I was 4 years old the first time we lost a home. It was the first of many times, and not everyone in my family survived that lifetime of housing insecurity. I’ve always told myself my work as an affordable housing developer is for the next kid. I’m proud of the work I have done with nonprofits and government to create affordable housing, and I know each home means the world to the people in it. But as we watch the rising floodwaters of our housing and homelessness crisis, I can’t help feeling the futility of bailing water against the tide.
What I really wanted to know when I started this work is how we create enough homes for everyone—and why we haven’t. I wrote Bittersweet Lane: Creating Home(s) in the American Affordable Housing Crisis to explore those questions and to help the public understand what affordable housing is, how it works, and what is necessary to fix this crisis. And what I found in researching the book is that our system has never sought to house everyone. Quite the opposite. We have married the puritan obsession with separating the worthy from the unworthy and the neoliberal drive to profit from restricting access to the necessities of life.
What fixes homelessness? Homes. What would solve our housing crisis? Housing.
We should not forget that it is, at its core, truly that simple. In 2022’s Homelessness is a Housing Problem, Gregg Colburn and Clayton Page Aldern demonstrated conclusively that the variance in rates of homelessness among cities cannot be explained by “disproportionate levels of drug use, mental illness, poverty … weather, local political climate, the mobility of low-income households, or the generosity of local welfare.” Their analysis found only two credible measures that explain levels of homelessness: rents and vacancy rates. That should have been the end of the argument, and yet…
I don’t know about your city, but the city where Gregg Colburn and I both live has spent the last few years turning its back on Housing First strategies, falling back to blaming individual choices and pursuing carceral solutions. Precipitating events like divorce, illness, unemployment, addiction, or injury may lead to an individual’s homelessness, yes sure, but only in situations where the rent is too damn high and homes are too scarce.
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Our country does not have enough homes for the people and places that need them. Our housing crisis is not an unsolvable, abstract problem. There are physical realities at play, literal bricks and mortar.
How do we get more homes in the places we need them at prices that people can afford? What is absolutely, unavoidably necessary to achieve housing for all?
At the most basic level, creating new homes requires a place to build, permissions to build there, and the resources to direct labor and materials. There are many tactics available toward those ends but allowing homes to be built and paying for them are absolute, unavoidable necessities for solving our housing crisis.
The price of accomplishing all that is the real floor for how cheaply a new home can be produced. There is no innovation or magic technology that can reduce the cost of creating a home to zero. Your 3D-printed nano drone swarms will still be made from materials, still require energy, and still require designing. Homes cost something, and there will always be people who cannot afford that something.
That’s the inherent market failure in housing: At any given time, a large portion of us cannot express our need for a home as economic demand for a home. The market does not even see us.
I’m not advocating market-based solutions. I’m saying that if we don’t create solutions to the market’s failure, then we are failing.
Housing development is a servant of two rents, but a third there is that matters the most. To illustrate housing’s core market failure, let’s examine these functional rent levels:
First, there’s what I call the construction rent, the rent level (or sales price) that allows developers to create homes by functionally covering the costs of acquisition, predevelopment, construction, and any payments to lenders and investors. For example, if a local market can develop new homes at a cost of $3.50 a square foot, it means a household must bring in $105,000 per year to afford a two-bedroom apartment at $2,300 per month. About half of the households in my metropolitan area can afford that rent. The development market doesn’t even notice the other half. Their need for a place to live, their “shelter demand,” does not translate into economic demand for new development. Instead, they must compete with other potential residents for whatever homes currently exist, a cruel game of musical chairs where the losers end up displaced or homeless. To create homes for people who need them but cannot afford the Construction Rent, we must somehow close the gap between what it costs to develop and how much people can afford with fully funded vouchers and capital subsidies.
It is possible for public policy to lower (or raise) the construction rent, thus leading the market to serve more (or fewer) people in need of homes. Local and state governments can change requirements for parking, land use, design, procurement, design review, labor, impact fees, environmental methods, construction materials, accessibility, and so forth in ways that reduce (or increase) costs. Even so, our ability to lower the Construction Rent is limited. Experts must be paid to design a building, engineer a safe structure, lay a foundation, frame it, wire it, complete its plumbing, source and transport materials, and complete each of the hundreds of other complex tasks that go into creating new homes. The cost of doing so creates a lower bound on how cheaply private market developers can offer new homes. To serve households who cannot afford the Construction Rent requires subsidies.
Secondly, there’s what I call the operations rent, which is the rent level that allows a solid operations budget to cover water, sewer, taxes, insurance, maintenance, garbage removal, cleaning, landscaping, snow removal, management, resident services, mortgage payments, and so on. For example, in Seattle in 2025 an apartment building needs about $750 per unit per month to cover its bills, which is a rent theoretically affordable to someone earning $30,000 per year ($15/hour working full time). To serve households that make less than that requires an operating subsidy.
[RELATED ARTICLE: Why We Must Fight for Housing First]
Construction rent and operations rent are conceptual tools to help us understand why current programs and policies are not solving our housing crisis. But as you know, they are not actually how we currently think about rents. The affordable housing world instead focuses on programs and percentages of AMI (area median income) because those are how government agencies define which people are worthy of help.
We put more time, effort, and creativity into our massive compliance edifice than we do into ending homelessness. From the Puritans to the present, our governments have prioritized their obsession with separating the worthy from the unworthy. Yes, it is important to audit for the legal use of public funds. Yes, unfortunately, it is necessary for us to triage while our leaders continue to egregiously underfund housing. However, we have spent centuries studying, defining, redefining, and monitoring who is the worthy poor and who is not, rather than simply helping people who need help. When it comes to the necessities of life, we should aspire to make help available to all. It could be a universal housing voucher, a universal basic income, a plentiful supply of social housing, or all the above and more.
Well-meaning professionals do what good we can within the system we have, but a system premised on defining who is deserving will always include a group who is not. Our system assumes homelessness. Maybe that isn’t obvious if you’ve never had to ask the system for help. It’s reality to millions of us.
And public policy aside, that third rent is the only rent that matters to you, to me, or to anyone else—the rent your household can actually afford. When we cannot think beyond this game as it exists, we do no favors to overwhelmed people navigating this byzantine morass to apply for help during hard times. We need to get real.
Our housing shortage is a centuries-old, multibillion-dollar problem. Yet I stay optimistic because I must. I nourish my optimism knowing it is possible to fix this. There are well-understood physical realities at play. What does it take to create homes? A place, permissions, and the resources to direct labor and materials.
It is within our control as a nation to allow new homes to be created, wherever they are needed. It is within our control as a nation to subsidize and build affordable housing to correct for housing’s inherent market failure. Rental subsidies can transform shelter demand into economic demand that owners/developers can use to create and maintain homes. Every person in the U.S. can have a home. If we decide to align our laws and our budgets with our humanity, we can solve our nation’s housing crisis.
The money is there. The U.S. currently spends four times more on housing benefits for the wealthy than the poor; the home mortgage interest deduction is a larger program than Housing Choice Vouchers, and its benefits accrue almost entirely to the richest fifth of Americans. Even during the Democratic Biden–Harris administration, we spent twice as much money on Trump’s Space Force as we did on public housing. Over a decade or so, for fewer dollars per year than we spend on research for orbital weapons systems, we could build enough of the right types of homes, in the right places, to meet our tremendous need for housing today and for our children tomorrow.
We actually do know how to address this crisis, after all.
Let’s fix this shit.
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What resonated for me in this piece is the question of who housing is actually designed to serve when conditions change.
Much of what we call “affordable housing” is built on a financial structure that requires planned rent escalation to satisfy outside investors, syndicators, lenders, and layers of legal complexity. That isn’t incidental—it’s foundational. Housing that must get more expensive over time to work financially cannot be truly affordable in a durable sense.
Investment inherently carries risk. But in economic downturns, residents absorb the shock first—not investors. Debt service and investor claims are senior; people are the flexible variable. Even in publicly subsidized housing, the capital stack is protected before households are.
That’s the structural flaw.
If we want long-term affordability and stability, we should be asking why housing depends so heavily on absentee investors, rather than designing models where people are the primary investors in their own housing. Resident-controlled and shared-equity models don’t require perpetual rent escalation because they aren’t built to extract returns from the people who live there.
Housing behaves differently when it’s treated as infrastructure for human stability rather than as an asset class. Until that priority shifts, affordability will remain conditional—and homelessness a predictable outcome.
Carol’s comments are right on. I live in a brand new 100% “affordable” housing development for seniors built by our local housing authority. They have cornered the market on developing affordable housing for low-income people in our wealthy city, so they have a well oiled approach to how to get it done over and over again. I don’t pretend to understand the complexities, but I do know it relies heavily on LIHTCs that are generously provided by our state, and a capital stack of local investors like our regional bank as well as their preferred contractors and construction partners. The city also provides significant funding because it’s such an easy way to meet their housing targets. — 15% affordable housing units by 2030, and they are averse to change.
The problem, as Carol points out, is that the housing is not really affordable for most low-income people, and the rents increase annually depending on some combination of AMI and resident’s income which still doesn’t make it affordable since, in the case of my property, it outstrips our Social Security cost of living increases or whatever wages we make. As a Housing Choice Voucher holder, I am fortunate (so far) in that the percentage of total rent I pay stays the same. But what happens if the Fed Gov simply refused to fund the vouchers through HUD anymore out of spite. Could easily happen, especially if the government shuts down again, and they decide to take aim at blue states.
I have recommended to city council and other organizations that we pivot to shared equity housing. To start with, the city could provide some plots of land for a couple of pilot projects and hire an experienced nonprofit to construct and steward the projects. But there is zero interest in doing anything outside the status quo because that’s what works for them. The housing authority would roll their eyes because they just want to keep developing housing and they like their model. The thing is, they are well aware that they really need to start building housing for even lower income folks, like 30% AMI and below, who don’t have housing vouchers, but I don’t think they have the first clue how to do that and actually make and keep it affordable. Does anyone know of any housing authorities that build shared equity housing or other types of social housing not dependent on the federal government? I love the Social Housing Authority created by Seattle’s HON nonprofit, but how can that be scaled to smaller cities?