A starter home in 1985 cost about $82,000. Today, that same slice of the American dream runs over $548,000. Meanwhile, median income only crawled from $23,000 to $78,000 in that time.
Something’s off there.
While housing prices surged nearly 400%, wages didn’t even triple. This is what happens when free markets get buried under layers of red tape and cheap money.
The blame doesn’t really fall on Baby Boomers, immigrants, or the neighbor’s Airbnb. It falls squarely on a government that tried to plan too much, spend too freely, and regulate the life out of common sense.
Zoning: When the Government Tells You What You Can’t Build
In large swaths of the country, you still can’t legally build a duplex or add a modest in-law suite without begging for permission. Some towns require minimum lot sizes so large you’d think they were planning for cattle grazing.
These rules, sold decades ago as orderly urban planning, now act like a velvet rope keeping out the middle class.
A report from NAHRO found that 70% of residential land in major U.S. cities is zoned to exclude apartments. That’s not a bug; that’s the system working exactly as designed.
What was once the land of opportunity is becoming a gated community guarded by zoning boards.
Property rights should extend to what you can build on your own land. You buy it, you maintain it, you should get to decide whether to build an extra unit for your mother-in-law or a tenant.
That’s not radical.
The Fed’s Free Lunch Is Over
Housing inflation has risen 5–7% per year since 2000. Wages? Only 1–2%.
That gap didn’t appear out of thin air. It came from monetary policy designed to juice markets, not stabilize prices.
When interest rates drop too low for too long, people don’t just buy homes. Investors buy ten of them.
The Federal Reserve printed money like it was a patriotic duty, and it left young families competing with hedge funds for fixer-uppers. Even now, with rates near 6.5%, the damage is baked in.
Conservatives have warned for years that easy money leads to hard times.
Immigration and Demand: A Real Conversation
Is immigration the sole cause of rising home prices? No. But when millions enter the country and housing supply remains handcuffed by zoning and permits, something’s got to give.
Demand goes up, supply stays stuck, and prices climb. That’s Econ 101.
We don’t want to shut the doors, but we need to make sure the house has enough rooms. That means fixing local laws and getting immigration policy to match economic reality.
The Canada Curveball
New this week: Canadians are pulling out of U.S. real estate. A New York Times report notes a sharp drop (over 25%) in Canadian homebuying interest, likely triggered by recent trade policy shifts under Trump.
Some might see this as an odd twist; it could also be seen as proof that when foreign demand eases, local buyers catch a break.
Still, without real reform, it’s a drop in the bucket.
What Now?
The housing crisis didn’t arrive overnight. It’s the product of decades of decisions, well-meaning or not, that made homes harder to build, harder to afford, and harder to pass down.
The solutions don’t lie in more subsidies, more federal programs, or another task force.
They lie in restoring what once worked.
Let people build. Let markets respond. Let communities decide.
That means cutting red tape, not just ribbons at groundbreakings. It means recognizing that every permit delay, every zoning restriction, every interest rate distortion affects real people. People who just want a roof, a yard, and maybe a chance to stop renting by the time they’re 40.
We’ve seen what central planning brings. Now let’s try freedom again.
This article was written with the assistance of AI. Please verify information and consult additional sources as needed.
