Key Takeaways:
- Government regulations add anywhere from 24% to 58% to the cost of buying a home.
- Housing costs are rising faster than wages.
- Almost half of renters spend more than 30% of their gross wages on housing.
- Census Bureau data shows 15 million excess housing units nationwide — a 10.4% vacancy rate.
- DEI advocates argue there’s a housing shortage so they can push for more high-density, low-income housing incorporating DEI quotas.
- Their ultimate goal is to change suburban demographics and flip red voting areas to blue voting areas.
Housing costs are through the roof.
Housing affordability is deteriorating at the fastest pace in decades.
Federal, state, and local government policies are making everything worse.
In some areas there’s a housing shortage… in other areas there’s a surplus.
Here are 4 things you should know:
- Government regulations and policies – federal, state, and local – drive up the cost of purchasing or renting housing.
Housing costs – just like the costs of everything — are driven by the economic law of supply and demand.
But “supply” is greatly impacted by government policies such as:
- Zoning laws and restrictions
- Building permit costs
- Environmental rules
- Other regulations and fees
Examples of zoning laws and restrictions:
- Single-family zoning excludes duplexes, apartments or condos.
- Minimum lot size, easements, and open space requirements limit population density.
- Zoning restrictions limit supply – even in high-demand areas – raising per-unit costs.
Examples of building permit costs:
- Building requirements for energy efficiency.
- Building codes for fire, flood, and earthquake readiness.
- Long approval timelines and delays increase administrative burdens and add risk and uncertainty.
Examples of environmental rules:
- Environmental impact studies and reviews.
- Traffic flow studies.
- Emission requirements.
- Utility easements and storm drainage requirements.
Examples of other regulations and fees:
- Impact fees
- Landscape fees
- Infrastructure fees for water and sewer connections.
All of these regulatory costs are passed on to homebuyers and renters.
For example, the 2021 Washington State Energy Code – which went into effect on March 15, 2024 – adds at least $24,070 to the cost of a new home.[1]
A 2021 study by the National Association of Home Builders found that on average across the nation, regulations at all levels of government account for 23.8% of the cost of a new single-family home.[2]
Another study by the University of Hawaii Economic Research Organization (UHERO) in 2024 reported that regulatory costs account for 58% of the median price of a two-bedroom condo in Hawaii.[3]
A few of the economic realities of high housing costs:
- Higher housing costs reduce discretionary spending on goods and services.
- Older homeowners with locked in low mortgage rates are better off than younger new buyers who face much higher entry costs.
- What the U.S. Census Bureau is saying about rising housing costs.
The U.S. Census Bureau gathers housing data every year by conducting its American Community Survey (ACS) of about 3.5 million households.
In 2023, 27.1% of homeowners with mortgages and 49.7% of renters spent more than 30% of their gross income on housing.[4]
This equates to over 21 million renter households spending more than 30% of their gross income on rent.[5]
It gets worse.
The 2024 ACS data shows that housing costs are rising faster than wages.
The report highlights sharp increases in mortgage costs and in rent cost – particularly in high-cost states such as:
- California
- Hawaii
- New York
- New Jersey
- Massachusetts
- District of Columbia
Housing costs in these states are 40% to 50% of median household income.
The U.S. Department of Housing and Urban Development (HUD) defines affordable housing as costing (including utilities) no more than 30% of gross household income.
According to the Census Bureau:
- Monthly mortgage payments, property taxes and homeowner’s insurance have climbed by over 25% since 2020.
- Wage growth has slowed to 3% to 4% per year.
- National median rent rose by 7% in the past year alone, hitting record highs in metropolitan areas.[6]
Housing affordability is at historic lows.
Surging demand in Texas and Florida – once havens of affordability – are pushing prices higher in those states.
Midwest and rural areas remain more affordable, but rent inflation is faster than average.
- What the Census Bureau is saying about housing availability.
There are some who claim that one of the reasons housing prices are so high is because of a shortage of housing units.
The Census Bureau data from the 2024 American Community Survey says otherwise.
The latest data shows 131.3 million households in the U.S., and 146.5 million housing units.[7]
That’s an excess supply of over 15 million units – which equates to a 10.4% vacancy rate.
Just as the labor market needs some unemployment to provide efficient job matching, so a well-functioning housing market needs a vacancy rate.
Since the Census Bureau began tracking housing data in 1965, the vacancy rate has fluctuated between 8.3% and 14.5%.
So this year’s 10.4% vacancy rate falls well within the historical range.
But that’s not good enough for those who advocate DEI and its quota system.
- What DEI advocates are saying about housing availability.
Although DEI training and DEI quotas have been eliminated at the federal level, DEI advocates are still fighting to impose DEI policies in the housing market.
How?
First, they are arguing that the current housing surplus is not enough.
They say an additional 1 million housing units are needed to bring the vacancy rate to their arbitrarily-contrived target of 12%.
They claim there is massive pent-up demand and that millions of people would form separate households if housing were cheaper.
Second, they want to change local zoning laws so they can force high-density, low-income housing into suburban communities.
Their agenda? Eliminate disparities in living conditions by lowering community standards.
The end result they want is not equality of opportunity in housing – which is what the Fair Housing Act of 1968 guaranteed – but equality of outcome.
The Obama administration implemented this strategy via HUD, which issued a new rule in 2015 called Affirmatively Furthering Fair Housing.
The rule forced towns that accepted federal funding to eliminate zoning laws and to provide detailed reports on racial demographics.
The Economic Development Corporation of New York City follows this approach by criticizing certain neighborhoods for “restrictive land use regulations” that limit population density.
They explicitly declare that “Community Districts producing the least affordable housing are disproportionately white.”[8]
Their focus on racial demographics reveals their true agenda: to flip red voting areas blue.
DEI housing activists are not only pushing their radical agenda at the local level, but at the state level as well.
In 2021, Massachusetts passed a law requiring 177 towns along the commuter rail line to change their local zoning laws to allow high-density low-income housing.
The bill was originally to appear optional and incentive-based, but it is now being enforced as mandatory.
Similar efforts are taking place nationwide, with media influencers calling for increasing population density – meaning eliminating suburban single-family zoning.
Watch for this hidden DEI strategy to come to your neighborhood.
Action Item:
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FAQs:
Q – What is this article about?
A – This article is about the increasingly high costs of housing and how government regulations are adding to the cost increases.
Q – Where did the information on housing costs come from?
A – The information for this article came from Census Bureau data from the 2024 American Community Survey (ACS) and from a National Association of Home Builders (NAHB) study.
Q – Is there a housing shortage in America that contributes to high housing costs?
A – It depends on who you listen to. The Census Bureau data shows that the current housing vacancy rate is normal. DEI advocates argue that there is a housing crisis.
Q – Why do DEI activists believe there’s a housing shortage?
A – DEI activists want more high-density low-income housing units built in suburban neighborhoods so that they can impose DEI quotas and flip red-voting areas to blue.
About Craig Huey:
Craig Huey is a nationally recognized author, speaker, and publisher of The Huey Alert and Direct Marketing Update. He is also the author of The Great Deception: 10 Shocking Dangers and the Blueprint for Rescuing the American Dream, exposing the lies of socialism and defending America’s founding principles. Craig appears on national media such as FOX, FOX Business, Newsmax and more. He also co-hosts The Huey Alert Podcast with his wife Shelly and helps business leaders, Christians, conservatives, libertarians, young people and more understand the intersection of faith, politics, and freedom.
[1] Andrea Smiley, https://housingstudies.biaw.com/reports/cost-of-constructing-new-homes-in-washington-state-in-2024
[2] Paul Emrath, https://eyeonhousing.org/2021/05/regulation-now-accounts-for-93870-of-the-average-new-home-price/
[3] https://manoa.hawaii.edu/news/article.php?aId=13105
[4] Drew DeSilver, https://www.pewresearch.org/short-reads/2024/10/25/a-look-at-the-state-of-affordable-housing-in-the-us/
[5] https://www.census.gov/topics/housing/housing-affordability.html
[6] https://www.census.gov/programs-surveys/acs/news/data-releases/2024/release.html
[7] Stephen Frank, https://capoliticalnewsandviews.com/dei-is-the-real-cause-of-americas-housing-crisis/
[8] Ibid.