Americans are struggling to afford a place to live. Homes cost more than five times the average salary—compared with just three times the average salary in the 1960s. Over the same period, inflation-adjusted rental prices have risen by 64%, far outpacing inflation. Meanwhile, new housing starts continue to fall, including a more than 20% drop in multi-family construction in November 2024 alone. The simple fact is that we’re not building enough affordable housing—homes at prices families can really afford.
And if the housing market is straining the finances of many families now, just imagine what the market will look like as surging ranks of Gen Z buyers enter the market. Countless dedicated teachers, nurses, and carpenters are already unable to live in the communities where they work; how much farther are they supposed to commute?
Housing insecurity in the U.S. is obviously a long-developing and complex problem, and there’s no magic policy wand we can wave to eliminate it. But as a starting point, three major contributing factors can be addressed right now to ease the pressure on home prices. If we’re serious about affordable housing, it’s time to have serious conversations about these three priorities.
Let Gen Z help ease the skilled trades labor shortage
Housing affordability is often discussed as a matter of supply and demand: All we need to do is build more houses. But what if the houses we’re building are still too expensive for many buyers? After all, developers have to cover their costs. And those costs are currently being inflated by a significant labor shortage in the skilled trades—a problem of our own making.
For years, parents and career counselors have been telling young people that a college degree is essential for a successful life, and they’ve been listening. This meant that as builders, electricians, and masons retired, there just weren’t enough millennial and Gen X aspirants to take their place. In fact, 95% of skilled trade professionals on the Thumbtack platform report their top concern for the future is the ability to find workers to hire. But now we have an opportunity to reverse that trend.
A recent survey from my company found that a full two-thirds of Gen Z generation—including 78% of those with a college degree—express a growing interest in skilled trades professions, fueled in part by social media content. More than half of Gen Z are now considering a skilled trade career, up 12% over the past year alone, including 72% of those with a college degree.
Unfortunately, this appetite to learn trade-related skills is not matched by the opportunities available. Only 41% of Gen Z had access to trade programs in school—though 83% of those who did take shop class called it their favorite subject. That’s why comprehensive policy to address this issue has to include expanding the talent pipeline for Gen Z skilled tradespeople. Beyond restoring shop class, we need to build training, mentoring, and apprenticeship programs that prepare young people to enter the field ready to do quality work from day one.
Loosen restrictions on housing development
Exclusionary, single-unit zoning policies are the definition of NIMBY: “This part of town is for families with quarter-acre lots—let other families find somewhere else to live.” As the population grows, that “somewhere else” is getting further and further away from established communities and their infrastructure, while the prices of existing homes spiral. In fact, young adults who grew up in these spacious suburban spreads can rarely afford them by the time they enter the market.
Nobody is saying we should outlaw picket-fence bungalows and ranch homes, but if there’s land and capital available nearby to build affordable multi-unit housing, why should local governments impose barriers? States across the U.S. are already moving in this direction, from Oregon and California to North Carolina and Connecticut. And some cities are also stepping in to build affordable housing.
For that matter, why are towns and counties even allowed to determine what people are allowed to build on their land? Restrictions on industrial uses are understandable, but when it comes to residential housing, the market should decide what goes where—and the market is calling for affordable apartments and townhouses wherever there’s room to build them.
Take highways out of the equation
The housing shortage is most acute in our urban centers, where young people want to live and companies want to hire. There’s only so much we can do with infill development—though we should be doing all we can there, too. The greater opportunity is to help people access these places more easily while living further out—without soul-crushing gridlock.
A century ago, the first wave of suburbanization was enabled by the rise of widespread car ownership and a massive investment in roads to carry them. As commute times grow and daily drives slow to a crawl, we need to shift focus to transit-oriented development (TOD) policies. In many cases, that infrastructure already exists in the form of light rail. To make those investments work harder for homebuyers, we should rezone areas near transit stations for higher residential density, complemented with expanded park-and-ride lots and development incentives for affordable housing.
The Federal Transit Administration offers grants under a TOD pilot program to support community efforts to improve access to public transportation. In 2024, applications with a significant affordable housing component were eligible for up to 100% federal support. That kind of vision and commitment—on the part of both regulators and the communities participating in the program—will be essential to solve this crisis.
Housing is one of the most fundamental human needs—and America is falling short of ensuring that our families can achieve it. By taking practical steps to lower construction costs, make more land available for multi-unit development, and expand the inventory of transit-friendly homes, we can ease the pressure on home prices and help more Americans afford a secure foundation for their families.
