The Broken Housing Market of California: A Cautionary Tale for the Rest of the Country

The housing market in California broke in the 1970s, and the effects of that fracture are still being felt today. With a housing crisis threatening to spread across the country, California’s extreme housing market has become a symbol of the challenges facing many states. The state needs to build 180,000 homes per year to keep up with population growth, but has been falling short, averaging less than 80,000 homes a year over the last decade.

The roots of California’s housing crisis can be traced back to the 1970s, when a shift in the American mindset occurred, valuing homes more as financial assets than places to live. Policies put in place by politicians like Richard Nixon and Ronald Reagan, along with environmental and slow-growth movements, contributed to the current state of the housing market in California.

The consequences of California’s housing crisis are severe, with a large homeless population, high rent burdens, and soaring home prices. Other states are now facing similar challenges, with some moving to curb local control over land-use to avoid California’s fate. However, fixing the housing crisis will require more than just zoning changes; it will require a comprehensive approach to address the underlying issues.

As the housing crisis continues to impact California and other states, the question remains whether this is a temporary phenomenon or a structural change. The cost of California’s housing suppression is not just economic but also moral, highlighting the need for solutions that prioritize affordable housing for all residents.