For years, housing activists couldn’t agree on what was driving prices higher, let alone how to fix it.
The divide stems from two schools of thought: One side lays the blame on a lack of inventory. Build more housing — especially in dense, transit-accessible neighborhoods — and the laws of supply and demand will lower prices for everyone, goes the thinking of the YIMBY (Yes in My Back Yard) movement.
On the flip side are the “supply skeptics,” who tend to believe housing affordability calls for government policies, not just market forces.
From city council hearings to the halls of academia, the debate raged for years. Then came 2020, and Americans raced to buy homes during the early stages of the coronavirus pandemic. Prices shot up, pushing the U.S. median to $410,800, a 30 percent increase in five years, Federal Reserve data shows. Median prices go significantly higher in the West ($531,100) and Northeast ($796,700). Now even starter homes are increasingly out of reach.
The political pressure to rein in housing costs has led to a wave of YIMBY legislative victories. Last year, 13 states passed laws peeling back regulations to remove barriers to home construction, according to the group Welcoming Neighbors Network.
Dennis Shea, a housing expert at the Bipartisan Policy Center, says the YIMBYs have put the housing debate to rest. “They’ve won,” he says flatly.
Most Americans seem to agree, a YouGov survey found, with nearly 7 in 10 saying the amount of available housing contributes “a great deal” or “a fair amount” to the cost of housing. Nearly 6 in 10 also blame government regulation for housing costs.
But supply skeptics like Michael Storper, an urban planning professor at UCLA and the London School of Economics, say there’s enough home construction. “To put it bluntly, in America we haven’t actually been underbuilding,” said Storper, an urban planning professor at UCLA and the London School of Economics. “The problem is demand is now split in a very unequal society. The supply you get is the wrong kind of supply.”
Six years ago, Storper co-authored a paper with colleague Andrés Rodríguez-Pose arguing that regulations like zoning and parking requirements aren’t driving up home prices. It sparked an uproar in research circles.
In a newly published paper, Storper and new co-authors say that despite “broad consensus in public discourse” embracing the YIMBY push for deregulation: “Links between regulation and supply, and between supply and prices, are weak at best.”
Simply unleashing developers to build more homes won’t make housing affordable, the paper says. It explores a hypothetical: Imagine that a city increases its housing stock by 1.5 percent each year — a rate that is more than twice the growth of New York or San Francisco from 2000 to 2020, though lower than Denver, Phoenix or Houston.
If all that new housing caused prices to fall by 4 percent a year, it would take 18 years before a median one-bedroom apartment becomes affordable for a worker without a college education in San Francisco, or 11 years in the District or eight years in Boston, the paper says. If housing prices fall more slowly, less than 1 percent per year, it would take as much as 124 years in San Francisco and 109 years in Los Angeles.
That’s no way to fix affordability, they insist. Focusing on deregulation is a “harmful distraction” to more direct approaches like publicly funded vouchers to help pay for housing.
The National Bureau of Economic Research recently published a working paper attacking the idea of constrained supply as the problem with housing, claiming instead that rising home prices basically tracked local income, regardless of zoning laws in a given city. The paper called the idea that regulation drives up prices “the standard view” and “the prevailing view,” but claimed that it is wrong. YIMBYs rushed to poke holes in the argument.
One author, Schuyler Louie, said in an interview that he concluded developers have basically been able to build housing at the cost that each local market will bear. Removing regulations wouldn’t necessarily lead developers to build more.
“Per capita income growth is correlated pretty much one-to-one with house prices,” Louie said. “If I get richer in a city, I’m not going to demand more units of housing. I’m going to demand a nicer house, which is going to increase the price without actually increasing the demand for units.”
Rodríguez-Pose takes issue with a YIMBY view known as “filtering” — that even the construction of high-priced luxury housing will improve housing affordability, because the people who pay to live in the luxury buildings will no longer be competing for another apartment that will become available for a lower-income renter.
“What was, for me, very weird was the claim by many scholars that the best way to address urban inequality … was to start building the most expensive homes in the most desirable locations, and hope that everything was going to trickle down,” Rodríguez-Pose said. He doesn’t think the conventional laws of supply and demand function well in the housing market.
Houses, he said, “are not necessarily interchangeable. It doesn’t mean if you start building houses in Montana, then people are going to move to Montana.”
Across the country, a wave of pro-housing supply sentiment has been building in recent years, with politicians in both parties enthusiastically embracing the view that obstacles to housing construction are a problem to be cleared away. Maryland, for instance, will require counties to let homeowners build accessory dwelling units starting this year. Florida blocked local apartment building moratoriums and cut down on parking requirements. Arizona forced cities to allow construction starting at 5 a.m. A large group of cities, from Philadelphia to Denver to Seattle, passed YIMBY laws.
While Republicans tend to promote less regulation, the new YIMBY laws have support on both sides of the aisle.
“Today as many people on the left as on the right, maybe more on the left even, acknowledge that local [regulations] are the major if not the main obstacle to building housing. It’s just so clear of a story. … And people are witnessing it in the places where they live, where prices are so high,” said Kevin Corinth, a former Senate and White House staffer who works for the right-leaning American Enterprise Institute. “I think there’s just a recognition, if we want these places to be at all available for moderate- to middle-income families, we just need to build more.”
That said, he added, there’s growing concern among some on the right about density. Some Republicans say: “We worry about preserving suburban areas as they are. We worry about homeowners potentially seeing a decline in the value of their homes.”
Journalists Ezra Klein and Derek Thompson pushed for removing obstacles to housing and other forms of construction in their influential 2025 book “Abundance.”
Giselle Hale, a former mayor of Redwood City, near San Francisco, is involved in the advocacy group YIMBY Action and also leads the “Abundance Network,” a group of state and local elected officials across the country who espouse the ideas of the book.
“I do think that it has definitely turned the tide. We have seen so many more leaders get elected for whom this is a top priority,” she said. The book and the formation of new advocacy groups helped people learn about the topic, come to believe in the ideas, and prioritize the policies. And the increasing stress in the housing market upped the urgency. “We hit the tidal wave where the pain of not building housing for so long became undeniable.”
Adam Guren, a housing economist at Boston University, thinks some key questions are still up for debate. “The real question is: How segmented are housing markets? There’s one model where if you add floor space to the city, that drives down prices. Another where luxury apartments … are completely different, and there’s not going to be this trickle-down cascade where that drives down prices.”
Democrats are divided, with some taking up “Abundance”-inspired objections to rules that make it expensive to build housing, like parking requirements and mandated minimum lot sizes, while some left-leaning groups favor less market-driven ways to make housing more affordable.
“If we really were focused on getting and keeping people housed, we wouldn’t be playing around with all these things around the margins,” said Unai Montes-Irueste, a leader of the left-leaning group People’s Action. Instead of reforming permitting and zoning laws to allow housing to be built, he thinks, the government should just build it.
“The housing that we need is housing for working people, and that housing is really hard to produce” just by letting developers build more, said Meghan Choi, executive director of the Los Angeles tenants’ group Power. “In order for people to be truly safe, then yes, public housing has to be treated like public education. …. It should be protected as a right.”
Scott Clement contributed to this report.
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