By all accounts, Andrew Decker is doing everything right. He earns a six-figure salary, is engaged, and wants to buy a home in the Chicago suburbs. But as NBC News story this week reported, he’s priced out.
Mortgage rates are hovering near 7 percent, and median home prices have soared past $400,000. For Decker and millions like him, the American Dream is no longer a starter home — it’s a rental with no end in sight.
This isn’t an outlier. It’s a crisis. In this is the housing crisis.
And yet, some still insist we don’t have a housing shortage. They point to vacant luxury condos owned by international elites and conclude we must have enough housing. They claim that homelessness and housing insecurity are merely signs of “societal dysfunction,” not symptoms of a broken housing market. They invoke the “free market” as if it were functioning freely — when in fact, decades of exclusionary zoning, discretionary permitting, and voter vetoes have strangled housing supply where it’s needed most.
Let’s be clear: this isn’t just about the visibly homeless. It’s not even just about the working poor. It’s about middle-class people with college degrees and steady jobs who can no longer afford to live near where they work. In some parts of California, even a six-figure salary now qualifies you for low-income housing. Remarkably, it is expanding increasingly outside of California as well.
According to the state’s latest affordability benchmarks, the low-income cutoff in Santa Clara County is $111,700 for a single person. In San Francisco and San Mateo counties, it’s $109,700. In Sacramento, Placer, and El Dorado counties, it’s $72,050. In Los Angeles, it’s $84,850. San Diego’s figure is $92,700. These are not poverty-level wages. They are salaries that, until recently, would have been enough to comfortably buy a home. Today, they barely get you in the rental market.
And if you’re trying to buy, forget it. Inventory is tight, prices are high, and interest rates have doubled. Meanwhile, demand hasn’t gone away — it’s just been pushed further out. Families are now commuting from places they can afford to live to places they can no longer afford to live. That leads to longer drive times, more congestion, higher emissions, and worse outcomes for working parents. In other words, it’s not just a housing issue — it’s a climate and infrastructure issue too.
The problem isn’t simply that some homes are vacant or investor-owned, though that’s part of it. The deeper issue is that we haven’t built enough homes overall. Since the 1970s, California alone has underbuilt by an estimated 2.5 to 3.5 million homes. And it’s not just a California problem. Nationwide, household formation has far outpaced new housing construction for years. That imbalance is now reshaping the suburbs.
According to new analysis of U.S. Census data, 203 American suburbs are now majority renter. In 15 of them, the number of renter households has more than doubled since 2018. What once were homeownership strongholds have become rental zones. This shift reflects a stark reality: people want to stay close to work, schools, and community — but they can’t afford to buy.
Developers have responded by building more apartments in traditionally single-family neighborhoods. In some cases, it’s the only type of housing allowed. In others, it’s all people can afford. But this transition is happening under strain, not by choice. It’s happening because people who should be homeowners are stuck renting indefinitely. Not because they’re irresponsible, but because the system is broken.
For many, wages have not kept pace with rent, much less home prices. Cam Villa, a home loan broker in Sacramento, sees it every day. He reviews credit reports for clients with solid incomes — sometimes over $100,000 — and finds car payments above $1,000, rising food costs, and sky-high rents. “They’re doing everything right,” Villa told NBC. “But they’re stuck.”
That includes people like Chelsea Carmack, who recently moved to Sacramento from St. Louis after landing a job with Sutter Health Park. She loves the weather, but she can’t believe the rent. “For me,” she said, “it’s about survival.” This is not a sustainable trajectory.
The free market, as some like to champion it, depends on a functioning balance between supply and demand. But our housing market isn’t balanced. It’s distorted by decades of artificial scarcity. Zoning laws prohibit apartments, permitting takes years, and local ballot measures put every new home up for a popularity contest. When demand runs up against legal walls, prices explode. When building is slowed by process, not feasibility, affordability collapses.
Yes, we should address the harms of speculation. Yes, we must regulate short-term rentals, tax vacant properties, and crack down on institutional landlords who exploit tenants. But none of that changes the math if we don’t also build more housing. You can’t fix a supply problem by ignoring supply.
What we need is simple: more homes of all kinds, built faster and closer to where people work. That means reforming permitting laws and legalizing multifamily housing. It means aligning zoning with economic reality. It means recognizing that the suburbs can no longer be walled gardens of exclusion. It means embracing the idea that growth — done right — is part of the solution.
Those who continue to downplay or deny the housing crisis are doing so from a position of comfort, not clarity. They often own homes purchased decades ago, under very different market conditions. They forget that the rising generation is being priced out not because they’ve failed — but because the system has.
In a just society, housing should be tied to jobs. It should be affordable to those who serve our schools, hospitals, transit systems, and cities. It should not take $200,000 a year to buy a modest home in a working-class neighborhood.
The crisis is here. It’s measurable in rent receipts, commute times, and crushed expectations. The question is whether we’ll meet it with solutions — or keep pretending it’s someone else’s problem.
Good luck competing for houses against workers with $100 million signing bonuses (and annual salaries which exceed that):
“On a podcast released Tuesday, OpenAI CEO Sam Altman said Mark Zuckerberg’s Meta has been waving “giant offers” in an effort to poach talented employees from his San Francisco company. With the casual tone of a cashier ringing up a customer’s grocery total, Altman gave the offers’ specifics: “$100 million signing bonuses, more than that compensation per year.”
https://www.sfgate.com/tech/article/bay-area-artificial-intelligence-workers-20386541.php
“The crisis is here.”
yeah, OK, Sparky.
Construction costs are going up, general inflation is going up, insurance costs are skyrocketing. How do you intend to fund affordable housing? By taxing or fining those who can pay the rent? Thus making those least able to pay the rent no longer able to do so? You can’t play with the market like that, you’ll just end up siphoning off more money to bureaucracy. If you want to talk about providing a anti-trust framework in which corporations can’t buy up housing stock and manipulate the market, then you have my ear.
There is a strong towns book called “the housing trap” that goes through a lot of these systemic issues, and they call out one interesting dynamic that is one of those obvious-but-only-when-its-pointed-out-to-you kind of things:
We have created a system in america where “housing” is not just “shelter” but it is also “your primary net worth and savings vehicle” ( a financial insturment). The government systemicaly encouraged people to own homes, and created the 30 year mortgage so that when they retired they would own their homes outright and be much more secure financiall. Fannie and Freddie were part of that effort, etc.. “get people into homes so they will be economically secure” has been the gist of the intent..
And as time has gone on… since all americans’ net worth is tied up in their houses, we have also done everything possible to make sure that americans dont lose that value… this is the land of the current downpayment assistance schemes etc. The government is doing everything it can to just keep people being able to get on that housing ladder as the entire asset class continues to appreciate.
But as they point out if housing always goes up… and cant be allowed to come down (bailouts during the housing crisis etc) eventually you cant keep up with the high prices and anyone NOT on the property ladder gets left behind.
There is quite a bit to this story and a lot of the solutions that might theoretically be on the table are not ones that we have any power to enact locally
But what we CAN do is to exert OUR power to making sure that we establish a new rung on this housing ladder that is LOWER… condos / co-ops / towhnomes so that younger families CAN get onto this housing ladder and now waste most of their best earning years as a renter.
Thus, “Starter single family homes” are simple a stupid idea. A false no longer relevant concept. A LIE.
Starter homes these days need to be townhomes / garden courts / condos. We need building primarily missing middle housing. And yes, apartments are still needed because outside of the “financial instrument” role of housing, we still need to house people who are NOT yet in the phase of their life when they might want to purchase.
I dont know why we have left out this entire contengency here in davis…. but people in their 20’s and early 30’s who are working, perhaps still single, maybe married but not yet having kids… we have NO housing for them… we just assume they will stay in student housing or rent a single family home? Developing LOTS of apartments for this section of our society absolutley needs to be part of the mix as well.