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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Skyrocketing rents and home prices may be pivotal in the 2024 election

By Leigh Ann Caldwell Washington Post

LAS VEGAS – D. Carter paid $1,525 for rent, cable and WiFi for her one-bedroom apartment until her monthly rent jumped to $2,100 last year.

Unwilling and unable to pay the new rate, Carter, who spoke on the condition that her first name not be used, considered buying but quickly realized that with interest rates hovering around 7%, she was priced out. She found a new apartment in a decent part of town after months of searching, but said she still pays up to 50% of her fluctuating $50,000 to $70,000 income from her banking job for rent.

Housing is largely a local issue, yet it’s presenting a challenging and complex problem in Nevada and other battleground states with implications for this year’s race between President Biden and former president Donald Trump. Biden has proposed specific policies and tens of billions of dollars to address the supply and costs, while Trump has mainly proposed reducing inflation. As the incumbent, however, Biden could bear the brunt of the blame, as home affordability has grown worse in recent years. Biden won the Silver State by 2.4% age points in 2020 but is currently trailing Trump in almost every public poll conducted there.

“Given that the last few options haven’t been that great, and nobody really cares about the younger community and generations moving forward, I don’t really know if me voting is going to make a difference,” Carter, 26, said of voting in November.

In Clark County, which encompasses Las Vegas, median rental prices soared 36% during the pandemic. Prices started to come down slightly at the beginning of this year but are still 30% higher than they were in January 2020, according to Apartment List. The reasons for high rents are numerous, but ultimately it comes down to low supply, according to more than a dozen interviews with local and national housing policy experts. Michelle Merced, CEO of Neighborhood Housing Services of Southern Nevada, called the housing situation “desperate.”

It’s not just in Las Vegas that people are facing high housing costs. A shortage of housing, inflation and high interest rates are squeezing renters around the country and pricing out potential home buyers. April ranked among the six least affordable months for buying a home in the last 38 years, according to the mortgage technology division of Intercontinental Exchange (ICE), an information clearinghouse, including for mortgage listings.

In a recent Gallup poll that asked Americans to name the top financial concerns for their families, housing was the second most common response behind inflation. More mentioned housing than at any time since Gallup started asking the open-ended question in 2005.

What happens in Vegas

The Las Vegas metro area, home to about 2.3 million people, is short 78,000 housing units, or housing for about 312,000 people, according to the Nevada chapter of the National Low Income Housing Coalition.

That supply shortfall affects mid-income earners like Carter and low-income earners like Catherine Ayres, who is searching for an apartment she can afford on her fixed income of $1,451 per month. But in the Las Vegas valley, that’s nearly impossible. The average rent for an apartment is $1,487, according to Apartment List – nearly $40 dollars more than her monthly income.

Ayres said she has struggled with housing off and on since she got a divorce and lost her job at the now-shuttered Yucca Mountain Nuclear Waste Repository nearly 20 years ago. But she said the last four years have been particularly hard as rents have skyrocketed. Until she can find something she can afford, she will continue to share a studio apartment with two other people, as she has done for the past four years, she said.

“At 73 years old, I don’t need to be doing this. It has been very, very difficult,” Ayres said in an interview after meeting with affordable housing advocates.

Housing is people’s ‘pain point’

Democratic Rep. Steven Horsford, who represents North Las Vegas, said he has been imploring Biden and Vice President Harris to make housing “front and center” of their economic agenda and urged Biden to visit Vegas and focus on housing. Housing is the “pain point” – the constant reminder of economic stress – that people experience every month, Horsford argues.

On his first swing-state tour in March, Biden took Horsford’s advice. He stopped in Las Vegas for a housing-focused event where he touted pandemic-era assistance that helped keep 80,000 people in their homes in the state and kept millions of people from being evicted nationally. He also promoted his $258 billion plan he’d previewed days earlier in his State of the Union address to provide help for homeowners and to build new affordable housing.

In Las Vegas, housing supply was low after the Great Recession and exacerbated during the covid pandemic when construction came to a near halt and building supplies, including lumber, became scarce, leading to inflation and elevated costs. To tamp down inflation, the Federal Reserve lifted interest rates. Wall Street-backed firms are also buying up single-family homes in Vegas, further straining the demand.

Las Vegas is landlocked by federally owned land, preventing unchecked suburban sprawl in the state’s desert. Local and federal officials, including Republican Gov. Joe Lombardo, are calling on Biden to allow the Bureau of Land Management to release federal lands to allow housing development. The Biden administration is actively pursuing the release of BLM land for housing. Housing advocates say that would help, but the problem is far more complicated to solve.

Las Vegas City Council member Victoria Seaman, a Republican who is running for mayor, said that other than crime, housing is the top issue she hears about from voters. She traveled to Washington to lobby Rep. Mark Amodei, R-Nev., to ask him to address housing.

“One hundred percent, they need to be talking about it now, and they need to be addressing it,” she said of the presidential candidates – and any candidate running for federal office.

Nevada was already short on housing before the pandemic. But during covid, people continued to move there, further stressing supply. Nevada officials saw the crisis worsening and focused much of their pandemic response on housing.

“Housing instability is economic instability,” said Zach Conine, Nevada state treasurer, whose portfolio includes housing.

The state took advantage of $1 billion in federal funds from Biden’s American Rescue Plan. A federal eviction moratorium coupled with Biden-directed federal rental assistance kept people in their homes. The federal government also provided money and tax credits to encourage building.

But those federal funds are running out. Evictions have been on a steady incline, and the housing shortage persists. Nevada’s renter protections are minimal, making it easier than in most places to evict tenants.

A surge in building after the pandemic’s peak because of government subsidies and supply chain relief could slow again. Lorri Murphy, vice president of business development with Ovation, which builds low- to moderate-income housing in Las Vegas, said that while rents are rising, costs for builders are rising even faster.

“The problem not only isn’t getting better, it’s getting a little bit worse,” Murphy said, adding that there is little housing help for workers in income brackets that include teachers, firefighters and police officers.

According to the National Low Income Housing Coalition, there are only 17 affordable and available rental homes for every 100 extremely low-income renter households in Nevada. And a University of Nevada at Las Vegas study found that seven of the 10 most common jobs in Las Vegas don’t pay enough to afford a studio apartment.

And the housing crisis is particularly affecting Black voters – a constituency Biden needs to win. There is a 34-point gap between Black and White homeownership in Nevada, according to census data examined by the Post. Black homeownership in six battleground states – Nevada, Arizona, Pennsylvania, Michigan, Georgia and North Carolina – was lower in 2022 than it was in 2015.

How the candidates are responding

While housing is in large part a local and state issue, there is some room for the federal government to act. Biden and Trump diverge greatly on how they’d address it.

The Biden administration views the challenge of housing in two ways: cost and supply. Both are intertwined, of course, but supply is the ultimate driver as costs won’t decrease if demand can’t be met. Increasing supply doesn’t happen overnight.

“The United States has had a housing shortage for many years,” White House senior economic adviser Gene Sperling said in an interview. “It’s an issue we are strongly addressing because it’s both a monthly pocketbook issue but also an American Dream issue, too.”

Biden’s $258 billion plan aims to give relief to renters and some homeowners and address what Moody’s Analytics economist Mark Zandi estimates is a shortfall of 2.9 million housing units nationwide. Biden’s plan, which would need the support of Congress, would expand and create housing tax credits for low-income Americans, which his administration says would lead to 2 million homes across the country.

His plan also aims to help alleviate costs due to elevated mortgage rates with a $10,000 tax credit over two years for first-time home buyers as well as a $10,000 tax credit to middle-income families to encourage them to sell their starter home. The administration is also encouraging state and local governments to change zoning laws to allow more housing density.

“These issues are really important,” Biden battleground state director Dan Kanninen said. “The American people can see who was on their side.”

Trump, a second-generation real estate mogul who made millions as a landlord, proposed massive cuts to the Housing and Urban Development Department’s affordable housing programs, although many of those cuts never passed Congress. He also as president gutted the Fair Housing Act, which prohibits discrimination in the housing market, in what some considered a political play for White suburban voters.

Trump has accused Biden of having a “sinister plan” to “abolish the suburbs.” He vows to “protect the suburban way of life” by rejecting multifamily housing units in suburbs and encouraging construction of new housing on the outskirts of town where land is cheaper.

“On top of sky-high prices for rent, gas and groceries, Bidenomics has made the American Dream of homeownership unreachable for families across the country,” Trump campaign spokesperson Karoline Leavitt said.

The problem will not be solved quickly. Construction of new units takes anywhere from 12 to 24 months. Carter, the 26-year-old working in banking, said that until costs cool, she has two choices: “continue to rent this place … or move back home with my mom” on the East Coast. “I don’t want to do that, but also I’m grateful that I have that option because some people don’t.”