xHow the Five Structural Constraints Identified in “The Housing Shortage Is a Systems Failure — A Developer’s Perspective” Actually Get Resolved
In “The Housing Shortage Is a Systems Failure — A Developer’s Perspective,” Tyson Dirksen argues that the housing crisis persists not because of a lack of demand, capital, or political will — but because five systemic constraints operate out of alignment.
These constraints are often discussed in isolation. In reality, they form a tightly coupled system. When even one fails, housing production slows. When all five are misaligned, housing production collapses.
With affordability worsening, capital retreating from urban infill, and political pressure rising, the cost of misalignment across these levers is no longer theoretical — it’s measurable in units not built.
These dynamics are well-documented across academic research, institutional capital analysis, and global productivity studies — yet rarely addressed as a single system.
Addressing housing at scale requires understanding each lever — and, more importantly, how they interact.
Lever 1: Restrictive Zoning and Land Use
Policy-focused
Zoning and land-use rules determine where housing is allowed to exist — and in many high-demand metros, they artificially constrain supply by design.
Exclusionary zoning, minimum lot sizes, parking mandates, and height limits suppress missing-middle and mid-rise housing, pushing development toward either luxury formats or distant greenfield expansion. The economic effect is well-documented: constrained supply drives up land prices and embeds scarcity into the system.
This is not a market failure.
It is a regulatory supply ceiling.
What works:
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By-right zoning for standardized housing typologies
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Legalizing density where infrastructure already exists
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Treating mid-rise and infill housing as baseline, not exceptions
Zoning reform alone does not build housing — but without it, nothing else downstream can function.
Lever 2: Inefficient Delivery Mechanisms
Policy-focused
Even when zoning allows housing, the delivery pathway often does not.
Fragmented, discretionary, and unpredictable approval processes introduce execution risk long before construction begins. Multi-year entitlement timelines inflate predevelopment costs, delay capital deployment, and force redesigns that erode feasibility.
From a systems perspective, these mechanisms don’t just slow housing — they reprice risk across the entire capital stack.
What works:
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Predictable, time-bounded approvals
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Objective standards that reward compliance over negotiation
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Alignment between planning, building, and utility agencies
Efficient delivery mechanisms don’t weaken oversight — they convert political intent into executable outcomes.
Lever 3: Misaligned Capital Flows
Investor-focused
Capital flows where risk is understandable — not where need is greatest.
Today’s housing system channels investment toward institutionally familiar formats: luxury multifamily, master-planned developments, and large greenfield projects. Meanwhile, scalable housing types within constrained metros — mid-rise, modular, infill, and retrofit development — remain structurally undercapitalized.
The reason is not returns.
It is system-driven uncertainty.
When zoning is discretionary, and delivery timelines are unpredictable, capital demands higher premiums — or exits entirely.
What works:
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Standardized project typologies that reduce underwriting variance
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Delivery certainty that aligns with institutional risk models
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Capital structures designed around execution reliability, not speculation
When uncertainty is engineered out of delivery, capital reallocates naturally.
Lever 4: Low Construction Productivity
Investor-focused
Construction productivity has lagged nearly every other major industry for decades.
Labor shortages, fragmented site-built workflows, and limited adoption of industrialized methods have turned construction into the most volatile variable in housing economics. For investors, this volatility manifests as schedule slippage, cost overruns, and compressed margins.
This is not a labor problem alone.
It is a systems productivity problem.
What works:
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Industrialized construction, prefab, and modular systems
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Shifting labor into controlled environments
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Leveraging automation, digitization, and AI-enabled coordination
Productivity gains don’t just lower costs — they restore predictability, which is what capital ultimately underwrites.
Lever 5: Underutilization of Existing Housing Stock
Investor-focused
Millions of structurally sound buildings sit underleveraged, energy-inefficient, or misconfigured — not because demand is absent, but because retrofit pathways are fragmented, bespoke, and capital-intensive.
The housing system over-indexes on new construction while ignoring the fastest path to supply: standardized upgrades to what already exists.
What works:
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Repeatable, cost-effective retrofit systems
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Modular and prefabricated upgrade components
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Capital models that treat retrofit housing as scalable infrastructure
Unlocking existing stock is not a secondary strategy — it is one of the highest-ROI supply levers available.
Why Solving One Lever Fails
Each of these constraints reinforces the others.
Zoning reform without delivery reform still scares capital.
Capital availability without productivity gains still inflates costs.
New construction without retrofit strategies leaves supply stranded.
Addressing any single lever in isolation leaves the system broken.
Where Evolve-US Fits: Systems Execution
Evolve-US operates where theory meets execution.
We do not rewrite zoning codes or reprogram capital markets — we build the execution layer that allows both policy and capital to finally work together, reliably producing housing at scale:
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Standardized housing typologies that align with zoning reform
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Predictable delivery mechanisms that reduce underwriting risk
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Industrialized construction systems that restore productivity
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Retrofit strategies that unlock existing supply
When execution becomes reliable, the entire system rebalances.
Closing the Loop
TysonDirksen.com frames the WHY — why the housing shortage persists despite capital, demand, and political urgency.
Evolve-US delivers the HOW — the execution systems that align all five levers into a buildable reality.
The housing crisis is not unsolvable.
It is systemically misaligned.
Fix the system — all five levers working together — and housing starts getting built again.
About Evolve-US
Evolve-US designs and delivers scalable housing systems using industrialized construction, modular retrofits, and integrated execution models. We partner with developers, municipalities, and capital groups to reduce delivery risk, restore productivity, and make housing feasible at scale.
For developers, municipalities, and capital partners exploring system-aligned delivery models, Evolve-US focuses on execution where theory typically breaks down.