Hosted by HomeAid Georgia, the Greater Atlanta Home Builders Association, and HouseATL, the Housing Affordability Summit tackled one of the biggest challenges facing our industry today: how to create more attainable housing. John Hunt, Principal and Chief Analyst at MarketNsight, delivered a clear message: the path to more affordable housing lies in building smaller homes or building homes farther out. But in today’s market, even that formula is being challenged by outdated zoning laws, market inertia and a lack of political will.
The Two Paths to Housing Affordability
According to Hunt, there are only two real ways to make housing more affordable:
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Drive until you qualify, meaning buyers move farther from job centers to find lower-cost homes.
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Build smaller homes and more dense communities, which reduces the price point of the homes.
The pandemic opened up more flexibility for remote workers, leading to expanded housing development with Metro Atlanta sprawling in all directions including into markets like Chattanooga, Macon, Alabama and South Carolina. But even with the ability to live farther out, housing affordability remains elusive.
Are We Really Building Smaller?
There’s a lot of industry talk about builders shifting toward smaller, more attainable homes—but Hunt questioned whether that’s actually happening. In Metro Atlanta, the average new home in 2019 was 2,070 square feet and sold for $345,838. Fast forward to 2024, and the average new home is larger—2,210 square feet—and priced at $493,954.
While the price per square foot has moderated, square footage has increased. That begs the question: what size home would we need to build today to hit a $350,000 price point? Hunt’s answer: a 1,560 square foot home.
But here’s the catch—homes that size aren’t typically traditional single-family detached homes. They’re more likely to be townhomes, duplexes or what Hunt calls “mansion apartments,” part of the so-called Missing Middle housing that has all but disappeared from the U.S. market.
Outdated Zoning: The Core of the Problem
The reason we can’t easily build homes at these sizes and price points? Zoning regulations.
Many localities still require large minimum lot sizes, minimum home sizes and specific architectural standards that drive up costs. Hunt argues that these outdated rules are “stuck in the past” and are one of the most significant barriers to building homes that today’s buyers can afford.
In particular, Hunt pointed to the “Missing Middle” housing types—duplexes, fourplexes, bungalow courts and mansion apartments no larger than a house—that used to define many walkable, diverse neighborhoods like Atlanta’s Grant Park. These housing types promote density and flexibility without overwhelming existing neighborhoods, but modern zoning rarely allows them.
Who’s Driving the Housing Affordability Resistance?
Hunt didn’t mince words: existing homeowners are one of the largest obstacles to increasing housing supply. This vocal minority of NIMYs (not in my back yard) often opposes zoning changes out of concern for property values or neighborhood character. But as Hunt noted, the claim that smaller homes hurt property values isn’t supported by data. In fact, smaller homes cost more per square foot and are not comps for larger homes.
He traced much of our current zoning philosophy back to the 1920s, when federal policies—many driven by socioeconomic and racial exclusion—pushed cities to adopt zoning codes. These historical decisions still shape our neighborhoods today, often unintentionally perpetuating inequality and limiting housing choice.
Hunt encouraged attendees to read The Color of Law to understand how zoning has been used to reinforce socioeconomic divides and why it’s time for change.
The Cost of Inaction
“This is the defining issue of our time,” Hunt declared. Unlike shortages in commercial or industrial space, which are quickly addressed by market forces, housing is artificially constrained by policy. As a result, housing costs continue to rise, and working families are increasingly priced out.
Hunt offered a promising case study in Barrow County, where 249 homes ranging from 1,100 to 1,350 square feet were approved at a $350,000 price point. The proposal passed by the narrowest of margins, 4-3, illustrating both the challenge and opportunity of enacting real change.
Meanwhile, Hunt noted that “flyover states” are moving forward with innovative zoning and housing solutions. “We’re not doing that in Metro Atlanta,” he said pointedly.
Final Thought
For Hunt, the housing affordability crisis is a policy crisis. Until we reform zoning, reduce regulatory burdens and embrace smaller, more flexible housing options, we will continue to fall short in providing homes for the people who need them most.
Look for parts 2 and 3 of this series soon:
- Housing Affordability: Economic Headwinds
- Housing Affordability: Policy and Tax Uncertainty
About MarketNsight
MarketNsight currently serves 50+ cities in 10 states – Alabama, Florida, Georgia, Louisiana, North Carolina, Oklahoma, South Carolina, Tennessee, Texas and Virginia. Look for the addition of more cities soon! To schedule a demonstration of the MarketNsight Feasibility Matrix® or Mortgage Matrix®, call 770-419-9891 or email info@MarketNsight.com. For information about MarketNsight and John Hunt’s upcoming speaking engagements, visit www.MarketNsight.com.
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