The most powerful voting bloc—homeowners—is financially incentivized to oppose new housing development that would lower prices. This political reality means politicians cannot address housing affordability without alienating their core voters, leading to policy stagnation and an intractable crisis.

Economist Tyler Cowen suggests the YIMBY movement would be more successful if it championed aesthetic beauty alongside housing density. A key opposition point is the fear that new developments will be uglier than what they replace. Promising prettier neighborhoods could be the key to overcoming local resistance.

The difference in home price trends between US regions is not about weather or jobs, but housing supply. States in the South and West that permit widespread new construction are seeing prices fall, while "Not In My Backyard" (NIMBY) states in the Northeast and Midwest face shortages and rising prices.

The common belief that people oppose new housing to protect property values is likely wrong. A more rational explanation is that residents are protecting their existing quality of life from negative externalities like noise and traffic. Pro-housing arguments should therefore focus on improving neighborhoods, not shaming residents.

Local city governments are often captured by "Not In My Backyard" (NIMBY) homeowners who block essential development. A practical solution is to elevate planning and zoning authority to the state level. States, motivated by tax revenues and broader growth, are inherently more development-friendly.

Policies intended to curb luxury development, such as a construction freeze, have a counterintuitive effect. They transform the existing luxury housing stock into a limited, finite resource. This artificial scarcity dramatically drives up prices for those assets, making them 'gold' and potentially worsening inequality.

Housing scarcity is a bottom-up cycle where homeowners' financial incentive is to protect their property value (NIMBYism). They then vote for politicians who enact restrictive building policies, turning personal financial interests into systemic regulatory bottlenecks.

A major driver of today's housing scarcity is that homeowners, particularly Boomers, who refinanced into sub-3% mortgages have no financial incentive to ever sell. This seemingly positive economic condition has had the negative side effect of locking vast amounts of housing inventory in place, worsening the supply crisis.

Homeowners and local governments block new development, creating artificial scarcity that drives up prices, similar to how luxury brands like LVMH restrict supply to increase value. This "LVMH-ing" of housing makes it unaffordable for younger generations and limits economic mobility.