America is in the middle of a housing crisis, and it is not a mystery why. Home prices have surged far beyond wage growth, first-time buyers are locked out of the market and young families are increasingly forced to rent indefinitely or leave high-cost states altogether. This did not happen overnight, and it is the predictable result of decades of policy choices that made it harder and harder to build owner-occupied housing.
The data tells a clear story when viewed over time.
In 1950, the United States had 23.6 million owner-occupied housing units. By 2000, that number had climbed to roughly 70 million. That represents an increase of about 196% over 50 years. During that same period, the U.S. population grew from roughly 151 million to about 281 million, an increase of approximately 86%. For half a century, America was building owner-occupied housing at more than twice the rate of population growth. Housing supply was not merely keeping up with demand. It was staying well ahead of it.
That era is over.
CONSTRUCTION LABOR CRUNCH DRIVES UP COSTS AND DEEPENS AMERICA’S HOUSING AFFORDABILITY CRISIS
At the end of the third quarter of 2025, the number of owner-occupied housing units had reached approximately 86.92 million. That is an increase of only about 24% since 2000. Over that same period, the U.S. population grew by roughly 22%. Housing growth and population growth are now moving almost in lockstep, which is a dramatic departure from the postwar model that made broad homeownership possible.
This slowdown is critical because population growth alone does not capture housing demand. Household formation, immigration, the number of families purchasing a second home and changing family structures all increase pressure on supply. When construction merely matches population growth, shortages become inevitable. When it falls behind, prices skyrocket.
One of the biggest reasons America is not building enough owner-occupied housing is regulation. In many cities and popular suburban areas, building codes are hundreds of pages long, and the number of regulations can reach the thousands.
TRUMP’S 50-YEAR MORTGAGE JUST INTRODUCES A NEW KIND OF DEBT
The massive regulatory burden weighing down homebuilders makes it harder and more expensive to construct new homes. In 2021, an economic analysis by the National Association of Home Builders found that regulations add nearly $94,000 to the cost of building a new home. That burden prices millions of families out of the market before construction even begins.
Zoning restrictions, environmental reviews, permitting delays and land-use rules combine to make building slower, riskier and far more expensive than necessary. These barriers overwhelmingly benefit entrenched interests while harming working families and first-time buyers.
Land-use regulations have become particularly burdensome. In many states, huge swaths of land are owned by the federal or state government. In other cases, land is privately owned, but local regulatory bodies have blocked developers and families from adding new homes. This has squeezed millions of homes into relatively small areas.
California offers a stark illustration. Roughly 90% of the state’s population lives on just 5.1% of its land area.
Because zoning and land-use rules are largely imposed by state and local governments, Washington cannot solve the housing crisis by decree. But it is not powerless.
President Donald Trump and Congress should use federal leverage to force change. Federal dollars for education, infrastructure, transportation and housing should be conditioned on measurable progress toward expanding owner-occupied housing. States that refuse to loosen land-use restrictions and reduce regulatory barriers should not receive unlimited federal subsidies.
This approach respects federalism while acknowledging reality. The federal government should not draw zoning maps, but it also should not bankroll policies that artificially restrict housing supply and drive up costs nationwide.
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For America’s entire history, home and land ownership have been essential to economic stability, family formation and upward mobility. In previous generations, Americans built accordingly. Today, that commitment has been undermined by regulatory systems that make new housing scarce by design.
Politicians in both parties have wrongly tried to solve these problems in recent years by calling for more subsidies or hatching schemes to make it easier for people to go deeper into debt to purchase a home. But this is terrible economics. When you increase the availability of money without decreasing demand or increasing supply, you end up causing prices to rise rapidly, and that is exactly what has occurred.
If the housing crisis is going to be solved, states must be forced to change course. And for now, that pressure will have to come from Washington.
If the Trump administration and Congress want to solve the housing crisis, it is time they get tough with states.
