One of the biggest domestic issues facing this country in 2016 is accessibility to housing—a problem politicians have been notably silent on. A recent report from McKinsey indicates people in California are over paying for housing, to the tune of $50 billion. That’s a big discrepancy between the amount people are paying for housing versus what they can actually afford. That gap is costing the state $140 billion in lost economic opportunity from potential construction and new business.
The report says there is enough land in California to add more than 5 million housing units in so called “hot spots,” which would in theory alleviate much of the housing pressure. In many areas, including California, there is a misperception that there is not enough available land for construction. But often impediments to development prevent new housing from going up.
McKinsey chose California as a case study to highlight the overall housing problem in the U.S. with the hope that some of its proposed solutions could provide insight for other regions.