Overzoning is when land is zoned (i.e. allocated and planned) for too high an intensity of use, leading to problems such as development of the land being infeasible (due to high land prices or expectations of owners) or inappropriately distributed.
The concept apparently first arose in Los Angeles in the mid-1920s, only a few years after citywide zoning was established. According to [Weiss 2002], related ideas were widely discussed in the last 1920s and early 1930s by planning officials around the U.S.
A related line of thinking, we think, has been articulated more recently by Chuck Marohn, founder of the StrongTowns movement, in his arguments for "incremental development," in which most places are allowed to evolve to a somewhat higher step of use intensity, but it is limited so that land values do not go beyond what is likely feasible or development becomes unsustainable.
1926 issue in Los Angeles
Charles Marohn / StrongTowns - incremental development
Chuck Marohn (StrongTowns founder), in conversation with Scott Beyer. [Marohn 2017]:
"What I have suggested is that we should be allowed by right to incrementally build to the next level of intensity everywhere. I think have stated that would make, in 99 percent of America, upzoning."
Austin has tried to solve this [affordability] problem in two ways. Way number one is to build lots more out on the edge...The other way they've tried to deal with it is to allow for market liberalization, as intensive buildings as you can. And when I look at that and I talk to the developers there, we always get back to the fact that the land is priced really, really high. The land is like obscenely high. And so, they’ll say, when I buy this little house and I'm going to build something on here, I have to build 20 stories because that's what the land prices justify. And you get in this, I think, a Catch 22 kind of cycle, where it's “OK, I have to build this intense because that's what the land is priced at.” And then you go and look at the land being priced that high because that's what people can do with it. And I just sat down and ran the numbers. I said “OK if we took every piece of land that is priced this high and we actually ran flat out and said we're going to build at the intensity that would be demanded by that price, [what happens?]” In other words let's assume the market is accurate, is accurately reflecting prices. Let's go out and let's build intensely at that price. What you would find is that a city like Austin [would need] 20 million people. [It] would be so intense a number. That will never ever happen in Austin. And so I step back, and I say that the land is mispriced, there's something stuck in this market. There's something that's not working here in the underlying land values if it actually has this huge supply in relationship to what the potential demand could be. There's something stuck and broken. I can't tell you what it is. I can't figure it out. "
"as the city, if you're sitting here facing literally, in Seattle, square miles of land that's financially not viable. And that's like an overhang that you have to deal with someday. To me what needs to happen in all those neighborhoods is that they need to become more intense they need to actually grow and see investment and become more viable. And that can't happen when the land prices are stuck and distorted and it can't happen when the regulations make it stuck and distorted. So my solution has been, or my approach has been let's try to figure this out by clearing away those regulations: Allowing people to build, by right, to the next increment. Let's get that going. And my sense is that what that would do is it would – a little bit of development everywhere – would drop the underlying land values down significantly."
- @HousingForLA. "25 Solutions From A Builder’s Perspective To Fix The California Housing Crisis." Urbanize.la, 10 Jan 2018.
- Marohn, Chuck. “Podcast: A Conversation About Market Urbanism.” (interview with Scott Beyer). Strong Towns, 30 August 2017.
- Strong Towns. “Incremental Development.” 5 December 2015. https://www.strongtowns.org/curbside-chat-1/2015/12/16/incremental-development.
- Weiss, Marc A. The Rise of the Community Builders: The American Real Estate Industry and Urban Land Planning. 2002. https://books.google.com/books?id=ZXjddnZYyLYC&lpg=PP1&pg=PA102#v=onepage&q=overzoning&f=false.