The New Housing Crisis: Shut Out Of The Market Ten years after a housing collapse during the Great Recession, home values have rebounded but there are too few homes on the market. Buyers face intense competition, and that means higher prices.
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The New Housing Crisis: Shut Out Of The Market

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The New Housing Crisis: Shut Out Of The Market

The New Housing Crisis: Shut Out Of The Market

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NOEL KING, HOST:

Ten years after the housing market collapsed, a different crisis has emerged. Back then, a decade ago, lots of people were losing their homes. Today people who want to buy or in a lot of cases even just rent are being priced out of the market because there just aren't enough places for sale or for rent. So all this week on NPR's news shows we're taking a look at the new housing crisis in the U.S. from coastal cities to the rural heartland. And we're looking at what's being done to solve it. NPR's Kirk Siegler starts the series in one of the fastest-growing metro areas in the country - Boise, Idaho.

KIRK SIEGLER, BYLINE: Jennifer St. John has lived in Idaho's Treasure Valley all her life. The Boise she was born in was a sleepy, tree-lined river town surrounded by farms and mountains. It's hard to recognize today.

JENNIFER ST JOHN: A lot of the areas that were fields and farms are now full-on neighborhoods. And corners that were out in the boondocks and why would you ever go there are now a booming part of town.

SIEGLER: The boom didn't really get personal, though, until last year when St. John decided she was ready to buy her first house. She's 37. She manages a learning center for autistic kids. She's solidly middle class.

ST JOHN: It's been hard for me.

SIEGLER: Two hundred thousand dollars is as high as she can go. She's in good company. That's the limit for the average buyer here. The problem is the median home price is a hundred grand higher than that.

ST JOHN: I'm single. There's only one income in my home (laughter). And I don't want to share my house with roommates.

SIEGLER: So how did we get here, especially in a city like Boise that's long marketed its livability and affordability? Well, one answer lies in the immediate aftermath of the Great Recession, when homebuilding ground to a virtual halt. And the rebound has been slow.

(SOUNDBITE OF TRUCK REVERSING)

SIEGLER: Nationwide, new home construction is lower than it's been in four decades. Housing experts tick through a list of specific reasons - there's tougher zoning; there's not enough undeveloped land; lumber is expensive. And one of the biggest problems - labor.

ROBERT DEMARAY: Yeah, there is a shortage. It's been real tough to find help. Thank goodness my two sons work with me.

SIEGLER: On a job site in the Boise suburb of Meridian I met Robert Demaray.

DEMARAY: Yeah, we're just getting ready to use a crane to set our trusses here, and...

SIEGLER: He's a contractor.

DEMARAY: OK, down.

SIEGLER: A huge crane is swinging each truss over to the skeleton roof where a few men are laying them in place. But because of that labor shortage, it's taking about two to three months longer to build homes than it would have back in 2006 before the recession. Demaray says after the housing crash, a lot of people in the trades left for the oil fields in North Dakota, and many didn't come back. Also, younger people aren't going into the trades like they used to, and those workers who are here and available are hard to keep.

DEMARAY: The guys chase dollars. You know, they - this guy over here, he'll give me a dollar more an hour, so I'm going to go.

SIEGLER: So they can't build homes fast enough to keep up with the demand. When you drive around the Boise area, it seems like every road is lined with for-sale or ready-to-build signs. You see a lot of bright flags and banners advertising brand-new spec homes, too. But a federal study showed that in Boise there is still a demand for more than 10 times the amount of homes being built right now. This is a nationwide problem, but it's especially acute in cities like Boise that are a draw for people moving from the more expensive and crowded West Coast.

JOE ATALLA: This is just such a great place to live. And people do move here with a certain lifestyle in mind.

SIEGLER: Joe Atalla moved with his wife 13 years ago from the Bay Area to start a family. An architect by trade, Atalla now owns his own building firm. Now, since the recession, he says developers across the country are building more high-end. If land and everything else is so expensive, you've got to make sure you're not going to go underwater.

ATALLA: As a builder, if I'm buying a more expensive lot, I have to build a home that justifies the cost of that lot.

SIEGLER: In Boise, two-thirds of all the new homes and rentals being built right now are on the upper end of the market. Now, Atalla took me to see his new Settlers' Village development, which he sees as one possible solution.

ATALLA: Yeah, we're looking to pave our roads here in the next week or so.

SIEGLER: It's an infill project, smaller homes on denser lots. Now, they'll still sell for probably $275,000 or more, which won't help a lot of people here. But Atalla says it's a start.

ATALLA: I really like these smaller projects. It plays well into some of what we're trying to do where we can bring homes at a lower price point into the marketplace.

SIEGLER: In some ways, Boise is a victim of its own success. Its easy access to hiking trails and trout streams and skiing always puts it high on top 10 lists by outdoor lifestyle magazines.

DAVE BIETER: You know, we'll take these kinds of problems, you know?

SIEGLER: Boise's popular longtime mayor Dave Bieter says a lot of cities and towns would envy being in this position.

BIETER: You know, with 2.6 unemployment - you know, our unemployment's so low here it looks like a typo.

SIEGLER: The only problem is, where is everybody going to live - the teachers, the firefighters, the service workers that make a city tick?

BIETER: Our figures show we need to build about a thousand units a year in the city of Boise to keep, you know, the kind of demand we're seeing.

SIEGLER: And they're way behind in that goal. The city may look to voter-approved bonds to build more affordable housing like one large project that's underway on city-owned land not far from Bieter's office. Now, that could help ease the market, but it's not going to do too much right now. Brock Bridges is 28. He's a bartender at a local brewery. His wife is a sheriff's deputy. They've spent the past year looking for a starter home.

BROCK BRIDGES: When a house that's decent pops up, it gets so many offers it's almost impossible.

SIEGLER: Bridges says it's nice to have new people coming in. He's just tired of losing out on all the bidding wars for houses. One they recently bid on got 16 other offers, some all cash.

BRIDGES: We feel priced out. You know, I don't think prices are going to go down anytime soon. So it's the kind of situation where you've got to make more money or live somewhere else.

SIEGLER: So he and his wife are going to keep renting, which isn't exactly cheap anymore in Boise or a whole lot of other places either. That's what we'll dive into in the next story in this series later today on All Things Considered. Kirk Siegler, NPR News, Boise.

(SOUNDBITE OF PRIESEMUT'S "THE BEARABLE")

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