Zoning laws, housing fees, and lengthy permitting are helping fuel homelessness crisis, new report suggests

Washington, DC; October 30, 2025: A new report from Pacific Legal Foundation reveals the real culprits of our nation’s homelessness crisis: unaffordable housing from a housing shortage fueled in part by restrictive zoning laws, exorbitant fees, and arduous permitting processes.

The report, Addressing Homelessness Through Housing Reform, authored by Kyle Sweetland, Megan Jenkins, and Mark Miller, analyzes funding of homelessness initiatives and other evidence related to rising homelessness rates and proposes four property rights reforms to expand housing opportunities. The evidence suggests that a lack of housing and affordability—not mental illness or alcohol and drug abuse—are related to higher levels of homelessness across the country, and that removing excessive barriers to homebuilding—not increasing funding—is one of the best ways to solve our current homelessness crisis.

“Decades of restrictive land-use and environmental regulations have blocked Americans from building the homes their communities desperately need,” said Kyle Sweetland, strategic research manager at Pacific Legal Foundation and lead author of the report.

“It appears that states that allowed more housing construction saw homelessness decline, while states that restricted building saw homelessness skyrocket—even when they funneled billions trying to solve the problem.”

The report suggests a striking pattern: States that allocate less money toward reducing homelessness have cities with higher housing construction rates than cities in states that have allocated the most money toward the issue—and cities like Los Angeles and New York are experiencing some of the worst homelessness and housing challenges nationwide.

“We need cost-effective solutions like decreased regulations, not increased government funding. Both Texas and Florida demonstrate that this is possible. These states increased the production of housing through reduced regulations, and their homelessness counts have dropped,” Megan Jenkins said.

Through housing reforms—by-right development of housing projects, timely permit application approval, limited third-party challenges to building permits, and removal of improperly assessed impact fees—states can remove unnecessary barriers and prioritize flourishing communities, improving the nationwide housing market for the better.