Lack of affordable housing a challenge we (in the developed countries of the world) must face

Abstract

J. David Chapman is professor of finance and real estate at the University of Central Oklahoma reflects on housing as the USA nears the end of 2021, and he is thinking about limitations and threats to otherwise successful communities.

In this era of political divisiveness, there are two things that David suggests most can agree on:

1) There is a tremendous need for affordable housing throughout America.

2) There is a strong “Not in My Back Yard,” or NIMBY, agenda.

There is a shortage of more than 7.2 million affordable rental homes for extremely low-income renter households, defined as those with incomes at or below the poverty level or 30% of their area median income.

To make matters worse, the lack of affordable for-sale homes drives up rents and increases prices of multifamily investment properties.

Solutions that could be considered include:

1) expediting the approval process by adding “Inherently Beneficial Use” to municipal land use laws to circumvent “NIMBY” opposition;

2) expand taxpayer funded one-time front-end subsidy programs for affordable housing and encourage the expansion of existing subsidy programs at the federal, state and county levels;

3) use the power of zoning to create subsidies necessary for providing more affordable housing and market rate housing at no additional costs to the taxpayers.