Challenges We Faced in 2021: Housing Affordability
Housing affordability has been an ongoing concern surrounding the home building industry, as factors such as lot and labor shortages continue to impact housing prices. The issue was compounded in 2021 by skyrocketing material prices, which had far-reaching effects on multiple aspects of the building industry, including affordable housing through organizations such as Habitat for Humanity and teaching materials for much needed skill labor courses.
Lumber price spikes sidelined buyers during a period of high demand, and forced builders to put projects on hold at a time when home inventories were already at a record low. Record-low mortgage rates helped to offset some of the rising costs at the beginning of the year, but many home buyers continued to be priced out of the market. NAHB research also noted a greater disparity for housing affordability challenges among minority households.
NAHB closely monitored the administration’s response to these housing issues, while actively engaging in dialogue and challenging inefficient efforts around the factors contributing to a lack of housing affordability:
- NAHB Senior Officers Bring a Housing Agenda to Capitol Hill (April 15, 2021)
- Bringing Housing Home: Rising Lumber Prices Tops the Agenda (April 21, 2021)
- NAHB Continues to Engage the Administration, Congress on Lumber (April 30, 2021)
- Move to Double Lumber Tariffs Shows White House Does Not Care About Housing Affordability (May 22, 2021)
- Real Estate Industry Unified Against White House Tax Proposals (May 24, 2021)
- NAHB Tells HUD to Prioritize Housing Affordability (June 24, 2021)
- NAHB Chairman Urges Congress to Boost Lumber Production from Federal Lands (June 29, 2021)
- NAHB Urges Congress to Enact Policies to Help Builders Boost Housing Production (July 14, 2021)
- Action on Supply Chain Bottlenecks, Tariffs Needed to Boost Housing Affordability (Oct. 20, 2021)
- NAHB Joins With Key Lawmakers to Stand Up for Housing (Oct. 20, 2021)
- NAHB Leaders Discuss Lumber Tariffs with Canadian Officials (Dec. 6, 2021)
- GOP Lawmakers Hear Firsthand Account on How Supply-Chain Woes Delay Home Construction (Dec. 9, 2021)
Housing affordability has remained steady over the course of these efforts: According to the NAHB/Wells Fargo Housing Opportunity Index (HOI), 56.6% of new and existing homes sold during the second and third quarter of 2021 were affordable to families earning the U.S. median income of $79,900. However, it’s still the lowest affordability level since the beginning of the revised series in the first quarter of 2012.
NAHB will continue to be outspoken on the challenges surrounding housing affordability and work diligently to ensure that they are taken into account as part of any housing efforts on Capitol Hill.
Learn more about the factors contributing to housing affordability and how it can be addressed at nahb.org.