Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Nashville news?

Get a daily digest of the most important stories affecting your hometown with the Axios Nashville newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Columbus news?

Get a daily digest of the most important stories affecting your hometown with the Axios Columbus newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Dallas news?

Get a daily digest of the most important stories affecting your hometown with the Axios Dallas newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Annelise Capossela/Axios

America's troubled urban housing policies are having negative effects that go far beyond high rents and real estate prices.

Why it matters: Decades-old barriers to building more housing in America's most productive cities make it harder to move and live there, which eats into wages, depresses population, saps economic growth, and even worsens climate change.

  • Whether the U.S. can build a better, more equitable future will depend in large part on whether it can build its way out of its persistent housing problem.

By the numbers: Mortgage payments as a share of income hit 19.4% in June, according to a recent study by Zillow, and are forecast to reach 23.1% by the end of the year, which would be the highest figure on record.

  • Rent payments as a share of income are forecast to rise from 29.6% in June to 30.2% by December, above the 30% threshold for being considered housing burdened.
  • Those national numbers hide an even deeper crisis in pricey, housing-short cities like San Francisco, where one-bedroom apartments rent for a median of $2,800 a month — the second-highest in the country after New York — and the median price for a single-family home is $1.85 million.

The big picture: High housing prices can directly lead to a rise in homelessness, but they also hold back economic growth by making it harder for people — especially those lower on the income scale — to move to more productive metro areas.

  • 2017 research by economists Chang-Tai Hsieh and Enrico Moretti found the high cost of housing — which they chiefly attribute to local land-use restrictions — reduced wage and GDP growth by 50% over the past 50 years.
  • It also cost the average American worker an additional $6,775 in additional annual income.

Background: It wasn't always this way — historically, Americans moved in large numbers to those parts of the country where jobs and opportunities were most abundant.

Between the lines: Where you live matters. Everything from wages to health to carbon footprints tends to be significantly better in productive cities, a product of the growing divergence of the U.S. economy over the past few decades.

  • Today, while high-wage earners can make the move to expensive cities — albeit with housing eating up more of their income — it no longer makes economic sense for low-wage earners to migrate.
  • The result is widening inequality — especially for the roughly one-third of Americans who don't own their own dwellings — and less growth and productivity, which makes for a poorer future overall.

Of note: Americans who did move last year predominantly migrated to cheaper cities with fewer regulations on housing construction like Phoenix and Houston. This has the perverse environmental effect of increasing carbon footprints that tend to be lower in denser but more expensive cities.

Context: While policies like rent relief and subsidies are meant to target demand, high housing prices in productive cities are primarily a supply problem. The rent is too damn high because there isn't enough housing to go around.

  • The solution could be what New York Times columnist Ezra Klein recently dubbed "supply-side progressivism" — policies focused on increasing the supply of scarce but necessary goods like education and housing, whether through undoing burdensome regulations or new innovations that can bring down the cost of production.

Zoom in: California's SB9, a long-gestating bill signed by Gov. Gavin Newsom last week, effectively abolishes exclusionary single-family zoning in America's largest state.

  • Yes, but: SB9 is just a drop in the ocean that is California and America's housing supply problem.
  • A study by the Terner Center for Housing Innovation found that, because of various loopholes, SB9 will apply to just 1 in 20 single-family home parcels in California.
  • Factor in California's prohibitively high buying and development costs — a result of both high wages in construction and strict regulations — and the number of parcels affected by SB9 shrinks from 6 million to just 410,000, notes Slate's Henry Grabar.

The bottom line: Big cities are America's economic engine now and in the future, but that engine won't run fast if people can't afford to live there.

Go deeper

Single-family home prices are up 12.4% in a year

Expand chart
Data: Move.org; Table: Kavya Beheraj/Axios

On average, the price of a single-family home rose 12.4% in the year ending May 31, to $301,855 — though the figure is much higher in hot-market states like Idaho, Arizona and Utah.

Why it matters: The pandemic fervor for real estate continues to overheat the housing market, making homeownership elusive for many and keeping others stuck in living situations they'd prefer to upgrade or otherwise change.

UNC race conscious admissions process upheld by judge

Students walk through the campus of the University of North Carolina at Chapel Hill on Aug. 18, 2020 in Chapel Hill, North Carolina. Photo: Melissa Sue Gerrits/Getty Images

The University of North Carolina at Chapel Hill can continue its race conscious admissions process, a federal judge ruled on Monday.

Why it matters: The case could end up in the Supreme Court after the conservative nonprofit Students for Fair Admissions (SFFA) vowed to appeal the judge's ruling that UNC didn't discriminate against against white and Asian American applicants in its policy that it said was designed to increase diversity.

SEC debunks conspiracy theories about meme stock mania

Photo: Alessia Pierdomenico/Bloomberg via Getty Images

The SEC issued its long-awaited report on the meme stock mania, which downplayed the narrative that a "short squeeze" was the primary driver behind GameStop's historic stock moves — and shot down conspiracy theories about the event.

Why it matters: The postmortem was highly anticipated, largely because of what it could hint about what the regulator thinks should be done in wake of the saga. But the report stopped short of specific policy recommendations.