The American housing market is broken

The American housing market is broken. Too many people are priced out of homeownership, and there aren't enough reasonably priced rental properties to meet demand. No wonder so many people are grumpy about the economy even though by many measures the outlook is bright.

"First, widespread unaffordability of housing may be the single biggest tangible element contributing to the bad-feelings wave," writes Joe Weber in his Substack column. "After all, a key part of the American dream is owning one's home, something that brings with it safety and promising educational prospects for a family," adds the professor emeritus at the University of Nebraska-Lincoln's College of Journalism and Mass Communications.

The core issue is a lack of supply. The need for more affordable-housing options in urban, suburban and rural communities across the state and the country is now part of a much larger conversation about economic development, economic growth and quality of life.

Among those vulnerable to the broken housing market are older people. The recent report "Housing America's Older Adults" by the Joint Center for Housing Studies at Harvard University makes for bleak reading. Nearly 11.2 million people 65 years and older are cost-burdened nationwide, meaning they spend more than 30% of household income on housing costs — an all-time high. The housing stock isn't designed to support the health and independence of older people. There are deep, cumulative inequalities by race and ethnicity among owners and renters. Older people are at risk of living lonely and isolated.

"I'm here to tell you to be afraid, to be very afraid," said Julia Gordon of the U.S. Department of Housing and Urban Development "We have an affordable housing crisis."

This column can only hint at solutions.

Any reform must include greatly expanding the supply of housing options. Build!

Surveys routinely show that older Americans want to age in their home or community (to be near family). That desire offers an additional insight for political leaders and regulators. Make it a priority to sweep away obstacles to families turning garages and basements into accessory dwelling units (ADUs) for aging parents and relatives.

Create incentives to encourage other variations on communal living, including home sharing, cohousing, intergenerational living arrangements and multigenerational housing (the latter is most popular). Sharing resources lowers the cost of living and nurtures the connections vital to a life well-lived.

Chris Farrell is senior economics contributor, "Marketplace"; commentator, Minnesota Public Radio.