February 5, 2026 – The United States is facing a housing crisis. Many policymakers are seeking solutions.
New research by The Pew Charitable Trusts, led by experts from the New Urban Mobility Alliance (NUMO) and ECOnorthwest, found that building homes near existing jobs, stores and transit could save taxpayers thousands and municipalities millions of dollars in upfront and ongoing infrastructure costs.
The research used economic modeling to estimate the fiscal impact of new housing in 10 states: Arizona, Florida, Maryland, Minnesota, Montana, New Hampshire, North Carolina, Pennsylvania, Texas and Washington. For each state, researchers modeled the number of new homes needed to relieve housing shortages over the next 10 years and how public costs and revenues would vary according to the type and location of housing.
The analysis found that the upfront cost to government and taxpayers of building roads, water and sewer lines, and other public utilities to serve new homes near existing jobs, stores and transit is approximately $21,000 lower per home than the infrastructure costs of building homes at the outer edge of cities and towns.
Furthermore, the ongoing costs to government and taxpayers of maintaining roads and utilities that serve new homes are on average 50% lower when those homes are built near existing jobs, stores and transit. The average payback period for infrastructure serving these homes is nine years, compared to 13 years for homes built in outlying areas. Property taxes generated per acre are 13% higher on average when new homes are built near jobs, stores and transit.
Achieving these savings requires reforming rules and regulations in many cases. Cities that have achieved housing growth and improved affordability, such as Minneapolis, Minnesota, and Houston, Texas, have done so largely by making it easier to build apartments near commerce and public transit. Other successful reforms include limiting costly parking mandates, allowing homebuilders and property owners to determine the amount of parking that residents actually need, and streamlining permitting.
Making it easier to build housing is an important step. But that is not the end of the story. Housing reforms that target areas with existing transit, amenities and infrastructure can concentrate maintenance needs, reduce long-term costs and alleviate budgetary pressure on local governments and taxpayers — all while providing much-needed housing in areas with high demand.
Modernizing regulations so that it is easier to build housing in amenity-rich, well-connected areas improves affordability for renters as supply gets closer to demand. It gives people more choice in where to live, strengthens public finances and helps communities thrive.
Read the full study and methodology at pew.org.
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