We show that post-GFC bank regulatory changes intended to curb bank risk-taking contributed to the decline in the supply of new housing. With unique data on the financing and sales of nearly 18,000 homebuilders, we document a sharp decline in construction loans from large banks subject to stress testing following the 2013 reforms, a reduction that was not offset by increases in financing from other sources. Employing a difference-in-differences (DiD) design, we find that, relative to homebuilders that previously borrowed from smaller banks, the credit availability and new home sales of homebuilders that previously borrowed from stress-tested banks declined after the reforms. In a county-level instrumental-variable analysis, we find that counties where stress-tested banks held greater pre-GFC market shares originated fewer construction loans, supplied fewer new homes, and experienced greater house price appreciation after 2013.