Bloomberg Businessweek May 31, 2021 pp 8-9|REMARKS|”America has a housing mess and President Biden wants to fix it” by Noah Buhayar and Olivia Rockeman
Read the Bloomberg Businessweek article for all detail
Summary provided by 2244
Not surprisingly decades of incremental change in U.S. housing policy have created “an accretion of policies and bureaucracy that’s complex and inadequate for today’s needs." Exacerbating matters for the most vulnerable has been the additional impacts of the COVID-19 Pandemic on housing as government support for rents, which “have been slow to get to renters in some places” and eviction moratoriums come to an end. Some startling facts are that “Almost 11 million households spend more than half their income on rent in 2018, a level of financial stress that frequently tipped people into crisis…On a single night in January 2020, more than 580,000 individuals were homeless in the U.S.”
Further, market forces have fueled price increases due to shortages of building materials, labor and most importantly, for those seeking first home ownership, an existing housing inventory at historic lows. According to Ali Wolf (Zonda, a housing data and consulting firm), “If you don’t have excellent credit, if you don’t have a really high and competitive down payment, and if you don’t have the ability to go over ask [asking price], good luck.”
So, what are the potential solutions to deal with the longstanding and current housing issues? “…The White House is pushing for even bigger investments in housing…including “a sharp increase in tax credits [that] would put more money into families’ pockets, and an increase in housing vouchers…”. Even these supports won’t be enough in high-priced areas like “the San Francisco Bay Area, Seattle and Boston” where “local wages haven’t kept up with rising housing costs.” Stimulating more housing development, including housing targeted at lower incomes, means “taking on the Nimbys.” Local regulations like “parking requirements…and prohibitions on multifamily dwellings-have furthered housing segregation, exacerbated sprawl, and driven up costs.” Federal incentives likely to be most effective are those that “tie federal transportation dollars to the reforms” says Sara Saadian (National Low Income Housing Coalition). She adds “That’s the money that’s really sought-after [by local governments]…”.
Some of these ideas have bipartisan support but ideally this is tied into an Infrastructure bill that now has less support across the aisle. Without bipartisan support, Democrats alone in sufficient numbers could advance these programs through “budget reconciliation.” Beyond passing legislation “administering it effectively would be an enormous task.”
Comments