One of my goals with the Vanguard’s coverage of housing has been to show the Davis community that Davis’ housing crisis is part of a much larger problem that is statewide and increasingly nation wide.
What caught my eye this morning was that Conor Dougherty, who covers housing for the NY Times, has an article on Kalamazoo, Mich as well as a brief column.
In his article on Kalamazoo, he writes, “A decade ago, the city — and all of Michigan — had too many houses. Now it has a shortage. The shift there explains today’s costly housing market in the rest of the country.”
For years, he writes, “when Michigan politicians talked about the state’s housing problem, they were referring to a surplus: too many run-down houses, stripped of valuable copper, sitting empty and blighting neighborhoods. Now the message has flipped.”
In her State of the State address this year, Doughtery notes, “Gov. Gretchen Whitmer lamented the housing shortage and landed one of her biggest applause lines” with, “The rent is too damn high, and we don’t have enough damn housing. So our response is simple: ‘Build, baby, build!”
This marks an important point that Doughtery raises in his column: “The housing crunch has been well documented in high-cost big cities, where rents and mortgages break the bank. Now it has moved into the rest of the country.”
The problem is that too little housing has been built since the great recession.
We can see here:
“In the three years leading up to the Great Recession, homebuilders started about two million homes a year,” he writes. But that number plunged during the Great Recession and has “never fully rebounded.”
Dougherty explains, “Since 2010, builders have started about 1.1 million new homes a year on average — far below the 1.6 million needed to keep up with population growth. America is millions of homes behind, and it gets worse each year.”
In Kalamazoo, “which isn’t an obvious candidate for a housing crisis” the “prices exploded as the supply of homes fell behind the need.”
The result, “Now even middle-class families earning six figures struggle to make ends meet there, and Michigan lawmakers are subsidizing developers who build for those residents.”
Sound familiar.
Dougherty believes it will take a long time to fix.
We are finally starting to see this creep into the national discourse.
As Dougherty writes, “Republicans and Democrats agree on the urgency, and housing was a theme at both political conventions this summer.”
Indeed, both Barack Obama and Bill Clinton, former Democratic presidents mentioned the housing crisis in their speeches this week at the DNC Convention.
But as Dougherty writes, “those changes will be measured in decades because we fell so far behind.”
That is the real problem The market may have gotten us into this mess with not enough homes being built in the last 15 years to keep up with demand, but as yesterday’s column demonstrated – a market solution alone will not solve the crisis.
We need government subsidies to help make that housing more affordable – and that figures to be a lot more tricky as we have already discovered.
