Opinion | This Is How To Fix the Housing Crisis

Vice President Kamala Harris correctly identified one of America’s biggest problems when she said that “there’s a serious housing shortage.” America’s affordable-housing crisis exacerbates wealth inequities, leads low-income parents to live in neighborhoods with less upward mobility and reduces our country’s capacity for economic growth, innovation and adaptation to regional shocks. Unfortunately, her proposed solutions seem too small and too poorly targeted to generate enough housing to make America’s most productive places more affordable.

Our next president could do much to unwind America’s housing shortage, which has its roots in regulations enacted by innumerable municipalities. But “not in my backyard” towns won’t start building out of the goodness of their hearts. To unleash enough new building to bring affordability, we need to dust off our history books and remember how this country raised the legal alcohol drinking age. The National Minimum Drinking Age Act of 1984 demanded states raise the minimum age to buy or publicly possess alcohol to 21 — or face a reduction in federal highway funds. The threat of losing such funds is a big stick.

It will take a forceful solution to address such a big problem. Nominal rents have risen by 6.5 percent a year since the start of the Biden administration and continue to surge even while overall inflation is dropping. The National Association of Realtors reports that the median sale price for an existing single-family home was $422,000 in the second quarter of 2024. One-half of renters spend more than 30 percent of their income on rent, and about one-fourth spend more than one-half of their income on housing. High prices and high interest rates make homeownership way out of reach for millions of people.

America wasn’t always like this. In the 1920s, New York City was affordable to its poorer residents because it permitted the construction of as many as 100,000 units a year. After World War II, builders like the Levitt brothers kept costs down by applying mass production techniques to new housing. But in those early days, builders had a distinct advantage: Existing residents didn’t control the permitting process, and zoning still accommodated growth. Fear of change, especially change to one’s neighborhood, is constant, but the ability of residents to block projects has since exploded.

And while the merits of any battle over a particular project are debatable, the overall cost to our country is beyond doubt. We are just not building enough homes, especially in the coastal markets where there is the most demand. Per capita, there was less than half as much permitting in 2023 as in 2003 or 1973.

What’s newer, and worse, is that even those places in the country that historically built a lot of housing and thus offered less expensive alternatives — such as Austin, Texas, and Raleigh, N.C. — have also experienced big price increases, possibly because of less building in their most desirable neighborhoods. Hopefully, this is a blip and does not portend the spread of NIMBYism to these onetime growth machines.