How can we create more Indianapolises and fewer San Franciscos?
How can we create more Indianapolises and fewer San Franciscos?
The Soviet Union famously churned out tens of thousands of new apartment buildings in the 1960s, ’70s, and ’80s — some assembled in as little as 12 days — together comprising tens of millions of individual apartments. Such speed is not unique to communist command economies, or even to grim concrete mega-blocks. In Sweden and Japan today, modern, high-quality new homes can be factory-built and assembled in a matter of weeks using the same basic method — prefabrication — as the Soviets.
The US, alas, evinces no such urgency to build housing.
In some of our highest-cost cities — San Francisco, New York, Miami — it takes, somewhat astonishingly, nearly five years to erect a modestly sized apartment building, from the time an application is first submitted to building completion. That was one of the top-line findings of a remarkable new economics working paper on housing construction timelines across 60 US cities. The gaps between the fastest and slowest cities were just as striking: In Raleigh, North Carolina, a builder can complete a 20-unit apartment building in about as much time as it takes just to approve the permit for one in San Francisco, where applications languish for more than a year. In Indianapolis, a single-family home can be built in six months from proposal to completion, less than one-eighth the time it takes in San Francisco.
Such delays have costs — in delayed housing supply at a time when America is millions of homes in the hole, in lost staff time that developers ultimately bake into the cost of the new homes, and in homes that simply never get built because the process is discouraging to anyone but the best-resourced developers. The authors, Leonardo D’Amico, Evan Soltas, and Audrey Wang, found that longer permitting lengths are correlated with higher housing prices and lower rates of housing production, though they don’t claim to have shown that these are causal relationships. The research (which has not yet been through peer review and, like any working paper, may be revised before final publication) represents the first such comprehensive dataset comparing homebuilding timelines across the US. To build it, the researchers assembled 1.1 million permits covering 2.7 million housing units between 2000 and 2025 — about one in 13 new homes permitted nationally over that period, they write.
It probably won’t come as a shock to you that housing can be built faster in Sioux Falls, South Dakota, than in Los Angeles or pretty much anywhere in California. But perhaps the most notable takeaway (to me, anyway) from the paper was how massively home permitting times have lengthened across the board over the past 25 years. Across the cities in their sample, the researchers estimate that permitting time for a standardized multifamily building rose from 0.6 years in 2000 to 1.5 years in 2023, and, for a single-family home, from 1.6 months in 2000 to 4.9 months in 2023.
Is there really any good reason why we should take nearly a year longer to approve an apartment building than, Soltas joked in a recent interview, “the barbarians of 2006”? Shouldn’t we be getting faster and more efficient at building housing over time, not slower — especially at a time of acute housing scarcity?
You would think. So what is going on here?
One building, very different wait times
Permitting refers to everything that happens after a developer submits an application to build a house or multifamily building, before they’re allowed to break ground. The proposal is then reviewed for compliance with a range of different sets of rules, from building safety and energy codes to plumbing to zoning and, in some places, aesthetic design. Initial applications will often be found noncompliant and then sent back to the builder for revisions, Soltas, an assistant professor of economics at Princeton, told me.
The gulf between housing starts in California and Texas has become something of a meme in housing abundance circles. But, for all that, we have until now lacked rigorous apples-to-apples comparisons of permitting and building times in different metro areas, Soltas said. That gap in seemingly basic knowledge, what should be “step zero” facts for the national housing reform debate, became apparent to him when he was teaching an urban economics class, which became one of the impetuses for the new paper. “I realized if I needed that information to teach my students, that it might be useful for other people,” he said.
Rather than merely pulling permits from different cities and comparing how long whatever happened to be built in each city took to approve, the researchers used the data to estimate how long an identical, standardized project would take in each place between 2015 and 2019, keeping constant its size and the density of the surrounding neighborhood. Their uniform archetypes were a 2,800-square-foot detached single-family home on a 0.15-acre lot and a 20-unit multifamily building with 1,200 square feet per apartment.
Cities with longer permitting times also tended to have longer construction periods — the longer it takes to get an application approved, the longer it then takes to do the building itself, which compounds the gap between the fastest- and slowest-building cities (it’s possible that “cities that make the permitting process difficult also put in lots of burdens that slow the construction process,” Soltas said). One advantage of the researchers’ method is that the differences across cities can’t merely be chalked up to something like the complexity of building within already-dense environments like Manhattan — the analysis already controls for that. So the enormous gaps between different places become harder to dismiss as inevitable features of development in big cities.
The study wasn’t designed to answer the “why” of it all — those will be questions for future research. “Our paper doesn’t directly identify any smoking guns,” Soltas said. Still, some of the culprits are likely obvious — California, for example, has long subjected some housing projects to extensive environmental review requirements under the California Environmental Quality Act (CEQA). Apartment buildings, especially larger ones, are more likely to have to go through CEQA review, though they’re more environmentally friendly than single-family homes (recognizing this as an obstacle to housing affordability, California has been moving to exempt many housing projects from such reviews).
Why are we taking so much longer to permit housing?
But why, as the study finds, is permitting becoming slower across the country, not just in the most regulated cities? “We estimate that, in 2000, our standardized multi-family project had a 71-percent probability of approval within six months of applying for a permit,” the researchers write. “In 2025, that project had a 44-percent approval probability within six months.” Permitting times have come down a bit since 2023, but it’s unclear whether that just represents the reversal of pandemic-era highs, or if it reflects real progress from the pro-housing policies that have been passed in many cities and states in recent years.
That discovery dovetails with other economics research finding that zoning codes, which were first widely adopted in the US in the early-to-mid 20th century, have continued to become more restrictive even in recent years, making it harder to build housing.
Without knowing why exactly permitting lengths have ballooned, it’s hard to say whether those increases have occurred for good reasons. At least some of it may have to do with the aforementioned intensification of zoning and other land-use restrictions, which, I can say from having written a lot about zoning, tend to be pretty ill-conceived and hard to justify.
The slowdown may also be connected to expanding building code requirements. I’ve written at length about that issue, too; although ever-more stringent rules might seem like a great idea — who could be opposed to more safety? — they tend to be biased against multi-family housing and likely inflate the cost of building, all without having to show that the benefits are worth the costs. Particularly the cost in housing supply that never gets built, which has the effect of keeping more Americans living in older housing stock. And do we really think a home built to 2005 standards is dangerously subpar today?
We might ultimately decide that many of today’s building requirements — particularly ones like stronger energy efficiency standards — are worth it, but first we’d need to determine what their full costs are, which we remain far from doing.
At a minimum, it seems unlikely that an apartment building that’s okay to build in Grand Rapids today would be unsafe for New York. So what, exactly, is all that extra permitting time buying the city? Now, at least, Mayor Zohran Mamdani can put an exact number on the delay.
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