Housing crisis

They are difficult to address, because they are a complex "web of problems and dysfunctions" with many contributing factors,[1] but generally result from housing costs rising faster than household income.

[citation needed] Although major cities around the world face housing shortages, substantial variation exists across countries and across planning systems.

[3] According to a 2012 report by the National Buildings Organisation (NBO), the shortage of housing units in urban areas was estimated to be 18.78 million.

[9][10][non-primary source needed] Auckland quickly boosted supply and slowed the increase in rents and home prices by loosening constraints on the construction.

[13] Building on Auckland's success, the national government passed a bipartisan upzoning of much of the country's largest cities to allow 3 units and 3 stories on all residential parcels in October of 2021.

[16] The UK National Planning Policy Framework uses the "standard formula" to assess local housing need.

The formula uses household growth projections, adjusted for affordability[17] Critics of this method say that it does not account for the present backlog of housing.

Rapid swings and especially declines in housing asset prices can cause shocks to credit markets, the banking sector, and the wider economy.

[23] Many homebuyers purchase housing on credit in the form of a mortgage, but changing economic conditions can leave them unable to pay back their loans.

Economists debate the causes of these cycles, but have studied links to changing beliefs about asset prices, broader economic conditions, credit constraints, and interactions with mortgage lenders.