Like Richard Nixon going to China, sometimes a change in policy is sold best by an unlikely proponent. Vice President Kamala Harris leading the charge for more housing supply in the United States shows just how far her party has come. Democrats have long been skeptical about overhauling supply and regulation to make housing more affordable. Harris’ $40 billion housing agenda, released last week, is a welcome recognition that drastic changes are needed to close a national shortage of 4.5 million homes.
Harris, who hails from California, the western epicenter of the national housing crisis, wants three million new homes in four years, on top of what homebuilders were already planning. That’s a punchy target: developers completed just 1.5 million units in 2023. Her campaign aims to encourage what it calls “innovative” approaches to affordable housing, like providing grants and loans to local developers and non-profit organizations. The plan leans heavily on zoning reforms and employs language about cutting red tape usually used by Republicans. Former President Barack Obama endorsed the shift in his speech to the Democratic National Convention on Tuesday night, saying his party needed to "clear away the ideas of the past" and slash outdated rules.
Nevertheless, a nationwide housing drive risks stoking homeowners’ ire in a country where the middle class derives most of its wealth from real estate and two-thirds of dwellings are occupied by their owners. Residents seek to defend property, opens new tab values at planning board meetings, for example by delaying projects so they become uneconomical. Harris’ plan would not remove local control but would use federal power to support more building.
Zoning reforms sound great.
One of my biggest issues with increasing housing is that many Americans store their wealth in their house. Home ownership is the retirement plan for many, or the generational wealth plan. So how can we build housing without devaluing existing housing?
The answer is to build more multi-family housing, which doesn’t really compete with single family housing for price. The former is mostly for rent, while the later is for owning.
Or, markets sometimes go down. They can't all grow infinitely forever.
According to capitalism they can. /s