# The way to address housing affordability is to build more housing **URL:** \ **Category:** In My Humble Opinion\ **Created:** [November 12, 2025, 5:43pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808 "2025-11-12T17:43:53Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![DeadTreasSecretaries](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/deadtreassecretaries/32/4817_2.png) [@DeadTreasSecretaries](https://boards.straightdope.com/u/DeadTreasSecretaries)\ **Post date:** [November 12, 2025, 5:43pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/1 "2025-11-12T17:43:53Z")
Wanted to continue the discussion of increasing housing supply from [Is Trump’s mortgage plan a bad idea?](https://boards.straightdope.com/t/is-trump-s-mortgage-plan-a-bad-idea/1024795) > [@Is Trump’s mortgage plan a bad idea?](https://boards.straightdope.com/t/is-trump-s-mortgage-plan-a-bad-idea/1024795/17): > > The right solution to the housing squeeze is… wait for it… to build more housing. A sound lending policy might be government-backed zero-interest loans for _construction_ of qualified residential housing. You get favorable terms for _building_, not for _buying_. > > We can’t borrow our way out of the housing squeeze, we can only build our way out of it. > [@Is Trump’s mortgage plan a bad idea?](https://boards.straightdope.com/t/is-trump-s-mortgage-plan-a-bad-idea/1024795/19): > > Not so fast. I live in an older suburb, and a lot of our “older” (pre-1980 or so) housing stock has been knocked down to make room for half-million dollar McMansions. The lack of older, smaller and cheaper housing has put an end to the concept of starter houses for younger couples. > [@Is Trump’s mortgage plan a bad idea?](https://boards.straightdope.com/t/is-trump-s-mortgage-plan-a-bad-idea/1024795/23): > > We can quibble over what _type_ of housing needs to be built, or the best way to incentivize that, but the only real way out of the housing crunch is to build more housing, and the best way to do that is to encourage building over buying. > [@Is Trump’s mortgage plan a bad idea?](https://boards.straightdope.com/t/is-trump-s-mortgage-plan-a-bad-idea/1024795/44): > > The solution is to add more _moderately-priced_ housing supply. The home-building industry has moved away from that, in favor of building bigger/more expensive homes – the median selling price of a newly-built home in the U.S. is now $416,000, about double what it was 15 years ago ([source](https://www.nahb.org/blog/2025/05/prices-for-new-homes-drop-as-existing-rises)). Adding to the problem is that, in recent years, many existing smaller single-family homes have been bought up by companies and investors, flipping them into rental properties and taking them off the market for actual homeowners ([source](https://jacobin.com/2024/05/single-family-homes-rentals-wall-street)). The way to make housing more affordable is to increase the supply of homes that someone wants to live in. Whether you build more luxury condos, McMansions, section 8 apartments or anything in between, increasing the supply of any housing makes it easier for everyone to afford housing. The reason is fairly simple: If you build a luxury condo building and rich people who could otherwise afford a more modest house move into the condos, those rich people are no longer living in the comparatively modest houses they were living in before. They’re either going to sell or rent those houses to someone who can’t afford a luxury condo. When housing supply is too low, people who were rich enough to afford the non-existing luxury condo are competing with their slightly poorer neighbors for the more modest homes, driving them past modestly priced homes. And some of the slightly poorer people would then compete for homes another step down, driving those prices up. And on down until you get to actual homeless people. Yes this sounds like trickle-down economics (because it is). However, unlike applying supply-side economics to something like income where it doesn’t make sense, with the housing market it’s fairly straightforward. The one thing I’ll mention is that of course there’s the risk of people owning vacant properties. The best way, again, to solve this problem is to build more housing. People owning vacant properties are either owning low-quality properties that they don’t know what to do with, or they’re just hoping to increase their investment value via scarcity. To alleviate this, you need to address the scarcity. ---
**Author:** ![Saint\_Cad](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/saint_cad/32/18907_2.png) [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)\ **Post date:** [November 12, 2025, 5:49pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/2 "2025-11-12T17:49:47Z")
According to a study I read, most housing is bought by rich investors to use as income property. Add to that that someone with a FICO under 640 has almost no hope at getting approved for a loan and someone under 580 has absolutely no no hope at getting approved for a loan and simply building more housing is not sufficient to make it affordable or doable for those that need the help. ---
**Author:** ![DeadTreasSecretaries](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/deadtreassecretaries/32/4817_2.png) [@DeadTreasSecretaries](https://boards.straightdope.com/u/DeadTreasSecretaries)\ **Post date:** [November 12, 2025, 6:08pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/3 "2025-11-12T18:08:08Z")
The rental market has the same dynamic. If more properties exist, and more investors buy them and rent them out, the renters have a higher supply of rental housing and as a result can get lower rents. ---
**Author:** ![Saint\_Cad](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/saint_cad/32/18907_2.png) [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)\ **Post date:** [November 12, 2025, 6:12pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/4 "2025-11-12T18:12:55Z")
> [@DeadTreasSecretaries](#): > > the renters have a higher supply of rental housing and as a result can get lower rents. I do not think rental prices follow basic supply and demand like that. But even if you are right, shouldn’t it be a goal to have the middle-class getting equity from home-ownership and not rich landlords? ---
**Author:** ![kenobi\_65](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kenobi_65/32/13178_2.png) [@kenobi\_65](https://boards.straightdope.com/u/kenobi_65)\ **Post date:** [November 12, 2025, 6:18pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/5 "2025-11-12T18:18:06Z")
> [@Saint\_Cad](#): > > I do not think rental prices follow basic supply and demand like that. At least, in recent years, they certainly haven’t. The chart in this article shows that, for the past five years, average rent has going up by 5 to 7% annually. Yes, general inflation has been up in the past few years, but rental rates are outstripping that. > **[Average Rent by Year](https://ipropertymanagement.com/research/average-rent-by-year)** > > Find average rent by year nationwide, by square foot, and by state, as well as rent-to-income rates and rent inflation by year. ---
**Author:** ![DeadTreasSecretaries](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/deadtreassecretaries/32/4817_2.png) [@DeadTreasSecretaries](https://boards.straightdope.com/u/DeadTreasSecretaries)\ **Post date:** [November 12, 2025, 6:26pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/6 "2025-11-12T18:26:17Z")
Because housing demand has outpaced supply. [https://home.treasury.gov/news/featured-stories/rent-house-prices-and-demographics](https://home.treasury.gov/news/featured-stories/rent-house-prices-and-demographics) ---
**Author:** ![Cheesesteak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cheesesteak/32/3694_2.png) [@Cheesesteak](https://boards.straightdope.com/u/Cheesesteak)\ **Post date:** [November 12, 2025, 6:37pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/7 "2025-11-12T18:37:50Z")
> [@Saint\_Cad](#): > > I do not think rental prices follow basic supply and demand like that. Everything follows basic supply and demand. I’d say two things can make housing more affordable. First is more supply. Second is reducing a particular source of demand, namely investor purchases. While I hear that investor demand is a problem, I don’t really know how significant it is. Right off the bat you can discourage the rental of single family homes and individual condos with tax law. Eliminate certain tax options that make this a highly profitable venture, and turn it into a relatively suboptimal venture and fewer investors will be taking the leap. Increasing supply is a trickier one. The nuclear option is to take away local control of zoning. Suburbanites don’t want a 200 unit apartment building down the block? Too bad, somebody wants to build one, you’re getting one. ---
**Author:** ![HMS\_Irruncible](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hms_irruncible/32/7394_2.png) [@HMS\_Irruncible](https://boards.straightdope.com/u/HMS_Irruncible)\ **Post date:** [November 12, 2025, 7:36pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/8 "2025-11-12T19:36:36Z")
> [@Saint\_Cad](#): > > According to a study I read, most housing is bought by rich investors to use as income property. The solution to this is to build more housing to drive prices down so that they’re in reach of people who aren’t rich investors, and to change the calculus of investing itself. If prices are going down, appreciation goes down, and rents also go down, so investors’ incentives will rebalance toward holding or selling. I’ll note here that my suggestion in the other thread was to offer zero-interest construction loans, up to a reasonable amount, for new homeowners to build new residential housing. As people start creating new housing supply that’s not for investing but to be _lived in_, this reduces demand for existing housing, which reduces prices as well. Increasing supply is the fix for decreasing prices, and decreasing prices is the fix for everything. ---
**Author:** ![Saint\_Cad](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/saint_cad/32/18907_2.png) [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)\ **Post date:** [November 12, 2025, 7:47pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/9 "2025-11-12T19:47:19Z")
> [@HMS\_Irruncible](#): > > The solution to this is to build more housing to drive prices down so that they’re in reach of people who aren’t rich investors, and to change the calculus of investing itself. This is too simplistic. First of all, it is assuming non-rich people can get a mortgage, many can’t. Second, how do you stop investors from overbidding. Someone offers you $250,000 and another offers $260,000. Are you going to turn down the extra $10,000 because the buyer wants to rent it out? > [@HMS\_Irruncible](#): > > If prices are going down, appreciation goes down, and rents also go down, so investors’ incentives will rebalance toward holding or selling. Again, assumes facts not in evidence. If the going rental rate in my area is $1500/mo, then that’s what I’m charging whether the house itself cost $100,000 or $500,000 ---
**Author:** ![Velocity](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/velocity/32/18006_2.png) [@Velocity](https://boards.straightdope.com/u/Velocity)\ **Post date:** [November 12, 2025, 7:50pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/10 "2025-11-12T19:50:34Z")
It needs to be a combo of 1) encouraging more house-building and 2) stiff penalties of some sort for people or companies who hoard homes. There are some nations where you pay low property tax for your primary residence but pay much higher property tax for any additional houses you own. ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [November 12, 2025, 7:54pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/11 "2025-11-12T19:54:00Z")
This. Make it financially impractical for housing to be owned by anyone but the actual occupants and suddenly that layer of profiteering middlemen will disappear. ---
**Author:** ![Saint\_Cad](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/saint_cad/32/18907_2.png) [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)\ **Post date:** [November 12, 2025, 7:59pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/12 "2025-11-12T19:59:25Z")
Here’s an idea, no FHA loans on a rental. If you later turn your owner-occupied home into a rental you have a limited time to get refinancing or the FHA can foreclose. ---
**Author:** ![snowthx](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/snowthx/32/10660_2.png) [@snowthx](https://boards.straightdope.com/u/snowthx)\ **Post date:** [November 12, 2025, 8:04pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/13 "2025-11-12T20:04:35Z")
People are talking about bringing housing prices down. But, I own my home after paying off the mortgage last year, and the house has appreciated nicely since we moved here 25 years ago. If we stay here long enough, it’s value will figure into our old-age care - I don’t want the value of _MY_ house to go down! When people want the price of housing to go down, what are they referring to, exactly - new homes? Also, as an empty-nester, sure, it might be nice to downsize at some point, which would avail this big house to the next young/growing family, but there is zero incentive for us to move. I am not doing another mortgage, and my property taxes here in CA are relatively low. Leaving now would be a massive, massive burden - how are you going to incentivize people like me to move? ---
**Author:** ![Q.Q.Switcheroo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/q.q.switcheroo/32/5713_2.png) [@Q.Q.Switcheroo](https://boards.straightdope.com/u/Q.Q.Switcheroo)\ **Post date:** [November 12, 2025, 8:07pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/14 "2025-11-12T20:07:00Z")
> [@Cheesesteak](#): > > The nuclear option is to take away local control of zoning. Or just amend the zoning laws to allow single room occupancy construction. > **[How single room occupancies could be the answer to NYC’s housing crisis](https://nypost.com/2025/05/10/opinion/how-sros-could-be-the-answer-to-nycs-housing-crisis/)** > > Mayor Adams is introducing reforms to make SROs easier to develop. ---
**Author:** ![Jas09](https://avatars.discourse-cdn.com/v4/letter/j/d07c76/32.png) [@Jas09](https://boards.straightdope.com/u/Jas09)\ **Post date:** [November 12, 2025, 8:12pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/15 "2025-11-12T20:12:35Z")
> [@Velocity](#): > > There are some nations where you pay low property tax for your primary residence but pay much higher property tax for any additional houses you own. > [@Saint\_Cad](#): > > Here’s an idea, no FHA loans on a rental. If you later turn your owner-occupied home into a rental you have a limited time to get refinancing or the FHA can foreclose. These are both great ideas. Won’t go anywhere because of whose ox is being gored (many, if not most, Senators own multiple homes; and their big donors all do), but great ideas. > [@snowthx](#): > > People are talking about bringing housing prices down. Typically they don’t mean literally lowering the price (although maybe…) but more slow the rate of growth. Housing prices have far outstripped wage growth, and that is a societal problem (if you want to have home ownership be a central pillar of your economy). ---
**Author:** ![Roderick\_Femm](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/roderick_femm/32/14875_2.png) [@Roderick\_Femm](https://boards.straightdope.com/u/Roderick_Femm)\ **Post date:** [November 12, 2025, 8:12pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/16 "2025-11-12T20:12:43Z")
> [@Saint\_Cad](#): > > If the going rental rate in my area is $1500/mo, then that’s what I’m charging whether the house itself cost $100,000 or $500,000 But will you buy another $500K house to rent at $1500? Probably not. When this trend is wide-spread, it reduces demand for $500K houses, so they will start selling for less, and fewer of them will be bought by investors. Or smaller, less expensive houses will be where the demand is, and those will be built. > [@Saint\_Cad](#): > > First of all, it is assuming non-rich people can get a mortgage, many can’t. Mortgages are a market like anything else. If housing is tight and housing prices are rising, larger mortgages will be in demand, and banks will be able to charge more for them. What happened after the bubble in 2008? Mortgages were going begging, and mortgage rates dropped. We need to make that an ongoing and more steady trend, and increasing the stock of less expensive housing will help that happen. Mortgages are also affected by the prime rate, so that’s another excellent reason for the federal government to keep inflation low. I’d like to mention a pet hobbyhorse of mine, pre-fab modular housing, i.e. housing manufactured in a factory in modules and then shipped and assembled on-site. You get exactly the house you want, made under controlled conditions with consistent quality, at a lower cost. This won’t work for every location, but for many it lowers the cost of construction by a significant amount (actual percentages will vary greatly depending on various factors, but all things being equal it will always be less). The 0% construction loan idea would be a boon to these kinds of manufacturers and we would start seeing more of them, and more competition among them. > [@Q.Q.Switcheroo](#): > > Or just amend the zoning laws to allow single room occupancy construction. Isn’t that usually offered as a solution for homelessness? ---
**Author:** ![kenobi\_65](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kenobi_65/32/13178_2.png) [@kenobi\_65](https://boards.straightdope.com/u/kenobi_65)\ **Post date:** [November 12, 2025, 8:17pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/17 "2025-11-12T20:17:56Z")
> [@snowthx](#): > > People are talking about bringing housing prices down. But, I own my home after paying off the mortgage last year, and the house has appreciated nicely since we moved here 25 years ago. If we stay here long enough, it’s value will figure into our old-age care - I don’t want the value of _MY_ house to go down! When people want the price of housing to go down, what are they referring to, exactly - new homes? Mostly, yes, as I understand it, as well as finding ways to keep affordable homes from being snapped up by investors who turn them into rental properties. They aren’t talking about specifically trying to lower the value of existing homes; they are talking about making sure that “entry-level homes” become a thing again. In addition, we now have the phenomenon of current homeowners who _could_ move up to a bigger/more expensive house – and thus put a smaller, more affordable house on the market – but are disincentivized to by current mortgage rates. Many of them bought or refinanced when mortgage rates were at historic lows a few years back, and would be having to get a new, higher-rate mortgage if they moved now. ---
**Author:** ![Cheesesteak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cheesesteak/32/3694_2.png) [@Cheesesteak](https://boards.straightdope.com/u/Cheesesteak)\ **Post date:** [November 12, 2025, 8:18pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/18 "2025-11-12T20:18:02Z")
> [@snowthx](#): > > If we stay here long enough, it’s value will figure into our old-age care - I don’t want the value of _MY_ house to go down! Neither do I. I own two homes and don’t particularly want either value to drop or for my second (vacation) home to be targeted with fees or unfavorable tax treatment. But… something needs to be done. The market is outrageous and people can’t afford homes, and I don’t want to be profiteering off their misery. I’m not going to drop my house price unilaterally, but if someone enacts a way to rightsize the market, I’ll go for it. ---
**Author:** ![Q.Q.Switcheroo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/q.q.switcheroo/32/5713_2.png) [@Q.Q.Switcheroo](https://boards.straightdope.com/u/Q.Q.Switcheroo)\ **Post date:** [November 12, 2025, 8:18pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/19 "2025-11-12T20:18:53Z")
> [@Roderick\_Femm](#): > > > [@Q.Q.Switcheroo](#): > > > > Or just amend the zoning laws to allow single room occupancy construction. > > Isn’t that usually offered as a solution for homelessness? It’s also a way to free up multi-bedroom apartments that would otherwise be occupied by young singles trying to save on rent by moving in together as roommates. ---
**Author:** ![HMS\_Irruncible](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hms_irruncible/32/7394_2.png) [@HMS\_Irruncible](https://boards.straightdope.com/u/HMS_Irruncible)\ **Post date:** [November 12, 2025, 8:20pm UTC](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808/20 "2025-11-12T20:20:07Z")
> [@Saint\_Cad](#): > > This is too simplistic. First of all, it is assuming non-rich people can get a mortgage, many can’t. Second, how do you stop investors from overbidding. Someone offers you $250,000 and another offers $260,000. Are you going to turn down the extra $10,000 because the buyer wants to rent it out? 1. Lower prices mean smaller mortgages, which means risky borrowers will be more able to afford the risk premium. 2. How do we stop investors from overbidding? I propose zero-interest construction loans for owner-occupants. People build homes and then move into them. No investors in the loop. But apart from that, the only answer is to keep adding capacity. The lack of capacity is why investor demand can’t be saturated. > [@Saint\_Cad](#): > > Again, assumes facts not in evidence. If the going rental rate in my area is $1500/mo, then that’s what I’m charging whether the house itself cost $100,000 or $500,000 The supply/demand relationship is a fact. Increased housing supply puts downward pressure on both rents and prices. It can’t be any other way. [Next page](https://boards.straightdope.com/t/the-way-to-address-housing-affordability-is-to-build-more-housing/1024808.md?page=2)