Addressing Affordable Housing

Pennsylvania municipalities are increasingly confronting a housing affordability crisis driven by rising costs, constrained supply, and outdated zoning frameworks.  Even smaller entities are experiencing this impact as demand for housing grows – especially in and around economic centers – where traditional local land-use regulations have often restricted their ability to respond effectively. Consequently, many cities, boroughs, and townships across the state are rethinking zoning both as a source of the problem and as a possible solution. The primary issue is the mismatch between housing supply and demand. Many zoning codes in Pennsylvania still reflect mid-20th-century planning assumptions, emphasizing low-density, single-family housing. These rules restrict multifamily units, accessory dwelling units (ADUs), and mixed-use developments that could increase supply.

Researching this dilemma revealed that in cities, population stabilization and neighborhood revitalization have intensified demand without a proportional increase in housing stock. This imbalance has led to rising rents and home prices, particularly in neighborhoods experiencing economic reinvestment.

Municipalities are beginning to treat zoning reform as a key policy tool and have exposed several approaches that are gaining traction in order to address this conundrum. One is inclusionary zoning that requires or incentivizes developers to include affordable units in new projects. Another is upzoning that allows greater density in targeted areas, especially near transit or job centers, and lastly is ADU allowances, by permitting smaller, secondary units on existing residential lots to incrementally expand supply.

Outside urban cores, zoning can be even more restrictive. Many suburban municipalities enforce large minimum lot sizes and prohibit multifamily housing altogether. These exclusionary practices limit affordable housing options and push lower-income households farther from employment centers.  Some Pennsylvania counties are beginning to explore “missing middle” housing—duplexes, townhomes, and small apartment buildings – as a way to diversify housing stock without dramatically altering community character.

It’s important for municipalities to keep their residents informed about these possible changes. Community engagement and transparency are key, as there is often public resistance to change. Recognizing this, it will be important that any changes to zoning rules be made carefully and with plenty of public input.

Pennsylvania’s Municipalities Planning Code (MPC) grants significant zoning authority to local governments, resulting in a fragmented policy landscape. While this allows municipalities to tailor solutions, it can also hinder coordinated responses to regional housing shortages. State-level support, primarily through the Pennsylvania Housing Finance Agency, provides financing tools such as tax credits for affordable housing development. However, these programs depend on local zoning that permits such projects, limiting their reach when municipal regulations are restrictive.

Efforts to increase housing density will often face local resistance. Justified concerns about traffic, infrastructure strain, and neighborhood character can slow or block reform. Municipal leaders must balance these concerns with the need to expand housing access. Cities like Harrisburg have found some success through adaptive reuse—repurposing older buildings into residential units—allowing for growth without extensive new construction. Again, community engagement and design standards are also critical tools in building public support.

Zoning reform is emerging as a key strategy to address some of Pennsylvania’s housing affordability challenges. Although traditionally restrictive, local land-use policies are gradually changing to support higher-density, mixed-income, and diverse housing options in some areas. However, residents in established communities often oppose these changes to protect their neighborhood’s character. Municipalities that modernize zoning to meet current housing needs—while engaging residents and maintaining community character—will be better equipped to manage growth and improve affordability.

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About the Author

David L. Anthony is a member of the Keystone Municipal Solutions team of experts. He is a veteran of municipal government, having served more than 33 years in various positions of public service. Contact him at david@keystonemunicipalsolutions.com. To learn more about David and the Keystone Municipal Solutions team, click here.