{"id":179065,"date":"2024-11-18T15:59:01","date_gmt":"2024-11-18T22:59:01","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=179065"},"modified":"2024-11-18T16:00:01","modified_gmt":"2024-11-18T23:00:01","slug":"what-we-learned-about-housing-affordability-from-the-election","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/what-we-learned-about-housing-affordability-from-the-election","title":{"rendered":"The People Spoke Loud and Clear About Housing Affordability\u2014What Does It Mean For Investors Long-Term?"},"content":{"rendered":"\n

Americans are becoming increasingly worried about housing costs<\/span>, according to <\/span>the Pew Research Center<\/span><\/a>, with 69% of survey respondents reporting that they are \u201cvery concerned.\u201d<\/span> Nearly one-third<\/span><\/a> of Americans <\/span>were considered<\/span> cost-burdened in 2023, meaning that they spent more than 30% of their household income on housing costs, and renters <\/span>were especially strained<\/span>. High mortgage rates, <\/span>a dearth<\/span> of new housing construction, demographic shifts, and urbanization all have a role to play in this issue.<\/span><\/p>\n\n\n\n

Members of both political parties view housing affordability as a growing problem, and both presidential campaigns attempted to address the issue. <\/span>While everyone <\/span>seems to agree<\/span> that the housing affordability crisis requires the attention of policymakers, the potential solutions are many and varied, and voters often disagree over the policies that <\/span>should be prioritized<\/span>.<\/span> <\/span><\/p>\n\n\n\n

There\u2019s evidence that <\/span>zoning reforms<\/span><\/a> make an<\/span> impact, but <\/span>building codes<\/span><\/a> remain an obstacle. About <\/span>60% of voters<\/span><\/a> think rental property investors are a <\/span>major<\/span> contributor to rising home prices, but much <\/span>of the<\/span> evidence <\/span>shows<\/span><\/a> the effect has been minor. <\/span><\/p>\n\n\n\n

Most voters support government funding for affordable housing but often disagree on how it should <\/span>be spent<\/span>. A recent Redfin survey showed that <\/span>82% of Americans<\/span><\/a> support rent control despite overwhelming <\/span>evidence<\/span><\/a> that it decreases the supply and quality of rental housing and faces opposition from <\/span>most economists<\/span><\/a> and many <\/span>housing organizations<\/span><\/a>. <\/span><\/p>\n\n\n\n

State and local ballot measures from this past election demonstrated voters\u2019 concerns and highlighted their differences of opinion. Voters passed (and rejected) state and local ballot measures across the country that may impact real estate investors in some <\/span>of the<\/span> top markets. <\/span><\/p>\n\n\n\n

Raising Funding for Affordable Housing<\/span><\/h2>\n\n\n\n

Several ballot initiatives presented to voters in the November 2024 election aimed to secure dedicated funding for programs that would improve housing affordability and reduce homelessness, including the following state and local measures.<\/span><\/p>\n\n\n\n

Los Angeles tackles homelessness with sales <\/span>tax<\/span><\/h3>\n\n\n\n

Los Angeles voters approved <\/span>Measure A<\/span><\/a>, which replaced a 2017 sales tax increase that funded anti-homelessness programs with an even <\/span>larger<\/span> and permanent sales tax increase designed to provide affordable housing and other services to the county\u2019s homeless population. The measure, which added a 0.5% sales tax estimated to raise more than $1 billion annually, received support from nonprofit housing advocates like Habitat for Humanity of Greater Los Angeles and passed with <\/span>57%<\/span><\/a> of votes from Los Angeles County residents. <\/span><\/p>\n\n\n\n

In general, sales tax is <\/span>regressive<\/span><\/a>, meaning that it takes the <\/span>greatest<\/span> share of income from low-income workers, and some <\/span>argued<\/span><\/a> that Measure H, which previously imposed a 0.25% sales tax, had an insufficient impact on the county\u2019s homelessness crisis. <\/span><\/p>\n\n\n\n

Approving the increase was a tough decision for voters, particularly amid high inflation<\/span>, but there<\/span> were reasons to be optimistic\u2014the new measure added funding for new housing construction in addition to shelters and services, as well as oversight to ensure appropriate spending. <\/span>And<\/span> since taking office in 2022, Los Angeles Mayor Karen Bass has <\/span>taken steps<\/span><\/a> to incentivize <\/span>the development of affordable housing<\/span>, allowing real estate developers to profit from building affordable units.<\/span> <\/span><\/p>\n\n\n\n

Voters in Rhode Island, North Carolina, and Baltimore approve <\/span>bonds<\/span><\/h3>\n\n\n\n

Voters in three North Carolina cities <\/span>approved<\/span><\/a> bond projects that will provide a collective $125 million investment in affordable housing development: <\/span><\/p>\n\n\n\n