Housing Policy Changes That Could Unlock Affordability

Policy Alone Will Not Solve This

Let's start with an honest framing: no single policy change will fix the housing affordability crisis. The problem is too large, too deeply rooted, and too geographically varied for any one law or regulation to resolve.

But policy changes can unlock conditions that make solutions possible. They can remove barriers that currently prevent housing from being built, create incentives that channel capital toward underserved markets, and establish frameworks that protect residents from displacement.

The most promising path combines smart policy with private innovation — creating the environment where models like community-owned housing, rent-to-equity programs, and community land trusts can operate at scale.

Here are five policy areas where change could have the most impact.

1. Zoning Reform

The Problem

In many American cities, the majority of residential land is zoned exclusively for single-family homes. This makes it illegal to build duplexes, triplexes, townhomes, or small apartment buildings in most neighborhoods — exactly the types of housing that serve the middle of the market.

Restrictive zoning limits housing supply, drives up land costs, and concentrates apartments in narrow corridors while spreading sprawl outward. It is the single largest policy barrier to housing affordability in the United States.

What Reform Looks Like

Several states and cities have already taken action:

• Oregon legalized duplexes on all single-family lots statewide (2019) and fourplexes in cities over 25,000 (2021).
• California passed SB 9 (2021), allowing homeowners to split single-family lots and build up to four units.
• Minneapolis eliminated single-family zoning citywide (2018), allowing triplexes in every residential zone.
• Montana legalized duplexes statewide and streamlined permitting for accessory dwelling units (2023).

The results are early but encouraging. Minneapolis has seen a measurable increase in duplex and triplex permits since the zoning change, adding supply in neighborhoods that had been frozen for decades.

What It Enables

Zoning reform does not directly create affordable housing. But it removes the primary obstacle to building the types of housing that are naturally more affordable: smaller units, shared walls, modest footprints. When you allow four units where one used to be, land cost per unit drops by 75%.

For community-owned housing models, zoning reform is essential. Built By DAO and similar organizations cannot develop workforce housing if the only legal option is single-family homes on large lots.

2. ADU Legalization and Streamlining

The Problem

Accessory dwelling units (ADUs) — sometimes called granny flats, in-law suites, or backyard cottages — are one of the fastest and cheapest ways to add housing supply. A single ADU can be built for $100,000-$250,000, compared to $300,000+ per unit in new multifamily construction.

But in many jurisdictions, building an ADU requires navigating a maze of permits, setback requirements, minimum lot sizes, owner-occupancy mandates, and parking minimums that make the process prohibitively complex and expensive.

What Reform Looks Like

• California has led the way, passing a series of laws (AB 68, SB 13, AB 881) that override local restrictions on ADUs, eliminate owner-occupancy requirements, reduce fees, and streamline permitting.
• Washington State passed legislation requiring cities to allow at least two ADUs per single-family lot.
• Some cities have created pre-approved ADU designs that skip the design review process entirely, reducing permitting timelines from months to weeks.

What It Enables

ADUs add housing supply without requiring large-scale development. They can serve as affordable rental units, housing for extended family, or aging-in-place options for seniors. For communities exploring shared ownership, ADUs offer a low-cost entry point for building community-controlled housing stock.

3. LIHTC Expansion and Reform

The Problem

The Low-Income Housing Tax Credit (LIHTC) is the largest source of federal funding for affordable housing construction, responsible for producing roughly 100,000 units per year. But it has not been meaningfully expanded since its creation in 1986, while the need for affordable housing has grown dramatically.

The program also has structural limitations: it primarily serves households at or below 60% AMI, leaving the 60-120% AMI workforce housing gap unaddressed. Application processes are competitive and complex, favoring experienced developers over community-based organizations.

What Reform Looks Like

Proposals currently in various stages of legislative consideration include:

• Expanding the credit by 50%, which could produce an additional 50,000 units per year
• Creating a middle-income tier targeting 60-120% AMI, addressing the workforce housing gap directly
• Simplifying the application process to make the credit more accessible to smaller developers and community organizations
• Extending compliance periods to maintain affordability for longer durations (currently 15-30 years, with proposals for permanent affordability)

What It Enables

An expanded LIHTC that covers workforce housing would unlock significant capital for the exact market segment Built By DAO targets. Community-based housing organizations could access tax credit financing to build resident-owned properties at scale, combining public incentives with community ownership structures.

4. Community Land Trust Support

The Problem

Community land trusts (CLTs) separate land ownership from building ownership, keeping land in permanent community control while allowing residents to own (or accumulate equity in) the structures. It is one of the most proven models for long-term affordability.

But CLTs face persistent challenges:

• Land acquisition costs are high, especially in the urban markets where they are most needed
• Operating funding is scarce — most CLTs rely on grants and donations for their day-to-day operations
• Legal frameworks vary by state, with some jurisdictions lacking clear enabling legislation for CLT structures

What Reform Looks Like

• Dedicated federal funding for CLT land acquisition, similar to the Community Development Financial Institutions (CDFI) fund
• State enabling legislation that provides clear legal frameworks for CLT operations, tax treatment, and resident rights
• Property tax exemptions or abatements for CLT-held land, recognizing its community benefit
• First-right-of-purchase laws that give CLTs and community organizations the first opportunity to buy properties before they are sold to private investors

What It Enables

Stronger CLT infrastructure creates a foundation for community-owned housing at scale. Built By DAO's model — where residents accumulate equity in DAO-governed properties — is conceptually aligned with the CLT approach. Policy support for CLTs creates legal and financial frameworks that benefit all community ownership models.

5. Tenant Protections and Right to Organize

The Problem

Even in jurisdictions with strong tenant protections, enforcement is inconsistent. Many renters do not know their rights, cannot afford legal representation, and face retaliation for asserting their interests. And in many states, tenant protections are minimal or nonexistent.

What Reform Looks Like

• Right to organize legislation that protects tenants who form associations to negotiate collectively with landlords
• Just cause eviction laws that prevent landlords from evicting tenants without a legitimate legal reason
• Rent stabilization frameworks that limit annual rent increases to a percentage tied to inflation or CPI
• Right of first refusal laws that give existing tenants (or their organizations) the opportunity to purchase their building before it is sold to an outside buyer
• Anti-retaliation protections with teeth — enforceable penalties for landlords who retaliate against tenants for exercising their legal rights

What It Enables

Tenant protections create stability. Stable tenants are more likely to invest in their communities, participate in governance, and engage with equity-building programs. Right-of-first-refusal laws specifically enable community organizations to acquire existing buildings and convert them to community-owned models — preserving affordability in place rather than displacing residents.

Policy + Innovation = Progress

None of these policy changes alone will create the housing we need. But together, they create an environment where community-owned, equity-building housing models can operate at meaningful scale:

• Zoning reform opens land for development
• ADU legalization adds supply quickly and cheaply
• LIHTC expansion channels capital toward workforce housing
• CLT support builds the legal and financial infrastructure for community ownership
• Tenant protections stabilize communities and prevent displacement

When these policies are combined with private innovation — community governance, rent-to-equity mechanics, transparent blockchain records — the result is a housing system that works for the people who live in it.

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Be Part of the Solution

Built By DAO is building community-owned housing that combines policy frameworks with private innovation. 10% of every rent payment becomes equity. Every resident gets a vote.

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