The Year in Housing Policy: 2024

It’s the time of year to reflect back on the past 12 months. In housing policy, two items stood out nationally among the many other stories of 2024, while there are some signs of progress in certain locales.

The largest national story was the Supreme Court’s Grants Pass decision. The Court settled the question of whether homelessness itself is a crime (it’s not), but offered no solutions on how to fix the problem of people living in improvised shelters in public or private spaces. Policymakers can learn from many of the spontaneous and improvised arrangements by people unwilling to move to shelters with requirements they find unacceptable. The Grants Pass decision will force local governments to consider less conventional solutions like congregate shelters to address homeless encampments. 

The second big story has to be the Federal Trade Commission’s efforts to prosecute housing providers who so much as look at rental data on software applications downloaded from the internet. This was the worst housing policy decision of the year. It is a waste of time and truly doesn’t meet the standards set when the agency was created to protect consumers and promote competition. The solution to rising rents isn’t punishing people who operate housing from gathering available data, but allowing the construction of more housing of all kinds everywhere for people of all levels of income. Gathering housing and rental data isn’t evidence of “price fixing,” as critics allege. These data help developers, builders, and providers to create more competitive pricing, not keep prices high. 

Thinking about the path forward

I revisited two common methods for building housing in 2024: community land trusts and using Low Income Housing Tax Credits (LIHTC). I’ve pointed out the economic advantages of community land trusts, which build housing on community-owned land and limit resale prices to keep units affordable. But there are also political advantages to the model: elected officials often resist making big changes to land and zoning policies but prefer policies to control prices, especially rents. Community land trusts can set limits on resale without creating disincentives to build, making them attractive to politicians who want to show that they’re intervening in the markets. 

As for LIHTC, developers talk about the many sources of funding that go into their projects as if they are a good thing. But any project—whether LIHTC or a regular market-rate endeavor—will be more expensive to produce with more sources of capital. As projects that depend on federal funds seek to leverage tax credits, they often mix many different sources of funding, each with strings attached. Reforming and simplifying these complex transactions is essential to make housing less expensive and more plentiful. 

Finally, the attempts to enshrine a right to housing through established codified “tenants’ rights” in federal, state, and local laws won’t lower rents. Only creating more housing can do that. Unfortunately, 2024 saw a continued push for slanting contracts between tenants and housing providers toward the tenant. While this might be good politics, it increases risks for people trying to finance, build, and operate housing that ultimately results in higher prices, the exact opposite effect of what advocates say they want. 

Most of the typical themes in housing policy stayed the same in 2024. Will things change next year with a new administration? That depends as much on the economy as what the federal government does. Since most land use and housing decisions are made at the local level, federal policy changes are likely to be insufficient to reduce local prices. But thoughtful efficiency efforts at the federal level could change that with cuts in subsidies and different incentives.