Housing figures prominently--not in a good way--in Wall Street Journal staffer Nick Timiraos' top line analysis of the White House's annual Economic Report of the President, which summarizes the state of the economy.
Timiraos highlights five areas of the 400-page report, ranging from global economic growth rates compared with forecasts, the recovery of state government budgets and hiring, the tepid growth of wage and income power, and the rise of manufacturing automation and robotics.
The fifth area is a sore point: housing. Timiraos notes, in particular that local zoning and regulation are directly forcing prices up, which is making housing too costly for people. He writes:
Zoning rules and other local regulations constitute another form of rents that may have constrained housing supply, contributing to affordability problems. Reduced housing affordability can limit mobility, which in turn makes the economy less dynamic. The report references some recent research that examines how construction costs can’t explain most of the increase in home prices, suggesting that land-use regulations may be contributing instead to price inflation.