Political Reform

Affordable Low Income Housing

How do we get affordable housing without causing another housing market crash?

The high cost of housing is one of the major causes of poverty in this country.  Some cities such as San Francisco have such high housing costs that housing alone consumes as much as 60% of the average persons earnings.  This is in contrast to the historical 25% that housing used to cost.  

There is absolutely no reason for housing to cost this much.  Housing has not gotten more expensive to build.

The reason housing is expensive is entirely due to city and state governments artificially restricting what people can do with their own property.  This makes housing artificially scarce  because private land owners are not ALLOWED to fulfill the demand in housing by building more housing.  

The Federal government also restricts housing in the mid-west by its ownership of up to 80% of the land in some states like Utah or Nevada.  

Restrictions that keep housing scarce push housing prices up due to supply and demand.  In addition to that the city and state governments may deliberately charge absurdly high fees to give out building permits.  The fee goes directly into the cost of the finished product.  

The final thing cities and states do to push housing prices up is minimum standards for housing.  Now this sounds benign but if someone cannot afford to buy a large house that is fully carpeted then requiring that all houses have a minimum set of amenities just means that the poor person will have to remain homeless.  


I lived in Rio De Janeiro in Brazil for a couple of years, and I saw first hand poverty far worse than anything most americans can imagine.  The funny thing was that even people in dire poverty usually had a house to live in.  The reason is simple.  They could just move somewhere out in the sticks where land is cheap.  Then they would purchase a tiny plot, maybe only a few hundred square feet and BUILD THEIR OWN HOME.  It was usually just brick walls and a corrugated tin roof, sometimes without even a door, but at least they had somewhere to sleep out of the rain and cold.  The brick they used was the Brazilian equivalent of cinder block.  Cheap, mostly hollow and easy to build load bearing walls with even for the untrained.   

We don't have to leave the poor homeless.  If we eliminate zoning restrictions that require a minimum plot size then the poor can buy tiny plots and build their own house.  If we also eliminate exorbitant fees for building permits and requirements on minimum size or quality of house then the poor will be free to at least own their own home instead of being homeless.  There is also no reason we cant give them a hand so that the finished product is better than what they could do on their own.  We can design a nice house for them, and then give the plans and instructions away for free.  You would be amazed at what modern technology allows in terms of construction methods.  You can even make a house out of mostly styrofoam these days.  (expanded polystyrene foam if you want the correct name).  Of course the foam is coated in concrete when it is done to add strength.  But in addition to those methods there is concrete tilt wall construction, insulated concrete forms, concrete lego blocks and other methods that would allow a poor homeless person to build a reasonably high quality home for himself without requiring a lot of skill or time.  All this is possible only if we ALLOW the poor to build their own home.  As long as the government continues to prevent the poor from building their own homes they will remain homeless.  

A good resource for this topic is Thomas Sowell's book "Economic Facts and Fallacies"