The cause of the housing shortage is simple and demand. The economy is not producing enough housing to meet the demands, which drives up the prices. This situation benefits certain groups; including existing homeowners, realtors, mortgage brokers, Baby Boomers, senior citizens, professionals, and the rich.
Those people benefit from higher property values; which increases their potential wealth and their ability to borrow against the real estate. To add icing to the cake, property owners get huge tax advantages because mortgage interest can be tax deductible.
It is in the economic interest of those groups to keep the supply of housing low. That is why they strongly favor restrictive zoning laws such as limits on density; bans on high-rise and multistory buildings, rent control and bans on the construction of apartment houses.Read more