Using a case study design, the study focuses on identifying the institutional configuration that determines land take by low-density residential areas. Methodologically, it combines geospatial approaches and new institutionalism to capture and understand residential development, taking into account the interests, constraints and agency of local planning authorities, developers and households. The geospatial analysis shows that land take in the case study regions is primarily the result of low-density residential areas. We find that the combination of rural housing ideals, municipal policy objectives, municipalities' disengagement from spatial development and private sector interests are the main drivers for this kind of residential development. As the interests and constraints apply to all case study regions, the identified institutional configuration has high power in explaining low-density residential development. Our study thus uncovers a close link between the interests and constraints of actors, which on the one hand explains the limited impact of existing and new planning instruments on reducing land take, and on the other hand fosters path dependency in the development of low-density residential areas. Although there is some potential for change, breaking path dependency requires significant behavioural change among local planning authorities, developers and households. •Applying new institutionalism as a conceptual framework for understanding development of low-density residential areas.•Measuring low-density housing at sub-municipal level through building-based spatial analysis.•Structuring the housing construction process, taking into account local planning authorities, developers and households.•Understanding actors’ interests, constraints and agency through expert and household interviews.•Study covers five case study regions and a period of 10 years (2009–2019).