting people and property while expanding individual choice in pursuit of life, liberty, and the American promise of opportunity.

About the author:  Jeff Hulett leads Personal Finance Reimagined, a decision-making and financial education platform. He teaches personal finance at James Madison University and provides personal finance seminars. Check out his book -- Making Choices, Making Money: Your Guide to Making Confident Financial Decisions.

Jeff is a career banker, data scientist, behavioral economist, and choice architect. Jeff has held banking and consulting leadership roles at Wells Fargo, Citibank, KPMG, and IBM.

From Commutative Justice to Style Policing

The original premise of zoning—protecting vulnerable populations and creating safe community design—aligns with basic justice. Most people agree that there should be thoughtful distance between schools and businesses like liquor stores. But that principle of protection quickly expands. Human nature, political incentives, and economic interests combine to create a system where zoning becomes a vehicle for enforcing preferences rather than preserving public safety.

Soon, zoning commissions—and their private counterparts, Homeowner Associations (HOAs)—are mandating roof pitch, building height, the location of garages, or the minimum square footage of a home. It is no longer about keeping children safe—it is about maintaining exclusivity and aesthetic control. This is not commutative justice; it is creeping paternalism.

Although zoning commissions are public entities and HOAs are governed by private contracts, the difference is legal, not functional. In practice, both exercise power over what gets built and what does not. The same incentives and constraints that drive zoning commissions, politicians, and bureaucrats—such as time-limited agendas, property value protection, and administrative growth—are mirrored in HOA boards, property managers, and neighborhood residents. Both are shaped by a small group of insiders with the time, motivation, and legal authority to restrict change, often to the detriment of housing affordability.

Yet a deeper question must be asked: Who is the "we" in "we decide" what gets built? Is it the board or commission, the landowners, or the broader public—including renters, workers, and future residents? This article argues for the broadest definition of "we," grounded in constitutional principles of life, liberty, and the pursuit of happiness—rights that belong to all, not just those with time or title. Zoning rules, like other governance mechanisms, should reflect the will and welfare of the entire community—not just its most vocal or powerful subset.

That is why blank slating should apply to both public and private land-use regimes. Whether land-use restrictions arise from municipal codes or neighborhood covenants, they should be periodically reset and re-justified—retained only if they serve a legitimate safety or public-interest goal. In both cases, the path to more affordable housing depends on undoing the accumulation of well-intended but exclusionary rules.

Why Zoning Always Expands

The challenge is not just philosophical—it is structural and behavioral.

• Zoning commissions (and HOA boards) attract a specific type of person: individuals with the time, resources, and motivation to influence neighborhood design. Often, these individuals already own property and have a vested interest in preserving or increasing its value. Their preferences—about style, density, or “fit”—become law, even if those preferences are not shared by the broader community.

• Bureaucrats (and HOA property managers), who administer land and property use codes, have incentives to grow their departments. The more complex the zoning code, the more staff it requires to interpret, enforce, and defend it. Complexity becomes a job-preservation strategy.

• Politicians, bound by short election cycles, face little incentive to pursue long-term housing reform. Increasing housing supply takes time—often longer than a single term in office. It is easier to respond to vocal constituents by adding restrictions than to embrace reforms that may benefit future residents more than current ones.

Renormalization, as described by N. N. Taleb, accelerates this dynamic. When a small group pushes for a narrow, new restriction—say, banning duplexes or mandating specific architectural features—the broader, more flexible majority tends to concede, simply because it is easier than resisting. Over time, these minority preferences become the default norms. The community adapts to rules it never consciously chose, reinforcing a cycle of regulation creep. This behavioral feedback loop helps explain why zoning restrictions rarely shrinks—it only expands.

The result is predictable: zoning codes that grow more complex each year, driven by a small group of insiders, with few mechanisms for review or repeal. The zoning corpus comes to resemble Frankenstein, an emergent being built with incremental and ill-fitting parts.

A Hayekian and Behavioral Warning

Economist Friedrich Hayek warned of this problem. In The Use of Knowledge in Society, he argued that centralized planning often fails because it cannot keep up with localized, dynamic knowledge. When a small group imposes rigid rules, it freezes a living system.

Behavioral economics reaches the same conclusion from a different angle. Human psychology leads us to favor the status quo, cling to existing rules, and justify regulations even when they no longer serve their original purpose. This is how outdated zoning codes survive—by default, not design. As Thomas Sowell observed, "...zoning allows some people to impose their values and life-style on others who may not share the values or be able to afford the life-style."  The result is a set of rules that not only reflect outdated assumptions, but also disproportionately benefit the few at the expense of the many.

Zoning and the Affordable Housing Crisis

It is no coincidence that America’s housing affordability crisis coincides with the proliferation of restrictive zoning laws. In cities and suburbs across the country, minimum lot sizes, height caps, density limits, and design mandates make it legally difficult—or financially impossible—to build starter homes, duplexes, or small apartment buildings.

Consider this: nearly 75% of residential land in many U.S. cities is zoned exclusively for single-family homes. These rules were not handed down by nature—they were made by people. And they can be changed.

The Solution: Start with a Blank Slate

We do not need to eliminate zoning altogether. But we must rethink how zoning is justified and maintained. The solution is a process called blank slating.

Blank slating means periodically clearing the zoning code and requiring that every land use restriction be re-justified from scratch. It flips the burden of proof: instead of assuming existing rules are valid, they must be re-earned.

• Land use restrictions should only exist if they are clearly tied to public safety or health.

• Periodic blank slating should occur to set aside ALL zoning rules. Then, a smaller rule corpus will be recommended and should be reviewed by an impartial authority—someone without a financial stake in rising property values or bureaucratic expansion. This includes local homeowners, developers, or staff whose salaries are tied to increasing property tax revenues.

• Zoning rules should have expiration dates or sunset clauses that force communities to revisit and reaffirm them, rather than allow them to accumulate unchecked. This enables the qualifying rules to be reviewed before periodic blank slating.

• Optimal representation. Blank slating ensures the larger community members' individual diverse preferences will be communicated via third-party representatives like zoning commissions, HOA boards, and relevant bureaucracies.

Think of it as addition by subtraction: removing the outdated to make room for the essential.

Our constitutional system is built on checks and balances, not just to limit power, but to revisit decisions through independent review. Zoning commissions and HOAs, by contrast, often operate without similar guardrails. Elections may check officials, but they do not check default bias—the tendency to preserve existing rules simply because they already exist.

Blank slating serves as a decision-level check, not a political one. It resets the assumption that current zoning rules are valid and forces communities to justify them based on public safety or necessity. Without this independent review, zoning codes expand unchecked—driven by narrow interests and insulated by complexity. The result is fewer homes, higher prices, and shrinking opportunity.

In a democracy, we review, we justify, we adapt. Zoning should follow the same principle.

How We Pay for Reform

A fair question emerges: how do we pay for this?

Blank slating requires administrative effort—independent reviews, public hearings, legal drafting. But these costs are more than offset by the gains:

• Win 1: Lower administrative costs. A simplified zoning code requires fewer staff and less oversight. As complexity decreases, bureaucracy naturally shrinks through attrition. Fewer bureaucrats mean lower government costs.

• Win 2: Lower costs for builders. Simpler rules reduce permitting delays, legal fees, and compliance costs—speeding up construction. More business activity means more tax revenue.

• Win 3: More affordable housing. Increased supply leads to lower prices, expanding access for working families, teachers, nurses, and first-time buyers. Builders with fewer restrictions are freer to innovate for local demand. A larger tax base means more tax revenue.

During the transition period—when housing supply is still catching up—public funds previously tied up in regulatory systems can be redirected to support nonprofits and housing assistance programs.

This is not about expanding government. It is about redeploying existing resources in smarter, more accountable ways.

A Proven Governance Model: Zero-Based Budgeting (ZBB)

Blank slating may sound novel, but it mirrors a proven framework in public administration: Zero-Based Budgeting (ZBB).

ZBB requires agencies to justify every dollar of spending from a zero baseline each year. There are no automatic renewals. Programs must prove their value annually. ZBB is used in both the private and public sectors to eliminate inefficiency and restore alignment with mission-critical goals.

Blank slating applies the same logic to zoning. It asks:

• Does this rule serve a real public need?

• Is it essential for safety?

• Does it promote fairness or restrict opportunity?

Research from institutions like McKinsey, the Mercatus Center, and the U.S. GAO shows that ZBB improves transparency and accountability. When applied to land use, it becomes a mechanism for modernizing governance—turning legacy code into living policy.

Conclusion: Back to First Principles

The problem with zoning is not corruption. It is good intentions left to grow without review.

We started by protecting children from liquor stores. We ended up making it illegal to build anything but 3,000-square-foot homes on half-acre lots.

But we can reverse this. With blank slating, we return to first principles. We re-center land use policy on safety, simplicity, and fairness. And we build—not just houses—but opportunity.

The housing crisis is not inevitable. It is policy-driven. And that means it is solvable.

Let’s stop layering rules on top of rules and start making policy that works. Let’s blank slate zoning—and make space for a future that includes everyone.

See my companion article:

The simple answer to the affordable housing crisis: Stop Making Home Building Illegal

Postscript: Is Reston the Exception?

Reston, Virginia is located west of metropolitan Washington D.C. and just outside the beltway. It is near Dulles Airport and is on the subway network supporting the DC area. Reston is a master-planned community with well-integrated residential, commercial, and recreational spaces—appears on the surface to challenge the core argument of zoning reform. It is walkable, pleasant, and has managed growth with foresight. So does Reston prove that comprehensive zoning and planning work?

Not quite. The better question is:

What can we learn from Reston's planning success without replicating its regulatory rigidity?

Reston’s strengths come from intentional design, not incremental overregulation. Its founding vision prioritized mixed-use development and human-scale planning. But unlike most American communities, which evolve through decades of uncoordinated zoning changes, Reston was guided by a unified plan—not a patchwork of rules driven by vocal minorities or bureaucratic momentum.

Yet even Reston faces affordability challenges. Its strict density caps and inflexible zoning rules have made it difficult to add new, lower-cost housing options. Recent proposals to modestly increase allowable density have encountered resistance, illustrating how even the best-laid plans can calcify over time.

This is precisely where blank slating applies. It does not oppose planning—it supports revisiting plans. It is a governance tool to ensure that communities remain adaptable, inclusive, and aligned with today’s needs rather than yesterday’s assumptions.

Reston’s success is not a contradiction; it is a reminder: good planning must evolve. Blank slating ensures it does.