The nation is experiencing a major housing shortage coupled with a crisis of housing affordability. “New housing supply is not keeping pace with rising demand,” warns Sam Khater, Freddie Mac’s chief economist, citing a shortage of about 300,000 units a year. And innovation can have a significant impact. But as Matt Ridley recently stressed in the Wall Street Journal, we need to rethink the incentives for innovation, “to expand the use of prizes, to replace the reliance on grants, subsidies, and patents.” Prizes provide the opportunity to identify innovations that are already underway, as well as recognizing creative successes that can be expanded or repeated by others. To this end, the Ivory Prize for Housing Affordability was established in 2018 to advance projects and reward innovators for their efforts to develop affordable solutions to tackle housing affordability.
Through the Ivory Prize, significant innovation and creativity have been identified: Not one solution, but a number of solutions are emerging, with a great deal of energy and creativity at the grassroots level. Based on the innovation underway and recognized through the Ivory Prize process, this article will highlight six innovative paths that will help us move towards affordability in housing.
- Removing Regulatory Barriers at the Local, State, and Federal Level to Allow More Homes and Apartments to Be Built and Reduce the Time and Cost of Building
- Innovation to Build Faster, Increase Productivity, and Lower Costs
- Creative Finance to Allow More People to Qualify for a Mortgage and Buy a Home, and to Provide More Affordable Rental Housing
- Assist Renters to Improve Their Financial Position and Credit Scores to Help Them Achieve Homeownership
- Using Existing Housing and Land to Provide Greater Housing Opportunities
- Preserve and Produce Affordable Housing in Neighborhoods, Building on the People and Strengths of That Community
There are no simple nationwide solutions to housing affordability, but it’s a mistake to spend all our time talking about the problems. With the focus on solutions and innovation, it is possible to identify marvelous creativity at the “grassroots level” which is already underway throughout the country. As we recognize the innovation that is in progress, it helps highlight the directions and paths that should be followed to improve housing affordability.
Read the full article about achieving housing affordability by Abby Ivory and Kent W. Colton at Stanford Social Innovation Review.