Breaking the Mold: Smarter Codes Can Unlock Smarter Housing
Unblocking the Blueprint: Zoning Reform and the Future of Affordable Housing. You can’t innovate your way into affordable housing if the rulebook won’t let you.
At Offsite Innovators, we feature breakthrough thinking in building. But innovation doesn’t just happen in factories—it happens in city halls too. Zoning reform might not sound exciting, but when cities like Austin and Dallas start scrapping outdated codes, they make room for the kind of housing innovation the country sorely needs.

If you work in housing—especially offsite construction—you know the roadblocks all too well: overly prescriptive zoning, building codes rooted in 20th-century assumptions, and neighborhood resistance to anything that doesn’t look like the house next door. The result? Fewer homes, longer build times, and higher prices. It’s a perfect storm that’s been quietly undermining affordability for decades.
But some cities are beginning to realize that if we want more housing, and especially more affordable housing, we have to fix the rulebook first.
When Good Intentions Go Bad
Zoning codes and building regulations were created to keep people safe, protect property values, and shape communities. And in many cases, they’ve done exactly that. But over time, they’ve also created unintended consequences.
Single-family zoning—the default in much of the country—limits most neighborhoods to just one house per lot. It sounds harmless, even quaint. But when land prices soar and construction costs rise, this low-density mandate becomes a luxury we can’t afford. Duplexes, triplexes, and other “missing middle” housing types are essentially banned in huge swaths of American cities.
Then there’s the complexity layered on by national standards like the International Building Code (IBC) and National Residential Code (NRC). While these standards serve critical safety functions, they can also stifle innovation, particularly in the modular and offsite sectors. Building a high-quality home in a factory is often more efficient and sustainable, but good luck if your local code official isn’t on board with that approach—or if the code itself doesn’t allow for it without time-consuming variances and appeals.
We’re not saying throw out the rulebook. But it’s long past time to revise it—and that’s exactly what Austin and Dallas are trying to do.
Austin’s Affordability Bet
Let’s start with Austin. In 2019, the city passed its “Affordability Unlocked” ordinance—a name that pretty much says it all. The idea was simple: if a developer includes enough affordable housing in their project, the city will waive or relax zoning requirements like minimum parking, height restrictions, and setbacks.
It worked.
Developers responded quickly, and projects that once would’ve been economically impossible started to pencil out. Hundreds of units have been approved under the program, many using modular or prefab construction to save time and cost.
And in late 2023, Austin took it a step further. The city council voted to allow up to three units on any residential lot, effectively eliminating single-family zoning altogether. This move, controversial in some circles, was aimed squarely at boosting density, especially in areas with good infrastructure and access to transit.
Is it perfect? No. But it’s bold. And it shows that a major U.S. city is willing to get serious about affordability by rethinking the rules—something many housing advocates have long called for.

Dallas Joins the Fray
Just a few hours north, Dallas is tackling the problem from a different angle. The city launched an affordable housing plan with an ambitious goal: 20,000 new or preserved affordable units in three years.
Rather than a one-size-fits-all approach, Dallas split its strategy across three key zones:
- Stabilization Areas, where displacement is a concern and preservation is the focus
- Redevelopment Areas, where large-scale infill can create mixed-income neighborhoods
- Emerging Market Areas, where incentives can encourage development in underbuilt pockets
In all three cases, zoning flexibility is key. The city is exploring upzoning, reducing minimum lot sizes, and simplifying the permitting process—all critical steps for bringing in modular and innovative building methods.
Dallas is also working to align its local regulations with federal fair housing obligations, recognizing that outdated zoning has often reinforced patterns of racial and economic segregation.
The approach is methodical, but promising. It reflects a growing consensus that supply-side solutions matter—and that regulation needs to evolve with the times.
Why This Matters to Innovators
If you’re in the offsite construction world, this shift should have your full attention. We often talk about factory-built housing as a silver bullet for affordability, but the truth is: we can’t innovate our way out of the housing crisis without cooperation from city governments.
Factory efficiency means nothing if you can’t get zoning approval. Smart design and sustainable materials won’t matter if your units can’t pass code without a special exception. The best ideas stall out when the regulatory climate punishes anything that deviates from the norm.
Austin and Dallas are showing what it looks like when cities start to clear the runway for new housing solutions. And that creates real opportunity—for builders, developers, and the communities they serve.
Let’s Keep Pushing
Housing affordability is a complex challenge. But that doesn’t mean we have to accept gridlock. Reforming zoning and updating building codes isn’t easy, and it won’t solve everything overnight—but it’s a critical step toward allowing innovation to flourish.
The cities leading the way—Austin, Dallas, and a handful of others—are offering more than policy tweaks. They’re offering permission to rethink how we build and who we build for.
At Offsite Innovators, we’ll keep spotlighting the policies and practices that support smarter, faster, and more equitable ways to create housing. Because solving the affordability crisis isn’t just about cost. It’s about clearing the path for ideas that work.