Taking the Lead in Housing Affordability

Last week, we had our second successful Policy Forum at the National Press Club in Washington, D.C. Focused on one our top strategic priorities – housing affordability, this event was another step in our efforts to collaborate with a broad coalition of organizations, including multicultural real estate groups, lenders, builders, economists, and law and policy makers, to amplify our advocacy voice and discuss was to positively impact and broaden housing opportunities.

As America confronts low housing inventory and a persistent lack of affordable housing options, we were excited to bring together some of the brightest minds in our industry in front of more than 300 registered attendees. Housing affordability is set to be one of the defining policy issues of this decade, it is imperative for REALTORS® to lead discussions that will generate solutions to these far-reaching problems.

Also highlighted was the gap in homeownership rates between white and black Americans recorded at the end of 2019, which is larger than it was more than 50 years ago. During a session led by Director of Fair Housing Policy Bryan Greene, panelists highlighted proposals that would tackle housing supply constraints; improve access to credit for mortgage-ready Americans; and increase post-purchase support and counseling programs, among others.

Earlier this year, NAR Chief Economist Lawrence Yun released a report showing that major U.S. metro areas where housing affordability has worsened over the last five years have seen a corresponding drop in job growth. Specifically, housing affordability rankings have declined in 81 of 174 U.S. metro areas, while 34 regions are seeing job growth fall faster than the national average over the past five years. Additional research conducted by Lawrence’s team found that, from 1989 to 2019, 87% of home purchases in all major metro markets resulted in a positive housing equity gain for owners who held the property for 7–10 years.

Earlier this year, NAR Chief Economist Lawrence Yun released a report showing that major U.S. metro areas where housing affordability has worsened over the last five years have seen a corresponding drop in job growth. Specifically, housing affordability rankings have declined in 81 of 174 U.S. metro areas, while 34 regions are seeing job growth fall faster than the national average over the past five years. Additional research conducted by Lawrence’s team found that, from 1989 to 2019, 87% of home purchases in all major metro markets resulted in a positive housing equity gain for owners who held the property for 7–10 years.

While barriers inhibiting development remain, we support policies that we believe could bring relief to the market. In response to HUD’s Request for Information on policies that “raise the costs of affordable housing and contribute to… low housing inventory,” NAR penned a letter arguing for improved FHA underwriting criteria that is more equitable for first-time homebuyers; incentivization of “Yes in My Backyard” markets to encourage states and localities receiving federal dollars to reform high-density zoning; and for additional Community Development Block Grants that encourage localities to update development plans and address barriers to housing affordability.

Additional NAR research unveiled during the Policy Forum projected that $220 to $400 billion would be added to the economy if the pace of homebuilding and for-sale housing activity returned to a more normalized level, translating to 0.25% to 0.50% in added annual GDP growth over the next four years. We encourage you to watch the recorded session and read the conference materials, including reports examining inclusionary zoning, accessory dwelling units and, most notably, a White Paper reiterating the case for homeownership while calling on Congress to restore homeownership incentives in the U.S. tax code.