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The Solution to America’s Housing Woes

While many seem to be looking forward, trying to determine when another recession will upend our nation’s economy, others seem to be glancing back wondering if we ever fully recovered from the Great Recession that sent shockwaves across the nation in 2008. 

Foreclosure rates have been wallowing at impressive lows for some time. ATTOM Data Solutions reported the national foreclosure rate last year was 0.36%. 

However, some feel the housing market has never fully emerged from that housing crisis. One market expert says we’re just now seeing “some signs that America’s housing crisis might be starting to abate.” 

Ben Wilterdink, Director of Programs at the Archbridge Institute, a think tank based in Washington, D.C., said in an article in The Hill, “The nation as a whole has largely recovered from the financial crisis. But the recovery has been deeply geographically uneven, with urban areas experiencing high levels of population growth and new business formation while rural areas remain much more economically stagnant.” 

Wilterdink pointed to data from the Economic Innovation Group demonstrating that more populous counties as well as counties that were already more prosperous have accounted for much of the “recovery” we’ve seen. 

In fact, the Economic Innovation Group says, “Were it not for prosperous zip codes, the country would still be several years away from a full employment recovery.” 

The most prosperous ZIP codes have millions more jobs than they did in 2007, while “distressed” ZIP codes “are unlikely to ever recover on current trendlines,” the research group said. 

Naturally, housing costs rose in those areas that experienced booming jobs and growing populations, and the rising prices have been and still are exacerbated by zoning laws and regulations that limit and deter new home construction. 

The lower-cost urban areas often have little to offer in the way of employment opportunities, and as Wilterdink points out, the effects also extend to educational opportunities. 

The median home price for ZIP codes that have the highest quality public elementary schools is $486,104, more than four times the median home price in ZIP codes with the lowest ranked public elementary schools, according to data from the Joint Economic Committee’s Social Capital Project. 

“Ultimately, the lack of affordable housing across much of the country is a problem from which America can only build its way out,” Wilterdink said. 

He added, “A functioning housing market where supply is allowed to meet demand is still a ways off,” he is reading optimism in a few recent developments. 

For example, the Department of Housing and Urban Development updated the Affirmatively Furthering Fair Housing rule to scale back restrictions on federal funding and encourage more housing construction. 

Also, California has taken steps to discourage restrictive zoning rules and allow homeowners to build accessory dwelling units on their lots. Wilterdink says other states are following suit. 

About Author: Krista F. Brock

Krista Franks Brock is a professional writer and editor who has covered the mortgage banking and default servicing sectors since 2011. Previously, she served as managing editor of DS News and Southern Distinction, a regional lifestyle publication. Her work has appeared in a variety of print and online publications, including Consumers Digest, Dallas Style and Design, DS News and DSNews.com, MReport and theMReport.com. She holds degrees in journalism and art from the University of Georgia.

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