Missing Middle Housing, Explained

Missing middle housing is the group of small buildings that hold more than one home and sit, in size, between a detached single-family house and a mid-rise apartment block. It includes duplexes, triplexes, fourplexes, townhouses, cottage courts and courtyard apartments. Architect Daniel Parolek of Opticos Design coined the term in 2010. “Middle” describes the scale of the building. It is not an income category, and these homes carry no income limits unless a program adds them.

These homes are called “missing” because few new ones get built. They were an ordinary part of American neighborhoods before the 1940s. Zoning codes and related rules then made them difficult or illegal to build on most residential land. Since 2019, several states and cities have rewritten those rules.

What Counts as Missing Middle Housing

Opticos describes missing middle housing as house-scale buildings: no wider, deeper or taller than a detached single-family home, but with several households inside or clustered on the lot. The firm lists a few shared traits, including a walkable location, small footprints, smaller homes, simple wood-frame construction and fewer off-street parking spaces. Its catalog of types includes the following.

Definitions differ at the edges:

• Washington State’s 2023 law defines middle housing as buildings compatible in scale with single-family houses that contain two or more attached, stacked or clustered homes. Its list runs from duplexes to sixplexes and also names townhouses, stacked flats, courtyard apartments and cottage housing.
• The Terner Center for Housing Innovation at UC Berkeley uses a wider range, from an accessory dwelling unit (a small second home on a house lot) up to apartment buildings of ten to twenty units.
• A 2021 HUD report describes missing middle housing as unsubsidized options that blend into single-family neighborhoods, such as bungalow courts, townhouses, duplexes to fourplexes and courtyard apartments.

Why These Homes Stopped Being Built

They used to be ordinary

Opticos calls these building types a fundamental part of pre-1940s neighborhoods. A 2022 Terner Center brief, drawing on Census Bureau survey data through 2020, noted that about one in 13 U.S. homes is in a two- to four-unit building.

Zoning separated housing types

Zoning is the set of local rules that says what can be built on each piece of land. In 1926 the U.S. Supreme Court upheld the practice in Village of Euclid v. Ambler Realty Co. The ruling approved an ordinance that kept apartment houses out of districts of detached homes. Summarizing the case for such rules, the opinion said that in those districts “very often the apartment house is a mere parasite.”

Many communities went on to reserve most of their residential land for single-family zoning, which allows one detached house per lot. The Terner Center brief says these building types have been illegal to build in most neighborhoods since the 1920s. It also notes that restrictions on building types were used to keep out lower-income households and households of color, a practice known as exclusionary zoning.

What the construction numbers show

The Census Bureau has tracked completed homes by building size since 1968. The figures below are its national estimates for new privately owned homes.

Two cautions apply. First, the Census Bureau counts a townhouse as a single-family home when it has a ground-to-roof wall, its own heating system and utility meters, and no unit above or below. The table therefore covers duplexes, triplexes and fourplexes, not every middle housing type. Second, the numbers show a decline but not its cause. The sharpest drop came between the mid-1980s and the early 1990s, long after single-family zoning took hold, so zoning alone does not explain it.

The Barriers Today

Legalizing a building type is only the first step. Small-scale builders convened by the Terner Center in 2022 described a stack of rules and market conditions that decide whether a project goes ahead.

• Parking. Parking minimums can make a small building physically impossible. Opticos gives an example: a rule requiring two spaces per home means eight spaces for a fourplex, which will not fit on a typical residential lot.
• Size and shape limits. Minimum lot sizes, setbacks, height caps and floor-area limits written for one house often leave no room for three or four homes.
• Approval process. Small builders have little capacity to absorb long or unpredictable reviews. By-right approval, where a project that meets the written rules is approved without a public hearing, reduces that risk.
• Selling the homes. If a lot cannot be divided, the homes must be sold as condominiums or kept as rentals. Builders told the Terner Center that the condominium structure adds cost and complexity.
• Fees and utilities. Impact fees, utility hookups and street improvements are harder to absorb across four homes than across forty.
• Financing. Builders said national banks and large investors rarely fund projects this small. They reported relying on local banks, credit unions and community development financial institutions. Appraisers also struggle to value a building type with few recent comparable sales.
• Building codes. The model International Building Code requires at least two exit stairways in buildings taller than three stories, according to the Congressional Research Service (CRS). Supporters of single-stair designs say changing the rule would make apartment buildings easier to fit on small lots. The National Fire Protection Association and others say two stairways remain necessary for fire safety.

Buyers of small buildings have a federal financing option. FHA-insured home loans cover one- to four-family residences, and the statute sets higher loan limits for two-, three- and four-family buildings.

How States and Cities Are Changing the Rules

The main reform is upzoning: changing the rules to allow more homes on a lot. Since 2019 several states have required it rather than leaving the choice to each city.

These laws address more than the number of homes.

• Process. Washington requires cities to review middle housing through the same permit process used for detached houses. California’s approvals are ministerial, meaning staff check the plans against written standards.
• Parking. Washington bars cities from requiring off-street parking for middle housing within a half-mile walk of a major transit stop. California caps required parking at one space per home and at zero near transit.
• Ownership. Oregon’s Senate Bill 458 (2021) lets owners divide a lot so that each middle housing unit can be sold separately. Washington passed a lot-splitting law in 2025.
• Guardrails. California’s law does not apply where a project would demolish rent-restricted housing or housing occupied by a tenant in the previous three years. An owner who splits a lot must sign a statement of intent to live in one of the homes for three years.

Cities have also acted without a state mandate. The Terner Center describes Minneapolis as the first major city to allow duplexes and triplexes on single-family lots citywide. Its Minneapolis 2040 plan took effect on January 1, 2020. Portland’s Residential Infill Project took effect in August 2021 and was expanded in 2022.

Congress has acted at the edges. The 21st Century ROAD to Housing Act, Public Law 119-101, became law on July 11, 2026. It directs HUD to publish model code language and guidance for single-stair apartment buildings of up to six stories within 18 months of enactment, which falls in January 2028. It also authorizes grants, if Congress funds them, to help local governments and tribes select pre-reviewed building designs, sometimes called pattern books, for buildings of no more than 25 homes. The law lists duplexes, triplexes, fourplexes, cottage courts and townhouses among the eligible building types.

What the Results Show So Far

The early record supports one consistent finding: permission does not guarantee construction.

• Minneapolis. From January 2020 through June 2022, the city approved 65 duplexes and 20 triplexes, according to city data cited by the Terner Center. Builders pointed out that a duplex or triplex had to fit within the same size, setback and height limits as a single house.
• Portland. The city reports that it permitted more than 1,400 accessory dwelling units and middle housing units in single-dwelling zones between August 1, 2021, and June 30, 2024. It says middle housing became the most common housing type built in those zones. Portland’s rules allow a larger building as the number of homes rises.
• California. A Terner Center review of 13 cities found limited use of Senate Bill 9 in 2022. Los Angeles received 211 applications for new units, and San Diego received seven. The authors and the planners they interviewed pointed to small lots, high construction costs, added local requirements, the law’s owner-occupancy rule and the easier path of building an accessory dwelling unit instead.
• Across cities. A 2023 study by Urban Institute researchers examined land-use reforms from 2000 to 2019 in cities across eight U.S. metropolitan regions. It found that loosening density limits was associated with a 0.8% increase in housing supply within three to nine years. The gains were mostly in higher-rent units.

Scale matters as well. Several builders told the Terner Center that projects become financially workable at about eight to twelve homes, more than most of these laws allow on one lot.

Missing Middle Housing and Workforce Housing

Most missing middle housing is market-rate housing, with no income limits. Its cost advantage comes from size and land. Suppose a lot costs $240,000. One house carries the full $240,000 of land cost. Four homes on the same lot carry $60,000 each. (These numbers are invented for illustration.)

Portland’s 2025 progress report found that in 2023–24 a new market-rate middle housing unit sold, on average, for $250,000 to $300,000 less than a new market-rate detached house. The Terner Center brief says these homes have historically been attainable for families earning about 50% to 110% of area median income. That range overlaps the incomes that workforce housing programs commonly serve, and it is why small multi-unit homes are often discussed as a modern starter home.

Lower cost is not guaranteed. Prices follow the local market unless a home carries a legal restriction. Washington’s law offers one model: cities must allow extra homes on a lot when some are kept affordable for at least 50 years under a recorded covenant.

The Debate

Supporters argue that middle housing adds homes in established neighborhoods without large buildings and reopens areas with good schools and parks to households that cannot afford a detached house.

Critics raise several concerns. Some residents object to changes in neighborhood character, street parking and traffic. Others doubt that new market-rate homes will be affordable, or worry that redevelopment will push out current renters. Some local officials object to states overriding local control. Washington’s law responds to some of these concerns by letting cities apply for extensions covering areas at risk of displacement or short of water, sewer or other infrastructure capacity.

The research does not settle the argument. The Urban Institute study found supply gains but no statistically significant increase in lower-cost units in the years it measured. See Zoning Reform and the YIMBY Movement for the wider debate and Cottage Communities and Pocket Neighborhoods for one middle housing type in detail.

The Bottom Line

Missing middle housing is an old set of building types that many communities stopped allowing and are now starting to allow again. Laws in Oregon, California, Washington and Montana have made duplexes and similar buildings legal on land once reserved for detached houses. Results so far depend on the details: parking, size limits, lot splits, fees and financing matter as much as the zoning label. These homes tend to cost less than new detached houses nearby, but they are not income-restricted unless a program requires it.