The world is facing a global housing crisis. If the status quo persists, there won’t be enough affordable homes for billions of people by 2030. Even the most powerful governments struggle to figure it out, so who can do something about it? You can.
Ordinary individuals play vital roles in helping address this basic need. Take a few minutes to understand what fuels the global housing crisis and how climate change exacerbates it. Then, you can see how to make housing more affordable and why sustainability matters.
Climate change intensifies weather events, which threaten the structural integrity and safety of the existing property stock. Vulnerable homes can succumb to ravaging storms, rising sea levels and fast-spreading wildfires. Global warming increases the need to modify construction standards to build climate-resilient homes.
What Drives the Housing Crisis?
Low inventory makes housing unaffordable in the United States. Experts estimate the nation needs up to five million more homes on the market to meet the demand. Interest rate hikes meant to discourage people from borrowing have fleeting effects. Ramping up construction is the long-term solution.
Canada’s housing unaffordability stems from the real estate boom of the 2000s. Back then, people speculated in residential units in hopes of raking in profits down the road. The Great White North’s immigration policy complicates the situation. The country can’t build enough homes for the number of foreigners it welcomes. The gap between supply and demand has worsened over time.
Real estate developers have caused a property downturn in China. These companies borrow capital from banks to buy land from local governments. Afterward, they presell units before completing them. They reinvest their earnings into more projects. However, overleveraged developers can’t keep up with payments. The Chinese government has intervened and restricted financing to companies in the red. It has resulted in mortgage defaults, partially finished buildings and disgruntled property owners.
Unlike its North American counterparts, China has surplus housing. Property prices are falling because demand has peaked. The problem is 78% of urban Chinese residents’ net worth is residential real estate. Plummeting property values eat into homeowners’ wealth.
How to Solve the Global Housing Crisis
No silver bullet can fix the global housing crisis, but you can do these four things to be part of the solution.
End Real Estate Speculation
Saying the world should stop looking at real estate as investable sounds crazy. It has been a time-tested wealth generator. However, treating homes as commodities incentivizes property owners to behave in ways that negatively affect housing affordability.
Real estate speculators acquire housing units to make a profit. These buyers tend to have deeper pockets and can generally outbid aspiring homeowners with fewer resources. Those who can’t buy end up as renters, helping landlords build equity on their units instead of generating wealth for themselves.
Suppose you can buy multiple properties. Purchase just your primary residence. Owning housing units you rarely occupy can lower inventory and drive up real estate prices. If everyone thinks this way, the world will only need to construct fewer homes to give everyone access to affordable housing.
Support the YIMBY Movement
Echo pro-development sentiments. Housing inventory won’t increase when people are against construction. The “yes in my backyard” movement counters the prevailing NIMBY attitudes of the few but influential wealthy property owners. They lobby against the addition of more local housing units for selfish reasons.
The YIMBY movement is the key to narrowing the gap between supply and demand. House depreciation shouldn’t be a big deal if home affordability is in everyone’s best interests. Mortgage borrowers are immune to it as long as they stay put and keep paying what they owe. Homebuyers benefit from it because they can take on less debt to afford a house and enjoy more manageable monthly payments.
Some YIMBY advocates say the market alone can solve the housing crisis as long as developers can build more freely in locations needing more homes. Libertarians will nod in agreement with this statement. Home affordability is more attainable with adequate public housing and can increase supply and variety. This way, buyers with various budgets and lifestyles can enjoy lower property prices and more options.
Make Your Home Net-Zero
A net-zero home generates the amount of electric power it consumes, among other low-emissions changes. It can be less costly to maintain and more climate-resilient than traditional houses.
Invest in a residential renewable energy system to drive demand for sustainable products. The more commercially viable they are, the more investors they can attract — and the cheaper they become.Going solar can shield you from power outages, which may happen more frequently when prolonged droughts become more common due to global warming.
If net-zero homes go mainstream, a location’s housing stock is unlikely to decrease, even if the effects of climate change go from bad to worse. A stable supply of homes matters to housing affordability.
Source Materials Locally
Using locally abundant materials helps keep construction costs low and also reduce the embodied carbon of homes and inspire greener building designs and practices.
Local sourcing can also shorten lead times. It helps complete residential development projects more quickly since localized supply chains are less susceptible to geopolitical events. Stakeholders can enjoy peace of mind when their orders arrive on time.
When planning your next home improvement, use a contractor working with local suppliers. It’s the first step toward making the construction industry more resilient to climate change, helping them build more and better with less time.
There’s No Time Like The Present For Sustainability
Don’t let the global housing crisis go to waste. Use it as an opportunity to normalize practices promoting home affordability and sustainability. Take action in your community and share your achievements – send Earth911 your stories to help spur others to participate in the movement for access to housing.
About the Author
Rose Morrison is the managing editor of Renovated.com and a freelance writer with a passion for sustainable building and innovative construction technologies. She also regularly contributes to other publications, such as NCCER, The Safety Mag, and Geospatial World. For more from Rose, you can follow her on Twitter.