The dream of homeownership is receding for a generation of younger adults in ways that have no precedent in the post-war era, and the problem is not simply high interest rates.
The median US home now costs 8.4 times the median household income โ a ratio never before recorded in data going back to 1975. In major metropolitan areas: San Francisco at 14.2x, New York at 12.8x, Los Angeles at 13.1x, and even previously affordable cities like Austin approaching 7-8x.
The fundamental issue is supply. The US has built approximately 5 million fewer housing units than household formation would require over the past 15 years. This underbuilding results from NIMBYism in planning processes, complex permitting, high construction costs, and zoning laws that prevent high-density construction where people want to live.
We are not going to solve the housing crisis by tinkering at the edges. We need to build millions of new homes and governments at every level need to make that possible. Everything else is theatre.