America Needs More Houses – WSJ

A contractor works on a house under construction in Austin, Texas, April 20.


Jordan Vonderhaar / Bloomberg News

America faces a housing shortage. For too long, supply has not kept up with demand or household formation. Fewer new homes were built in the decade following the 2008-09 financial crisis than in any decade since the 1960s. Estimates vary, but the United States needs at least 1.5 million more homes. .

The shortage of affordable housing hurts American businesses and the broader economy by discouraging workers from living in areas with economic opportunity but high housing costs. Employers are forced to operate below their potential because they are unable to attract or retain workers. One study estimates that this misallocation can cost up to 2% of gross domestic product, or more than $400 billion a year in lost economic output. Housing costs also play an important role in inflation, making up the largest component of the consumer price index.

While the two of us don’t agree on every issue, we do agree that the shortfall is longstanding and must be addressed. The good news is that there are proven ways that government, Congress, state and local governments, and the private sector can work together to build and preserve enough homes to end the shortage. housing in the US. This is Ba:

First, encourage the removal of unnecessary barriers to housing production. For decades, exclusionary zoning laws — such as minimum lot sizes, mandatory parking requirements, and bans on multi-family housing — have increased costs and kept families out of neighborhoods. areas with more opportunities. This year, the administration announced three applications for competitive grants programs totaling nearly $6 billion to reward jurisdictions for land-use policies that promote density. and rural main street revival. Congress and state legislators could also encourage such reforms.

Second, it addresses other constraints on home production across the country, from rising raw material costs to labor supply challenges. Helping to ease supply chain challenges and draw more workers into the construction industry will help us turn record units under construction into homes that Americans can live in.

Third, make it easier for investors to finance new housing, especially affordable housing for low- and middle-income families. For starters, Democrats and Republicans in Congress have advocated for the creation and expansion of federal tax credits — like the low-income housing tax credit and the neighborhood housing tax credit. near — projected to enable the construction or rehabilitation of nearly one million affordable homes. Congress should enact and extend these credits immediately. At the same time, the administration announced changes Monday to federal funding for affordable housing developments to address key market gaps and ensure these programs operate more efficiently.

While recent home price spikes have created wealth and financial stability for millions of American families, for too many others, finding a place to live has become a source of stress and instability, inhibiting economic growth and exacerbating inflation. By addressing these issues and the regulatory hurdles that stand in the way of building new affordable homes, we can help reduce costs for families and accelerate economic growth.

Ms. Clark is the president and chief executive officer of the American Chamber of Commerce. Mr. Deese is director of the White House’s National Economic Council.

Review & Outlook: ‘I take inflation very seriously and it’s my top domestic priority,’ Joe Biden said. Maybe he should follow the advice given to George Costanza in TV’s ‘Seinfeld’. Image: NBCUniversal / Getty Images Synthesis: Mark Kelly

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Appears May 16, 2022, print. America Needs More Houses – WSJ

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