Vice-president Kamala Harris made a daring campaign promise: if she was elected president, she would obtain 3 million new houses.
It was too late. The rapid increase in rents and prices of houses contributed to the dissatisfaction of Americans and its defeat. But the promise to build houses will nevertheless be postponed by a multitude of legislators from both parties who were partly re -elected by promising to respond to the rents and the prices of the houses.
The last four years have criticized buyers and tenants with a sequence of three boosts of tenders, demand shocks and interest shocks, leaving them in shock.
First, the disturbances of the chain of the pandemic supply have slowed down production, leaving fewer purchase options and higher prices.
Then, the recovery checks, the higher demand for home space and the loose monetary policy sent more money in the continuation of the relatively few available houses, which exerts more pressure on prices.
Finally, when interest rates have dropped while the Fed fought inflation, the owners with historically low mortgage rates have avoided selling their homes, leaving a few houses for sale and many potential buyers empty.
Economists thought that Harris' proposals – like a major subsidy for new house buyers – would leave us less than 3 million new houses. In truth, the development of federal policies moves too slowly to deliver a large -scale construction in just four years.
Washington is not the most important capital in terms of housing policy either.
More important decisions concerning housing are made in town halls and Sacramento state houses in Augusta. And more than ever – many more than two or four years ago – governors and mayors are determined to approach this crisis with the tools at their disposal. Until now, in 2024, my colleagues from the Mercatus Center and I responded twice as many requests to the legislators of the briefings on the housing policy as the previous year.
Fortunately, we are able to report them to innovative solutions that Republicans and Democrats in other states have been pioneers. Many have proven to be ready to reserve their own Orthodoxies. The Democrats of Rhode Island have suppressed mandates with unrealistic and not funded affordability. Florida Republicans have offered deep tax subsidies to obtain labor and legalized labor housing in commercial areas throughout the state.
As Angelenos knew, California was the first to experience high prices and seek legislative solutions. Managers of other states have taken Sacramento benchmarks – but some have also found more daring solutions. Now, the California legislature, which has been shy as often as innovative, can borrow some ideas elsewhere.
It takes four “LS” to build a house: the land, the wood, the work and the loans. For a good reason, the reformers have paid the most attention to the land, the price of which varies the most and which is most regulated. When vacant and building land cost $ 400,000 and more, as they do in the suburbs of Massachusetts, the potential relief of costs to allow more houses to be built on an acre can be considerably larger than any other source.
The rules of relaxing density and the opening of more land to residential development were therefore at the heart of the housing strategies of the States. With Florida, the legislatures of Arizona, California, Hawaii, Maryland, Montana, Oregon and Rhode Island authorized residences in commercial areas under certain conditions. Some of these reforms have underperformed, notably AB California, which is hampered by unrealistic mandates to pay wages higher than the market and collect rents below the market.
Recently, the increase in prices for materials, wages and interest rates has drawn more attention to the other three LS. To reduce construction costs, Maryland and New Hampshire now require local governments to allow houses made wherever houses built by sticks are authorized. Northern Carolina has transferred houses three and four families to the international residential code at a lower cost, freeing them from the requirements intended for much larger buildings.
One of the main means of reducing salary and loan costs is to reduce delays. States have found many ways to do so, in particular by removing the requirements of public meetings for simple projects and demanding that local design criteria be “specific and objective”. Tennessee recently joined DC, New Jersey, Texas and a host of local governments to allow a developer to hire a qualified third party to examine construction plans as an alternative to the expectation of backlogs in meshes.
The most flagrant delays often come from frivolous proceedings – As the Californians know it too well. Wisconsin has tightened its criteria for legal complaints concerning development. Washington has exempted residential projects in the areas of urban growth specified by the examination under its law on state environmental policy.
Based on my conversations with representatives, delegates, members of the assembly and senators from across the country, all these policies and others will be seriously considered in many other states in the 2025 legislative sessions. Those who had previously considered housing policy as a purely local problem is now promising to tackle housing costs.
With arranged leaders and a well -developed political program, look for 2025 to be a record year in the housing policy.
Salim Furth is a principal researcher and director of the Urbanity project at the George Mason University Mercatus Center.
