<p>Recent discourses in building sufficiency focus on residential space use and the need to negotiate between environmental capacity and social standards. On the one hand, downsizing residential space reduces the need for energy, materials, and land. Many European countries face a problem of underoccupancy, where single individuals or couples live in homes originally designed for larger families, exacerbating housing demands and increasing the need for new construction. On the other hand, while there can be advantages for citizens to downsize, only a minority are willing to do so. Literature has therefore focused on national policies to incentivise shifts towards less space use. Notably absent is a focus on existing, well-established policies which might be preventing such a shift: in particular, local building regulations, such as rules against dividing dwellings and parking norms. This article considers local regulations as a hinge between top-down environmental goals and bottom-up housing demands in Flanders. It uses official statistics to reveal a potential to create 377,000 extra dwellings by splitting underoccupied houses in desirable urban locations, yet this is potential severely dampened by local regulations. The article then assesses the rationales behind the regulations, through a workshop with municipal representatives. Officials acknowledge that reconfiguring the housing stock can address key social, environmental, and economic concerns. They also reveal concerns over housing quality and affordability, though these are addressable through existing policy instruments. What is most lacking is awareness at different levels of government over how addressing underoccupancy is linked to high-level environmental agendas.</p>