Is Homelessness a Housing Problem?

This is a big question! We think it needs to start with perception. Homelessness needs to be understood as a problem driven by a lack of access to housing. It is a market failure. People are forced out of stable housing or are unable to access it when housing markets don’t provide sufficient and affordable options.

 
A natural follow-up question is, why is housing scarce in some locations and more abundant in others? The two core forces of economics— demand and supply—can help us understand differences by location. Generally speaking, the demand for housing is driven by population and income growth. All else equal, a growing population and higher wages will increase the
demand for housing.

 
Without any change in supply, this increase in demand will lead to higher prices. But we know that many metropolitan areas accommodate rapid population growth by building much more housing. In doing so, these cities’ rents remain more moderate and their vacancy rates remain higher. In Seattle, we’ve had rapid population growth and only modest increases in the housing stock, which translates to a housing deficit and the associated higher prices that basic economic theory would predict.

 
If we assume that strong population and employment growth will continue in our region over the next few decades (an assumption supported by estimates from the Puget Sound Regional Council), how will we create the necessary housing to accommodate this growth?

-Exerpt from Homelessness is a Housing Problem" by Gregg Colburn and Clayton Page Aldern. Previously published by the Sighline Instutute.