I got some disturbing information when two close family members told me who they were supporting in the upcoming election. It isn’t Donald Trump, but it’s almost as bad: Robert F. Kennedy Jr. This was upsetting, since he is not only an anti-vaxxer spreading deadly disinformation, but is such a conspiracy theorist that his entire campaign was awarded Politifact’s 2023 Lie of the Year.
Yet my family members’ support had nothing to do with his stance on vaccines, his racism, or his other nonsense; they liked him because they are young, having trouble buying a house, and Kennedy has made that a top issue. Neither Trump nor Biden ever seem to discuss housing affordability, but one of RFK’s speeches this past October in Los Angeles did, and it went viral.
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He blamed the housing crisis on giant corporations trying to own most of the single-family homes by 2030 so they can turn them into rentals. Kennedy ranted, “They can outbid your children!” Although one of the corporations he named seems to be part of the latest right-wing conspiracy, Kennedy wasn’t far off the mark for once.
According to MetLife Investment Management, institutional investors will likely control 40% of U.S. single-family rental homes by 2030. Last year, I wrote about Wall Street buying up homes hoping our leaders would take more of an interest. It truly does appear that the billionaire class really wants to claim the last remaining area the middle class has left to build wealth.
With Wall Street landlords buying up hundreds of thousands of homes to turn into rentals, along with the pandemic driving the costs of building supplies through the roof, and climate change taking out inventory, we are in what is described as the worst market for home buyers in American history.
What my relatives like is that Kennedy promised, if elected, he had a plan to lock home loans at 3% interest for first-time homebuyers, lowering mortgage payments by $1,000 a month by “tax-free bonds on the open market.” They aren’t the only ones who liked this, apparently. One month after that speech went viral, Vanity Fair wrote as a real headline that a “A Batshit Number of Young Swing State Voters Think RFK Jr. Should Be President,” where he was shown beating both Biden and Trump among under-45 voters in the major battleground states.
Current polls show him ranking very high in favorability ratings amongst the 18-44 crowd, while his highest unfavorability comes from those over 65. His preferred method of communicating has been on social media and podcasts, and he has made hundreds of speeches on college campuses talking about his housing plan:
“A month ago, a kid in New Hampshire told me that every Tuesday he has to make a choice about having a meal or filling his car with gas, and he said that I’m the only one talking about how he can someday own his own house.”
Kennedy said his plan for housing includes a guaranteed 3 percent mortgage rate for first-time buyers that he’ll finance with tax-free Treasury bills.
“If you have a rich uncle who will co-sign your mortgage, you’ll get a better rate. I’m going to give a whole generation a rich uncle, and his name is Uncle Sam,” he told Newsweek. “Everywhere I go, I talk about my housing plan, and that appeals to the younger generation.”
A national poll conducted by the Opportunity Starts at Home campaign showed that a staggering 85% of Americans, regardless of political party, are united in acknowledging that ensuring safe, decent, and affordable housing should be considered “a top national priority.”
The survey revealed deep concerns over the escalating housing costs, with 60% of respondents identifying housing affordability as the most significant issue in their locality. Although the poll was taken back in 2019, it’s backed up by a similar, more recent study by Pew Research last year:
“Americans’ concerns about the availability of affordable housing have outpaced worries about other local issues.”
Housing prices have only gone up the past few years, and for those that do have a house, the sacrifices needed to meet housing expenses are obscene. The Opportunity Starts survey showed that 61% reported having to forgo essential needs, from cutting back on health care to additional job undertakings. This burden is notably pronounced among younger demographics, African Americans, Hispanics, and renters. However, 90% of the respondents believe elected officials aren’t doing enough.
Congress is under tremendous pressure to act, but hasn’t been able to do much over partisan disagreements on how to address the issue. To Biden’s credit, he hasn’t ignored the issue. He unveiled the Housing Supply Action Plan in 2022, aiming to close the housing supply shortfall. However, progress has been minimal. Higher interest rates have further slowed construction, overshadowing the administration’s efforts.
This past year, Biden threw his support behind two key bills to address the housing affordability crisis. The Affordable Housing Credit Improvement Act, designed to limit rents to less than 24% of the median income in the local area, aims to extend affordable housing access to an additional 1.2 million households over the next decade.
Additionally, outlined in his 2023 budget, the Neighborhood Homes Investment Act endeavors to promote homeownership for an extra 500,000 households while concurrently increasing investments in neighborhood revitalization initiatives.
And while Biden proposed grants for communities loosening zoning rules, the actual implementation remains limited due to resource constraints and local government resistance. Experts have emphasized that zoning laws are restricting new construction and contributing significantly to housing scarcity. As Vox reported this year:
A top culprit for this scarcity is local zoning laws that bar new construction and empower homeowners who gain financially from restricting housing supply to decide whether or not to make room for more neighbors.
It’s illegal to build apartments on more than 70 percent of residential land in virtually every major US city. Other regulatory barriers, like minimum parking requirements, minimum lot sizes, and height limits, also make it harder to fit more people onto the available land. The popular shorthand for these restrictions is NIMBYism — short for “not in my backyard.”
Most cities haven’t done much to ease government regulations and loosen zoning requirements, although there have been exceptions, like Nashville, Tennessee. And although Biden’s plan recognized the zoning issue, more needs to be done to address regulatory barriers. Proposed federal funding to incentivize zoning reforms, unfortunately, received significantly less allocation than initially requested, hindering substantial progress in this area.
Biden should also follow the lead of lawmakers, notably Rep. Ro Khanna of California, who have urged for regulatory measures to curtail private equity’s role in buying up single-family homes. He, along with Katie Porter, also of California, are the sponsors of the Stop Wall Street Landlords Act, which would stop rent gouging by ending the role of institutional investors in the single-family residential market.
Yet one of the most innovative proposals that has emerged has been to transform vacant offices into affordable housing.
There will be 1 billion square feet of vacant office space by the end of the decade. Currently, in San Francisco alone, which is one of the highest housing markets in the U.S., there is currently 27.1 million square feet of empty office space.
Considering the ongoing housing affordability crisis, the prospect of repurposing vacant offices for residential use appears quite natural. In fact, a legislative proposal, known as the Revitalizing Downtowns Act, was introduced in Congress in 2021, but seems to have died in committee.
The bill aimed to establish a 20% annual tax credit to offset approximately one-fifth of the expenses associated with converting office structures into residential or mixed-use properties. Notably, residential conversions would be mandated to include affordable housing components. Biden can and should get behind this and promise to work with a new Congress to make it happen.
The sponsor, Democrat Debbie Stabenow of Michigan, emphasized, “As our workplaces change because of the COVID-19 crisis, we will see more unused buildings in our downtowns. Converting these buildings to residential and mixed-use properties will benefit families and our cities.”
Despite near-unanimous acknowledgment of the potential, there’s been much resistance, primarily from developers. They can charge higher rent for office space, and many believe that companies will eventually force people away from remote work because of the false myth of the “magical office.” They do have some valid arguments concerning zoning regulations, and even architectural constraints. It can be very difficult to convert office buildings to residential, especially the newer office buildings.
The Washington Post did an interactive graphic on the challenges. Newer buildings only have windows around the perimeter and they lack the necessary plumbing and electrical infrastructure that homes demand. The ceilings must be of sufficient height to prevent these additions from falling below the standard regulation height, typically set at a minimum of 7 feet. However, all of these issues can be addressed.
California’s SB 6 offered a blueprint. It allowed for residential development on commercial land without rezoning, offering hope for other regions grappling with housing shortages. The bill unlocks vast housing potential and generates substantial benefits for communities.
Urban Footprint, a company specializing in urban planning software, conducted a recent analysis suggesting that the bill would “increase market-feasible capacity by as much as 2 million new homes while generating substantial fiscal benefits to cities.”
When the bill passed in 2022, Gov. Gavin Newsom jump-started the process by announcing $1 billion in awards, creating thousands of new homes (and many new construction jobs) for Californians.
Biden has a State of the Union speech coming up on March 7, which will be his last before the election. He completely ignored housing affordability last year, but he can’t afford to do so this year.
Let Trump rant about his vendettas and walls—Biden needs to back legislative initiatives that curb Wall Street gougers and incentivize housing conversions at a much larger scale. California’s strides are commendable, but broader support and federal-level measures are crucial for a nationwide impact.
The transformation of empty offices into homes holds tremendous promise in resolving the affordable housing crisis. By addressing zoning regulations, architectural challenges, and leveraging legislative initiatives, it can pave the way for a more equitable and inclusive housing landscape, ensuring that every American has access to a safe and affordable place to call home.
And maybe, just maybe, I can convince my foolish relatives not to throw away their vote.
RELATED STORY: How Wall Street is killing the middle class dream of owning a home
