The rural county I live in has open jobs, but a sizeable chunk of the work force is either seasonal (logging, etc) then coast on unemployment for the off season or don't actually want to work. Those that do, are flaky as all get go. (My partner and I own a small business in the county).
What does this have to do with housing? Covid and growth of a near by metro area (about an hour away) have pushed people to buying up what was previously cheap (yet affordable) housing. Small cabins that would be going for ~75k or a bit more 7 years ago are pushing over $200k now. The local community college as well as natural disasters further puts pressure on the housing situation. How about building more? Well, insuring housing when large fires have come through? Hard to come by. Building costs have also gone through the roof.
Housing is needed in this particular county (and surrounding) but isn't being built.
Where does housing for 3.5 million get built?
One doesn't. One builds 3.5 million homes, mostly apartments.
Unfortunately, the sheer regulatory expense of new housing is such that it's not worth it for anyone to try any project short of big apartment/condo buildings.
With some of the recent changes to building policies I think we're going to find out that NIMBY local policy and regulation aren't the fundamental problem, but we're up against the limits of how capital naturally engages with building projects: chasing demand towards the high end of the market and staying well back from diminishing marginal returns.
https://citiesassociation.org/documents/constraints-survey-d...
Market prices of homes in places like Freemont tend to run from the high 6 figures through the low 7. Knock off $150k and we have maybe a 20% price reduction (probably closer to 15%). Nice to have but hard to figure out how that represents the largest portion of anything.
Land homes sit on costs more than $150k, maybe north of twice as much in Freemont-like areas (unless the lot is weird, inaccessible, or otherwise has issues that make it difficult to build on).
I'm not sure how one is going to get total materials and labor to come in less than $150k for most single family homes in CA. Maybe with small square footage and a good deal of luck with labor and materials? You tell me how to build for less than $120/sqft and I'm sure I'm not the only one who's all ears.
Seems to me to get regulatory expense to be the single largest item for building a home, we'd have ignore land, then play the game of lumping together all such expenses while splitting out building and labor, and even then I'm still not sure how it actually adds up.
The land cost scales down with density. The unit permitting cost is fixed regardless of size.
What infrastructure do you imagine California to be lacking that would be relevant here?
Also, there is the small fact that apartment dwellers use a tiny fraction of the water of people who live in detached houses.
In short, there is plenty of water in various major metropolitan areas.
I find this lack of optimism very dissonant and just divisive.
With the resources of an entire state government, or a lot of private equity, this is very solvable.
Take a place like Sunol, CA or Livermore, CA, either one about an hour east of San Francisco and trivial to connect to public transit.
https://www.google.com/maps/@37.5871047,-121.8716321,3a,75y,...
(California has nowhere to build they say... see above link.)
Build several hundred high-rise apartments with several thousand of residents each. There you go. Housing for a million people in the space of not even a square mile probably. Add in generous amounts of entertainment venues, coffee shops, live music, some parks, and a bunch of office buildings.
Done. Solved. But they don't do it. Why?
This is called the Napkin Fallacy. When you write down some solution to a long standing social problem on a napkin in a coffee shop, and then instead of asking
"What is wrong with my solution, that it hasn't been adopted?"
you ask
"What is wrong with the world, that it hasn't adopted my solution?"
The world needs a lot more people asking the first question rather than the second. Virtually no one should be asking the second question. As the saying goes "For every problem, there is a solution that is clear, simple, and wrong." That's usually the napkin solution. When you stop to really think about what is wrong with the napkin solution, you start down the path of solving real problems. It is highly unlikely that long standing social problems have napkin solutions.
As a slightly toxic corollary to the Napkin Fallacy is the Virtue Fallacy, which tries to answer the second question with
"It is because the world is run by bad people"
This is bad not only because it is an easy way to avoid the difficult work of understanding why the napkin solution doesn't work, but also because it caricatures one's opponents, and it is close to self-deification. While the saying "Let God be true, but every man a liar" is sound, the saying "Let me be true but every man a liar" is unsound. There is generally nothing about any of us that makes us better than others. Do not assume the world is run by people worse than you.
There are many vacant houses in the U.S., and many cheap houses -- pretending this is about shortage of physical housing is just foolish.
This is about shortage of desirable housing, and instead of stopping to ask what are the mechanisms that cause desirable housing (for you) to be so expensive, you just assume the problem is like a shortage of lumber or "space" or something equally irrelevant. If you build lots of affordable housing in Livermore, what would happen is that Livermore would stop being desirable for you, and you would end up wanting to live in some satellite area that was created outside of Livermore in which the exclusivity was maintained. Then good jobs would move there, because over the long term, the jobs follow the skilled workers and not the other way around. Then your utopian project in Livermore would find itself turned into a low income area where there is a shortage of good jobs, and most of the good jobs are elsewhere, in more exclusive areas, that are within commuting distance of the Lab. Then the Lab would find itself having trouble hiring enough people, and it would open satellite offices elsewhere. Then you would complain about a shortage of housing there, and want to rinse and repeat, not understanding why your intervention failed to solve the problem.
A good example is San Francisco. Most tech jobs were in Santa Clara county, not San Francisco. But a lot of tech workers enjoyed living in SF and did a long commute. Then tech companies realized they could hire more easily if they opened offices in San Francisco. Then companies began to be founded there, etc. All of a sudden, lots of tech jobs in SF. The jobs follow the skilled workers, and skilled workers have a lot of options in terms of picking where they want to live. They vote with their feet, and the jobs follow. How did the jobs end up in Santa Clara? Or Belmont. Through a similar process. Jobs chase high skilled people.
So you have to come to grips with why people that have a lot of choices choose to live in expensive, more exclusive areas. Why does the average high income person really not want to live in a neighborhood with a lot of poor people? Or, for that matter, even average income person? Why this hatred towards average people (something that can easily be found even on this site)? Why are they willing to commute elsewhere, and even take a pay cut, to be in a more exclusive area that is surrounded by other high income people? (And so signals to employers to open an office nearby). This is a social issue, not about lack of nails or space or a shortage of lumber.
I do have some arguments in favor of your position, but they’re mostly specific to the US: 1. Many people’s primary retirement plan and emergency fund is often their house, so property values are exceptionally important to them. 2. School funding per student goes down if less wealthy parents move to the district. 3. Violence in poor neighbourhoods can get really bad. None of this is God-given, though, which is why nimbyism isn’t quite as bad in many other countries. And while important, these factors don’t seem to be dominant.
The fact is, there just aren't that many cities that fit this bill, and those that do experience rapidly rising real estate prices. As with many issues, race is a taboo factor operating behind the scenes in determining which neighborhoods are targets of gentrification and which are not. When you create a lot of low income housing, people viewed as more undesirable move in and the high income earners go elsewhere. Then you rinse and repeat. But of course the problem is not that there's a shortage of housing or even a shortage of affordable housing. Median value of owner occupied units is $245K, which is 3.5x the median household income[1]. That's perfectly affordable. But the median home value in a major urban city with less than a 10% African American population is a different story. So there's a shortage of housing in our diverse society that has the "right" kind of demographics. As we become more diverse, the number of locations that are predominantly white or asian will get more and more scarce -- and more and more expensive.
You see a similar situation in Sweden, which accepted a large number of migrants and put them on the outskirts of major cities, and of course the house prices of units in the urban cores that were free of migrants skyrocketed. People are paying to not live in areas with large migrant populations. So all of a sudden housing is becoming 'unaffordable' in Sweden. But the unspoken part is that housing with few migrants is become unaffordable, not all housing. Again, this is a social problem, it's not a problem of a shortage of lumber or space.
So building more low income housing doesn't have the effects you believe, in terms of increasing the amount of housing in highly desirable areas. It will have the opposite effect, by removing one area that has the desired demographics, it makes the remaining islands even more desirable and thus even more expensive. At least this is my reading of history. It was very clear, after the race riots of 2020, how home prices in predominantly white/asian enclaves began to rapidly increase, at which point those who wanted to live in these enclaves began complaining about a "housing crisis" because they could not bring themselves to complain about a racial crisis.
But hey, I could be wrong -- housing in St. Louis or Detroit is still affordable. I'll wait to see tech workers scramble to move there, rather than, say Salt Lake City.
[1] https://www.census.gov/quickfacts/fact/table/US/VET605221
I don't know what all is happening in Sweden, but what happened in Chicago wasn't an organic process; it was deliberately engineered.
Fun Fact: The Obama Administration was instrumental in tearing down a number of low income housing projects in Chicago and exporting them to nearby cities in Illinois, in an attempt to "unlock value" in downtown Chicago housing by removing poor black families. This has had limited success, although South Chicago is still overall a no go zone for gentrification. This explains the slight gentrification you are referring to. There were multiple lawsuits over this, as the nearby suburbs did not want to receive these housing projects, and were basically forced into it by the Obama administration. This was portrayed not as an effort to enrich administration-connected housing developers in downtown Chicago, but rather as an effort "integrate wealthy suburbs" so that they do "their fair share".
Bottom line, you have to be aware of race and what is really going on when you complain about "lack of affordable housing". There is, of course, plenty of affordable housing. But not where you want to live.
https://www.theatlantic.com/business/archive/2015/07/chicago...
https://www.theamericanconservative.com/race-real-estate-oak...
Public housing projects as implemented by cities like Chicago were a failed experiment. The people that used to live in those places get Section 8 vouchers now, and live in houses on blocks like mine. They're better off, and the city is better off.