Housing Hang-up

New Hampshire struggles through how to handle the housing crisis

Politics Nh Mag Cap Off August 23 Copy17

Politics lately has been about partisanship, not progress. There are huge and endless problems where elected leaders should act but don’t. The incentives in the system are to fight, not compromise.

And yet, New Hampshire politics in 2023 has run counter to that. Even in what is essentially — but not technically — a divided government in Concord, bipartisan compromise can be found and even celebrated by most of everyone. This hasn’t only happened around small items, but also with the two-year state budget.

And, if you squint, you can see signs of how these same leaders might come together to at least try to address the biggest and most intractable problem facing the state: housing. 

Housing has long been a systemic issue for the state for decades, and it continues to grow in size and scale. In 2022, the price of a single-family home in the state set an all-time high of $460,000. This year, the average price grew to $465,000. 

These high prices mean more people trying to rent the same number of apartments — not to mention warps of the traditional housing market. The only available homes are vacation and second homes away from where most people work.

To be sure, the housing prices are high all over the region, but they are particularly acute in New Hampshire. Economists say this has created challenges for businesses trying to hire workers, significantly contributed to the aging of the state and reaped huge consequences for the middle and working classes, who are now spending more on rent as a proportion of income than they ever have. 

There seems to be widespread agreement on the problem: It’s supply. A 245-page analysis this spring from New Hampshire Housing (the state’s housing authority) found that, each year, about 4,000 new housing units are created. But by 2040, there will need to be 90,000 per year to keep up with demand.

The problem isn’t building these units; it’s figuring out where they could go. And this is where an odd, only-in-New Hampshire coalition of political actors could act. 

Finding more workforce housing isn’t just a cause of the progressive left and business owners. Now, it’s been the new cause of local Libertarians. This matters for two reasons.

First, under the state constitution, the Legislature tells local communities what they can and cannot do. Second, the New Hampshire Legislature has essentially three parties: Democrats, Republicans and Libertarians, who often run as candidates in one of the two major parties. Libertarians, for example, control the House Republican majority.

Libertarians have seized on the idea that local housing zoning laws, which dramatically limit housing units, are big government regulations run amok. For example, some towns say that a single-family house must have its own acre. Progressives see that as a way for the wealthy to limit the population of a town. Libertarians see that as limiting the landowner’s freedom by denying that person the ability to put up a two- or three-unit rental building somewhere else on that acre.

Building contractors and developers who are big political donors agree that more less-restrictive zoning laws mean more construction and more money. And then the laws of economics say that an increase in supply lowers prices in the future. 

So far, local governments have stalled efforts to address small-town zoning and “not-in-my-backyard” issues regarding additional housing. But it remains a looming predicament — one that could benefit from ambitious politicians working together, in a bipartisan way, toward a solution.

Categories: Politics