Kelly to Washington Post: It’s All About Bad Land-Use Policy

In a Nov. 3 letter to the editor, NAHB Chairman Kevin Kelly put the proper perspective on an Oct. 28 blog post in the Washington Post that examines the relationship between housing prices and political leanings.

“Restrictive land-use policies ultimately hurt U.S. households,” he said in the letter, part of NAHB’s continued push to highlight this important message to policymakers.

The Post piece notes the correlation between areas of the country that are more politically liberal and the cost of housing in those markets. “Liberal areas tend to have more land-use restrictions and other regulatory burdens that affect the cost of constructing housing,” Kelly said.

“Regulatory burdens are key components that determine costs for rental and owner-occupied housing,” he continued, pointing to NAHB analysis showing that “25% of the cost of newly built single-family houses is a combination of federal and local building and land regulations.

“Thus, the reason that homeownership is lower in larger metro areas and home prices run higher is that these areas tend to have more costly regulations and scarcer building opportunities, resulting in a restricted housing supply in the face of strong demand.

“Important policies such as the mortgage-interest deduction and low-income housing tax credit are vital to support homeownership and affordable rental housing, especially in high-cost areas,” the letter said. “olicymakers from both sides of the political aisle can act to improve nationwide housing affordability by protecting existing programs and reducing regulatory barriers.”

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