Housing costs are rising faster than monthly income. It’s putting financial stress on various families explains Maxwell Drever. If you go by 2022 reports, nearly half of the households spend 30% of their income on paying rent. Looking at housing department reports, you will clearly define cost-burdened homes. While affordability has become a long-drawn problem for renters, middle-class families face challenges getting a residential unit in the job market.
The recent research
If you go by research findings, you will see that children growing up in high-level communities get better economic outcomes when they grow up. Neighborhoods and cities with good schools and labor markets are always in high demand. Hence, new housing and buildings also contribute to this arena. However, most families falling within the median income of 60 to 120% cannot afford the expensive and luxurious apartments in the metropolitan areas. As a result, governments must invest their money and time in reducing the gap between demand and supply of affordable housing units.
The role of zoning reform
Remember that it is a high opportunity area. The western world must build more houses, which are less expensive and more affordable. To accomplish this, local governments have to reduce the regulatory barriers, limiting the cost of construction with minor homes but well-equipped dwellings.
Look at land value
When governments remove barriers to developing residential units, the rent of the houses goes down. The transition will happen faster and equitably. If the efforts are in the right direction, the government will not only procure high taxes but also resolve this issue of eviction. The taxing concept on land is not a new one.
It dates back to the early 19th century. Property tax on land and other structures needs to encourage individuals to build new estates and make judicious use of their resources, deciphers Maxwell Drever. Along with this, a few other points require consideration:
- Property value increases with up zoning. It creates a gain situation for property owners.
- Up zoning also encourages property owners to delay the development because they wait for the opportunity of building denser and larger buildings.
- Proper property assessment is necessary so that the government can impose related taxes to ensure that the construction is not expensive.
Building small housing will bring down the housing cost. However, only expanding the market-rate housing supply will not do the job. Spending a high percentage of income on housing costs for the workforce population is not feasible. As a result, Maxwell Drever says basic quality apartments need to be built by the government to help low-income families.
Affordable housing is a remarkable concept that needs evaluation to witness miraculous changes. When federal governments come up with financial grants and subsidies, it expands the availability of housing units. By implementing land-use policies and land value tax, massive changes can occur. Only implementation and regular monitoring of these areas is the need of the hour. Without adequate efforts, it will remain a dream.