Why Technology Hasn’t Fixed the Housing Crisis

A lot of start-ups have promising ideas, but the fundamental problem of affordability seems beyond their reach.

Comments: 230

  1. Of course, affordability is beyond tech companies reach. Granted, in some ways technology can help with data, most obviously with marketing and sales, but also exposing costs, segregation, corruption, and bad governance, but it cannot change those markets because markets are decided by laws and the politically powerful. Technology is often likely to exacerbate such problems by increasing income inequality and by limitations caused by differential access so that affluent individuals are more likely to use and find apps. Even then, companies are for-profit entities, and it wouldn't take long for them to be corrupted by the success for which they aim.

  2. Our City of Charleston SC is experiencing exactly this issue compounded by the lack of affordable land available. We hear many politicians and civic figures bemoaning the fact and yet they repeatedly attempt to address the issue with the same lame tool bag that has failed so often before. We have accumulated significant land within walking distance of the downtown employment hub and on our own auspices developed and tested a build methodology delivering a quality product at about a 50% discount from site build. And yet access to the necessary capital to scale has proven intractable. Is there "Opportunity Zone" capital available that targets this type of build-ready workforce housing niche?

  3. I work in mixed housing-tax credit, public subsidy, and market. We get calls from people on disability making only 1300.00 a month. Until they can get a HUD voucher or public housing, we have nothing. The last SRO in our neighborhood was demolished a decade ago, and it wasn't a nice place, but SROs with amenities for people in situations like my callers would be wonderful. As your article states, NIMBYism blocks potential building projects for these people.

  4. @PatitaC an even sadder fact is many of us with disabilities don't even qualify for any of this and have to figure it out on our own.

  5. @PatitaC: a person getting $1300 a month on disability would qualify easily for Section 8, meaning they would only pay $325 a month for an apartment. The government would cover the rest of the cost. People on disability get to "cut the line" even in front of families with kids. Consider though that 2/3rds of all people on "disability" are fakers and frauds, taking advantage of a mild condition or none to get a nice little income -- many if not most work under the table for cash to supplement this. $1300 a month is very close to the AVERAGE Social Security payment for a honest senior who has worked 50 years and paid into SS for 50 years. They do not qualify for most government programs either! Getting to call oneself "disabled" opens a whole huge can of freebies and benefits. I don't mind genuinely disabled people getting this, but I do mind the 66% who are bald-faced lying fakers and yes, I personally know about a dozen of these. Oh and as for "what should this person with $1300 do for housing"? HELLO! same thing I did as a young person with a low salary -- ROOMMATES.

  6. I've already written a post here in this comment section on how tech couldn't help since the fundamental cause if laws and political power of the RE industry, but after thinking, have additional thoughts. The biggest problem is our own governments, often hostile to the needs of the middle class and the economically disadvantaged, really only concerned about corporations and the wealthy, but there might be options. For one, making the process more efficient for others, automating the process of navigating the market and regulations would help. So would services that could locate affordable housing along with the jobs necessary to relocate people, so that finding affordable housing did not mean less income or a lower standard of living. Even then, a process to organize people to petition their own government for affordable housing and equitable treatment might help. Anyway, just some loose, idea...

  7. Many people want few restrictions on housing quality before they buy and want to impose many restrictions and changes after their purchase. For example, a developer may enjoy loose zoning laws in a rural area and low land prices because of nearby factories, quarries, and high voltage power lines. The developer can offer a nice home at a reasonable price. After people move in they want the factory, quarry, and power lines to go away. They want open space for parks and trails. They want better zoning, no more cheap houses. They want wider roads to handle the traffic. They want newer purchasers to pay for those things and that raises the costs of homes. It is all good practice of the American mentality. Expect the best and want someone else to pay for it.

  8. @Robert Williams I don't know how you fix human nature.

  9. There is a simple answer to help solve the worst of the problem whether it be landlords getting shafted in the 1970s in major cities or now tenants getting shafted. Create maximum and minimum limits on apts/sales. For example in NYC for a one bedroom in a standard bldg. (not super lux or below par) the limits should be app. (reasonable people can debate these limits) $1,200 and $3,000. Let the free market determine the rates in between. This will help prevent the massive upheavals for the landlord and tenants as proven by history.

  10. @Paul, it's rent regulation in NYC that has resulted in insanely expensive housing for people who have not lucked into a rent regulated apartment. Find a real estate market with insane market rents (e.g., NYC, SF) and I'll show you a market where rents are regulated. Rent regulation results in people who stay put forever and ever and then pass their apartments onto their heirs like private property. And in the case of NYC, there are scores of people gaming the system by illegally subletting out their regulated apartments for market rents.

  11. @Ed-Thank you for you're reply. Again Ed, you point out half the problem. The problem has pretty much gone away so where now the opposite is true, landlords are bilking the tenants. Rent control is pretty much gone. There use to be four million rent regulated apts in NYC, there are now 800k and I don't even believe that number. The problem is the extremes ie put all the blame on the landlord or vice versa put all the blame on the tenant. Both can abuse, and both have.

  12. For such a supposedly capitalist society, we have an almost feudal system when it comes to the entitlements we grant to property sellers. Every HOA with the power to dictate what can and cannot be built on what is supposedly your lot is an oligarchy, and the ability to set conditions on property you sell when subdividing is just bizarre-- as long as I don't poison your water, pollute your air, create an unacceptable level of noise, or cast a shadow with what I build on your property you should not have any say in what I can and cannot do with it after you've sold it to me. More than public or private investment, more than public policy, what we need is a constitutional amendment nullifying all such clauses in property contracts-- both past and future. I've had to pass on a lot I wanted to purchase because previous owners who subdivided in the 60s (and are now likely dead), didn't want a commercial building on the lot-- despite the zoning allowing for it-- and to get that restriction lifted I would have had to have tracked down the heirs (who don't own or live in any of the original subdivisions) and get them to agree to lift it; no thanks. It's time to put on our war-paint and go braveheart on this preposterous system people!

  13. the solution is simple...and very painful. 1. invest a massive amount of public private funds into new housing, transportation, and infra (sewers, water) 2. tear down old, inefficient apartment buildings (even if this means evicting a family who's lived there for decades) 3. rezone and rebuild energy and space efficient apartments; all other new developments should be highly taxed 4. build more units than what the market says is most efficient based on econ 101; use public funds to subsidize additional units until the average home is very affordable to a middle class family

  14. @Andrew What's your plan for the residents who are displaced by this solution? Where do they live while all the new housing is going up? Or are they just supposed to disappear quietly, and painfully? That's what we have now, in our rapidly gentrifying cities -- new development displaces long-term residents and they never return to benefit from the (few) affordable units created in the neighborhoods they sustained before they were forced out. That's not good enough. A rich nation like this has the means to do better if we want to.

  15. @Andrew You describe the outcome of World War II.

  16. Systems built modular construction is the quickest solution to this growing need. It's higher quality, lower cost and built in half the time compared to traditional construction. Warren Buffet understands this. That's why he bought Champion Homes, with dozens of factories across the USA.

  17. @jonathan The cost of the shelter itself is not the barrier to entry. It's the cost of the land upon which to put the shelter. We can't just live in smaller and smaller spaces.

  18. @Henry George, cap the tax deduction and profit per unit for real estate. That solves the tendency for the market to just build ever more luxury units and ends the Ponzi scheme for real estate prices. Homes would become actual consumer products subject to the same efficiencies as in other areas of industry instead of being subjects of market speculation.

  19. Sorry, none of this will work. Affordable housing, like affordable health care, requires gov't intervention. For the RICHSTER nation in the world, for one of the LARGEST nations in the world, housing is only a problem because we let it be. Republicans have refused to enforce antitrust rules for 4 decades, depopulating rural states, and they have defunded those same states with low taxes. The apps have made it worse, because it's a perpetual sellers' market now. Real estate tax breaks ensure that empty office buildings stay empty, even in DC, where residential construction is non-stop. It costs nothing to leave buildings empty, it's a tax write-off! The Trumpsters benefits. Housing costs are at an all-time high while occupancy is far short of that!? The lazy rich like Trump and Shulz are the problem, they rig the rules for their own benefit, then act like it's this big complicated issue beyond comprehension.

  20. @mjw On the whole, I'm no fan of the GOP platform, but did you not read the article which showed that the problem is completely bipartisan? You think it's just Republicans pulling the ladder up after themselves? Go to the wealthy, extremely liberal areas of the Bay Area if you want to see some ferocious opposition to higher-density more affordable housing.

  21. @mjw I agree but there is no corporate tax or subsidy that can ever be funded over the long term and that will actually solve the problem. The only way is to tax the root cause and that is overheated price increases in real estate, such as with a capital gains surtax to fund local low-income housing, as I am proposing.

  22. The rule for housing is simply: *If you can't go up, you go out, if you can't go out, you go up. If you go out, you have to have affordable transportation. And the transportation must be as hassle free and quick as parking in the garage in your building. If you go up, you must allow everyone to go up and not just allow one or two buildings to go up, because you need places for people to eat, shop and hang out. Or, you can just stay home and tele-commute. The other answer is: we need to get off this planet and try again on the next one.

  23. Our neighbor to the west, Minneapolis, has recently passed a plan to allow small apartment buildings to be built on much of what was once zoned for single family only. It is expected to provide at least a partial answer to the affordable housing problem. It should be noted, the plan was very unpopular in some neighborhoods (think Brexit here). To many people, higher densities are an anathema. https://www.brookings.edu/blog/the-avenue/2018/12/12/minneapolis-2040-the-most-wonderful-plan-of-the-year/

  24. @WmC I agree. Higher density is the answer. I live in the south Loop of Chicago and there are several apartment and condo buildings going up of 70+ stories. Yet prices are reasonable as there is such a huge supply. Yes it's getting crowded around my little 6 story building but I don't care. Far too many cities have too many restrictions. LA and SF are among the worst.

  25. Mr. Hoffman's comment about where to put all these wonderful new homes is the big point. An app that would work to fix the housing affordability problem would be a worm or virus that infects local laws and removes or greatly adjusts legally mandated lot sizes, limits mixed-use developments, blocks small homes, dense homes or shared residences (that one about people tapping equity to build a little backyard house for the mom would run smack into zoning laws most places). And the article is also correct that expecting homes to be affordable, but also the primary wealth-building for most people, is too much contradiction. Maybe separating property tax and education funding would help. Pay for all schools at the state level, make renting easier in areas typically restricted to ownership. Freeing people up to move to new jobs by eliminating the problem of being trapped in a house you can't sell would be nice, too, since part of the problem can also be looked at as too many houses standing where people don't want to live in them. Is there an app for that?

  26. Capitalism can house the workers it needs now what? How about company towns .The economic system is showing more and more incurable structural elements that no one wants to recognize more inconvenient truths . I fear for the bankruptcy of P&G utility with our affordable electric we go back to the jungle I have heard of communities in the us west were Doctors and high skill health workers can not afford to live in the communities they serve and receive fincacial aid to do so .

  27. Just here to point out that the housing crises is not limited to Seattle, the bay area, and NYC. Inflation and home prices have stayed relatively lock-step aside from a year or two hiccup from 2008. Wages have not kept up and jobs have also migrated to larger urban areas. Throw in the fact that nearly all new homeowners had to overcome crippling debt from student loans and you've got our current gumbo. If we delivered an education stimulus equal to the bank bailout to forgive loans you'd get an entire generation buying homes tomorrow. It wouldn't help as much in the areas that are more affected by availability, but it'd be a start. As for those areas (SF, Seattle, etc): tax empty homes, restrict all new construction to high occupancy, invest in infrastructure to move companies out of city centers, give tax breaks for companies that hire remote workers (within the same state), and if you want to go real hard... force large companies to pay COL and commuting hours. This is fixable.

  28. @Michael but the average student loan balance is something like $30K, about the price of an average new car. Do you really think most people are not buying houses because of a $30K student loan debt?

  29. @JTCheek For first time home owners? Oh heck yeah people are not buying bc of student loans. 30K is 15% down payment on the average home in US. It's actually 5% of a 600k home (close to lowest you can put down as first time buyer) in an expensive city. I know as a millennial all of my friends living in cities small and large place student loans as the sole reason they can't get into a home. Doesn't change that homes are overpriced in areas for various reasons, but most folks under 35 are holding out because we graduated with so much debt.

  30. I love your idea to make companies pay for commuter hours. Like the cigarette tax, but to fund public transit. It's brilliant to consider commuting to be a taxable vice.

  31. Perhaps the problem with the housing market is not the housing, but it's the jobs. Sure, there are jobs that require ones physical presence, e.g., food service, labor, teachers, firefighters, etc. But there are scores of white collar jobs that do not really require people to by physically present on their jobs every day, e.g., tech, Wall Street, law, corporate stiffs, etc. These people could theoretically work full time and never step foot in the office. Accordingly, they could be located just about anywhere in the country, which relieves the burden of being crowded into an urban center. If people can commute remotely from remote locations, cities will be less crowded and housing prices will fall accordingly. That being said, there is much that needs to be done to improve telecommuting. There needs to be better audio/visual quality. Telecommuting should be more immersive than merely words on a screen and a staticky voice on the phone. It should be HD audio and video. Holographic images, perhaps. Most people don't have dedicated, expensive A/V equipment in their homes, so there is an unmet need for a portable, cost-effective solution that anyone can access. You're welcome, Apple.

  32. @Ed This is 100% the problem- how we approach jobs vs housing. Any city will WELCOME new jobs with open arms and a ticker tape parade. Cities rolled out the red carpet for Amazon. Tax incentives. Fancy applications. Someone wants to build new housing in most communities? They will be met with opposition and an uphill battle. One community near me has a housing moratorium while aggressively chasing new jobs and industries. Commuting and working remotely is a key as you can push people out towards more affordable areas- it is the old problem with sprawl, but maybe with transit and better planning, it will help.

  33. @Ed It is also the transportation. For those who can't telecommute (for whatever reason), fast, convenient, clean public transportation can widen the radius where homes are desirable (and thus add to supply). As you noted, housing choices are constrained by a need for people to live within reasonable commute of their homes (in time, not distance).

  34. @Ed Excellent post. I have often said that the number one thing we could do to enhance rural and urban equality is to make fiber-optic broadband a utility, and have a government program to make it available everywhere electricity is available. Do that, and I-- along with many others-- would vacate the city in a heartbeat, putting our housing on the market and driving down costs for people who actually want to live in the city; I'll take my garden and starry nights, and you can have the quick commute, thank you very much.

  35. The short answer is no. Technology cannot fix the housing market. At most, technology will just speed the delivery of excessive rents to land owners and thus take money out of the pockets of labor and capital. Community land trusts can go a long way to make housing affordable. Stopping stupid developer give aways and increasing the capture of land values will also make housing affordable.

  36. My first thought is Tyrone Poole's approach is the best way to apply tech to housing. Well, sort of... Matching supply with demand is a valuable tool. Most affordable housing in Salt Lake City now exists as quasi-formal rental agreements. It's mostly sub-rental from primary lease holders or homeowners who rent out varying degrees of space. In-law apartments are more expensive because they have dedicated utilities. Matching this informal housing market with people looking for housing would obviously help. However, you still haven't addressed the elephant in the room. Developers still don't want to build affordable housing. Policy zoning hasn't really moved the needle on which construction gets built at any cost. The developer sets aside "affordable" units per law in a luxury apartment complex and calls it good. What we really have is a mismatch in expectations. Developers obviously want the wealthiest clientele they can possibly lease. However, the tenet's definition of affordable is also off. For me, "affordable" always meant a small single room. A private bath was considered a luxury. A mini-fridge and a microwave were a private kitchen. We called these units mini-studios. They're awesome. You don't see them much in the States though. Developers would much rather rent you more apartment than you can afford. Finding people to pay the rent becomes your problem. Assuming you get approved in the first place. You better have that deposit check on hand. Tech can't fix that.

  37. @Andy: a small single room, with a shared bath down the hallway? and maybe a microwave in your bedroom? Dude, that's a BOARDING HOUSE, not a home or apartment. I don't know what country in which you lived, where this is the norm for housing but I am very glad I don't live there! It might be things are headed that way, in overcrowded costly Big Blue Cities -- but that is pathetic. There are already "micro-studios" in such places, not cheap -- very small -- but I am pretty sure you get your own bathroom, if not much else.

  38. "...software can’t solve the fundamental problem created in the gap between stagnating incomes and rising housing costs." A whole article devoted to tech that cannot solve the problem, and one small sentence directed to the actual problem. This is fundamentally a problem of stagnating incomes versus large speculative real estate profits. For this reason, no subsidy, corporate tax, or government program can ever succeed, because the open ended costs are astronomical. After two generations of observation, it becomes clear that the only solution must involve redistribution of those excessive RE profits back into affordable housing, and it must be a national program that mandates local taxation and housing programs for each individual market. We need a capital gains surtax on real estate profits to generate local revenue to fund affordable housing. This tax will also help dampen excessive speculation.

  39. @Agent GG On the money! A tax structure to do just this was proposed in the 1800s, called Land Value Tax (LVT), and so far no economist has credibly disputed the theory. Why do we allow landlords to reap ever-increasing profit from land that they did not produce? Shouldn't value that they did not produce be passed back to the people/community/state? It's time for us to truly consider Georgism. Singapore is the only place that fully implements it (by a different mechanism but same effect), and their biggest problem is budgetary surplus.

  40. @Agent GG putting more of a burden on developers will only further the problem. The issue is government regulations - zoning and the cost of complying with endless code (including ADA). We need to build more market rate housing and drastically increase density (while conserving historic structures). Zoning is the number one culprit in today’s housing problem. While low income housing construction is noble, its costs are often as much, if not more than market rate housing. Build to the “market” and allow the older housing stock to become low income housing. Condo laws restrict development in many states to wealthy condo construction. We’ve lost an important component of the entry level market by trying to protect buyers where buyer don’t need protection. We have unsustainable suburban neighborhoods that hog massive tracts of land and aren’t accessible by public transportation. Maintaining their infrastructure costs all of us far more than their denser urban neighbors. We have union protected industrial areas that are no longer used by industry - yet remain protected by draconian zoning laws. They need to become high density residential neighborhoods. In many cities they’d force the cleanup of brownfield sites, better utilize infrastructure, and provide vast areas of new housing - frequently in or near urban centers. More fees and regulations for developers will simply drive up prices for buyers and renters. Developers aren’t paying for the end product.

  41. @Rob Spot on. I don’t understand why people always want to punish developers, while developers are the ones that are producing the resource that is too scarce! As the commenter before said however, we can tax the land instead: this cannot restrict its supply (because the supply of land is constant anyway), and yet redistributes wealth that was acquired without actual production. Tax land value at 1% and by definition the public can purchase 1% of the land every year and redevelop it to adapt cities to the new needs in terms of housing and infrastructure.

  42. I'm an architect, specialized in multi-family urban housing, and, despite my MIT degrees and my 25 years of experience, I can barely afford my one-bedroom apartment in a mid-priced city. As the article says, this is a knotty issue. We want more efficient buildings, but the energy code makes housing more expensive to build. We want to avoid the high cost of land and construction for parking, but our governments won't fund public transit. We want beautiful cities, but we architects are paid half as much as we were a generation ago. At root, I believe the housing crisis arises mostly from depressed wages, ever more expensive construction, and a culture that unquestioningly demands the obsolete and wasteful trappings of middle-class suburbia.

  43. @Vee.eh.en When incomes go up, prices go up too, so unfortunately depressed wages are not the reason for the lack of affordability. Land prices can go up as far as they want, so until we manage to make the land not a scarce resource anymore (by increasing density or by making places further away decent alternatives) there is no point trying to lift wages to solve the housing crisis.

  44. @Vee.eh.en: "I'm an architect, specialized in multi-family urban housing, and, despite my MIT degrees and my 25 years of experience, I can barely afford my one-bedroom apartment in a mid-priced city. " What you're describing is the conscious destruction of the middle class. As you say, there's a lot of waste in suburbs.

  45. @Yaj, says the guy that lives in a city with 4 TIMES the population density of other American cities and STILL isn’t able to resolve the "inefficiencies" of urban living. So what would solve it? Tokyo levels of crowding? Nope. They have the same problems. Putting people into rat cages like in the movie Fifth Element? Haven't tried that. Yet...

  46. We could have had affordable housing for all after the 2008 crisis, but the government, the federal reserve and the banks decided to re-inflate the bubble. Then faced with QE, investors searching for yield piled into the construction of pseudo-luxury apartments that even people making good money can't afford. Don't see technology fixing the basic conundrum: Wages must rise while prices stagnate or collapse. Tough combo to pull off.

  47. @SJ Harrington What does luxury housing have anything to do with the issue? When there is quantitative easing (or lower interest rates), the value of all types of properties go up. And the 2008 crisis was certainly not a missed occasion though, because the main reason why prices went down was that people couldn’t afford previous prices because of economic hardship. Affordability didn’t really improved, quite the contrary: foreclosures went up. But fundamentally you are right: one of the problems is that for many (bad) reasons many want prices to go up, not down.

  48. @SJ Harrington It is time to start support and promote the sale by owners. That would cut home prices by a large amount. But, no. the RE bizz is opposed, and Trump would never help home buyers. It is all political, and rotten selfish.

  49. Pittsburgh PA has a wonderful resource for business, city and community problem solving at CMU. Most recently, thanks to Carnegie Mellon University’s very bright and industrious engineering and computer science graduate students, the city benefits from a metered parking system that adapts pricing based on busiest times, CMU has also helped organic farmers meet the growing demand for specialized greens and herbs using vertical beds that rotate for light, water, monitoring and harvesting. It seems that this school would be an ideal place to start a research program, thesis, or contest between universities to come up with the best ideas for solving the affordable housing crisis in the country today.

  50. @Gallogarden the only smart " parking system" for LIVABLE CITY is one that reduces the number of city parking spots by 3% each year! Naturally, the latter is just one of many necessary changes in the SCIENTIFIC design of a city in order to create a livable economically sustainable sociable city.

  51. @Gallogarden Unless, as the article mentions, if the problem cannot be solved by technology.

  52. @Harry This isn't about "science"; it's about those so-called "urbanists" and "livability experts" who think "social life" is about being elbowed on a subway or bus.

  53. The idea that prefabs or other cost-saving techniques could improve affordability relies on the fallacy that prices follow costs. But that very idea of prices being connected to costs, while true in many occasions, relies on certain supply-demand mechanisms that are broken in the case of housing: For it to work you need supply to be able to react to a price signal: if costs decrease all other things being equal, building housing becomes more profitable, and therefore supply should increase until prices decrease to the same profit equilibrium as before. But if supply can’t increase (because it is limited by other reasons), then you just have profits increasing. In effect land becomes more valuable, because you can sell for the same price something that costs you less. All the benefits are captured by landowners. Technology (as well as subsidies and even higher incomes) can only go that far, when you have 10 houses for 15 households, you will always have 5 households left out. In an environment where prices are free, it translates into prices rising until 5 households can’t afford one of the houses. If you regulate prices it will work differently, but you will still have 5 households left out. The only way out is to increase supply, and technology can’t really do that. The problem is political.

  54. @Bob Robert, Handsomely put.

  55. We once had an official policy in southern states, and unofficial in other places like New York, of racial separation and segregation. Now we have economic segregation. That's the way people like it, that's the way people want it. This out in the open, but still hidden, type of segregation is not purely about race, though that comes into play. It is about people who want to live around other successful people and be able to send their kids to the schools that result from economically advantaged people living in the same general area. In America, we treat poverty like it is a disease. Heaven forbid, we don't want that disease to rub off on our kids growing up. Economic segregation leads to walled off communities where people who can afford to live there do so and they rest are excluded. The underlying cost of housing is the cost of land. If governments or other entities could set aside a certain amount of land for lower cost housing, there would be an incentive for builders to move in because they would know what price they would have to charge to make a profit and would not have to pay huge land costs in advance. There are fundamental economic forces at work as well. The median price of a house goes up as high wage jobs take over in a given area. Too bad for the middle class and near poor, they get left behind. These problems are going to need a comprehensive approach involving govt., technology and businesses. Right now, the money is in building to expensive tastes.

  56. @Doug Terry Ooooh ! sounds like "Socialism" and a "Planned Economy"

  57. @Doug Terry "If governments or other entities could set aside a certain amount of land for lower cost housing, there would be an incentive for builders to move in". If you make sure that there is no shortage of land, you won't have a shortage of housing, so no affordability issue, so no segregation issue. No need to set aside land (that you will need to buy at market price) for the poor (that you will need to provide at discounted price) if you make sure that land is not scarce. And that's much cheaper to the taxpayer.

  58. Technology may be not only the best solution to fixing the housing crisis, it may be the only realistic solution. Many in the technology industry believe this as do the thousands of technology and construction industry professionals who have joined us at our grass roots and volunteer-organized AEC Hackathons (Architecture, Engineering and Construction). We are hacking the industry to rebuild the building industry and invite the tech industry to join us. Technology is changing almost every industry and it is time to use automation to modernize the oldest industry. I am a geek building investing in automation and technology to raise declining productivity in the construction industry and to make it safer, cleaner, greener in addition to helping democratize the industry and make better housing more affordable at all price points. Google Sidewalk is innovating in Toronto and a growing number of technology companies are investing in the building industry because high housing costs are having an outsize impact on their employees and cost of doing business. Embracing technology and change in the building industry can be win-win-win for everyone. By getting more people involved we create more employment and help distribute the many benefits of smarter building. Join the optimists building a future we want to live in.

  59. Millennials and other young workers would be wise to invest early in a nicer, drive-able motor home. Then when they lose their jobs or must relocate, put gas in and go. It'll save paying exorbitant rents and dealing with the hassles of buying and selling a property. RVs are the way to go until the real estate market bottoms out, again, then equalizes.

  60. @jk And you park where? Most cities are cracking down on RV street parking and RV and mobile home parks are among the land uses most discriminated against.

  61. @jk: my dad in his retirement years got into motor homes and RVs. He had several, each time moving up to a larger model. He enjoyed many wonderful vacations this way. HOWEVER….when he visited us in NE Ohio, we had an awful problem finding any parking for his motor home. There are no RV parks anywhere remotely near our city! I can only imagine how far out you'd have to go to park a huge honking' RV in NYC, SF, LA, Boston or Chicago!). The closest we could find, and it was somewhat expensive, was in another county about 35 miles away -- very inconvenient for a family visit! I ended up having dad park in my driveway, illegally for my city, and hooking him up to the house utilities. The motor home was so heavy, it caused permanent damage to our asphalt driveway. So while an interesting idea….I cannot see any practical application for it.

  62. The title is fitting for our Trumpian age, given Big Tech is one of the leading *causes of* the housing conundrum. Cupertino allows (nay, entices) Apple to plant a 5,000 employee space-ship in the middle of one of the most congested areas in northern CA, with no consideration of housing, infrastructure or employee transport other than a few token buses. Amazon is about to recreate this disaster in Long Island City. These companies, and those of their ilk, claim to be leading-edge innovators; given the incredible wealth they've accumulated, and the huge investments they garner, how about situating a stupendous new-modern-age, super-tech demonstration-project company "town," with offices, varied housing, and entertainment resources, in a remote, undeveloped region, where real estate is cheap, and building there won't destroy the housing market for everybody else who doesn't happen to be making an absurdly high salary for questionable productivity (but I digress). Add to that a 300mph shinkansen to the nearest megacity (e.g., NY, SF, LA), so employees can have the best of both worlds. For the tech companies, it's a huge marketing coup; for the employees, they get to enjoy open spaces, modern housing and conveniences at reasonable prices, and whatever entertainment the towns can provide, with quick access to the big city. All done without adversely affecting housing cost and availability in the cities themselves. Housing apps? Stop thinking small! Start actual building!

  63. @ nota bene: except that a shinkansen (high speed Japanese "bullet train") in the US would cost about a trillion dollars! and only serve a sliver of wealthy people! also, they do NOT go anywhere close to 300mph, even at top speed -- try half that.

  64. Wow, a Times "analysis" that mentions a lack of good paying jobs. Stunning. Of course Ms Badger pretends it's simply "working class" jobs that don't pay. This is deeply misleading; jobs that paid the rent or the mortgage, and sent the kids of the middle class to college, have become scarcer and scarcer over the last 40 years. And many of those jobs didn't return after the ongoing crash of 2008.

  65. Supposedly I am an expert, a specialist on "livable" affordable housing for all income levels. However, no "technology" company, or anyone else for that matter, has contacted me for help recently. In fact the last time it was the U.N. who did contact me; but, that was 40 years ago! :) By the way, most (all?) universities are clueless about this topic (they never ever get off campus .)

  66. In Ohio we are looking at a housing & transportation model that incorporates coordinated care. What is the value of someone occupying a space---mobile or fixed---and contributing to its maintenance...physically, socially, data-wise? To borrow from the parable of the babies in the river, we attend to the babies by using the resources of the river itself.

  67. When a technology or app is developed to reduce or eliminate avarice, it will be truly innovative and disruptive. Until then, we'll continue to see and experience the downside of innovation which squeezes the many and benefits the few: the 21st Century is built on technology of greed or capitalism.

  68. @Wade "For lack of a better word...Greed is Good."-Gordon Gecko in Wall Street

  69. @William Smith Good for whom?

  70. Tech in America has never been about changing the world - it's about finding new ways to aggregate free information in a new manner that makes a profit. While it's nice to hear Tyrone Poole originally created his app to help with homelessness - he clearly was quickly exposed to how much money he could make if he instead turned to focus on providing the same service to high net-worth individuals. Very upsetting considering he himself suffered eviction and homelessness but now seems to have forgotten that past in favor of selling his app / idea to hungry investors. Or perhaps Mr Poole realized through his own life experiences that nobody is going to help you in this life, not even your own government, so you'd better get what you can while you can.

  71. Horrors! The technological solution is the grim, resource minimizing, energy efficient, rabbit warren anthill, hive and global slum. It has to be. I attended MIT, I know how the thinking proceeds: what’s the smallest, cheapest box a human can fit in, and what’s the geometrical closest-packing way to do the packaging. Worst thing on Earth: the single family house in the suburbs. Best thing, factory housing on site with the factory. Come on, kiddies, we are now over seven billion, and the only way to get to ten in most of our lifetimes is to abandon crazy American expectations from the past, and embrace that lowest common denominator. Where technology allows us our fraction of one kWh per day, our ration of desperately engineered food, and of course, some kind of direct data feed about the fantasies we substitute for the reality of humanity eating all the agar in the Petri dish. Or, on a brighter note, technology inadvertently generates the unstoppable global plague that resets the Malthusian clock.

  72. One of the problems that I have seen over and over, is that the real estate business is one of the most predatory capitalist in their work. They are conservative Trump supporters. The sales commission today is outrageous. Homes have become much more expensive, but the commissions have been kept at the same percent. Time to share the pain.

  73. @Martyn Henry: realtors are all Trump supporters? where is the verifiable research to support that theory? Also: where real estate commissions lower under Obama? or Bush 43? or Bill Clinton?

  74. @Martyn Henry Even more absurd is that real estate commissions are based on sale price, not the profit. My husband just sold the house he owned and paid into for 18 years in Queens, NY. He had to take most of the equity out to pay off his exwife in the divorce in 2010, even though she never paid a dime of the super high mortgage and the refinance caused the mortgage to increase even more. His realtor acted like she was giving him some preferred rate of 4%. The house sold quickly. After two, 2-hour open houses and a few hours of work negotiating the sale she walked away with nearly $25k, while we spent several months dealing with the absurd issues that kept the bulk of the money tied up in escrow because of a Chase bank screw up. She was very nice, my husband he would have been better of selling without her. Or at least no worse off and with an extra 25k.

  75. Housing costs too much in relationship to household income. What happens if wages remain stagnant, health insurance costs increase, and the cost of construction increases? Layer on top of that the arcane zoning ordinances many municipalities have, demonizing roughly half of the US population for renting instead of buying their home, and a completely unhealthy fetish for speculating upon future increases in the cost of single family houses and we have created a tangled knot of burdensome bad habits that impact low and moderate income households. We can't "tech" out way out of decades of exclusionary zoning, boneheaded parking regulations, NIMBYism, redlining and a culture of disinvestment in neighborhoods close to jobs and services. If a cheap house or apartment is too far from work or your kids schools, the cheap housing comes with a big car ownership price tag.

  76. Housing appears obviously to be too expensive where the demand is highest. But suppose for a second that perhaps, housing is (or largely is) an “efficient market”. That would imply that the value of proximity is accounted for in housing costs and there is a “saved time” value built into housing costs. If the assumption of market efficiency is correct the scarcity of affordable housing is primarily a time scarcity problem, and until commuting time reduction is recognized as a shared public asset worth serious public investment, any housing market will not be able to find new equilibria. Time itself then has become an unrecognized (or under appreciated) public good. This would also imply that housing is not as such a “technology” problem that can be “solved” on widespread individual sites by design improvements or material delivery efficiencies. It is fundamentally a common goods problem whose solution requires great political will and wise leadership along-side of, but fundamentally different from the technical problem of creating housing assets that are resilient and reduce maintenance investments over time. Seattle and most planners understand the primary long-term importance of time and the leveraging of land opportunities in relationship to public transportation investment.

  77. @W. Michael Johnson @emilymbadger From a tech perspective, we can certainly be of service. For example, we (Deepblocks.com) are building an AI software that combines zoning, finance, construction costs, and market data logic into a single centralized engine. One of the problems is that information is decentralized and development processes are fragmented into many disciplines that generally don't play well together. This problem spreads inefficiency and all kinds of hidden costs at every scale, from development to planning. At the scale of planning, Zoning ordinances are usually, if not always, designed without any financial logic. So the value of land is mismatched with the allocated density. With our software, planner can analyze if the density allocated for a market sector will allow for good returns and therefore potentially lower rents. With tech, we can make the optimization of zoning ordinances and housing project practically free. We can also centralize and offer transparency and allow more players to participate, which will increase competition for hopefully better product. We appreciate the conversation.

  78. @Olivia Ramos I applaud the effort, but all this technology promises to do is allow developers to make more prudent investments. Other companies have similar analysis, and market that information directly developers. The fact is, it is in the developers and property owners shared interest to maintain a constrained housing supply. Why would builders or voters intentionally devalue their product or largest investment, respectively?

  79. Capping the mortgage deduction sure helped, no one.

  80. @northlander Mortgage deductions are a subsidy to house-owners, which is many places is counterproductive (if the issue is the lack of supply, there is no point subsidizing demand). So the cap helped many, including the taxpayer in general.

  81. So the population is barely growing, fewer people are interested in owning and yet prices are skyrocketing for the benefit of a small group of investors vs. the people who need housing like a utility. WHY NOT JUST PREVENT 1 PERSON FROM OWNING MORE THAN 1 HOUSE?

  82. You can’t expect people to relocate to where the jobs are if the housing isn’t.

  83. @Ed I might be splitting hair, but yes we can, and we do. The problem is that at a given level of housing supply, if new people come in other people need to leave. In an environment where prices are free, it means that prices will necessarily rise until some people decide to leave because they can’t afford something decent. So to phrase it better: you can’t expect people to move to cities and things to go well if you don’t increase housing supply. It seems so blatantly obvious, but many seem to think that the solution does not require increasing the housing supply.

  84. Zoning changes could help a little - the restaurant owner who wants to expand but can't find help that can afford to live in a tourist location could solve the problem by adding apartments or dormitories to the proposed new building but is zoning restricted. The many empty nesters who can't reconfigure their too big homes into multiple units but are zoning restricted. Changing existing homes from zoning mandated single families could avoid the NIMBY push back of rejecting new apartments, and making illegal conversions legal will make them safer.

  85. The total belief that there are no policy solutions is WHY there are no policy decisions. Where that belief comes from is a mystery because absolutely no one has really tried beyond a few half-hearted attempts that were done just so they could say: see, it doesn't work. That's extremely cynical.

  86. Since Reagan the idea government is the problem has captured the American electorate

  87. While much of what is presented in this piece is interesting, the absence of living wages throughout the country is the ever present, domineering factor defining the lack of affordable housing. This is made more difficult by the fact that America – except in hyper inflated areas like Silicon Valley - is not worth what it was in Xmas past. So, we are caught in this double whammy of declining values and declining wages. I have thought for some time that the states and the fed should use undervalued and/or underutilized housing stock to incentivize companies to locate where affordable housing is more easily attained. Cities like Detroit have done some of this on their own…but we should be making this part of the federal housing arsenal.

  88. In our capitalist world solutions are hard to find. The problem, or at least one problem is that a home is 2 things, a place to live and an investment expected to grow in value much faster than inflation. We need to separate the speculative real estate market from the housing market. The thing that keeps people paying their mortgage is the carrot that maybe the home value will outstrip the interest. I don’t see any one solution, but there are lots of ideas that might help, like deed restrictions that prevent the next sale from being (much) over the inflation rate over the ownership period. Solutions typically require an angel to buy and donate the speculative development rights on some property destined to be “affordable”.

  89. @Mr Pb getting rid of the 250k/500k capital gains exclusion that Bush signed into law in 2002 and which set off the last housing bubble would go a long way to reduce incentives for house flippers

  90. @Mr Pb you are absolutely right. Capitalism is the problem and Venezuela has the solution. Thinking before writing is a good thing.

  91. This doesn’t touch the affordability of housing purchases, but the one of the best ways to lower the cost of living is to cut the energy bill. Most American houses are hopelessly leaky and waste tons of energy, whether it’s heating up north or A/C down south. Set up a bond fund where investors can invest in other peoples energy retrofitting, and then the homeowner splits the energy savings with the investor as a dividend. The RoI of these improvements can be 30-40% annually forever. Everyone wins and it’s good for the environment.

  92. @JDB This is a good idea in general, but won't solve the housing affordability crisis, because in a situation of housing shortage prices will necessarily rise until they exclude some people. You can't house 15 households with 10 properties, however cheap to run these properties are.

  93. Tech can help in the rural areas by making the expansion of water and sewer districts affordable. We are already at the one bedroom per family density whenever an older person passes and the heirs make the home a rental, so if someone could make developing new water supplies affordable, even denser housing could happen. Add in high speed internet, and high speed rail...possibilities open up. Closer to city, start by upgrading MetroNorth so that there is free & fast wifi in the cars and work space as there is in light rail in cities like SLC and that alone would be an improvement.

  94. The complexity of housing makes it rife for people to take advantage of it. Expertise and accountability in the field is crucial. Aside from people making money, one would hope Molly Turner also advocates for increased oversight by HUD before innocent homeowners get taken advantage of.

  95. So - you're saying an app can't re-write the basic laws of supply and demand. And - part deux - you're saying egregious permitting rules restricting the vertical development of sprawling cities also impacts basic accommodation availability. And lastly - you're telling me that people of modest means can't live in the most expensive cities in the world? Consider my mind blown

  96. "It now costs as much as $500,000 per unit to build low-income housing in the most expensive markets." To make a small profit you have to charge 1% of the construction cost per month See: https://smartasset.com/mortgage/how-much-you-should-charge-for-rent). So this "low-income" unit should rent out for $5,000/month. To make this affordable will take a very large subsidy. We have a very large problem.

  97. @Phred Where does this $500,000 figure come from? Last time I saw such a high figure, it was from a study financed by people who were asking for subsidies to build affordable housing... The higher the figure, the higher the subsidies, so you have to be careful. This amount is obviously way too high (concrete is not that expensive, and it doesn't require much materials in general to build something the size of the apartments people live in in expensive cities), unless it includes the value of the land, which is the true issue here. Make the land not scarce anymore (and hence not much valuable), and suddenly housing becomes affordable for most. (Also to "make a profit" when renting out you only need to cover maintenance, property tax and other building charges; which certainly doesn't require to charge 12% of building cost per year).

  98. @Bob Robert your last paragraph: how do you pay for buying the land, paying the soft costs, and the costs of construction?

  99. @Brokaw Land is by far the main cost where housing is unaffordable. Land is expensive because it is scarce, so once it stops being scarce it becomes affordable, almost by definition. If building an apartment costs 200K and you can sell it at most for 250K, nobody will try to sell the required land for 100K. Soft costs are affordable for most, and so is construction: as I said, building an apartment the size of what people live in in unaffordable areas does not require a lot of materials, there are economies of scale because you are building a lot of them at the same time, the skills are quite easy to find…

  100. George Carlin said it perfectly. The reason homelessness continues to exist is that “there’s no money to be made off of the homeless”.

  101. there is housing stock available but it is in the wrong places....What technology can do is decentralize the corporation....I understand you can not build I phones in your basement, but you can put your office cube out in the boonies where housing is cheap. Provided there is internet back bone to do it.

  102. Really, an article about tech and lack of housing that doesn't mention Airbnb and the other tech companies that have moved housing from the home market to the hotel market?

  103. @Mr Rogers Indeed!

  104. Actually there are solutions and some of those solutions do involve technology based on a comprehensive highly integrated end to end approach to the problem. The loss of existing affordable housing; the lack of new affordable housing; and the rise in need for affordable housing as wages stagnate while housing and living costs rise out of control is turning America's housing crisis into a housing disaster. Nowhere is the crisis in housing worse than in Miami where more than 50% of the residents struggle with the lack of safe decent and affordable housing. It so happens the tenant's association for a senior affordable housing project threatened with extinction has developed innovative solutions that will not only save the existing housing we have but also promote the new affordable housing we need. Check out the story of 1809brickell.org. They are not just talking about the crisis but they are living the crisis and doing something about it. In the process they are creating a model for others.

  105. Molly Turner speaks my language about Root Cause Analysis. Technology cannot address the root causes, although it can improve some of the symptoms. I've been part of a team that built affordable owner-occupied housing in the SF Bay Area before the recession. If I termed it a fools errand I would be understating the lessons learned. A 600 sq ft condo within 40 miles of any of the major bridges across San Francisco Bay, for a 20-30 unit complex on a 20K sf lot has the following fixed costs: $85K per unit for entitlements including public utility connections, school fees, impact fees, road/transit fees, park fees, hospital fees, library fees, etc. Some of these fees vary by sq foot of construction, but baseline is still $85K. $25K or more per unit for construction defect liability insurance Land costs including space for the required off-street parking $100K per unit. Existing infill residential/mixed use areas limit density via height limits and Floor Area Ratio (residence sf/land sf). 250% is common FAR. Construction costs of about $400/sf. Some of the technology may get that down to $250/sf but your project manager will spend more time with the planning department if it's an infill lot. You're $210K+ into costs before you break ground. The cost of capital for 3-4 years until the project is complete, management legal, sales costs, and cost of risk make this unprofitable at $400K selling price. I'll stick with tech.

  106. @Capt. Penny Thank you greatly for your cost analysis. It helps us understand the problem. Please help us with some more details. Namely, why are constructions costs ($400 per S.F.) so high? -- What percent is for labor? -- what is the average rate per hour per worker? -- union or non-union? -- Just like some football players take a cut in pay to stay on a team or help keep other players on a team, the better to get to the Super Bowl, how much of a cut in the average rate per hour could we hope for, in order to create a team that builds housing for their children and relatives? -- What percent for materials? -- what materials were used? (what % wood, % steel, % concrete, % for windows, etc.) -- Has the high demand for these materials from Asia increased the cost of those materials and by what %. Years ago Japan was found to have that effect. Now China probably even more so is hurting us. -- Would it help to have export controls on lumber and sheet rock producers, etc.? These could be in the form of quotas (X tons of material) that must go to builders of affordable housing, at the marginal cost of production. These quotas could be matched with a lower corporate tax rate. Or a higher tax rate for non-compliance (:--). -- Vice versa, would it help to eliminate the tariff on steel from China? Is that steel really defective, as claimed for one of the SF Bay bridges? -- What percent is for profit or high management salaries?

  107. I would have much preferred if the author elaborated on the policy fixes they think are needed. The author only discusses the technology enabled ideas that they believe won’t solve housing affordability, but fails to explore policy solutions in any meaningful way.

  108. Bay Area, California. City and agency fees top over $100k per new home in many locales. That's $500 a month just to pay the City/agencies. 4.5% interest at 30 years. The affordable housing requirement is rolled into the price of the home, so new home buyers are burdened with solving a problem everyone shares. Now, the local environmental agencies are adopting unattainable cleanup requirements for new reuse (think old strip malls), which will further reduce available land.

  109. The lack of suitable land in a decent location near cities is a product of the rise in the US population over the past 50 years. With 200 million residents in 1967, it is no wonder that the land cost of a housing unit was just 20 percent of the total cost of the property including the house in the 1960's. But when the US population now at 327 million as of 2017, it explains why the cost of the land component is now 40 percent of the total price. It sounds nice to put technology to work to stabilize or make homes affordable, but the ever increasing demand for housing units with a rising population makes that much harder to achieve.

  110. Perhaps technology has already created a solution, or part of a solution, to the housing crisis: Shipping containers. Of course they don't seem like housing, but after seeing so many people living on the streets, the idea of a stout roof overhead, HVAC, running water, and a lockable door makes a lot of sense And shipping containers are cheap and plentiful, because even a small amount of twist to the structure makes it unusable in the shipping industry. Our ideas about housing are going to change, along with regulations, zoning, and other restrictions. Population density is going to increase substantially in many areas, and public transit is going to improve also. The single family home on a quarter acre lot is not going to be the standard of housing in the future. The biggest problem facing the housing industry is inability to afford housing, which is not a housing issue but a social issue.

  111. Seattle and Atlanta are moving ahead on policy solutions.You may want to google: new non-profit housing Seattle.

  112. I thought prefab had died. In Russia, where it was the Soviet technique for cheap housing for the masses, it's mostly been replaced with poured concrete. New trucks/machines can pump concrete slurry straight from the concrete mixer to the 20th floor. Pour in place is just faster and better.

  113. According to Census Bureau's latest data, there are about 375 million bedrooms in the US, not including lodging. That's enough for each of us to have our own room. We don't have a housing shortage in this country, we have an access shortage. Not enough people are able to affordably access high performing metro areas. I believe this is because of inadequate investment in regional multi-modal transportation networks.

  114. @Nate I certainly am not interested in renting out extra rooms in my house, and there should be no way to compel me to do so.

  115. @Spook I second your motion spook, but more importantly trying to compel people to rent every single room in their house without regard to occupany issues and ignoring the reality that people have second and third houses that are empty or only in seasonal use is...well... asking the poor to pay for the very very poor while ignoring the rich and the very very rich. Both democrats and republicans seem to dip from this well real often and then middle class american blames the poor and the government for problems of wealth inequity instead of the rich and the policies they lobby for

  116. Like many things in industry the nay-sayers claim it can't be done until the innovators actually do it. Affordable housing is an issue that cannot be a solution everywhere particularly in over-priced cities where the land is at a premium. It is somewhat like having a Toyota Corolla budget and shopping in a Porsche showroom. That said, our country is huge and the agenda, which can be led by major corporations is to move the jobs to where residential development can be done inexpensively; not keep creating jobs in the most expensive places in the nation. Take AmeriSus as an example. They've been building hundreds of homes nationwide each year (not modular) where the average price of construction is under $100k. Add to that all the extras, land, site development, fees, etc and you have housing at under $150k. Many of their homes are affordable (30% of income) for couples earning minimum wage. Better yet their homes and ADU's are actually attractive not containers or ugly boxes. A few years back, before moving, I lived in one of their homes built as an infill project 1600 sf and my utility bill was $60 per month gas & electric - darn efficient. We need more companies like this stepping up to the plate.

  117. Modular construction is modernism, a 100 year old construction method. Prefab is mostly a gimmick, more expensive then just bringing materials and cheap labor to the site which is what usually happens. What’s missing in our culture is a design — thinking behind gimmicks to change the paradigm away from top-down bureaucracies to a new tech-architecture paradigm that makes visible the nuts and bolts of the city that are now behind the curtain of the powerful. Instead of smart cities monitoring us, we should be monitoring the city. That’s the only way things change for the better.

  118. This housing tech movement looks like the blind leading the blind. Instead of starting with the premise of fixing this or that problem, they need to take a step back and ask what they are even looking at. There is a glut of data out there but no easy way to see or use it. Govtech is worthless, a top down bureaucratic exercise in futility while Big Tech solutions reek of real estate and surveillance exploitation. It’s a clue that neither (or media) covers architecture anymore — the values of place, context, meaning, structure, climate, energy, experience.

  119. Neither tech nor new construction techniques will solve the affordability problem. First working people need higher incomes. Second there needs to be more housing supply and the constraint on that in cities like New York is land costs not construction costs. That means loosening some restrictions on land, like low density Housing Authority sites that often have surface level parking lots, a very wasteful use of land. And it means building up higher, increasing density.

  120. Why would raising incomes result in anything different than what government loans did for college education: paying a lot more for the same product?

  121. There are always tech companies looking for new ways but they never can find great units without working with real estate brokers. I am a Chicago Real Estate Broker and I find better deals particularly in the rental market outside all the real estate platforms because I deal one on one with small and medium size management companies that lack the resources and the technology knowledge to join any of these platforms. All the different websites and One, They take took long usually 2 or 3 days to update their websites based on what they import from Real Estate Databases and Two, they are usually tend to be higher priced units which does not benefit any renter, buyer or seller. One on One with clients works best in my experience.

  122. Tyrone Poole's insight is brilliant, but this article just reflects one range of that brilliance. Top-down solutions like Microsoft's and the Zuckerberg's address a symptom, but ignore the problem. Like health care, which ought to be universal but cannot become a greed-is-good incentive for rapacious pharma; or like higher education, where University Presidents ought not make over $1,000,000 a year while teaching is dumped on part time adjuncts; housing is not "solved" by money, but, rather as Poole well shows, by good and timely and accessible information. It is not coincidental that Poole's solution reflects insights like those of James Livingston (No More Work) or the Sidelsky's (How Much is Enough) or Philip Mirowski (Machine Dreams). There really is a "disruptive innovation," and it really does rely on information, on access, and on client-centered planning. But it's not just tech-centered. It is how "clients" actually access and use that tech, whether in tenant applications (like Poole suggests) or in deed revisions, limits on equity ownership, access to discounted or no-money-down mortgage financing, or through employer-guaranteed mortgages from traditional banks and financial institutions. It takes a little creativity to cross those boundaries, and that's really rare in housing, but it's just as rare in higher ed and pharma.... Think from the client, not from the sales force.

  123. First, housing costs what it does because there are people willing to pay those prices. Many places have a shortage caused by zoning and an inability to increase density as properties get more expensive. Second, the promise of "tech" is often an ability to get around existing regulations. There is no good reason why adding a secondary unit wouldn't be a good loan for existing lenders, but there are provisions in lending standards and such for FHA loans that disallow it. Thus, borrowers are forced to go to secondary loan markets with higher interest rates. Could just fix the FHA provisions. Third is a continual creep of building codes that keep adding costs. Multifamily now has to basically be fireproof between units and with energy standards then there is no such thing as cheap housing any more.

  124. We need to invest in more affordable ways to get to the great places people want to go -- whether they be restaurants, theater, movies, parks, etc. People don't want to live in New York because it's called New York; they want to live in New York because of all of the things New York has. if we could figure out a way to distribute some of that greatness to more places, the demand and price for New York, LA, chicago, etc, real estate will fall or at least stop climbing so sharply.

  125. The author has it all wrong. The crisis is being caused by greed and the rich never having to pay taxes. Our bogus laws leave landowners above the laws most of us have to abide by for instance. They only have to pay %3 income tax no matter how many properties they own it's called 'passive income" another cruel joke on the rest of us. Then add 30 yr mortgages for those who don't need it and we have this unbalanced home ownership where soon most of the "owners" will be renting out and not living in the tax subsidized second or third home they bought.

  126. Tech fixes nibble around the edges at most. Either we bite the bullet and tax ourselves at a sufficiently high rate (or reduce our spending elsewhere) to make housing affordable by subsidizing its costs both for construction and continued maintenance. Yes, this will cost into the hundreds of billions of dollars a year but it's still appreciably less than we spend on defense.

  127. I have worked in electrical construction as an electrical engineer, and have lived in both very old houses and fairly new ones. Can advise this. The attempted solution has been to build components in a plant and assemble them in the job site. But the problem is houses today are both bigger and more complex than the old ones. In the old days, you had one bathroom for the house, even in two story homes. And one electrical receptacle per room. Now, a two story home has two bathrooms in the second floor and a half one in the first floor. And one receptacle per wall plus a smoke detector. Since they are bigger, components are bigger, making it more difficult to manufacture, transport and assemble. All this increases the cost of materials and labor. Maybe we should look at the cost per square foot, rather than per house, to see how expensive houses really are .

  128. The ultimate cause of the housing problem is excessive population growth through reproduction, migration (legal and illegal) and over-prolonged existence. It is impossible to house a population that increases faster than shelter can be constructed. Over large and complex trends for housing exacerbate the problem by consuming space and materials. The demands that perfectly usable dwellings be demolished for 'upmarket' "developments" further aggravate the shortages of affordable housing. Technology can only assist with these problems once the politics have been sorted out and greed removed from the equation.

  129. @Philip Brown "It is impossible to house a population that increases faster than shelter can be constructed"- I would like to see a source on this. Because if there isn't reputable research backing up this point, it sounds a whole lot like thinly veiled racism/xenophobia.

  130. @Philip Brown It takes 9 months to make a baby. It takes longer to get into the US as an immigrant. Now even if it took 10 years to build a 20-apartment block (and I think we can do better than that), it would take only half a year to build an apartment. So see: we can build faster than population grows. The problem is not demand: the problem is that we are not even trying to match it with supply.

  131. @Michelle It does look a lot like it indeed. Many people bark at housing being affordable because it would let “the poor” come into THEIR neighborhood (like they own it). And when they describe what “these people” would bring, you can see a lot of thinly-veiled stereotypes… Segregation by price is not something everyone is against; as a bonus, it is much less obviously racist than the former actual laws (or legal covenants), and if you already own your property it even makes you richer!

  132. There is no housing crisis. There's just an assumption among many people that they should be able to live in expensive places, without having an income to match. You don't need to live in London or Paris. There's dozens of moribund villages in rural parts of Europe. The world has lots of land on which people could live. You just need to go there and build a house with your own two hands, as people have done for thousands of years.. Or you could just move back into one of the caves where our ancestors lived.

  133. @Gerber Really? You don’t see the flaw in your plan? Also for centuries, people have just built more housing where people wanted to live, because letting people take advantage of opportunities (such as the ones big cities like Paris, New York or London provide) is how economies prosper and how successful cities were built. Letting a class of owners reap all the rewards of people’s work and forcing people back to the countryside, however, has had mixed results.

  134. @Bob Robert I am aware of the flaw -- the jobs are in the cities -- but I don't think that's as important as everyone assumes. Houses are affordable in Iowa and Indiana. So why don't people just go there if they want a cheap house? Why don't they just STAY there if they are there already? Because Iowa and Indiana are not prestigious, cool, hip and exciting. It's not for lack of jobs; it's for lack of *status.* People are drawn to the big cities for the opportunity to be a somebody in a world of nobodies. Those who do make it to the Land of Oz will soon discover that their standard of living is no better, because all they earn goes to pay for the higher price of everything. But for many, whether they end up being princes or paupers, it's still better to be in Oz than in Podunk, Iowa.

  135. @Gerber You have nothing to back your claim that people move to NYC and other big cities for prestige rather than for jobs. However, there are many surveys of people living in big cities who are tired of the low quality of life. The main reason why people don't do it is because they can't find the same opportunities elsewhere, especially for skilled jobs (finance and tech being the obvious ones), and especially when they are a couple when both need good opportunities. And just from personal experience, I don't know many people who actually care about the prestige or the status of living in a big city. It is not a secret that anyone can move there if they want to. Finally, you are still not addressing the main issue: people should be able to move wherever they want. There are many good reasons to move to a big city other than work, so why should not build more so the cities remain livable?

  136. Back in the 1940’s and early 1950’s, neigborhood retail centers and the corner grocery stores had integrated residential living units on the second floor. Perhaps it would a good idea to go back to this idea for this to be considered in the suburban fast food business and dollar stores. This would greatly help these minimum wages business to recruit and retain quality help. These would greatly reduce the need for private ownership of motor vehicles, which would reduce the cost of living for these workers.

  137. @Louis A. Carliner Fast-food restaurants are often demolished after forty years as an answer to accumulated grease, secondary to labor economies in sanitation.

  138. Government policies can have positive effects on the cost of living and the environment. It can promote dense housing. It can give people incentives to live close to work and give up driving. It can require that companies are responsible for employees commute miles and large companies to provide employee housing next to work. Housing and transportation costs are the two biggest overhead in people's lives in the US. These costs can be severely lowered with the right policies.

  139. The only solution for the housing crisis it to build enough housing. Nothing else will do. There is no substitute for enough. There are really only three choices when it comes to housing policy: pack people in tighter, spread people out more, or price them out of the area. All housing policies must work to balance those three parameters. While working within those parameters, local governments have their own sets of conflicting interests. Expensive housing generates more tax revenue, while inexpensive housing generates more expenses. People who paid to live an a less-dense neighborhood justifiably don't want it made more dense. There are plenty of technical solutions for creating less expensive structures, but the value of obtaining permission in most places where people can get jobs costs more than the actual cost of building the structure. Inflation has less to do with the cost of construction, and more to do with transferring money from the new owners to the previous owners. It is a subsidy for speculators which comes from the pockets of renters and new owners.

  140. Supply of housing is deliberately restricted by government through zoning and other land use restrictions. NIMBYism also prevents high density housing from being constructed in wealthy areas. Cost of construction is virtually irrelevant.

  141. Yes, we need land to build housing. Yes, we need to figure out ways to lower construction costs. Yes, we need to build at higher densities to lower land costs. But, so long as housing stays largely in the hands of the for profit market, there is no incentive to construct for those at the lower reaches of the income range. Rents and purchase price are partially a function of supply and partially a function of land and construction costs. But, in a for profit environment, they are also a function of what people can afford to pay. If a substantive portion of jobs are high wage, as is true in the region I live, then there will be people who bid up rents and purchase price. More housing, particularly in areas with excessive demand relative to supply might lower costs for middle income renters and buyers. But assuming high salaries for at least a portion of jobs, it might also just attract more people to the region who can afford the higher costs. If we want to fix the housing crisis we need to get more creative about how housing is created and how it is subsidized (and it is heavily subsidized now through the mortgage interest deduction). We need to expand a number of options that are currently available such as nonprofit housing, land trusts, tax credits for building affordable housing, housing bonds and dare I say publicly provided housing (or social housing as it is called elsewhere) as a viable part of the housing market.

  142. The housing crisis is caused by the same old thing: greed. Developers have no reason to lower prices and there is no government regulation on those prices. With wages stagnant, many workers can't afford to buy. Unless one factor or another or both change, it won't change.

  143. County policies and NIMBY have an impact as well. For example, in Montgomery County, Maryland, a DC suburb, accessory apartments must be licensed (which is apparently very difficult), and must be 500 feet (about 2 blocks!) from the nearest licensed accessory apartment. So my neighbor's licensed basement apartment (which is on a corner) means that no one, for two blocks in every direction, will be able to have one (I don't want or need one -- I'm just pointing out the impact on housing availability in a county where housing is expensive). I do understand the "density" argument, but some of these policies are nonsensical, and clearly for the purpose of preventing multi-family housing.

  144. We need communities of small houses and their sale needs to be based on income rather than excessive devoloper profits.

  145. a major part of the solution is relatively easy to fathom, but difficult to implement: 1) adopt a reasonable and fair rent control program in every community; 2) require developers of new housing to set aside at least 20% of the new units for moderate income buyers. these units would be spread throughout the development in every BR size to avoid concentration and stigmatization. eliminate the option of having developers pay an in-lieu fee! If the community (at its sole option) wishes to push down the costs of an additional 10% of the new units so low income persons can qualify, then the community can pay the developer to underwrite the costs of building such units. the supply of affordable units would greatly increase!

  146. Housing costs more or is unavailable because there are 120 million more people looking for housing in the USA than there were 50 years ago. Expel illegal immigrants and significantly reduce the number of legal immigrants, thus reducing demand, and housing availability and cost issues will improve.

  147. Technology will never solve this problem because it IS NOT the problem. The REAL problem is human overpopulation. Start reducing human numbers, and there will be plenty more resources to go around. Of course, common sense doesn't make for good sound bytes.

  148. Tech being the answer to the affordable housing problem? Sounds like more Silicon Valley rich person hogwash that will be used to make someone a ton of $ and leave the poor high and dry yet again with no accountability.

  149. I really believe the only person in this article with whom we should listen would be Mr. Hoffman. Financial people and socioligists can assist, but their lack of building knowledge and lack of depth in the field makes them backseat drivers. Studies, research and attempts at building various forms of preconstructed housing have been enlisted. From Sears catalogue homes (and similar), double-wides (actually successful), Wrights's Usonian Homes, to today's expensive off the shelf preconstructed homes, we end back to on-site building. This takes people who need real wages. Period. We need people who are in the field to weigh into this equation. Developer's profits are based upon the short term for a product that lasts a century. Should this be scrutinized more carefully? Should a main driver - the developer - decide in slow times we should not build because despite lower labor and material costs there is not enough profit? Conversely, in busy times should the high cost of labor & materials also trigger a slowdown in construction because the profit motive is also insufficient? The developer is the only one working on a basis of margin for profit - & coincidentally has the least education & experience in actually designing and constructing towns and buildings. All others are hired on a fee or hourly wage. With LLC's & other peoples money, developers only risk to their reputations - as do all other regardless of investment versus wage/fee workers. Perhaps there-in lies the problem

  150. The article ends on something of a cliffhanger, with the Berkeley professor referring to “the policy changes we need.” And they are?

  151. The housing crisis of 2008 and its ramifications is still the monster in the back of the room for housing in general and affordable housing in particular and politics in general. The crisis was caused by Bush and Wall Street when the rules were changed to allow anyone to buy a home. It was just a scam to make it look like our economy after 911 and the Iraq war was roaring back to life and then elect another imbecilic Republican regime. The Republicans and their Wall Street Over Lords did not foresee the golden tongued Obama waiting in the wings. Following the election the foreclosures went from a million to many millions of people losing their homes. Washington did nothing for the people, but saved Wall Street with the exception of Lehman Bros which was just the scapegoat. Obama took over under horrible circumstances and went with the same old gang of Democrats that gave Bush the win when they would not fight for Gore. So, after eight uneventful years, we get Trump because the same old Clinton's were entitled to the White House. The real damage to our country is that Wall Street and Washington got away with stealing the homes of millions of good citizens and no one did anything about it. With the pain still unresolved people voted for Trump to send a message to the Democratic Party that they have not forgotten or forgiven them. The real issue that is still stuck in the craw of Americans is trust. You stole our homes and we do no trust you and we may never trust you again

  152. Zoning laws affect affordability. The city of Houston (627 sq. mi) and the nine Co. Greater Houston area (10k sq. mi) [for the most part] has no formal zoning laws (http://blog.urbanleasing.com/five-ways-houstons-lack-of-zoning-affects-city-life/). This gives way to urban sprawl and a VERY shoddy mass transit system but, for the wont of convenience, better schools, supply and demand will bring the merchandise further and further out to the consumer. Without a state income tax and revenue streams gained from property taxes, the lack of zoning laws encourages the urban sprawl thus helping the cities and counties obtain higher yields on property taxes when the land value increases. Working with the low-income 1st time home buyer's seeking to use down payment assistance, after 5-years of the forgivable loan, each is contributing money back into the County tax coffers. The lack of zoning laws may not be the answer BUT overly strict zoning laws certainly won't fix the issue no matter how many gigabytes the tech start-ups try.

  153. @Coffee Bean I got one word that renders your argument moot: Harvey.

  154. The employment is in the city, so everyone wants to live in the city. The way technology can reduce housing costs is telecommuting.

  155. Two great relevant books - Winner Take All by Anand Giridharadas (very recent, and talks about tech approaches to society’s big problems) - The Big Sort by Bill Bishop (2008).

  156. Curious that "technology" has come to mean "software". Why isn't what Katerra or Blokable doing technology?

  157. “The California company Katerra has been valued at more than $4 billion by investors,” This is the core of the problem - valued by investors. Not valued by the community. Investors are profiteers, not those genuinely committed to making the things better - if it improves things a little bit, great, but the ultimate goal is skimming profits out of a community. The problem is not NIMBYism, although realtors and other profiteers will keep ringing this bell to divert attention from their relentless work to ban all zoning laws so that they can sell more. It is corporations such as Airbnb that are sucking up all available housing. Add to this millionaires, billionaires and corporations who “invest” in houses and apartments that are rarely inhabited. Prohibit empty units and short-term rentals and you will be on the right track. Housing should not be a commodity, but a human right.

  158. Technology hasn't fixed the housing crisis because we have not applied technology for the 21st century. The 1964-65 World’s Fair: Monorails: Asia has maglev trains Picturephones: we all have them, but we use them mostly for text messages - a primitive use for advanced technology See the World: we can, but don't. I still haven't figured out why people take pictures of the food they're eating or why they prefer to watch cat videos, or what the draw to memes is. C'est la vie! Jet packs: wrong application of propelling humans through the air. They missed that one 55 some years ago, no one wants a jet engine strapped to their back and where do you "fill 'er up?" Mars: Oh well, why? Underwater cities: Now there's an idea! Robots: Doing that half way - the displaced worker side of the equation is still being worked out. UBI - is hardly a complete answer. The way I see it is we need to reverse the migration of the 20th century from rural populations to urban populations. There's plenty of land, but then what do people do ... farm? More than enough financial resources and interest exist. I have one solution which incorporates a complete synergistic approach. The article mentions NIMBY, but I personally am tired of getting the NIVH responses when I pitch, or attempt to pitch, my concepts. If any one (or more) of the companies listed in this article wants to discuss this further, please reply to my comment and include contact information. Thanks, we can do this!

  159. Tech hasn't solved the problem because it is not a tech problem. The political economist Henry George wrote about this same phenomenon back in 1879 in his classic book "Progress and Poverty." He recognized that increases in population and in economic activity would increase the price of land giving landholders a huge capital gain while making housing unduly expensive for working people. George devised a plan to solve the problem. He proposed a land tax of sufficient size to transfer the profit generated by popular demand for a limited supply of land from the landlord to the public treasury. In 1886 he ran as a candidate for mayor of New York City in which post he hoped to implement his plan. Unfortunately he lost to the corrupt Tammany Hall candidate. Theodore Roosevelt, the future president, came in third. It is not too late. We can still enact George's program and thereby provide for public needs while lowering or eliminating taxation on non-land owners.

  160. @David Weinkrantz You must be the only person on Earth who thinks property should be taxed more. Remember, it was property taxes that got the tax rebellion going with Prop 13. Most people do not like paying property taxes.

  161. It was insulting to read this author's, probably terrified of the 1% advertisers in the NY Times, avoidance of stating the most fundamental "root" causes of unaffordable housing in the USA. First of course is the killing of a large fraction of our workers' wages via outsourcing of so many jobs to China, Mexico, and flooding the US labor market with 10s' of millions of desperate immigrants in the last 4 decades. When you force many 10's of millions of Americans to do "global labor competition" with no-rights overseas or imported low-wage slaves you predictably have a lot of additional people in poverty who cannot afford housing! And also the fact that one can't magically create more land to put housing on - near where jobs are, or where people are moving to is a root cause which indicates our leaders should simply stop intentionally increasing our already huge population. But this author couldn't say that, because our 1% wants ever more "bodies", more workers and customers so they can make higher profits no matter how much perpetual growth damages the common good. Now of course if our 1% riggers had not put their fingers on the scale of the free market, economic theory tells us that housing prices should have gone down with wages. But again because our "leaders" have flooded our housing consumer market with 10's of millions of foreigners, this unnaturally high demand, and probably upper level stock market, Wall Street fiddling, has kept housing prices high and rising.

  162. @winthrop staples: yes yes yes yes and YES -- what you said. And yes, that the writers here seem beholden to the 1% advertisers and "powers that be", and the status quo.

  163. There absolutely does not need to be more housing... there's plenty of viable housing that already exists that just needs to be modernized, e.g. older apartments over storefronts. You could even seize the ugliest unsellable McMansions in barely inhabited suburbia and convert them for high-occupancy use. Naturally, the zoning laws would have to go... But the big problem is that there's practically no system of checks and balances against landlords. They can raise rents as much as they like, even on properties in sub-par shape, and there is nothing any renter can do about it. The lowest rent you can find in my area for a barely habitable 1B/1B apartment is around $700. If you use the 30% to rent adage, for anyone making less than $28,000, that's too much. Rents need to match the the median wages for residents of a specific area, and the conditions of the premises need to match the rent asked for. Skilled trades are regulated by unions and have standards, why should landlording be any different?

  164. How can you compost an article about housing costs and not discuss what is THE most important factor. That is, the availability of mass transit. Why do we, in this country, continue to fail to draw the connection between mass transit and housing costs? Imagine what the cost of housing would be in the center or near center of Manhattan if we did not have Metro North and LIRR. Now, take a look at other parts of the country, especially in Silicon Valley and around LA and their lack of mass transit. If you want reduce pressure on housing costs, then make it possible for people to live further away but get to where they need to go quickly. Look at Japan and Germany as models. We have got to connect our thriving urban centers with outlying suburban and rural areas. Let people live 90 minutes away by car, but make the commute 30 minutes with high speed trains. The wrong policy is to merely build more housing in the centers. Focus on boosting ACCESS to outlying towns and regions.

  165. @Jim S. housing costs in cities that have excellent mass transit are just as high. In fact, the city has the lowest housing costs in the US is Houston, which has no public transit, no zoning laws, and allows unlimited development. Every study I've looked at has shown that mass transit increases housing values in the area where it's added. The reason why Cobble Hill and the West Village have high housing prices has as much to do with restrictive zoning and a determined local population bent on forestalling new development. People want to keep their neighborhoods as they are, even when they are sorely in need of new services and housing. As another commenter said, it's human nature.

  166. @Jim S. Well Said Jim. Singapore is also a good example for providing better transport facilities allowing people to stay far from offices.

  167. Perhaps a more interesting question is, can tech make the affordability crisis worse? I was disappointed that this article did not explore recent tech efforts to buy housing stock and extract rents, making housing even less affordable.

  168. @Peter Friedman It most certainly can and does. Just imagine the intel that flippers can gain on the market with a robust listing registry and sales trend information. That alone would be counter productive if the goal is affordable housing.

  169. Because technology is fundamentally not about solving problems. It is about having cashing in with an IPO and buying a private island. Duh!

  170. Housing at present is a financial instrument in a market awash in cheap debt allowing persons or businesses to buy up large quantities of housing and increase the price or value then return it to the market. I routinely see flippers buy a house for $100-150k before it hits the market, but $50k into it and resell it for $300-350k. Affordable housing is a business opportunity to be consumed to produce luxury housing at a profit. Likewise you can buy a variety of properties and then rent them out through one of the various intermediaries at minimal risk adding a solid margin to the original housing cost. Add on to that the cost of building housing means that it makes the most sense to build high end homes. Where are affordable houses to come from then? Nowhere, there is every reason to consume them and no reason to build them. The eventuality is that home ownership will become a rarity and renting will be a requirement and a major loss of household wealth. Rent personally has been growing at 5% a year for over a decade. The math isn't hard, most of us are headed for poverty. If interest rates rise significantly it could upset all of this and tank the market again but that's about it.

  171. If the election of Donald Trump has done nothing else, I hope it has laid bare the crushing financial-real estate-new construction complex. Indeed, you can see it all over the world, and Paris preservationists are terrified that Brexit will bring it there, too. This is what has arisen in opposition to infrastructure maintenance. The difference between the two categories is in types of ego gratification. Steady, reliable infrastructure work supports a sound household income, much of it in skilled and detailed labor. When I was a kid, this was a man’s dream for himself. In those days, greed was a dirty word, and what we called “conspicuous consumption” earned widespread public derision. The banking/real estate/construction complex in those days kept a low profile. They built suburbs by redlining and fear mongering in urban neighborhoods. This was not “draining the swamp” but “gutting the treasury” — of cultures, of public transportation, of neighborhood institutions that gave stature and identity outside of financial gain. There was new building in the infrastructure sector as well — interstates, schools, hospitals — so the American Dream was not out of reach for people who worked with skilled hands and strong backs. When the infrastructure had completed its goals, there were two options. One was to maintain those household incomes with maintenance, the other was to create artificial building needs by pandering to greed. Voila, Trump.

  172. as a real estate developer, it's clear most of the commenters are unaware of the many ancillary costs that go along with construction. Building codes that require 12 - 16 months to navigate despite the architect requirement in NYC. A shortage of qualified construction workers. The ability of one dissatisfied resident to stop construction for weeks at a time. When we price out a project, typically soft costs, permits, carrying costs, etc... are 15% and if it ends up that way, it's a best case scenario. The other part that is missed, real estate once built is a stable asset, but the time and cost of construction means that capital gets tied up for years. It's a tough sell for a capital fund when there are many more liquid investments that provide a similar return. A quick breakdown of our last project that we passed on: 10,000 square foot $165k for a roof $150k for new concrete floors $250k for electrical $150k for plumbing $100k for HVAC $100k for sprinklers. $300k for general construction and soft costs. This is a single story existing warehouse being converted to studios. End price was about $1.2 million and a 2 year timeline. The ROI was about 8% but the timeline meant we had no idea what would happen with the tenant we had lined up. I hope it's easier in other cities because NYC is a tough one.

  173. @Tom Thanks, that's some good info. I am so tired of the "greedy developer" meme. A lot of people are misinformed but not only that, they blame the high prices purely on the greed of sinister entities and they resist any effort to add new housing in their areas because gentrification. Individuals who try being a landlord themselves are in for a rude awakening.

  174. Nimbyism is just grass roots democracy and should not be disparaged. The most achievable "tech" fix for affordable housing is more public transportation and bicycling/walking infrastructure. Obviously eliminating automobile costs in a person's or family's budget frees up funds for housing. But it is more than that. More car free households mean more housing can be built without expensive and land gobbling parking lots and garages. Also, money spent on labor intensive housing tends to stay more local than that spent on automobiles. Keeping the money in the community, rather than sending it to Detroit, Japan and Saudi Arabia, fuels a positive feedback loop that creates even more funds for housing.

  175. The most achievable thing to do is to disperse the lemmings who gravitate to a handful of overly popular hubs and keep cities, towns and villages of all sizes viable. Bringing high speed communications and solid infrastructure to such places is quicker and cheaper than planning for and building higher density affordable housing in any of the current overheated markets.

  176. @From Where I Sit Most high-tech workers like to live in large-ish metro areas. Build all the high speed internet you want in low-population areas and it will change this only at the magins. Unless one such area takes off and becomes yet another large hub, and then you haven’t really changed anything.

  177. It is fairly obvious to all who have worked in planning: The Euclid v. Ambler decision was poorly written. It should not have left an opening for non-health, non-safety, issues. As a result of that opening, planning is used to guarantee property value increases. So, gone are the days of the "Bailey Savings and Loans" where an American could buy a starter home and expand it as needed (this is limited by neighbourhood covenants as well as planning legislation). Gone are the days where one might buy a vacant lot and build on it what s/he wanted: Zoning (and probably also covenants) restrict what could be built (probably even if what was to be built was entirely subsurface!).

  178. "“If among you, one of your brothers should become poor, in any of your towns within your land that the Lord your God is giving you, you shall not harden your heart or shut your hand against your poor brother, but you shall open your hand to him and lend him sufficient for his need, whatever it may be...For the poor you will always have with you in the land. Therefore I command you, ‘You shall open wide your hand to your brother, to the needy and to the poor, in your land.’" (Deut 15:7-11) That's at you, rich folks. Not gummint taking it from the middle class.

  179. @Austin Not just giving the land but in the old testament prophets created laws that said housing for the agricultural community had to be built to the sturdiest highest standards. Widows were included.

  180. In the first half of the twentieth century we HAD affordable housing: old run-down houses, lean-to's, shacks and corrugated metal structures. We tore them down with urban renewal. New Orleans suffered a similar fate when long-ago paid-off structures were lost to the hurricane. We haven't really figured out how to replace them. In many cities, renters face eviction after eviction. As these rents increase, property taxes follow, further destabilizing the housing stock. You can't even just squat on your property any more since the taxes will soon take it away from you. Houses sit abandoned in the cities where renovation costs exceed value. Then, thieves break in and steal the copper, crack smokers burn them down or vandals wantonly destroy what is left. Contemplating the trade-off between housing standards and affordability is very frustrating.

  181. @Arch Davis In the mid 20th century, we built Levittowns in the suburbs for the inflation equivalent of $30,000 and those houses are now selling for $600,000.

  182. If the design and construction of computers, phones or cars were controlled by the local government, they would not be merely unaffordable but non-existent.

  183. The fundamental problem is a mismatch of supply and demand in the housing market. Most of us have too much stuff and we buy or rent too-big houses to keep all that stuff in. Zoning laws and CC&R's prefer McMansions, or at least, houses too large to be affordable or practical for most people. If we can construct smaller dwellings closer to where jobs and businesses are, we'd go a long way towards making housing affordable. The other problem is the bifurcation of the US into global cities and the rest of the country. Those who are willing to commit to the big city rat race face high housing and other costs. The rest of the country and those in the big cities without valuable skills, faces low wages. Lower wages require more modest housing, which may not be either available or desirable.

  184. @Steve Webster Some small communities in the US, built in the mid-nineteenth century, were by-passed later in that century with changes in technology and national population centroid. Solid housing of exquisite materials, scale, and craft (built for company magnates) remain and are occupied by people of modest incomes, both with regard to a local and a national scale.

  185. It seems to me that bringing those missing features to a broad variety of existing and under used communities works be faster and cheaper than building so-called workforce housing in NYC or Seattle or the Bay Area.

  186. @Steve Webster When a city demands a $50,000 permitting fee, it makes it impossible for a builder to profit on selling a house that costs $50,000 to build, but he can sell a house that costs $250,000 to build for $350,000.

  187. When Amazon announced plans to move to Brooklyn and Northern Virginia - experts speculated that it was because of availability of talent. It is a convenient explanation for densely packed, high rent areas around the country. Had Amazon moved to the outskirts of say, St. Louis (a somewhat geographic center of the country) - would talent not move to take great paying jobs? The solution to the housing crises is likely beyond one person's vision; but I wonder whether there are good explanations for why talent cannot or does not move to areas where jobs exist, real estate is cheap, and the air is clean. If businesses move driven by greed, why doesn't talent follow? I guess this is the question.

  188. @Kalidan: OF COURSE talent follows jobs (and money). Offer software engineers $200K a year, and they will move to Hazard, Kentucky....where they can live like KINGS in huge McMansions instead of sharing a tiny studio apartment in San Francisco or Palo Alto. Those guys work 80 hours a week anyways. They could live happily in Antarctica. We entirely have the power to create 4-5 NEW economic regions in the US -- bringing tech & prosperity to all corners of the nation -- but our leadership utterly lacks imagination and vision.

  189. @Concerned Citizen "but our leadership utterly lacks imagination and vision." Actually, government doesn't have the power or authority anymore to just make businesses move to places like st. Louis. 30 years of "starving the beast" does that and that's how the billionaire ceos want it. Better for the rich and powerful elites to have the govt neutered and in their pockets then working to better the lives of the serfs.

  190. No technology fix? I wonder if we looked at all the empty living space in US and compared it to those needing a living space, is there a shortage? For example what if air b n b was used for long term rentals/ finding room mates? What about technology to help you find a job and housing together, if willing to move? Maybe spending money to help people move to a different city with plenty of housing and a job? If such a combo exists. Tech to make a map of the U S where there is exes housing and available jobs. If that exists. Then connect people looking for jobs to that. Also cost of living tables/charts to understand that a 40k job in the Midwest is paying you more money than a 40 k job in ny city.

  191. @Zorana Knapp Even in crowded locations, prefabricated units manufactured distantly could be a assembled into high rises if local zoning would allow it. But local zoning rules do not favor mixed use areas.

  192. The problem is in hoping technology will fix anything. If technology worked, we wouldn't have the problems that make life difficult to impossible.

  193. I don't know about Silicon Valley, but every large, medium, and small city I visit has miles of empty strip malls and empty indoor malls. Can't these acres of empty retail space be reconfigured into apartments?

  194. @Linda, in Austin, software companies have started turning dead shopping centers into workspace; the local community college bought an old shopping center to turn into a new campus.

  195. @Linda Malls are poorly insulated and have little plumbing or windows. They can be converted to residences that are rarely satisfactory.

  196. @5barris Yeah, but she has a point. It's better then living on the street.

  197. There is great irony that much of the issue of affordable housing is created by excessive demand in a relatively few popular regions. At no time in human history has there been less cause to reside in a particular place due to employment. Why are those regions so popular? Because a slew of tech firms are located there. Yet the very tech they are immersed in makes it possible to work from almost anywhere. As for those areas where such work isn’t currently tenable, upgrading to high speed communications seems much more doable than residential building and mass transit schemes.

  198. You have it partly backwards. Did people move to the jobs, or did the jobs move to the people? Amazon surely decided to move to New York because of the job market, not to create one. In theory, everyone could telecommute. In fact, bosses still like butts in chairs, and work is mores social environment that is commonly assumed.

  199. For NYT readers: This is a ridiculous article. The problem of low cost housing housing has been solved! YOUR problem is politicians not allowing the solution! Out here is rural America we can buy a complete manufactured two bedroom home (single wide) for under $50,000. YOU just need a lot to locate it! You could truck them to any location for a few thousand more! But many areas don't allow them! Why try to reinvent the wheel? Just free up vacant land, order thousands of manufactured homes and you will have more housing!

  200. @Donna Gray Manufactured housing is highly flammable.

  201. @5barris The problem in NYC is there is little land available that won't flood, not that manufactured homes are flammable, which they aren't.

  202. Mobile homes are the opposite of a solution. You can’t build cities with mobile homes. How many households per acre using single-wides? Four is cozy, eight might be common. Twenty? An acre is 660x66 feet. Moderately dense urban housing is sited on lots 20 x 100. Allowing for 330 x 132, that’s 16 lots per acre. If they’re 2-family duplexes, that’s 32 households, with a sizable backyard. If they are 5-floor walkups, as is common in New York, that’s 80 households. If you raze the low-rises, you can put 500 units on an acre in a 16 story building. Cheaper to heat, and enough people to support stores and restaurants and jobs within walking distance.

  203. Rule No. 1. of trying to solve a problem is: Find out did anyone already solved the problem. Housing is an issue for every countries. But for development country, Singapore probably has a pretty good solution. Govt. funded housing. All citizens and permanent resident can buy them with their CPF -- something like your 401K or IRA but better. And because all employees salary will be deducted pre-tax but they able to use the money for their mortgage -- what a brilliant idea? How much 401K was sitting in some mutual fund that can't even beat the SP500? And how many people struggle to pay their rent/mortgage? with after tax money? If US adapted the Singapore way, US doesn't even need to solve the problem with 'technology', just copy how Singapore did it. In short, let people use (part of) their retirement saving to pay mortgage.

  204. @SWW: you can withdraw IRA funds (I don't know about 401K) to pay for a downpayment on a FIRST TIME mortgage....but that only helps young people with a first home. It does nothing if you are moving to a new city for a job and need to buy a different house.

  205. It's not a problem of technology; it's an ecoenvironmental problem.

  206. After WWII, real estate and housing is used by rich as an investment tool. A lot of people with extra money just buy affordable property as that in most cases appreciates more than any other kind of investment vehicle. While doing so, they deprive their poor fellow human beings, access to affordable housing as it drives up the rent/own prices of that place. So rich people not only have place to live but effectively deprive other who are less fortunate or poor to have any roof on their head. In US, if the population is 330 million, do we think that housing unites are also 330 million? NO! So, while lots of people are homeless and barely renting inadequate living space they can afford, a small number of rich people are occupying vast "spaces" in urban living quarters! Same for China as well. More so, as real estate is sliced and diced for stock market, a lot of housing is only created to add up debt, show on paper the rental "guaranteed" income, and lots of derivative purposes which has nothing to do with humans living in it! This is increasingly true for China and India as well and their Government is also participating in it. So, a lot of housing is created just for different investment purposes rather that keeping in mind of the housing need of the population! The root cause behind his is simple "HUMAN GREED". This cannot be solved until the mentality changes to - Live and Let Live .... which in current geopolitical situation - impossible !

  207. @Pidus the greek I favor reducing income tax and replacing it with a land value tax as advocated by 19th century philosopher Henry George. This has many advantages. It's highly progressive since the wealthy own a large proportion of land. And it distorts the economy very little since land isn't something people or firms produce. To be clear, a land-value tax (LVT) is a tax on the value of the unimproved land. So, building a big, beautiful house on a plot would increase the value, but not the *land* value. In this way, LVT steers clear of disincentivizing production.

  208. @Levi Barnes Even if the wealthy own a large portion of land, the portion of land they own is very probably less than the portion of the wealth they control. Therefore your scheme would not be "highly progressive."

  209. @Pidus the greek 320 million but great points otherwise.

  210. The housing crisis, like most permanent crises, is created by government. You can't fix government with technology.

  211. @Alan You could set state-level zoning laws to override NIMBY concerns. You could fund commuter train lines with public money. You could switch from property taxes to land value taxes.

  212. @Gavriel You could price commuter fares to pay for themselves rather than socializing the cost to people who do not have access to mass transportation.

  213. You could price roads and gasoline according to their environmental cost, instead of socializing it on the backs of those who don’t drive to get to work or to fetch a quart of milk. That step alone would make housing further from town cheaper, and drive demand for public transportation. No mere thought experiment: lived reality in Europe and Japan.

  214. I own a residence in a community where Blokable is building a demonstration project. The company uses very innovative design tools and materials. However, driving down the cost of housing this way is a lot like making cars cheaper by finding cheaper floor mats. The reason for the housing cost crisis is that too many people want to live in certain cities. There is plenty of cheap housing in communities that fewer people want to live in. In some places, the 2008 collapse persists. The driver of this is income inequality, not housing costs. Sections of the Midwest have turned into Warsaw Ghettos.

  215. @Charles Coughlin The desire to live in the hip cities is entirely rational. People want to live where the jobs are, and telecommuting is barely an option. Most companies would rather outsource such jobs overseas. Lack of jobs aside, few young adults want to living in aging communities, with little or no social scene, where drugs like fentanyl are often a problem, and the values are likely paleoconservative. Even some cities have this problem: transplants lament the lack of non-church activities in places like Topeka, for example.

  216. We all know what drives the price of housing in America. I suspect it's not as much a dearth of supply as much as it is a dearth of ownership. The last Great Recession put millions of foreclosed homes in the hands of few Wall Street speculators. We need to find a way to take speculation out of RE. That process should start with the RE Industry first. Just removing the Mortgage Interest Tax deduction would make the price of homes available to millions of our millennials.

  217. @John Kominitsky: except that Trump removed the SALT deduction for many people -- mostly affluent white liberal professionals in Big Blue Cities (where housing is the mostly costly) -- and the screaming continues to this day! the same liberals who say "I will happily pay more taxes!", in fact shriek bloody murder when actually asked to....pay more taxes.

  218. @John Kominitsky +1 for eliminating the mortgage interest deduction I'm not sure it would do anything to limit speculation, but why should real estate get a special tax incentive?

  219. So, you would fix the dearth of ownership by ... removing an income subsidy for it? You’re right that the deduction raises the price of the house, by increasing demand, but removing the subsidy would reduce price and income in equal measure. There’s no reason to expect housing to become more affordable that way.

  220. Among the many problems in US housing is that location is tied so firmly to work and especially schooling. At one point, we found ourselves living across the street from identical houses worth almost $250,000 more because the street was the school district boundary. This, to me, is insane. That extra quarter million per house did not go to teachers or school buildings or bunsen burners or chromebooks. The two districts were nearly identical by all of those measures. That quarter million was the premium you pay to go to school with the rest of the kids whose parents could pony up the extra quarter million. So why, even as our work and our school are increasingly untethered from a specific location, does location continue to be the watch word in housing? This, at least, is one place where technology can make a massive difference. Can employees at your company telecommute? Why or why not? What technology or legal framework would make that more viable? Would you ever consider doing some of your kids' (or your own) school online? Why or why not? Again, what tech would get you to yes?

  221. @Levi Barnes If the schools were equivalent, and the homes were $250,000 cheaper, you got a bargain.

  222. @ebmem: he got a bargain on education, but his HOUSE never appreciated like those in the "elite" district. It also might be that the status gave the kids from the elite district a leg-up on college admissions. Usually there is more at play here, like the cheaper district has more poor people or minorities and the more costly district is 99% white/asian.

  223. One thing that would fix this "crisis" overnight.....less regulation. Allow builders to build new housing. Doesn't take any new tech either, since the basic laws of supply and demand haven't changed much in centuries. Allow more supply, lower prices.

  224. @JJ Jetson Easy to say, difficult to do. Because every 'place' wants it's own say about how it's land is used. And who can blame them? Simply saying 'less regulation' is like saying NIMBY (Not In My Back Yard). When it's not your neighborhood "let 'em build wherever". But when it IS your neighborhood, suddenly you're glad that strip mall isn't getting built across the street from you, or you're glad a McMansion isn't built next to you, raising your property taxes.

  225. @JJ Jetson --- Less regulation is easy to say, but that is what we had 1880s to 1940s, and that "let anything go" attitude enabled "developers" to build the miserable, cheap, unsafe housing we see all over America. Now we call them slums. That housing drove people out of the cities into the Levittowns and their copies. Fire safety is one key reason for some of the zoning regulations. A few years ago, a fire in one triple decker house in a high density part of Boston spread to 5-8 adjacent homes, only 10 feet apart.

  226. The article cites nimby, land use, and zoning as ancillary causes. In fact, those are different names for the same thing: legal restrictions on building, especially on density. It’s true in city, country, and suburb, in every state. It’s most acute in our newly popular cities. You won’t find a neighborhood or town whose government officials are elected on a platform of more housing. You won’t find a New York suburb with plans to rezone for apartment blocks, so more people can live there. In California, a bill to build apartments near transit hubs across the state, overriding local zoning restrictions, went down in flames. The population is growing. Cities are growing. Without permission to build denser housing in cities and towns, what else can happen except higher prices nearby and sprawl further and further out? For decades, we’ve built new housing by paving over farmland. We’ve reached the limit of that shortsighted, ugly, isolating solution, and have not yet begun to accept the inevitable: build bigger cities. I’ll refrain from mentioning this is yet one more example of the baby boom generation pulling up the millennials’ ladder. Housing, college, the climate. No pattern there.

  227. I laughed at the headline. Then I read the article, getting more and more bewildered before finally hitting on the key line in the piece: "Incomes are too low." There you go. Wanna solve the housing problem? Get American business to give up just 1% of it's profit margin and return it to wages...and watch the economy jump like a jackrabbit, including housing. It ain't rocket science. It's plain old greed that's holding America back. It's time to make our take rates progressive again. The more you make, the greater you're taxed. Not so much to think you can't get ahead, but not so little that the wealthy are sucking it out of the rest of us, like they are today.

  228. Regret that the comments show little insight or understanding of the complexity and dynamics of housing affordability. Technology can have some impact on housing cost factors - materials, labor (productivity improvement), financing (less time to complete=less financing cost). Land is a key cost element that technology doesn't address. Building on inexpensive land is another name for inefficient sprawl, often where people would not prefer to live and where infrastructure (water, sewer, roads, etc) is limited, unavailable, and costly to create. Community land trusts seek to reduce land cost - increase affordability, but are too limited in scale to have broad impact. Income strategies are also a potential part of an overall strategy. After more than 45 years of work in affordable housing, I find the complexity of the challenge remains daunting, and more complex than can be covered in a comment submission.

  229. Why is there the assumption that technology can fix anything in the first place? The additional irony is that in the Bay Area, tech is magnifying an already bad problem. No, its not true that God is not making more land, he is just not making it where rich elites want to live. You would think the type of people who invented the technology to work remotely would set up shop in the middle of nowhere, but then you get companies like Amazon who set up shop in the most desirable metros. I too have built housing in the bay area, and it is not profitable for resale unless you go for the top of the market. I thought I could do it otherwise, but it is absolutely not true. Bottom line is Americans are spoiled by traditional global standards. The new reality is people will not be living in a big house on a big lot with a white picket fence. Unless you have means, it will be a tiny apartment and your kids can play in the stairwell or the neighborhood park. This has been the reality or worse in many parts of the world for decades, including high income countries, particularly in Asia. I am not a Russian troll, but unfortunately, Putin was right in this respect when he was referencing the end of American exceptionalism. Unfortunately the population keeps growing and with globalization comes a standardization of living standards. We had a good run with high living standards (if you were white) in post war america but it is a totally different ball game now. Change is inevitable.

  230. @Disgruntled model minority Excellent point. Anyone who has ever been stationed in Germany, knows how much smaller their homes are compared to ours. Good architectural design helps a lot.