Distinguishing between housing wants and needs is the only real solution to issues of housing affordability.
Not everyone will necessarily agree, but I believe the issues of housing affordability and homelessness are substantively different from one another, and as such the solutions to each issue are substantively distinct from one another. In the case of homelessness the solutions tend to emerge from society's general notion that those whose homelessness is beyond their control, at least in the short term, ought to be helped within the limits of public and private programs whose resources are targeted toward these solutions. It's not that the homeless have a right to decent living space but that society voluntarily will try to help them, at least temporarily, gain access to the space so that they have somewhere other than the street to call "home".
The affordable housing issue is different, and tends to be much more politically charged than that of homelessness. Almost every mayor, city council member, county supervisor and other politician at the local level has "affordable housing" as a high priority in his or her platform. After all, those voters who are unhappy with the cost of housing frequently are the constituents demanding to be heard, raising their voices to ask, "what are you going to do to ease my housing affordability problem"? Of course, if one were to look at the Case-Schiller housing price indices or the Zillow estimates of housing prices across the country it would be relatively easy for most San Diegans, for example, to find areas where prices are half or even less than half of the prices here. The problem? Those living in San Diego--of their own free will--want to stay in San Diego, not move to inland states where prices generally are considerably less expensive.
Imagine if you will a "state of the city" speech by a mayor anywhere in one of San Diego County's 18 cities. In his or her remarks the mayor acknowledges affordable housing as a major political issue, but then adds the following comments:
"As much as I wish everyone who elected me could afford the house of their desires, or even one meeting half of their desires, the fact is families who can't afford this city's high housing costs need to earn more money or to move to another region in America where housing prices are a lot lower. Rather than straining the family budget to maintain a household only minimally satisfying, at best, why not cut your housing costs by 30-60 percent by moving out of state. You made the free choice to live in this city, which is totally understandable because it is a fantastic place to live. But for many of you housing costs are beyond your means. Life is a series of trade-offs and at present you have sacrificed your family's budget to the housing gods, with nothing left over for equally pressing needs like clothing, transportation, education and other essentials. In effect, the extremely scarce resources you worked so hard to earn are not enough. Housing you cannot afford cannot make you happy because you can't afford to live a normal life in it. You might be living in constant fear of foreclosure. I encourage you to take a step back, consider those things in life you are doing without in order to live in your current desirable but non-affordable neighborhood. Think about how much better your overall life could be if you lived elsewhere in America, where housing prices are significantly lower than they are here."
The politician could go on, but by the time he or she finished the paragraph above, recall petitions would be circulating throughout the crowd, social media reports would be skewering him or her, and his or her political popularity would be flushing down the porcelain drain. Many a constituent knows what they want in the way of housing size, style, neighborhood, construction quality, land, access to schools and highways, and the like. Rare is the constituent who wants to think long and hard about housing in terms of what they truly need. I believe in important part it is the willful failure to distinguish between wants and needs that leads individuals and families to over-extend in acquiring housing, whether rental or ownership. In effect, they create their own affordable housing crisis by overextending, and once that happens, they view their problem is one that society should help them resolve. Personal responsibility goes out the window.
If enough individuals and families came to grips with the realities of housing costs that are beyond their budgets and moved out of high housing cost markets, their departures might ultimately contribute to slowdowns in the pace of housing price increases. If enough left, price declines might actually result. Readers might conclude that when former San Diegans moved to lower cost markets, however, by increasing demand for housing elsewhere they would be contributing to upward pressures on housing prices, which might well be true--but increases starting from a much lower base. In the extreme, housing prices would fall in the region being vacated and rise elsewhere, albeit with a long, long way to go before they began to equalize.
Maybe I am too idealistic, but as housing prices adjusted it is at least remotely possible politicians would come to grips with the high costs of regulation they have been imposing on new construction, and reduce those costs. Families might realize that by having more discretionary spending power (not straining mightily to cover housing costs) they might invest more in education, or put savings to work by investing in stocks/bonds/real assets. Over time they will generate even more income (and fewer budgetary headaches) and make life even more pleasant than if they had stayed in San Diego fighting a losing battle with housing costs.
No doubt, by painting this picture in blunt language rather than sugar coating it as politicians are wont to do, I am coming across as callous. My goal is not to run for public office, nor to criticize anyone facing their own affordable housing hell. Instead, following the concept of "tough love", my intent is to point out that those individuals and families stressed out by housing costs have choices they could make, choices that could ease dramatically housing-related budget nightmares. In many cases the truth is they want (and may have acquired) more housing they they need. That's a difficult insight to admit, but unless and until consumers and society come to grips and distinguish between housing wants and housing needs, politicians forever will have affordable housing high on their priority lists, and voters rushing to the polls will continue to break tires and axles on potholes not being fixed. Comparing affordable housing and potholes as political priorities you can guess with 99 percent certainty which side the politicians will favor in investing scarce public resources. By prolonging the problems of affordable housing, of course, politicians retain the issue as a high priority and continue to get re-elected because they appear to "care" about their constituents.
The affordable housing issue is different, and tends to be much more politically charged than that of homelessness. Almost every mayor, city council member, county supervisor and other politician at the local level has "affordable housing" as a high priority in his or her platform. After all, those voters who are unhappy with the cost of housing frequently are the constituents demanding to be heard, raising their voices to ask, "what are you going to do to ease my housing affordability problem"? Of course, if one were to look at the Case-Schiller housing price indices or the Zillow estimates of housing prices across the country it would be relatively easy for most San Diegans, for example, to find areas where prices are half or even less than half of the prices here. The problem? Those living in San Diego--of their own free will--want to stay in San Diego, not move to inland states where prices generally are considerably less expensive.
Imagine if you will a "state of the city" speech by a mayor anywhere in one of San Diego County's 18 cities. In his or her remarks the mayor acknowledges affordable housing as a major political issue, but then adds the following comments:
"As much as I wish everyone who elected me could afford the house of their desires, or even one meeting half of their desires, the fact is families who can't afford this city's high housing costs need to earn more money or to move to another region in America where housing prices are a lot lower. Rather than straining the family budget to maintain a household only minimally satisfying, at best, why not cut your housing costs by 30-60 percent by moving out of state. You made the free choice to live in this city, which is totally understandable because it is a fantastic place to live. But for many of you housing costs are beyond your means. Life is a series of trade-offs and at present you have sacrificed your family's budget to the housing gods, with nothing left over for equally pressing needs like clothing, transportation, education and other essentials. In effect, the extremely scarce resources you worked so hard to earn are not enough. Housing you cannot afford cannot make you happy because you can't afford to live a normal life in it. You might be living in constant fear of foreclosure. I encourage you to take a step back, consider those things in life you are doing without in order to live in your current desirable but non-affordable neighborhood. Think about how much better your overall life could be if you lived elsewhere in America, where housing prices are significantly lower than they are here."
The politician could go on, but by the time he or she finished the paragraph above, recall petitions would be circulating throughout the crowd, social media reports would be skewering him or her, and his or her political popularity would be flushing down the porcelain drain. Many a constituent knows what they want in the way of housing size, style, neighborhood, construction quality, land, access to schools and highways, and the like. Rare is the constituent who wants to think long and hard about housing in terms of what they truly need. I believe in important part it is the willful failure to distinguish between wants and needs that leads individuals and families to over-extend in acquiring housing, whether rental or ownership. In effect, they create their own affordable housing crisis by overextending, and once that happens, they view their problem is one that society should help them resolve. Personal responsibility goes out the window.
If enough individuals and families came to grips with the realities of housing costs that are beyond their budgets and moved out of high housing cost markets, their departures might ultimately contribute to slowdowns in the pace of housing price increases. If enough left, price declines might actually result. Readers might conclude that when former San Diegans moved to lower cost markets, however, by increasing demand for housing elsewhere they would be contributing to upward pressures on housing prices, which might well be true--but increases starting from a much lower base. In the extreme, housing prices would fall in the region being vacated and rise elsewhere, albeit with a long, long way to go before they began to equalize.
Maybe I am too idealistic, but as housing prices adjusted it is at least remotely possible politicians would come to grips with the high costs of regulation they have been imposing on new construction, and reduce those costs. Families might realize that by having more discretionary spending power (not straining mightily to cover housing costs) they might invest more in education, or put savings to work by investing in stocks/bonds/real assets. Over time they will generate even more income (and fewer budgetary headaches) and make life even more pleasant than if they had stayed in San Diego fighting a losing battle with housing costs.
No doubt, by painting this picture in blunt language rather than sugar coating it as politicians are wont to do, I am coming across as callous. My goal is not to run for public office, nor to criticize anyone facing their own affordable housing hell. Instead, following the concept of "tough love", my intent is to point out that those individuals and families stressed out by housing costs have choices they could make, choices that could ease dramatically housing-related budget nightmares. In many cases the truth is they want (and may have acquired) more housing they they need. That's a difficult insight to admit, but unless and until consumers and society come to grips and distinguish between housing wants and housing needs, politicians forever will have affordable housing high on their priority lists, and voters rushing to the polls will continue to break tires and axles on potholes not being fixed. Comparing affordable housing and potholes as political priorities you can guess with 99 percent certainty which side the politicians will favor in investing scarce public resources. By prolonging the problems of affordable housing, of course, politicians retain the issue as a high priority and continue to get re-elected because they appear to "care" about their constituents.
Agree - I saw a report today that 1/2 of seniors have no retirement savings. The number of Seniors is growing . I also read a story today about a senior that could live at a Holiday Inn for about $59 per day versus $179 per day at a senior center. Do you have ideas on how we might get ahead of the senior problem.
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