To build affordable housing you need land — and the federal government has an ample supply. Michael Albertus, professor of political science at the University of Chicago, joins host Krys Boyd to discuss the plusses and minuses of an idea that’s been floated in many administrations: selling federal lands to cities and developers to address the affordable housing crisis. His article “The U.S. Government Is Sitting on a Possible Solution to the Housing Crisis” was published by Bloomberg.
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Transcript
Krys Boyd [00:00:00] Imagine a reasonably modest home in a highly desirable zip code. And let’s say it’s on offer for $1 million. Most Americans cannot swing the payments for a mortgage that high, but build the exact same structure in a different part of the country. Maybe the selling price is less than half that. If there is a shortage of affordable places for Americans to live, some advocates say maybe we just need to start building where land is cheap. From Kera in Dallas, this is Think. I’m Krys Boyd. You know who owns a lot of land that could be sold at bargain basement prices. The federal government. It is a fascinating idea that seems to be worth talking through. So we’ve invited Michael Albertus to join us today. He is professor of political science at the University of Chicago and author of an article for Bloomberg titled “The U.S. Government is Sitting on a Possible Solution to the Housing Crisis.” Michael, welcome to Thank.
Michael Albertus [00:00:53] Thanks. It’s great to be here.
Krys Boyd [00:00:55] So many challenges these days get labeled crises that I think the word doesn’t pack quite the same cognitive punch that it once did. Will you start by describing for us the state of the housing shortage and why it does, in fact, deserve to be called a crisis?
Michael Albertus [00:01:10] So American housing and people who are in the housing market are facing a situation that really is unprecedented in many ways. So since the financial crisis in 2008, construction never really caught back up with demand. And as a result, the housing market is short several million units, depending on how you measure it. And that’s one of the major contributing factors to a reduction in supply and pushing up housing prices. Of course, the pandemic supercharged a lot of this. And housing prices have risen even more precipitously in the last several years.
Krys Boyd [00:01:52] Is this a shortage in all forms of housing, like single family detached homes and multifamily apartments and condos and, you know, rentals and purchases? Everything?
Michael Albertus [00:02:02] It is a shortage in housing pretty much across the board. Of course, housing markets are in many ways regional markets. So the constraints that consumers and the buyers face and that sellers encounter as well differ from place to place. And so whether you’re in Chicago or in Dallas or in Boston or in a small town in Tennessee, what’s on the market and what’s available and the restrictions and the like in terms of what is out there? Those are all those are all different. But by and large, yes, there’s a shortage of just about everything.
Krys Boyd [00:02:42] So I think in the piece, you quote the real estate site Zillow, in saying there’s a shortfall of something like 4.5 million homes will, you know, stipulate that Zillow obviously is in the business of getting people to buy and sell houses. But that obviously would represent several times that number of residents who could occupy those homes. Assuming these folks are mostly not unhoused, Michael, where are they living now? How are they getting by without enough housing?
Michael Albertus [00:03:08] There are several trends. So one of them is that people are living people or some people are stacking up, some families are stacking up. And that might mean moving out of your parents house later on in life compared to what you might have done previously. That might mean several low income families that are living in a single unit as well. So there are different there are different things that people are doing in order to make do with with the current situation. But nonetheless, when surveys are conducted about what people want to do with housing and would they like to buy a home, they like to go in the housing market and look for something new. There is very clearly a big discrepancy between the share of people who say that they are looking for new housing and the share of people who come out at the end of any given housing season with a new place.
Krys Boyd [00:04:08] So this might also include people who would ideally make a move to a different kind of home, like more bedrooms or places with yards for young families. But they just can’t afford to go anywhere based on the cost of things.
Michael Albertus [00:04:19] That’s right. Yeah, that’s exactly right. So many people are delaying or postponing moves that they have that they would like to do. And and that could be because they’re trying to, you know, get get a new place that fits a growing family. It could also mean that they’re not taking a job offer in a place that they would otherwise think about moving. But the housing constraints are such that it just doesn’t make any sense for them to do that. And the prices are too high for them to be able to afford it.
Krys Boyd [00:04:50] We are right on the cusp of getting into potential solutions, but I do want to ask if there’s any reason to think that projected ongoing declines in birthrates could naturally ease the housing shortage over time if we all just stayed crowded for now.
Michael Albertus [00:05:05] That’s a great question. You’d have to wait quite a long time in order for that to happen. And, you know, birth rates, like you said in the in the U.S., are declining. But immigration has been picking up the slack on that such that we actually have a growing population. And and that’s projected notwithstanding some of the current efforts by the Trump administration to restrict immigration. There are the most projections show that the American population is generally going to continue to increase in the coming years and in the coming decades. And so that’s really not going to be enough.
Krys Boyd [00:05:41] What sort of interest has President Trump expressed in acting to ease this shortage through federal policy?
Michael Albertus [00:05:49] There are several things that the Trump administration has put forward in terms of addressing the housing crisis. One, which we already mentioned is actually immigration and constricting the supply of new or the flow of immigrants coming to this country, which in theory could could help to reduce demand for housing in some areas. And and that’s that’s true at the margins. In some in some areas, of course, it would have to be quite a quite a restrictive immigration policy in order to open up enough housing for people. But another major policy that is on the table is opening up federal lands for more housing. And that’s not the only other one. There are also ideas of trying to support first time homebuyers and the like. But a major problem in the housing market really is is actually the the sort of red tape, all of the zoning requirements, all of the permitting that comes with building. And that has become, over time, more and more difficult in most locales. And one attractive thing about using federal housing is that it starts some of that regulatory structure.
Krys Boyd [00:07:09] So the Trump campaign has floated this interesting idea of opening up federally controlled public lands as a site for building housing. There are different ways to do this that we’ll get into, but it has achieved this kind of magical unicorn of political ideas, which is to say bipartisan support for at least the broad strokes.
Michael Albertus [00:07:28] That’s right. There are very few things that seem it feels like America today where there is considerable bipartisan support and housing seems to be a point of rare convergence, including the use of public lands for for building And and, you know, the Harris campaign also had proposals to use federal lands for building new housing. And in fact, the Biden administration also engaged in this in a in a very restricted way. But but but there is clearly support for this on both sides of the aisle, albeit with different details.
Krys Boyd [00:08:04] Just to be clear, nobody is talking about like condo developments on the rim of the Grand Canyon or a stone’s throw from Old Faithful. Right. This this could be done without taking over national park land where else is federally controlled land located?
Michael Albertus [00:08:21] That’s exactly right. I want to make clear here that we’re not talking about bulldozing Yellowstone or, as you said, putting up condos at the rim of the Grand Canyon or something like that.
Krys Boyd [00:08:29] Although there would sell like hotcakes.
Michael Albertus [00:08:31] Yeah, of course. That would be pretty attractive land. Put me in line for that. Right. But although I don’t know if I could afford it. I will say that, you know, there are very different kinds of federal or several kinds of federal lands that are out there, and there’s a lot of federal land. So the federal government owns about 50% of all land in the American West, where, you know, and the share of publicly owned land is disproportionately high in the American West, as are some of the, you know, some of the worst problems in terms of supply and demand and housing are also in some of these places, although not exclusively. And so we’re talking about different kinds of public lands. National park land is off the table in this sort of proposal. Nobody is proposing using national park land. There are also very few proposals for using U.S. Forest Service Forest Service land. Most people are instead talking about using land that’s managed by the Bureau of Land Management, and that is land that is vast and its extent and as a result is located in many different states and some of it is very far flung land from the perspective of places that people might want to live, you know, towns, robust economies, urban areas and the like. But others are at the fringes of those places.
Krys Boyd [00:09:57] Why does the federal government own so much land?
Michael Albertus [00:10:00] There’s a long history of this. A lot of it has to do with the early development of the US. So, you know, as the country was founded and as there was acquisition of land by the federal government through the Louisiana Purchase and then the Mexican-American War, all of a sudden the US comprised more and more land, these tracts of land, those two tracts of land that were acquired, the Louisiana Purchase, and then after the Mexican-American War, those were enormous tracts of land. There simply weren’t enough people to settle all that land, to privatize that land at the time, nor in the in the several subsequent decades. And as a result, only a portion of that land was privatized and a lot of it was held by the federal government. And you know that as a that’s that’s the history in brief of why there’s so much federal land, particularly in the American West, as opposed to the eastern seaboard, which is much more densely populated and which was settled much earlier than the American West.
Krys Boyd [00:11:08] So what is the broad geography of housing shortages like? Are there cities and reasons where regions where it’s not really a problem and other places where it is really severe?
Michael Albertus [00:11:18] Yes, definitely there are there’s big, big discrepancies in terms of where the biggest housing shortages are. But, you know, there are places, for example, like the Bay Area where there’s a real housing crunch and has been for a long period of time. As a result, you know, land value is the majority of the value of any real estate transaction. There are other places where land pressure is much smaller there in smaller parts of the Midwest and the like, where there are less population pressures there, the housing problems are not as significant, although again, it’s a very complex picture. You know, you kind of have to go town by town, even within a given state, to see the extent of the problem in a given area.
Krys Boyd [00:12:10] And it’s not necessarily all that easy. Like it’s really easy to tell people who can’t afford housing in the Bay Area, like just move to Nebraska and you’ll find, you know, plenty of land for cheap. I mean, Nebraska’s lovely, but, you know, people may not be able to leave jobs. They may not want to leave friends and family. It’s a move across the country is not as common as it used to be. And it’s it’s a big undertaking.
Michael Albertus [00:12:34] That’s exactly right. It is a big undertaking. And people are rooted in the land in many ways, and their identity is oftentimes rooted in the land and in the places that they live. And as a result, you know, of course, family networks develop around that and and personal histories, relationships, etc.. So it’s not simply about, hey, let’s move to a place where it’s cheaper. There are many different calculations that come into play for any given family about where to locate and where to live. And they may simply be faced with a relatively difficult circumstance or a difficult housing market and have not much of a choice or, you know, when they think about it, in the broader scheme, it’s it’s not the number one thing on their list. It has to be taken into account alongside all their other considerations.
Krys Boyd [00:13:23] So there may be people who choose to be in a smaller house in a location they really want, and there may be people who prefer to have all the house they want in a further flung location.
Michael Albertus [00:13:34] Yes, of course. And you see that with some of the the nascent kind of zoning changes, Right. I mean, there are parts of the Bay Area to stick with that example for a minute where there have been zoning changes to allow people to rent out sort of smaller structures that are in the yard of a larger house.
Krys Boyd [00:13:59] Michael, one idea the president has talked about is something called Freedom Cities. What is the vision he’s articulated for these?
Michael Albertus [00:14:08] Well, the vision isn’t entirely clear. It’s a sketch of a it’s a sketch of a plan at this point. And the idea is to build new cities from scratch that feature totally different regulatory structures and that have that feature new technology as well. Things like the deployment of flying cars and drones for delivering packages and all sorts of things like that. The there’s a long history, of course, of coming up with new towns, new ideas of places for people to live from scratch. And and, you know, there’s a new city, for example, that’s being constructed right now in on the opposite side of the planet in Bhutan called the, you know, dubbed Happiness City, where the idea is to build a city around the premise of, you know, building a life not just about engagement with economic activity, but also mindfulness and broader happiness. And so there are these sorts of utopian ideas that that float around in that that people adopt, that countries adopt, that planners adopt at various times. Of course, reality comes into play as well. And many times these cities and these projects don’t end up looking like the initial vision that that they began with.
Krys Boyd [00:15:37] Yeah, I actually love stories of utopian communes and communities that have formed over the course of history, and they almost always end in a less satisfactory way than they were imagined.
Michael Albertus [00:15:52] Yeah, that’s right. The difficulty, of course, is that. You know, even if people are attracted to these places that have certain ideals, there inevitably are inevitably new towns, new areas, new settlements, replicate some of the old things, whether it has to do with, you know, you’ve got a similar set of builders, you have a constraints in terms of of what can the materials that can be sourced. And then even ultimately, you know, as towns and cities grow, they bring people and people bring with them histories and cultures that are oftentimes rooted in the prevailing in the prevailing norms of the broader society. And as a result, they end up falling, falling flatter than than planned.
Krys Boyd [00:16:41] So building super modern cities from scratch sounds like a very cool project. Even maybe if it won’t turn out quite as proposed. It also, though, Michael sounds like a big project, right? Because you’re not just building houses for people. If you’re starting from the ground up, you also need roads and power and water lines and other infrastructure, which can be a huge and an expensive undertaking.
Michael Albertus [00:17:05] Of course. Yeah. So what a great example of this right now is the proposal called the East L.A. Plan. In the northeastern part of the bay. There were several billionaires and people involved in tech tech entrepreneurs who got together several years ago and started surreptitiously buying up large tracts of ranch, land and the like in that part of the bay with the idea of building a new city from scratch that could then be integrated into the broader Bay Area. People could live there and then work in the tech industry and the like and be able to move back and forth between the heart of Silicon Valley and this area. And, you know, there were a lot of plans from the get go to make this a community that would, you know, be a green community where we’re very walkable, there would be access to great amenities and all that stuff. But very quickly, as it became public that this was going on, there was backlash from the local communities and in the local area for precisely the reason that you just mentioned, which is to say that in order to foster such a such a new city, there needs to be a ton of new infrastructure. You have to change the you have to hook all these places up to the to the grid. You know, you have to reroute water, which is something that’s a scarce resource in that area. And it has implications for everyone else who lives in those counties and who pays taxes in those areas. And so very quickly, it became it became controversial. And and there was enough local pushback that the group that had planned this new city had to dial its plans back and to push back all of its plans, basically. And right now, they’re sort of in a holding pattern trying to figure out what to do, whether it can be salvaged, the project as a whole because of these because of these broader issues.
Krys Boyd [00:19:07] Would Trumps Freedom cities, which I think are an inchoate idea. But they have been put out there. Would they be built by government or by private contractors?
Michael Albertus [00:19:17] I think that remains to be seen. I suspect that the idea would be to create some areas to target, some areas that would be promising for new cities and then to contract out bits and pieces of that to private contractors in terms of building new areas. But again, a broader consideration is how to connect those to existing infrastructure and make them places where people that people would actually want to live in. You know, you need to have a a dynamic economy, a diverse economy to attract a lot of people. And that takes quite a lot of time and it takes quite a lot of buy in as well from from private companies and the like in order to actually build that sort of plan and have it realized.
Krys Boyd [00:20:06] I mean, the people who get in the way of big developments, you know, by saying not in my backyard might strike us as unnecessarily obstructionist until the backyard in question is yours. I mean, talk about some reasons why local residents established in these areas proposed for new development are concerned.
Michael Albertus [00:20:28] Well, many of them are concerned about changes to their daily routines. They’re concerned about changes to the character of the community and that sort of thing. So if you think about building a new city from scratch in a in what had previously been, you know, a more pastoral rural area or corner of the bay, that’s going to major impact traffic patterns. It’s going to, as I said, previously, impact property taxes because it’s going to require a lot of new infrastructure. And figuring out who’s going to pay for that bill is something that’s relatively complicated, especially when you think about that over the long haul. Even if even if new developers promise to foot the bill in the short term, what happens in the medium and long term? And so there are a lot of a lot of changes. Plus, of course, it brings in people who might might be who are going to be from outside of the community and people who are in the community who feel like there’s a certain character or identity to the community that is going to be fundamentally altered by outsiders. Oftentimes, we’ll have a reaction against that and push back to try and maintain what they feel like is the pride to the native character of a place.
Krys Boyd [00:21:40] You mentioned earlier that the idea of using repurposed federal lands is attractive in part because they could be developed without quite as much red tape as you might find in a local area. So are we talking about building outside of established like municipal jurisdiction?
Michael Albertus [00:21:59] It could be building outside or at the outskirts of existing jurisdictions in some cases. Land patterns are very you know, when you look at it, you know, at a given city or something like that, public versus private, oftentimes it looks it can look like a bit of a checkerboard in certain places, even within a city. And so in some cases, you can even have lands that are incorporated within cities that are owned by the federal government. And and as I mentioned previously, there are examples of this. So, you know, under under the Biden administration, the Bureau of Land Management was transferring, you know, bits and pieces of land at very low prices to Clark County in Las Vegas for the purposes of building single family homes for low income households. And those lands were. Are lands that are, you know, quite attractively located within the, you know, within Clark County, around Las Vegas and their lands that were previously a wetland. Many years ago, decades ago. And with the growth of Las Vegas and the draw on local watersheds over time, that is depleted, you know, that particular wetland. And and so it’s you know, it’s it’s dry air, land. It’s not really used for anything now and doesn’t have very much value. And certainly it’s not people don’t go visit it for, you know, for natural purposes in the lake. And so it’s a good example of a piece of land that’s well situated owned by the federal government that can actually be turned into housing. So again, we’re not talking about converting your local favorite park into housing. Rather, we’re thinking about the slices, the bits and pieces of federal lands that are in attractive areas in and that can be developed in in ways that would be a win win for for everybody, for people living there, for people who previously were living in the area for for incomers and for the city as a whole. And in fact, in the in the case of Las Vegas, this is part of a broader ongoing project called the Southern Nevada Public Land Management Act that’s been going on since the late 1990s. And some of the some of the revenue that’s generated through this is actually used for and pumped back into, you know, into Clark County and is used for maintaining other local parks and and, you know, infrastructure and the like.
Krys Boyd [00:24:34] So has that would you call that Clark County project a unqualified success, qualified success?
Michael Albertus [00:24:41] I would call it a pretty unqualified success in many ways. Yeah. I think that and there are other there are of course, there’s a little bit of there’s an issue with the broader proposal, which is that you want to be sure that you’re using the quote unquote, right. Federal lands for this sort of policy because you can have you know, you can you can end up picking plots of land or that are that are not ideal and or that are controversial. You know, maybe that that do that are adjacent to park lands or something like that. And so you have to be careful about about precisely the lands that are being chosen in these in these cases.
Krys Boyd [00:25:24] We’ve started to understand the hazards of building near what is called the wildland urban interface, which is to say, like where cities and undeveloped land spaces meet, you know, wildfires and mudslides and floods and other hazards wrapped up in this. How significant are the efforts to ensure that any new homes built with this kind of federal scheme are not cited in places that are inexpensive but might become disaster areas?
Michael Albertus [00:25:53] Yeah, that’s a great question. And you’re right that there’s an increasing problem in many places with with housing that’s at this wildland urban interface. And not only that, you know, also in coastal areas, you know, coastal parts of Florida and Texas and Louisiana and even the state of Washington, Alaska, places that are that are under threat with rising seas and changing climate and the like. And so it’s you know, the good thing is that there, you know, climate, there’s a lot of climate science. The climate models are pretty good. Of course, there’s a lot of uncertainty the further you project out. And for the first time in in you know, in many states, they are starting insurance markets are starting to actually price in future climate risk in terms of policies. And so you know, when it comes to using federal lands there for housing, of course that would have to be an arrangement between, you know, let’s say the Bureau of Land Management and a local county or local municipality, local jurisdiction for, you know, development plan. And part of that should entail bringing in, you know, the private sector insurance market in terms of thinking about the longer term potential risks in these areas from from climate change, again, whether it’s wildfires, floods or the like.
Krys Boyd [00:27:23] So another big question is how to make sure that new housing is anywhere near jobs or recreation sites or hospitals or schools or anything else. People need to really make a life in a place like you mentioned, Clark County. The rest of Nevada has the highest percentage of federally owned land of any state in the country. But like much of that land looks, we’ll call it, relatively inhospitable as it is now. How easily convertible might most federal lands be for purposes of easing the housing shortage?
Michael Albertus [00:27:56] You could probably write off 90% of federal land right away in terms of whether or not it’s going to be buildable or attractive for new cities and towns. There are, you know, as you mentioned, with Nevada, it’s a great example. A lot of the land there is arid land where there’s going to be very little access to water for a town that would be sustainable and that could sustain a robust growth over time. And and that would be, you know, livable in terms of climate going forward. And that’s true of a lot of federal lands. Not that they’re simply arid, but that there are other issues as well. Some might be. Of course, many are, you know, should be preserved for the purposes of the environment, for biodiversity and the like. And and many federal lands are simply far from other metropolitan areas. And, you know, building a city from scratch in the middle of nowhere could work. But it would take a very long time to do that sort of thing. And it’s not clear how many people are going to move there off the bat because, you know, when starting from scratch and it takes a long time to, you know, to attract business and and the like. And so that’s not a solution and a realistic solution for the housing crisis in the short or even the medium term. What we really should be thinking about is building again, at the peripheries of or even within existing metropolitan areas and and having, you know, certain restrictions for ways in which buildings should happen in those places in order to get the most bang for the buck. So, you know, you want to encourage, you know, a greater number of units per land or per acre in order to to serve more people in a given place. And so there should be some sort of restrictions in terms of land sizes and the like. If you’re talking about single family homes or when it comes to multifamily homes or multifamily units and apartment units, the number of units that might be in there. But again, it really should be done in a in a smart fashion. And we’re really talking about these kind of peripheral areas rather than any federal land anywhere in the West.
Krys Boyd [00:30:21] So my goal, this alternative for opening up land opened by the federal government. I mean, we could do that, but it could be making places available within and just outside urban areas. What sort of supply of federal land exists in or near existing cities and towns in this country?
Michael Albertus [00:30:42] It depends a lot on the particular city or town that you’re talking about. Some of them have very little access to federal land. And so the sort of proposal is off the table for them. But there are others where where there is actually a lot of federal land might be near cities and towns. So, for example, Utah, one study of federal land in Utah found over 200,000 acres of land owned by the U.S. Forest Service and the Bureau of Land Management within existing Utah city boundaries. And, you know, there’s another 600,000 acres of federal land excluding things like national parks and military land that are within one mile of city boundaries. So that’s plenty of land needed to to build the sort of housing that or to accommodate the number of housing starts annually and in the state of Utah.
Krys Boyd [00:31:36] So we don’t need a bulldoze like a post office or something to make this happen. There is land that maybe has nothing on it already.
Michael Albertus [00:31:43] That’s exactly right. Yeah, that’s exactly right. There is land that’s already there that is adjacent to existing private developments and the like that can be incorporated into into housing in there in a smart way.
Krys Boyd [00:31:56] So how could this work? Like, what entities might buy up this land from the federal government with the promise of building homes on it?
Michael Albertus [00:32:03] Right. So it’s not that the federal government is going to be actually building these homes and instead there’s going to be a deal struck in most of these cases with local municipal government, with the local county government or the like, in order to create new housing. And so, you know, that will because of that arrangement, there might not be the same sort of typical permitting process that you might get with with other private developments that have to negotiate with existing neighborhood communities and the like. But we’re talking about arrangements between the federal government and between towns and counties. So another example would be the U.S. Forest Service recently signed a long term lease on an 11 acre site near, you know, some major ski resorts in Summit County, Colorado. And the county is promised to construct rental units for local workers on that land. And and now they can do so relatively easily because they have access to this Forest Service land.
Krys Boyd [00:33:12] Okay. So let’s take an example like that where, you know, you have a ski resort where people with lots of money come in. They don’t necessarily own property there, but the workers are driving sometimes hours a day just to get to and from work. I’m not an expert in real estate. I think the margins are higher if you build things for rich people. What kind of policies need to be put in place to ensure that a developer doesn’t buy cheap land from the federal government and then put up a bunch of expensive ski chalets for people to rent or buy, of course.
Michael Albertus [00:33:43] So, you know, any program or a proposal that’s going to use federal land for the purposes of easing the housing shortage and the housing crisis and increasing affordability of housing in the locale has to come with certain restrictions and certain stipulations for the type of building that can happen. So again, things like density requirements, you can’t build housing, you can’t build houses that each have, you know, 100 acres of land to them, right? So that would not be a very good use of land locally or, you know, a minimum share, for example, of affordable housing units. You know, other guidelines for things like the preservation of, you know, desirable natural spaces nearby. There has to be an infrastructure, regulatory infrastructure that comes with this that has at its heart the goal of easing the housing shortage and the affordability problem. And so that means building sufficient number of units at at a price that is affordable for for for people to actually access.
Krys Boyd [00:34:53] Can you talk for a minute about how affordable housing is defined? I mean, what I can afford is different from what my 26 year old daughter can afford. I mean, like, how exactly is affordable housing classified as such?
Michael Albertus [00:35:08] Right. It is inherently relative. But when you think about the, you know, median house prices relative to median income that has grown, that ratio has grown substantially really quite a lot in recent years. So that now housing as a as a percentage of people’s monthly expenses is it’s really quite, quite high and it’s it’s much higher than it has been in any recent memory. And so that’s, I think the key way to think about affordability is, you know, what share of your monthly paycheck is, is housing taking up?
Krys Boyd [00:35:53] It is pretty stunning that we find ourselves in this place of having a housing shortage, given how much forget about federal and just land exists in this country. If you compare us to many other parts of the world, people live much closer together. But there is there are homes for everyone.
Michael Albertus [00:36:11] That’s exactly right. The United States in many ways is a relatively sparsely populated country. Obviously, there are sparser ones, if you think about Australia or Canada or the like, but almost everywhere in Europe is far more sparsely or far more densely populated than the United States. So there’s no shortage, inherent shortage of land per say. There’s this question instead about what land can be used for building and how long does it take to build on that land. And, you know, in the last number of decades, there has been an increase in zoning restrictions, permitting, permitting holdups that make it very difficult to build on the abundant land that there already is. And so the question is, you know, how do we how do we build against that backdrop? And it’s difficult to change those zoning restrictions and permitting processes that can happen and should be part of the solution. But it’s an inherently political issue that oftentimes will take, you know, many, many years to resolve or to even make much progress on. And so in the meantime, we have to think about ways to at least in part, circumvent some of those issues in order to use, again, the access to the relatively large territories of land that we have.
Krys Boyd [00:37:35] So let’s say federal land is opened up in lots of places for developers to come in, and these developers follow the guidelines and, you know, put enough units on a certain quantity of land, that sort of thing. Do you imagine residents would have to somehow qualify to buy or rent any new housing built, or would this be like available to anyone who is interested?
Michael Albertus [00:37:57] It would depend on the arrangement. I think, generally speaking, it would be available to anyone who’s interested. There might be certain there might be certain circumstances where there is an abiding interest in offering those units to a certain set of people. Take, for example, again this these implied right previously about the building, you know, in next to these ski resorts in Colorado in order to accommodate local workers. So in an example like that, the whole point is to accommodate local workers who are working at these these mountains in these ski resorts. And so opening it up to anyone would undermine that whole point of building there. But in most cases, we’re talking about changing housing market. It’s, you know, regional housing markets writ large, which means supply and demand. And so by increasing supply, we’re going to we’re going to make it easier for most people to afford housing, not only in those new areas that are being built, but also more broadly in those regional housing markets.
Krys Boyd [00:39:04] Do you think we need something like a culture change in this country, Michael? I mean, people have all different kinds of homes, multifamily housing and attached housing. But but like the American dream, whether people achieve it or not, seems to be living in a house that exists on its own plot of land isn’t attached to anything else. This is not necessarily the dream in a lot of other parts of the world. But but it is very much built into the fabric of how we think about success in this country.
Michael Albertus [00:39:33] That’s right. And you’re right in saying that that really is part of their traditional conception of the American dream as the single family home. And as you mentioned before, there’s enough land, that’s for sure, and for for everyone to have a single family home. So it’s a question of how to make land available. And and like but I will say that there is also an ongoing kind of cultural shift amongst younger generations who may not want that single family home anymore. Maybe they want to live in an urban area. And and that means, you know, writing off the possibility of a single family home instead having a, you know, a condo or townhome or detached townhome or something like that. And so so I do think that there is an ongoing cultural shift. You know, not all of that necessarily is by desire. Some of it is as a result of, you know, where jobs are located and the like. But but there is also, I think, a changing, changing culture amongst the young in terms of what they prioritize and where they want to live. So I think that, you know, using, again, whether it’s using federal land for housing or building more generally should take into account the fact that preferences differ a lot amongst people in different places. If you’re building on the outskirts of a municipality and in Utah, it could be that a lot of people want single family homes there. If you’re thinking about using a piece of land in downtown Las Vegas, you know, maybe single family housing is not the way to go.
Krys Boyd [00:41:13] Would these kinds of land use transfers or sales from the federal government to contractors and the construction that might take place have a direct cost to, like local existing taxpayers and their governments?
Michael Albertus [00:41:27] Not necessarily. It depends on how the arrangements are struck. And in fact, there can be positive consequences of these arrangements, too, for people for people who are already living in a locale, because, again, you can use some of the revenues in terms of property taxes and the like for broader initiatives and, you know, and demands of the of the local community. So it depends on how how these arrangements are set up in any given in any given locale.
Krys Boyd [00:42:04] And to the extent that the shortage of housing that we’ve all been living through has driven home prices up and up in recent years, how might addressing that shortage affect the selling value of existing housing?
Michael Albertus [00:42:17] Well, it’s hard to imagine that whether a proposal like this or any other proposal or a set of proposals together is going to actually bring down housing prices in the short or or medium term in the extremely long term. It’s you know, it’s I would probably anticipate more of a moderation of housing prices or a moderation in the rise of of housing prices over time rather than actually bringing prices down. Keep in mind that the shortage of housing units, by some estimates is 4.5 million units or something like that right now. And it’s just it’s a very large shortage that won’t be that won’t be filled over overnight or within the course of one year or probably even five years. And so that means that prices are going to the you know, the demand picture is going to outstrip the supply picture in the short term for sure, which is going to increase prices overall or at least keep pressure on high prices. Only when there starts to be, you know, when that shortage is entirely filled, could we see housing prices really starting to plateau. And then given the fact that populations are growing, like it’s hard to see that a proposal like this is actually going to overshoot and generate surplus housing and in such a way that would cause a housing crisis in the opposite direction of, you know, a reduction in prices that we saw like we saw at the at the outset of the financial crisis and in 2008. So I don’t see this I don’t see this really bursting the bubble of housing prices in that in the shorter the medium term. But but it hopefully it will be part of a facilitating or enabling greater housing affordability over the long haul for a greater portion of Americans.
Krys Boyd [00:44:15] Greater housing ability due to, you know, opening up federal lands for housing construction seems like a good idea. We’ve mentioned it has bipartisan support. What might get in the way of actually doing this?
Michael Albertus [00:44:29] A lot of things, you know, like many things. And with the. Federal government. There can be all sorts of problems. There are there are problems with the you know, with identifying the right pieces of land to apply this policy to. And inevitably, there’s going to be pushed back by some people who are attached to certain areas, even if there are people living on those areas. There is also the practical issue of creating arrangements between the federal government and, you know, municipalities, counties and the like. That’s something that that takes time.
Krys Boyd [00:45:07] Michael Albertus is professor of political science at the University of Chicago. His article for Bloomberg is titled “The U.S. Government is Sitting on a Possible Solution to the Housing Crisis.” Michael, thanks so much for the conversation.
Michael Albertus [00:45:19] Thanks for having me on the show.
Krys Boyd [00:45:21] Think is distributed by PRX, the Public Radio Exchange. Again, I’m Krys Boyd. Thanks for listening. Have a great day.
