Worsening Affordable Housing Crisis

The U.S. currently faces a substantial housing deficit of somewhere between four to seven million homes. Escalating costs, increasing interest rates, and construction delays and setbacks have slowed the production of new homes entering the market. Further, the nation has a shortage of 7.3 million rental homes affordable to those with extremely low incomes. Additionally, nearly 30 percent of American households consist of single individuals, a record high, which adds further pressure on the housing market. In urban areas, however, housing availability has slightly increased due to population decline.

Factors such as inflation, high interest rates, and the affordable housing shortage have put the "American Dream" of owning a home out of reach for many people, as homeownership is now almost 50 percent more expensive than renting. According to research by Zillow, in 2024, households needed to earn $47,000 more than in 2020 to afford a single-family home, with 2023 being the least affordable home-buying year in over a decade. Almost a third of Gen Z lives with their parents — the highest percentage in the past century — due to declining housing affordability, higher unemployment rates, and delays in marrying and starting families. Creating and preserving "starter homes" currently in short supply can help the younger generation gain independence at earlier ages.

But it's not just the younger generations that need affordable housing options. Research indicates that the U.S. is largely unprepared to meet the housing needs of more than 58 million people aged 65 and over, especially the fastest-growing group of those over 80, who are more likely to require accessible housing, services, and in-home support. Nearly 11.2 million older adults were cost-burdened in 2021, reaching an all-time high. Many baby boomers continue to hold onto large homes due to the lack of suitable housing options, further limiting availability for younger generations. Planners must work to support efforts to provide all residents with affordable housing options.