Land-use regulations are obstacles to the California dream According to the 2010 Census, 95 percent of Californians live on just 5.3 percent of the land in the state. Less than 17 percent of the San Francisco Bay Area is developed and California has an acute housing shortage. While most of the undeveloped land is owned by private parties who would develop it if only the government would let them. Is the allocation of land in California efficient? Does the government regulation operate in the social interest or self-interest? If the regulation were relaxed, how would the efficiency of the housing market change?