Housing in the United States has long symbolized societal progress, however beneath this narrative lies a legacy of systemic inequities embedded in historic policies and amplified by neoliberal economic imperatives. Policy mechanisms such as exclusionary zoning, redlining, urban renewal, and the further financialization of housing have produced enduring patterns of segregation, displacement, and restricted access to affordable housing. These forces persist today. They shape limited urban development through regulatory frameworks that paradoxically hinder spatial equity while enabling markets to continue to extract increasing value from urban geographies. This paper interrogates the structural economic and policy conditions that perpetuate limited growth and spatial injustice and proposes a speculative yet actionable framework for spatial reparations, that leverages zoning policies and urban regulatory arbitrage. The framework’s goals are to create new spatial assets, redistribute resources, and catalyze new typologies for affordable housing. Through the case study of Harlem, New York, this research illustrates how intentional engagement with neoliberal mechanisms can redirect capital flows, generate alternative markets, and emergent forms of urban innovation.