Last week, the National Low Income Housing Coalition and the Coalition on Homelessness and Housing in Ohio reported that a full-time worker needs to make nearly $21 an hour in Ohio to afford a two-bedroom apartment.
Housing affordability is a growing concern in Ohio. According to Apartment List, the average apartment price has grown from under $800 in 2017 to over $1,100 in 2024. While wages have also risen over this time period, this is still increasing costs for households across the state.
So what can we do about rising rents? Policymakers have options to address housing prices for residents.
Zoning Reform
The number one strategy for keeping the cost of housing under control is reforming zoning. Many communities across Ohio still zone specifically for single-family homes, even when people would be happy to move to a neighborhood where duplexes or small apartment buildings are available. This creates a serious barrier to entry for people entering a given neighborhood and can create economic gates for entry.
Reducing barriers to constructing the range of housing residents desire can ease the pressure on the market for housing and reduce the rapid rise in cost of housing throughout the state.
Housing Subsidies
A direct way to help people afford housing is to provide payment assistance to people for rent. This can even be deployed with programs like the Families Flourish (previously “Move to Prosper”) program that provide assistance for people to move to new neighborhoods with more assets. This demand-side intervention will help close the gap between the cost of housing and the ability to pay of renters by providing extra resources to families to pay rent.
Affordable Housing Development
Another approach is for state and local governments to put the thumb on the scale of the market to spur more development of affordable housing, either through tax incentives, subsidies, or some other intervention. This can increase the supply of affordable housing by reducing the cost of constructing it. Developers under this model could be traditional, non-profit, or even public sector.
While this approach does not provide the family and development flexibility of zoning reforms or housing subsidies, it can be a third-best policy intervention that can sometimes be more feasible than these more straightforward approaches due to governments’ comfort with providing subsidies through tax incentives
Cash Assistance
The easiest way to fight poverty is to give people money. Cash assistance works the same way a housing subsidy does, but without the strings attached. Maybe rent is paid for the month but a family is running out of baby formula. Maybe a family needs to buy a car to get to work to be able to pay rent. Maybe a family needs to pay down a credit card to improve their credit to qualify for a mortgage. Cash assistance acknowledges the lack of knowledge we have at the top and trusts families to make choices in their own best interest. This may be what the housing crisis needs most.
While there’s a trope in public policy that there is no silver bullet for a given problem, we have a cylinder full of bullets that can improve housing affordability in Ohio. Now it’s up to policymakers to pull that trigger.
This commentary first appeared in the Ohio Capital Journal.