How Has U+2 Enforcement Affected Housing Affordability in Fort Collins? Using the Synthetic Control Method to Analyze the Affordability Implications of Residential Occupancy Regulation

Abstract

In 2007, the City of Fort Collins began enforcing “U+2”, a residential occupancy restriction created in the 1960s which limited the number of unrelated persons who may cohabit legally. In a 2005 study, Corona Research estimated that 1,070 households were in violation of the ordinance. This study employs the synthetic control method (SCM) (Abadie and Gardeazabal 2003; Abadie et al 2010) to estimate the effect of enforcing U+2 on the cost of housing in Fort Collins, Colorado. The SCM is a data-driven comparative case study methodology which allows the researcher to estimate the impact of an intervention (such as U+2) on an outcome variable – in this case, the cost of housing. The results of this SCM are sensitive, but they indicate consistently that U+2 enforcement materially increased the cost of housing in Fort Collins following the beginning of its enforcement in 2007.