No State Immune to Housing Supply Shortage

A new report on housing underproduction from Up for Growth, sponsored by APA, tells the story of a worsening housing affordability and availability crisis affecting communities nationwide. This year's report found that housing underproduction is spreading geographically — and small towns and suburban communities are not exempt.

Housing Underproduction Worsens, Hits BIPOC Renters

Housing production is chronically behind demand as a result of decades of exclusionary housing policy, demographic shifts, and an enormous economic recession. As of 2021, the national housing underproduction number is 3.9 million, a 3 percent increase over 2019 underproduction levels. Between 2019 and 2021, the number of counties experiencing underproduction in the United States increased by nearly one-third. Additionally, there were 193 metro areas experiencing housing underproduction in 2021 and 85 percent of all markets are worsening.

This new data provides fresh evidence for the need to prioritize action on housing across all levels of government, highlighting the critical role community planners can play in finding solutions.

Unsurprisingly, the report draws attention to the spike in cost-burdened renter households, now 21.6 million strong, a new record-high for renters in the U.S. BIPOC renters are disproportionately impacted by this trend. Approximately 53 percent of BIPOC renter households will be burdened in 2021.

This map from details housing underproduction levels across all states, according to Up for Growth’s 2023 Housing Underproduction Report.

This map details housing underproduction levels across all states, according to Up for Growth's 2023 Housing Underproduction Report.

Rural Housing Challenges Surge Amid Shifts

With the rise in remote work, Americans left high-cost cities for lower-cost areas, relocating to suburbs, small towns, and rural communities. This shift, the largest since post-World War II, made keeping pace with demand for housing options in these places even more challenging than it already was pre-pandemic.

According to the APA-sponsored Up for Growth report, "between 2019 and 2021, a massive new household formation and shifting demand for lower-cost suburbs led to an 11 percent spike in the housing deficit of non-urban America."

With more individuals moving further into the suburbs, the demand for diverse housing options is reaching new highs. According to the APA-sponsored Up for Growth report, housing unproduction increased by 47.8 percent in small towns, a problem not unfamiliar to cities. The increase in demand in these places adds strain to already fragile capital structures and builds up pressure against restrictive barriers. Adding to these pressures in smaller communities, the report finds, is inadequate infrastructure for development, limiting the potential for creating new housing options.

Likewise, rural communities are facing new and distinct housing challenges in the aftermath of the pandemic.

APA President Angela D. Brooks, FAICP, sat down with Montana Governor Greg Gianforte at the 2023 Housing Underproduction Report release in Washington, D.C., to discuss the housing crisis and what it looks like for smaller towns and regions across the state.

In Wolf Point, Montana, a rural, tribal community located in the northeastern corner of the state, residents face median home prices as high as $300,000. With existing housing options falling into disrepair and new housing options out of reach for long-time residents aging in communities on fixed incomes, current and prospective residents, like traveling nurses and teachers, find themselves without options that meet their evolving needs. In the last year, Governor Gianforte and state legislators rallied together to address the housing supply shortage in Montana.

During the fireside chat at the report release event in October, Governor Gianforte pointed to planners as key partners in implementing land-use changes.

"We also moved local design review from volunteer boards to employees — the professional planners that are on staff — so we have a little less of the NIMBY and a little more YIMBY for building," said Governor Gianforte.
APA President Angela Brooks, FAICP, speaks with Montana Governor Greg Gianforte about state-level legislative solutions to housing, supported by planners, in Montana.

APA President Angela D. Brooks, FAICP, speaks with Montana Governor Greg Gianforte about state-level legislative solutions to housing, supported by planners, in Montana.

Service Workers Struggle With Housing Accessibility

Quality housing options affordable to people working as manufacturers, teachers, and in other public service roles are especially hard to come by in smaller towns, according to the 2023 report. McDowell County, a rural area in West Virginia's Appalachian country, is experiencing ongoing teacher vacancies in their schools due to a critical lack of modern housing in the county, and as a result, students are suffering.

Teachers in Montana are also feeling the pinch. According to Governor Gianforte, there is no place in rural Montana for teachers, nurses, and service workers to live. Elsewhere in the Pocono Mountain area located between New York City and Philadelphia, service workers supporting the tourism and recreation opportunities have been shut out of the local housing market by soaring real estate prices, a growing population, and a lack of attainable housing choices.

Central Ohio is also struggling to keep up with increasing housing demand stemming from economic growth in the region. A housing needs assessment found that Central Ohio needs to double its current 8,000 annual housing production to meet current and future needs.

Outdated zoning rules — paired with well-organized pushback to diverse housing options — are one of the major barriers to workforce housing. While projections are grim, there's still hope. Communities nationwide, and the planners who support them, are leading progress on reforms. Many cities are working to change their zoning rules to eliminate parking minimums construct accessory dwelling units, and promote mixed-use developments among other solutions.

From Walla Walla, Washington, to Oxford, Mississippi, communities are finding ways to boost housing supply options across income levels through zoning reform, creating space for critical service workers in the local housing market.

In Georgia, APA planning leaders spoke with Axios earlier this year about actions state and local leaders can take to provide more and better workforce housing options to support new jobs and growth.

Planners Advocate for Zoning Reform Action

There is a way out of this crisis, and planners, working together with elected leaders, are part of the solution.

At the state level, planners are working with legislators and governors to identify pathways forward. Montana is one example of a state passing groundbreaking legislation with planners' support. But the trend is spreading to blue and red states alike.

Action cannot stop with the states. Planners are calling on Congress to provide federal support on zoning reform through investment in housing planning assistance to expand planners' capacity to address our toughest housing challenges.

APA strongly endorses the Pathways to Removing Obstacles to Housing (Pro-Housing Grants) program and the Housing Supply and Affordability Act. Both items were shaped by APA. The first round of PRO-Housing grants is currently available with applications due on October 30.

Congress can and must do more to empower planners to do what they do best: use their understanding of community impact, expertise, and data-driven process to increase housing production and choice.

Emily Pasi is APA's senior public affairs manager. Sophia Flionis is APA's public affairs consultant.

October 13, 2023

By Emily Pasi, Sophia Flionis