In addition to zoning: Part of Dodd-Frank made it extremely difficult for contractors to finance new spec houses, or any housing that didn't participate in a f

In addition to zoning: Part of Dodd-Frank made it extremely difficult for contractors to finance new spec houses, or any housing that didn't participate in a federal multi-family housing program. Only the most financially stable companies could stay in the market. Otherwise, construction companies have to find customers (to do the actual financing) before they can start building. This means the market is always trying to catch up, but never really can.