Density Bonuses

‘Density bonuses’ enable a developer to increase the number of housing units in a development, beyond what would normally be allowed under the zoning ordinance, if the development meets some specified public purpose. A common public purpose is setting-aside a number of units for low-income occupancy. Density bonuses have long been used by communities in California to promote affordable housing (Calavita et al. 1997) and are now used in many parts of the country. However, evaluation of density bonuses is mixed, with concerns that the increased density reinforces the spatial mismatch between wealthy and impoverished neighbourhoods in the USA. For instance, a review of the use of density bonuses in San Diego found that the bonuses were used primarily in lower value land markets, and so acted to reinforce spatial concentrations of poverty (Ryan and Enderle 2012).

In New York City, a ‘designated areas’ voluntary inclusionary policy, introduced in 2005, offers density bonuses of up to 33 % in exchange for a 20 % affordable housing dedication for affordable rental housing. The scheme had produced around 1800 units by 2013 and is widely regarded to be successful (Hickey 2013). However, where permissible densities are already high, or applied with flexibility, density bonuses offer little incentive for developers to take up.

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