Los Angeles is grappling with one of the nation’s most severe housing shortages, especially at the lower end of the market. Among all US metropolitan areas, Los Angeles had the greatest price appreciation gap between the least expensive 20 percent of homes and the most expensive 20 percent of homes, a gap that widened 133 percent from 2000 to 2019. The situation has only worsened during the pandemic, as the city’s inventory of available housing dipped to a record low in December 2020, increasing only slightly since.
The lack of housing supply in Los Angeles helps explain why the city has lower homeownership rates, more overcrowding, and a higher housing cost burden than other cities. Only 37 percent of households in Los Angeles are homeowners, compared with 54 percent in California and 64 percent nationally, according to our analysis of 2015–19 American Community Survey data. Fifty-six percent of renters in the city are cost burdened (paying more than 30 percent of their income on rent), compared with 45 percent of US renters. And 14 percent of households are overcrowded (having more than one person per room), compared with 3 percent of US households.
One solution to the lack of affordable housing is to build more low-density infill housing, specifically accessory dwelling units (ADUs) and two-to-four unit buildings, which could increase housing supply while preserving unique neighborhood characteristics. Adding these types of units comes with potential challenges, some of which stem from misconceptions about the implications of low-density infill housing and others grounded in substantive barriers to creating more of this kind of housing.
We have been studying whether Los Angeles can benefit from policies that would make it easier to add low-density infill development in existing single-family zones. From that research—including a literature review, data analysis, and interviews with 25 local stakeholders—we debunk three common myths about low-density infill housing.
Myth #1: Building more infill housing leads to overcrowding
In Los Angeles, the city is much more overcrowded than the rest of the United States, in part because of its housing supply shortage. But there appears to be ample room for Los Angeles’s single-family neighborhoods to house more people without becoming overcrowded. A McKinsey report found that in Los Angeles, current zoning allows for 1.5 million to 1.9 million additional housing units on highly underutilized residential parcels.
Low-density infill housing could not only address the shortage of housing in Los Angeles but also increase the flexibility of existing housing stock to accommodate different needs, including multigenerational families, those working from home, and an aging population who want to remain where they live.
Studies have also shown that concerns about overburdened utilities, parking shortages, and a surge in short-term rentals don’t play out in practice. Utilities generally are more efficient and cost less in denser areas, 40 percent of tenants in California ADUs did not park cars on the adjacent street, and only 8 percent of new ADUs in California are short-term rentals. Although ADUs are not the same as duplexes or fourplexes, two-to-four unit homes are unlikely to increase these neighborhood burdens. Plus, they add housing variety and are more environmentally sustainable.
As communities consider how best to move forward with housing in the wake of the COVID-19 pandemic, they must recognize that neighborhood density is not synonymous with overcrowding. Overcrowding is associated with poor COVID-19 health outcomes, and increasing density can be a solution for overcrowding.
Myth #2: Low-density infill housing leads to higher rents and gentrification
Most studies on the impact of new construction on rents find new supply decreases the rents of nearby properties. Existing research mainly focuses on the development of larger properties and less on the impact of low-density infill housing. But, because two-to-four unit buildings and ADUs are relatively affordable properties and generate fewer new units, adding these housing types is unlikely to have a large spillover effect on the nearby property prices. In fact, adding these units can have an incrementally positive effect on supply and can lower housing costs, especially for affordable housing.
Where these structures are built will also affect nearby rents and the possibility of displacement pressure and gentrification. In higher-income neighborhoods, it is very unlikely that adding these new units will increase rents because the new units are likely to be more affordable. Opposition to new housing is generally higher in these neighborhoods, but the benefits may be larger for the new tenants, whose access to neighborhood schools and services could improve.
In contrast, adding low-density infill housing in lower-income neighborhoods could eventually increase rents and the possibility of gentrification. This is why local jurisdictions need strategies to mitigate those possible effects by distributing this new housing equitably around the city.
More equitable supply could also alleviate concerns that more low-density infill housing could disproportionally increase the number of renters in neighborhoods with these units because, in the long term, the increase in the affordable housing supply would enable more renters to become homeowners.
Myth #3: Low-density infill housing can’t be well designed
Contrary to opponents’ fears, low-density infill housing can be very well designed. Smaller homes can be built in established neighborhoods without adding out-of-context or sprawling development. As several interviewees pointed out, some of the classic and beautiful Los Angeles designs (such as bungalow or modern homes) include duplexes and quadruplexes.
Minimal design guidelines for new low-infill housing can ensure design quality without adding undue cost. Addressing the size and bulk of an ADU compared with the primary home or neighboring homes can be accomplished with design guidelines and regulations that preserve street fronts and neighborhood compatibility. Rethinking small design issues, such as locating utility hookups in the rear of low-density infill, could also address aesthetic complaints.
What’s next for low-density infill housing in Los Angeles?
Low-density infill housing can play an important role in helping Los Angeles solve its housing supply and affordability challenges. But the city’s current development process is challenging, and relatively little gets built, exacerbating its housing supply shortage. Revising policies to promote low-density infill housing could help address this challenge and ensure all residents can afford a home in the city.
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