Assessing the environmental arguments for and against new housing development
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April 30, 2025
Introduction
The United States faces a critical housing shortage that is especially severe for moderate- and low-income households. At the same time, global climate change is raising the stakes for addressing this housing shortfall without exacerbating environmental harms or excluding vulnerable populations.
This brief identifies key debates surrounding housing development in the context of climate change. We explore what evidence supports arguments about whether new housing benefits or harms the environment, whether new “green” housing helps or burdens low-income households, and whether housing development may be unsustainable in some places. The brief also highlights the need for more evidence and better frameworks to weigh the tradeoffs between sustainability, affordability, and housing supply.
Environmental concerns about housing development
New housing development has long faced opposition from those who believe it will change the character of their neighborhoods or depress the value of their property. In recent years, some groups who advocate for lower rents and housing prices have also opposed new housing development. These groups question the idea that building new housing, thereby increasing the overall supply, will result in greater affordability. This position, which New York University professors and researchers Vicki Been, Ingrid Gould Ellen, and Katherine O’Regan call “supply skepticism,” is rooted in fears that new homes are often aimed at the top of the income spectrum, doing little to help low-income households and possibly harming them by causing price appreciation, gentrification, and displacement.
Another set of arguments draws on concerns about the environment. Writing for The Atlantic in 2024, Jerusalem Demsas described how sweeping zoning reforms meant to allow for greater density, transit access, and housing affordability in Minneapolis “fractured the green community,” leading “a wide array of self-described environmentalists [to] find that they don’t agree on very much anymore.” While some saw the changes as essential for combating environmentally harmful sprawl and making progress toward a Green New Deal, others worried about the environmental impacts of new construction.
This brief explores arguments that those concerned about the environmental impacts of new housing have raised. These positions are diverse and sometimes contradictory. Some, fearing that any new construction damages natural habitats and systems, may oppose growth in general or in their own backyards (the latter viewpoint is sometimes referred to as “environmental NIMBYism”). Others may specifically oppose market-rate development, believing it exacerbates climate impacts without benefiting low-income households.
Does new housing help or harm the environment?
New housing development can harm the environment in a variety of ways. It stands to reason that building housing can result in the loss of forests, wetlands, and other environmentally sensitive areas, disrupting plant and animal habitats. By creating more impervious surfaces in the city, new housing could contribute to the formation of heat islands, increase stormwater runoff, and produce other adverse outcomes. The construction process itself is resource-intensive and generates greenhouse gas emissions, which contribute to global warming and climate change.
It is certainly true that constructing new homes consumes resources such as timber, steel, and land, and that manufacturing and transporting building materials, as well as erecting structures, produce emissions. One estimate suggests that new home construction in the U.S. generates more than 50 million tons of embodied carbon emissions each year, or about as much as 138 natural gas-fired power plants would produce. Some “cautious greens” point to renovating and preserving the existing housing stock as a more environmentally friendly alternative to building new housing. However, renovations alone cannot accommodate population growth or household formation and may also produce significant emissions. Research shows that changes in building practices and materials, including building taller, denser structures, could reduce emissions by more than 30 percent, and that the greater energy efficiency of new buildings compensates somewhat for the energy consumed during their construction.
The impact on plant and animal habitats, tree canopies, stormwater runoff, and CO2 emissions varies greatly depending on where new housing is located – for example, on a greenfield site versus a previously developed site such as an urban parking lot. The impact also depends on how the land would have been used otherwise. Farming, although it usually emits less than residential and commercial uses per acre, does release nitrous oxide, carbon dioxide, and methane, while forests act as carbon sinks. The type of housing matters, too. Single-family detached units on large lots may be more energy-intensive to build and less energy-efficient in the long term, while the shared walls in apartment buildings can save energy, materials, and space. Furthermore, green infrastructure strategies such as bioswales, green roofs, and permeable pavement can help mitigate harmful impacts or even reduce them compared to a site’s previous use.
Pro-housing advocates also argue that by indiscriminately opposing new housing projects for fear of the environmental harms they may cause, we risk several evils. First, we may fail to build housing where it causes the least harm, namely, on infill sites with robust transit and other existing infrastructure. Second, we may end up pushing housing development to places where it faces the least resistance, potentially making the most vulnerable bear the brunt of housing development’s environmental impact. Finally, we risk restricting housing supply in ways that drive up costs and disproportionately burden low-income households, who lack the resources to retrofit their homes or access more climate-resilient housing. Conversely, dense housing development may provide affordable, climate-resilient options and even reduce emissions if residents gain access to transit infrastructure or can walk to jobs or school. Today, transportation accounts for the largest share of greenhouse gas emissions in the U.S., and sprawl significantly contributes to this problem. Dense, urban development also preserves natural habitat. Researchers have found that the “skyscraper revolution” has helped preserve rural land worldwide.
Does new, greener housing help or burden low-income households?
Another question is whether new, greener housing only provides energy savings, greater climate resilience, and other benefits to the well-off, without improving (or potentially even worsening) the climate vulnerability of low-income households. In other words, although newly built housing may be held to higher standards of energy efficiency and incorporate green building practices and climate-resilient materials, it may enter the market at prices that are out of reach for low-income households. Indeed, if the housing is green-labelled, that label in itself may translate into slightly higher prices and rents.
While there is a robust literature on the price effects of certifications like LEED or Passive House, it does not follow that “green” housing is inaccessible to low-income households. Unlike other price premiums, “green” price premiums are offset by savings in transportation, utilities, and insurance. Many affordable housing projects competing for federal tax credits pursue green certifications because states award them points for doing so, increasing their chances of winning credits. It is unclear what share of new, green housing coming online today is also affordable, but there are clearly important opportunities to pair sustainability and affordability requirements in public subsidy programs as well as density bonus regimes.
What about arguments that environmentally friendly housing could raise the value of nearby properties, drive up rents, and cause low-income households to be displaced, potentially to worse housing or more climate-insecure neighborhoods? There is a growing body of literature on green gentrification, but it has focused largely on the gentrifying potential of major pieces of green infrastructure like urban greenways, and it is unclear that private housing could have a similar effect. Instead, the preponderance of new evidence shows that new construction – including market-rate housing – reduces or slows the rise of housing costs in regions and neighborhoods. If new housing in general does not induce displacement, it is unclear why environmentally friendly housing would do so. Furman Center research also found that new housing sparks chains of moves, which could benefit households across the income spectrum by allowing them to access newer housing. Although this housing may not be considered “green,” it nevertheless tends to have better insulation, heating, and cooling systems, as well as more energy-efficient appliances than older units.
Is building new housing unsustainable in some places?
A final question is whether there are some places where building new housing is simply unsustainable. In areas prone to wildfires or flooding, which have been intensified by climate change, constructing new housing may be irresponsible even if there is demand. Similarly, building new developments in water-scarce areas, which may become even drier due to climate change, can strain reservoirs and aquifers, leading to water shortages in the future.
These concerns cannot be dismissed in places like California, Arizona, and Florida, which are at the frontier of climate change in the U.S. Yet the failure to build enough housing comes with its own risks. Housing shortages and rising rents may leave vulnerable people with inadequate shelter. In 2022, 425 people died from heat-related illnesses in Maricopa County, AZ, and 42 percent of them were unhoused. Also affected are Indigenous and migrant farmworkers who often live in poorly insulated mobile homes and struggle to access better shelters due to local development restrictions. Researchers are also exploring whether the lack of affordable housing in California’s urban areas may be driving development in and near wildlands, including protected coastlines and other natural reserves, leading to more severe climate change impacts.
So while we should undoubtedly restrict new construction in the most vulnerable areas, such as flood zones and at the wildlife-urban interface, we must at the same time consider ways to create more housing supply in safer areas. Pro-housing advocates point out that these new homes can be better protected against wildfires and other climate risks; for example, by using fire-resistant materials, installing sprinklers, regularly clearing flammable vegetation, putting low-lying housing on stilts, and moving critical utilities off the ground. In addition, these homes can be designed to better conserve and recycle water. Resiliency-focused building codes paired with incentives at the municipal level, in combination with climate-sensitive insurance policies, can help encourage these shifts as climate change risks escalate. Flexible financing through green banks, paired with technical assistance, can also help ensure that such climate-resilient technologies are accessible for affordable housing projects and retrofits.
Conclusion
In sum, decisions about how to balance the urgent need for more housing with climate and other risks remain fraught. There is a need for more research, particularly to quantify the environmental impact and climate vulnerability of new housing in relation to its construction methods and location, and to assess how new, green housing units can best enhance climate resilience for households across the income spectrum. These evidence gaps exist alongside pressing questions about how to invest in the current housing stock to make it more energy efficient and resilient while preserving or enhancing affordability.
The evidence suggests that if we build new housing wisely, we can avoid a great deal of environmental harm. Even more, it demonstrates that failing to build adequate housing comes with grave risks. The relevant question for policymakers, practitioners, and advocates for a more sustainable future may not be whether to build new homes, but rather how and where.
Resources
Research and guidance at the intersection of housing and climate change is rapidly developing. Newly emerging tools can help practitioners and policymakers achieve both housing and climate goals.
- The Lab has developed a framework for how localities can simultaneously achieve their housing and climate goals. Brookings offers guidance on how policymakers, including at the local level, can nudge households towards homes with lower climate risk.
- Researchers caution that while relaxing zoning restrictions promotes housing development, it will not guarantee density or environmental friendliness. The EPA offers a variety of tools for cities pursuing sustainable development.
- Researchers at the University of California are studying how unaffordability may be driving housing development patterns that are harmful to habitats and increase wildfire risk. They hope to develop an “interactive planning tool” that can inform future development decisions.