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How a 100-Year-Old SCOTUS Case Precipitated the 2025 Housing Crisis

A 100-year-old court ruling effectively dedicated 75% of all U.S. residential land to lots with one residential unit.
Nearly 100 years ago, a supreme court justice set the course for the urban sprawl consuming the U.S. today.

The U.S. Supreme Court ruled that Euclid, Ohio, could keep large swaths of land single-family housing 100 years ago. That set the precedent for vast urban sprawl today.

As we mentioned in a previous blog entry, high labor and material prices, combined with a shortage of housing supply, etc., to fuel the U.S. housing crisis.

One thing we haven’t mentioned yet: How a 100-year-old Supreme Court decision effectively zoned 75% of the country’s residential land into single-family home lots. And that some communities are starting to claw their way out of that bit of backward-thinking urban planning (to be discussed in the next blog installment).

In 1926, Euclid v. Ambler pitted a Cleveland suburb called Euclid against a real estate company that had purchased 78 acres of land so it could resell it for the construction of a factory. When Euclid, Ohio, zoned that land for single-family housing to stop the construction of a factory, Ambler took the village to court and lost. Justice George Sutherland – perhaps beguiled by the notion of a sleepy suburbia – wrote that Euclid-style zoning authority would “…decrease noise and other conditions which produce or intensify nervous disorders… .”

 

The SCOTUS ruling in favor of Euclid, Ohio, did more than allow cities to segregate different land uses; it spurred cities across the nation to designate vast swaths of territory for single-family homes, fueling urban sprawl like wildfire.

In 2019, the New York Times reported that it’s illegal to build anything but a single-family home on 75% of residential land in America. The Times also wrote that the percentage of land that is single-family zoned is even higher in Sun Belt cities like Arlington, Texas (89%), and Sandy Springs, Georgia (85%).

Yale urban property law scholar Robert Ellickson attributes U.S. population migration toward hotter, less-habitable places like Texas to restrictive single-family home zoning in California and other more temperate states. Ellickson cites single-family zoning in Silicon Valley, as an example, for spiking real-estate prices 10-fold, sending workers (mostly academics) packing.

Ellickson describes the expansive use of single-family zoning across the U.S. as a “zoning straitjacket.”

“Since 2000, there has been a net outflow of households from California to sweltering Texas, a change that worsens the nation’s carbon footprint,” Ellickson writes in his article, The Zoning Straitjacket: The Freezing of American Neighborhoods of Single-Family Homes. “The zoning straitjacket also contributes to urban sprawl and automobile dependence.”

HomeEc’s push to expand land use beyond single-family housing offers a remedy to America’s zoning straitjacket.

“A typical quarter-acre lot could accommodate 14, 600 Sq. Ft. Accessory Dwelling Units (ADUs),” said Robin Ball, founder of HomeEc. “Our company is recommending one HomeEc ADU per single-family lot.”

Ball said the U.S. Census Bureau estimates that the U.S. has 82 million single-family houses.

“Adding an ADU to just a fraction of those single-family lots would make a tangible impact on the American housing crisis,” she said.

Next: How a growing number of communities and advocates are working to break America’s “zoning straitjacket.”