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Tackling the housing affordability crisis

Guest Contributor
Guest Contributor
Opinion
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The South Beach apartments under construction in the southwest part of Las Vegas

By Doug Bibby

In cities and suburbs, in blue states and red, a growing number of hard-working Americans are struggling to find housing they can afford. According to a recent national poll of mayors, housing affordability is the first or second most frequent issue they hear about from constituents for cities large, medium and small. In Nevada, it’s estimated that between now and 2030, 7,733 new apartment homes will need to be built each year to keep up with demand generated by a fast-growing population.

This might explain why many of the candidates seeking the Democratic nomination to challenge President Trump have laid out detailed housing proposals in recent months. The candidates must draw on the lessons learned in our great cities, pursuing real solutions to this national challenge — and avoiding the mistakes of the past including rent control.

Elected officials at the state and local level across the country are already experimenting with new policies and exciting public-private partnerships to tackle housing needs in their communities. As the presidential candidates debate housing policy this election season, they should work alongside the mayors and city councils across the country to elevate constructive solutions, and just as importantly, discourage harmful policies.  

Sen. Bernie Sanders is advocating for increased funding for federal housing programs. Former San Antonio Mayor and HUD Secretary Julian Castro also has proposed increased funding for Section 8 Vouchers and similar programs, along with a zoning reform commission to eliminate regulatory barriers to the production of housing. Sen. Elizabeth Warren’s housing plan is perhaps the most ambitious; she proposes to spend $450 billion over 10 years to invest in both supply and demand side solutions in the housing market.  Sen. Cory Booker has been praised for his plan to tie federal housing, transportation and infrastructure spending to affordable housing for local governments to diminish the power of NIMBYs and the racially motivated legacy these decisions often perpetuate. Others have offered similar proposals.

With more than half of American households spending more than 30 percent of their income on housing – including 79% of low-income Nevada renters who spend more than half – we need to reverse course and provide the types of housing families and individuals need today and in the next ten years. That means a wider array of housing options, from apartments and duplexes to single-family homes and townhouses. And we must make these homes easier to build. From 2000 to 2015, 23 states under-produced housing to the tune of 7.3 million units, which has created a significant supply and demand imbalance that is reflected in today’s housing prices. 

It should come as no surprise, then, that private companies, seeking to ensure that their employees are able to access housing that is both affordable and nearby, also are in search of solutions to this housing affordability crisis. 

Some approaches we’ve seen are innovative, such as investments in workforce housing by companies including Google and Microsoft. Others further entrench the problem, including Oregon’s new universal rent control law and the onerous rent regulation package Gov. Cuomo signed into law this past June in New York. 

The crisis is unique to each community, so with it must come customized approaches. Take Minneapolis. In December 2018, the city council voted to end single-family zoning citywide, recognizing that 70 percent of the city’s residential land was off-limits to multifamily construction. Their decision to “upzone” will spur construction, increase supply and decrease the cost of housing for residents. 

But for every innovative step forward, there are archaic, ineffective policies that bubble up to the surface and present themselves as remedies, when in fact they further aggravate the problem. 

Sen. Sanders also advocates for rent control. Under the misnomer that rent control helps the lowest income bracket the most, New York and California have learned the hard way that rent control policies have unintended consequences that far outweigh any benefits. Capping rents across the board hinders development of new and updated housing, reduces supply and ultimately results in the costs of rent control falling detrimentally on low-income residents. These costs include an often-substantial drop in the quality of existing rental housing because apartment owners are unable to recoup their costs. In a state like Nevada, where nearly 442,000 residents call an apartment home, that could be a big problem. Poor families in rent control areas often witness a marked decline in available housing, and while the middle class can just move, poorer families often lack that option. 

If we’re going to alleviate this crisis, we must quit the concept of rent control. In its place, we need elected officials to promote policies that boost housing supply, encourage public-private partnerships that tackle many of the existing barriers to development, identify additional resources for housing and empower local leaders. If we think smart, we can remedy this affordability crisis of today and plan for the future.

Doug Bibby is President of the National Multifamily Housing Council (NMHC), a national organization of more than 1,100 member firms involved in the multifamily housing industry.  

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