How to Repair America’s Broken Housing System — with Dr. Jenny Schuetz
The Prof G Pod with Scott Galloway
Key Insights
Why is America's housing system considered broken?
The housing system is broken because it is difficult to build new housing, especially in high-demand areas, due to local government and neighborhood resistance. This resistance often stems from homeowners who benefit from limited supply, leading to higher property values.
What are some policy solutions to address the housing shortage?
Policy solutions include making it easier to build a diverse set of housing types, relaxing zoning laws to allow for more density, and streamlining the approval process to reduce delays caused by community engagement.
How do local governments and neighborhoods contribute to the housing shortage?
Local governments and neighborhoods often resist new housing developments, either through formal zoning laws or informal community pressure, which limits the supply of new homes and drives up prices.
What role can state governments play in addressing the housing shortage?
State governments can reclaim some of the power delegated to local governments by setting housing targets and limiting local control over zoning near transit stations. This can help increase housing supply and address economic impacts of insufficient housing.
How has the pandemic affected housing affordability across the U.S.?
The pandemic has exacerbated housing affordability issues, turning what was once primarily a problem in high-cost coastal markets into a nearly national issue. This is due to increased demand in previously affordable regions like Austin and Denver, leading to higher prices.
What impact does remote work have on the housing market?
Remote work has led to increased demand for housing, particularly from high-income workers who seek more space for home offices. This has driven up prices, especially in metro areas with high rates of remote work.
Why are progressive cities struggling more with homelessness?
Progressive cities often have strict housing policies that make it difficult to build new housing, leading to higher rents and more homelessness. Additionally, policies aimed at community empowerment can be weaponized by affluent neighborhoods to block affordable housing projects.
What are the risks associated with institutional buyers in the housing market?
Institutional buyers can outcompete individual homebuyers, driving up prices. They may also provide poor-quality housing and unresponsive tenant services, but these issues should be addressed through regulations rather than banning institutional buyers altogether.
How might climate change affect the housing market?
Climate change is increasing property insurance premiums and making it harder to obtain coverage, particularly in areas prone to natural disasters like Florida. This could make homeownership less attractive and increase costs for renters as well.
What is the outlook for commercial real estate in the U.S. given the shift to remote work?
The commercial real estate market is mixed, with some areas like New York seeing high office vacancy rates, while others in the Sun Belt have held up better. The long-term impact of remote work on commercial real estate is still uncertain, but there is potential for office buildings to be converted into residential spaces.
Chapters
- Local governments control housing production, often leading to resistance from neighborhood residents.
- Affluent homeowners often oppose new housing developments to protect their property values.
- Policy changes should focus on making it easier to build diverse housing types and streamline the approval process.
Shownotes Transcript
