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Research papers on The housing affordability crisis

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  1. Housing Constraints and Spatial Misallocation

    Chang‐Tai Hsieh, Enrico Moretti · 2019 · American Economic Journal Macroeconomics · 649 citations

    We quantify the amount of spatial misallocation of labor across US cities and its aggregate costs. Misallocation arises because high productivity cities like New York and the San Francisco Bay Area have adopted stringent restrictions to new housing supply, effectively limiting the number of workers who have access to such high productivity. Using a spatial equilibrium model and data from 220 metropolitan areas we find that these constraints lowered aggregate US growth by 36 percent from 1964 to 2009. (JEL E23, J24, J31, R23, R31)

  2. The Variegated Financialization of Housing

    Manuel B. Aalbers · 2017 · International Journal of Urban and Regional Research · 490 citations

    Abstract There is a small but growing literature on the financialization of housing that demonstrates how housing is a central aspect of financialization. Despite the varied analyses of the financialization of housing and the importance of housing to financialization, the relations between housing and financialization remain under‐researched and under‐theorized. The financialization of housing is not really a specific form of financialization, transcending as it does a number of different forms of financialization. Housing systems, in particular, vary widely across the globe, which implies that housing financialization will be inherently variegated, path‐dependent and uneven. In this introdu

  3. Housing Enabling Markets to Work

    World Bank · 1993 · The World Bank eBooks · 433 citations

    No AccessStand Alone Books1 Feb 2013Housing Enabling Markets to WorkA World Bank Policy PaperAuthors/Editors: World BankWorld Bankhttps://doi.org/10.1596/0-8213-2434-9SectionsAboutPDF (1.2 MB) ToolsAdd to favoritesDownload CitationsTrack Citations ShareFacebookTwitterLinked In Abstract:This policy paper discusses the evolving role of the World Bank in the housing sector and provides a new agenda for housing policy and institutional reform in developing countries. It explains the rationale for a new housing policy statement, presents a conceptual and analytical framework for understanding the housing sector, and defines the broad characteristics of a well-functioning housing sector. The paper

  4. Housing and the Monetary Transmission Mechanism

    Frederic S. Mishkin · 2007 · National Bureau of Economic Research · 352 citations

    The housing market is of central concern to monetary policy makers. To achieve the dual goals of price stability and maximum sustainable employment, monetary policy makers must understand the role that housing plays in the monetary transmission mechanism if they are to set policy instruments appropriately. In this paper, I examine what we know about the role of housing in the monetary transmission mechanism and then explore the implications of this knowledge for the conduct of monetary policy. I begin with a theoretical and empirical review of the main housing-related channels of the transmission mechanism. These channels include the ways interest rates directly influence the user cost of ho

  5. The Impact of Zoning on Housing Affordability

    Edward L. Glaeser, Joseph Gyourko · 2002 · National Bureau of Economic Research · 188 citations

    Does America face an affordable housing crisis and, if so, why? This paper argues that in much of America the price of housing is quite close to the marginal, physical costs of new construction. The price of housing is significantly higher than construction costs only in a limited number of areas, such as California and some eastern cities. In those areas, we argue that high prices have little to do with conventional models with a free market for land. Instead, our evidence suggests that zoning and other land use controls, play the dominant role in making housing expensive.

  7. Housing Demand, Cost-of-Living Inequality, and the Affordability Crisis

    David Albouy, Gabriel Ehrlich, Yingyi Liu · 2016 · National Bureau of Economic Research · 129 citations

    Since 1970, housing's relative price, share of expenditure, and ``unaffordability'' have all grown. We estimate housing demand using a novel compensated framework over space and an uncompensated framework over time. Our specifications pass tests imposed by rationality and household mobility. Housing demand is income and price inelastic, and appears to fall with household size. We provide a numerical non-homothetic constant elasticity of substitution utility function for improved quantitative modeling. An ideal cost-of-living index demonstrates that the poor have been disproportionately impacted by rising relative rents, which have greatly amplified increases in real income inequality.

  8. An affordability crisis in British housing: Dimensions, causes and policy impact

    G. Bramley · 1994 · Housing Studies · 118 citations

    Abstract This article argues that the British housing system experienced a crisis of affordability in the late 1980s and early 1990s, manifested in several distinct ways, and similar to problems experienced in some other countries. A combination of circumstances produced this crisis, including changes in demography, income distribution, housing supply and tenure, but financial deregulation was particularly important. Housing affordability became a more significant policy issue when the impact on the normal functioning of the owner occupier market became severe and when the macro‐economic feedback effects were perceived as serious. A number of specific policy changes resulted from this crisis

  9. Rethinking Rental Housing.

    Judith J. Friedman, John I. Gilderbloom, Richard P. Appelbaum · 1988 · Contemporary Sociology A Journal of Reviews · 107 citations

    In recent years, almost daily media attention has been focused on the plight of the homeless in cities across the United States. Drawing upon experiences in the U.S. and Europe, John Gilderbloom and Richard Appelbaum challenge conventional assumptions concerning the operation of housing markets and provide policy alternatives directed at the needs of low- and moderate-income families. Rethinking Rental Housing is a ground-breaking analysis that shows the value of applying a broad sociological approach to urban problems, one that takes into account the basic economic, social, and political dimensions of the urban housing crisis. Gilderbloom and Appelbaum predict that this crisis will worsen i

  11. Sand Castles Before the Tide? Affordable Housing in Expensive Cities

    Gabriel Metcalf · 2018 · The Journal of Economic Perspectives · 87 citations

    This article focuses on cities with unprecedented economic success and a seemingly permanent crisis of affordable housing. In the expensive cities, policymakers expend great amounts of energy trying to bring down housing costs with subsidies for affordable housing and sometimes with rent control. But these efforts are undermined by planning decisions that make housing for most people vastly more expensive than it has to be by restricting the supply of new units even in the face of growing demand. I begin by describing current housing policy in the expensive metro areas of the United States. I then show how this combination of policies affecting housing, despite internal contradictions, makes

  12. Affordable Housing and City Welfare

    Jack Favilukis, Pierre Mabille, Stijn Van Nieuwerburgh · 2019 · National Bureau of Economic Research · 57 citations

    Housing affordability is the main policy challenge for many large cities in the world. Zoning changes, rent control, housing vouchers, and tax credits are the main levers employed by policy makers. But how effective are they at combatting the affordability crisis? We build a new framework to evaluate the effect of these policies on the well-being of its citizens. It endogenizes house prices, rents, construction, labor supply, output, income and wealth inequality, as well as the location decisions of households. Its main novel features are risk, risk aversion, and incomplete risk-sharing. We calibrate the model to the New York MSA, incorporating current zoning and affordable housing polici

  13. Assessing post-GFC housing affordability interventions: a qualitative exploration across five international cities

    Steffen Wetzstein · 2019 · International Journal of Housing Policy · 37 citations

    Abstract This paper confronts one of the biggest contemporary public policy conundrums globally; the challenge of decreasing housing affordability for urban residents. Aiming to align the international literature with the multitude of policy responses following the Global Financial Crisis (GFC), the paper explores ‘in-depth’, and via recontextualisation, the policy priorities and strategies designed to combat housing affordability challenges across five international cities from advanced economy countries – Berlin (Germany), Vienna (Austria), Singapore (Singapore), Sydney (Australia) and Auckland (New Zealand). Carefully guided by critical social science and heterodox political economy liter

  14. Toward Affordable Cities? Critically Exploring the Market-Based Housing Supply Policy Proposition

    Steffen Wetzstein · 2021 · Housing Policy Debate · 29 citations

    ABSTRACT This article confronts the global affordable urban housing crisis by critically examining what has arguably become the dominant policy rhetoric in advanced economies: the accelerated market-based housing supply. This approach promotes efficient land and housing markets, fashions an enabling approach to planning, aims to deregulate development and building processes, and seeks to curtail local government and planning systems’ powers. These claims are juxtaposed here with heterodox literature strands, and—utilizing a multicity comparative ethnographical methodology—urban stakeholders’ perspectives in the Australasian housing crisis hotspots of Sydney and Auckland. The findings suggest

  24. Can More Housing Supply Solve the Affordability Crisis? Evidence from a Neighborhood Choice Model

    Elliot Anenberg, Edward Kung · 2018 · Finance and Economics Discussion Series · 6 citations

    We estimate a neighborhood choice model using 2014 American Community Survey data to investigate the degree to which new housing supply can improve housing affordability. In the model, equilibrium rental rates are determined so that the number of households choosing each neighborhood is equal to the number of housing units in each neighborhood. We use the estimated model to simulate how rental rates would respond to an exogenous increase in the number of housing units in a neighborhood. We find that the rent elasticity is low, and thus marginal reductions in supply constraints alone are unlikely to meaningfully reduce rent burdens. The reason for this result appears to be that rental rates a

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