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1、Confidential and proprietary.Any use of this material without specific permission of McKinsey&Company is strictly prohibited.Investing in housing:Unlocking economic mobility for Black families and all AmericansFebruary 2025Copyright 2025 McKinsey&Company.All rights reserved.Cover image:rob dobi/Gett

2、y ImagesThis research builds on a larger body of work from the McKinsey Institute for Black Economic Mobility(BEM),particularly our 2021 report The economic state of Black America:What is and what could be and our 2024 report The state of Black residents:The relevance of place to racial equity and o

3、utcomes.The research was led by JP Julien,a partner in McKinseys Philadelphia office and leader of the McKinsey Institute for Black Economic Mobility;Shelley Stewart III,a senior partner based in New York,chair of the McKinsey Institute for Black Economic Mobility,and global leader of Reputation&Eng

4、agement;Kelsey Muller,an associate partner in the New York office;and Nick Noel,an associate partner in the Washington,DC,office;along with Kelemwork Cook,general manager of the McKinsey Institute for Black Economic Mobility;Jos Mara Quirs,a knowledge expert in the San Jose office;and Sophia Autor,a

5、 senior capabilities and insights analyst in the Boston office.Collin Johnson and Shea McHenry led the project teams.Core team members who supported the modeling and analytic work,research,synthesis,and solution development include Alexandria Agee,Brandon McGhee,Fiorella Correa,Jessica Wilson,Mimi V

6、erdonk,Sharifa Doudi,Shay Liu,Sirus Wheaton,and Teni Akeju.This report was edited and produced by McKinsey Global Institute senior editor Brian Blackstone.The report was developed together with senior data visualization editor Matt Perry.In communications,our thanks go to Denvol Haye Jr.Thanks also

7、go to McKinseys design team,especially Diane Rice,and McKinseys digital production team,led by Mary Gayen.Special thanks for additional support from Dennis Alexander,Nicole Phillips,Rachel Robinson,Rishabh Chaturvedi,and Stephanie Strom.This project benefited immensely from the perspectives of McKin

8、sey experts and senior advisers,including Aditya Sanghvi,Anthony Shorris,Ben Safran,Dave Dauphinais,Jan Mischke,Jennie Nevin,Lola Woetzel,Munya Muvezwa,Nina Yancy,Ryan Luby,Sebastian Vargas,and Shannon Peloquin.To better understand and surface potential unlocks for affordable housing,we spoke with s

9、takeholders from a range of organizations who care deeply about housing and economic mobility.Thank you for sharing your invaluable knowledge and expertise with us,including Michael Anderson and Robin Billups from Anderson Barker Architects;Anna MacNeill and Eleonora Bershadskaya from The Vistria Gr

10、oup;Sean Davis from Merton Capital;Marcia Griffin from HomeFree USA;Martin Muoto from SoLa Impact;Blue Meridian Partners;Rasheedah Phillips from PolicyLink;Ken Rogozinski from Greystone;Blair Smith from the Milken Institute;and Sonja Trauss from YIMBY.This work is independent and has not been commis

11、sioned or sponsored in any way by any business,government,or other institution.While we gathered a variety of perspectives,our views have been independently formed and articulated in this report.Any errors are our own.AuthorsJP JulienShelley Stewart IIIJos Mara QuirsKelemwork CookKelsey MullerNick N

12、oelSophia AutorAbout the authors and acknowledgmentsiInvesting in housing:Unlocking economic mobility for Black families and all AmericansContentsAbout the authors and acknowledgmentsiAt a glanceiiiExecutive summary01The challenge of housing and economic mobility 05The opportunity25Bold solutions fo

13、r a promising future 30Endnotes 43CHAPTER 1CHAPTER 2CHAPTER 3iiInvesting in housing:Unlocking economic mobility for Black families and all Americans Quality,affordable housing is out of reach for far too many Americans.This issue touches rural and urban households,young and old,poor and middle class

14、,and households across racial groups.Housing,and where that housing is located,matters a lot.Housing significantly determines access to employment,education,public and social services,and critical amenities that help families achieve economic mobility.The housing crisis is a national issue,and it di

15、sproportionately burdens Black Americans.Nearly 60 percent of Black renters and 30 percent of Black homeowners are moderately or severely cost burdened,well above national averages.Legacies of housing discrimination are compounded by continued supply,demand,and geographic imbalances that create acut

16、e housing challenges for Black families and impede their pursuit of economic opportunity.A shortfall of housing underpins the current crisis.There were 8.2 million fewer housing units than needed in 2023 to meet the needs of American families.Without decisive action,that gap could grow to 9.6 millio

17、n units by 2035.While not without trade-offs,investing to close this housing shortfall could unlock as many as 1.7 million jobs and add nearly$2 trillion to GDP through 2035.These gains would ripple across the US economy.Because Black Americans shoulder an outsize share of the housing burden,they wo

18、uld see material benefits.We highlight five housing themes,based on adeep analysis of more than 80 ideas.The themes are unlocking land through creative incentives and partnerships,augmenting programs to unleash private capital,scaling off-site home construction,reinvesting in public housing and shar

19、ed-equity models,and revamping housing choice vouchers.Together,these actions could unlock an estimated 2.3 million housing units,including 700,000 for Black households,over the next decade.At a glanceiiiInvesting in housing:Unlocking economic mobility for Black families and all AmericansSidebarDefi

20、ning economic mobilityIn alignment with other institutions in the field(for example,the Urban Institutes Upward Mobility Framework),we believe in the importance of the three interconnected dimensions of economic mobility:Economic success:having adequate income and assets to support a familys well-be

21、ing,now and in the future Dignity and belonging:being able to contribute to family,work,and community and being valued for those contributions Power and autonomy:having control over ones life and the ability to make choices and influence decisions that affect ones futureWhile this report focuses muc

22、h of its analysis on“economic success,”housing is critical to all three dimensions of economic mobility.1Investing in housing:Unlocking economic mobility for Black families and all AmericansHousing can be,and historically has been,a gateway to economic opportunity.However,it is increasingly an econo

23、mic barrier for American families.There is broad recognition that the relentless increase in the cost of renting or owning a home in the United States has put many already vulnerable families at further risk,widening inequality.1And as with other aspects of the US economy,2 Black Americans are parti

24、cularly vulnerable.Rising prices and constrained supply have been most prevalent in megacities and other urban areas,where nearly 50 percent of Black families reside.3 Unaffordability is among the key reasons Black families are more likely to live in neighborhoods with challenged public schools4 and

25、 limited access to green spaces5 and other amenities that increase quality of life.6 Having a limited number of quality homes7 in mixed-income neighborhoods that are affordable8 also restricts job access,creating a drag on both workers and the broader economy.At the same time,recent trends have inte

26、nsified these challenges for all Americans.Consumer prices have risen at rates not seen in decades,leaving families,particularly those with less income,vulnerable and with less to spend on housing.9 For would-be homeowners,mortgage rates rose sharply on the back of higher inflation and interest rate

27、 increases.Constrained supply has kept home prices and rents from adjusting downward,leaving the ambition of owning a home or renting affordably out of reach for many Americans.Ideas abound to address the crisis.Some have shown promise;others have not.Many solutions are local in nature and have yet

28、to scale successfully to other regions.New technologies that have increased productivity and brought down the costs of other goods have yet to gain significant traction in housing.10 Plans for mixed-income and higher-density housing often run into local opposition.Financial innovations have yet to o

29、vercome credit constraints facing lower-income borrowers.The housing crisis has gotten worse.This report aims to reimagine how housing could be a tool to accelerate economic mobility and produce widespread benefits for Black families and the United States(see sidebar“Defining economic mobility”).Exe

30、cutive summaryIn chapter 1,“The challenge of housing and economic mobility,”we examine the roots of the nationwide 8.2-million-unit housing shortage,which,absent forceful action,will likely climb even further(Exhibit 1).Our estimates go beyond most models by factoring in overcrowdingwhich we define

31、as households with more than one occupant per room(excluding bathrooms and kitchens).11 This contributes 3.7 million housing units to our 9.6-million-unit gap estimates by 2035.Research suggests this is indicative of declining housing and living quality due to financial strain,especially for minorit

32、y households.12 This national challenge affects many types of communities,and these signposts involve more than just numbers.They are barriers to opportunity for millions of Americans.In chapter 2,“The opportunity,”we quantify the potential benefits to the US economy and American families of address

33、ing the housing crisis and closing13 the undersupply gap by 2035.While not without trade-offs,doing so could add nearly$2 trillion to GDP through greater investment and economic activity in housing-related sectors(for example,construction)and related supply chains,and create nearly two million new j

34、obs across sectorsgains that would materialize gradually over the next ten years.For households,addressing housing supply issues could help reduce financial stress while cutting annual inflation in housing prices nearly in half(to 2.1 percent compared to 3.8 percent without intervention).In all,roug

35、hly six million cost-burdened households stand to benefit from addressing the housing gap.A range of US families,including Black households,would experience employment gains and greater financial stability.Exhibit 1108642020252030203520233.70.60.54.88.29.6Web 2025BEM-StateOfHousingBlackAmericaExhibi

36、t 1 of 14Projected 202335 US housing gap,millions of unitsNote:Projections based on assumption that population growth and housing supply will maintain their historical growth rates observed in 20122023(850,000 net new housing units/year).Figures exclude Guam,Puerto Rico,and Virgin Islands.1Housing-g

37、ap growth for 201223:3.3 million units;projected housing-gap growth for 202335:1.5 million units.2Homelessness assumed fat over 201223.3“Overcrowding”defned as household with 1 occupant per room,excluding kitchens and bathrooms.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Poin

38、t-in-Time Survey,US Department of Housing and Urban Development,accessed Jan 2025;US Census Bureau;US Department of Housing and Urban Development;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisThe US housing shortfall is projected to increase to nearly ten

39、million units by 2035.McKinsey&Company2035 projected breakdownOvercrowding3 reliefNumber of housing units required to address overcrowdingin 2012Vacancy rate benchmarkNumber of housing units across geographies required toreach US average vacancy rate in 2012Housing units for those experiencing homel

40、essnessNumber of housing units required to address existinghomelessness in 20232Housing-gap growth1Diference between number of housing units added to marketand number of new households formed between 2012 and 20352Investing in housing:Unlocking economic mobility for Black families and all AmericansW

41、e further spotlight three housing-challenged metro areas with significant Black populations:Atlanta,Chicago,and Washington,DC.We recognize that addressing the housing crisis and closing these gaps is a complex and resource-intensive endeavor that could face numerous barriers,including resistance fro

42、m industry actors and residents who may benefit from current market conditions.Overcoming these challenges will require creative approaches and proof points that help demonstrate the long-term value of this endeavor for a range of stakeholders and the broader economy.In chapter 3,“Bold solutions for

43、 a promising future,”we highlight five key themes based on an analysis of more than 80 documented and researched approaches,along with dozens of expert interviews.These bold solutions are more relevant in some community profiles than others,but all could help advance economic mobility,particularly w

44、here housing could be unlocked in economically diverse neighborhoods with access to critical resources(such as transit,jobs,and quality schools).The five key themes are unlocking land through creative incentives and partnerships,augmenting programs to unleash private capital,scaling off-site home co

45、nstruction,reinvesting in public housing and shared-equity models,and revamping housing choice vouchers.We examine why,and where,these innovations have worked and how they might be reimagined and scaled throughout the country.We quantify the impact these innovations could have if they were deployed

46、at scale.After decades of study and analysis,one thing seems clear:There is no single solution that will solve the US housing crisis.But if many of the solutions outlined in this report were reimagined,tested,and scaled,they could significantly improve the housing experiences of millions of American

47、 families,particularly Black families.In all,roughly six million cost-burdened households stand to benefit from addressing the housing gap.3Investing in housing:Unlocking economic mobility for Black families and all AmericansCHAPTER 1The challenge of housing and economic mobility Housing is much mor

48、e than the dwellings where people live.It serves as a core enabler of individual and family health and well-being,job opportunities,education,green spaces,and wealth.A homewhether rented or ownedis fundamental to ones ability to achieve economic mobility.Yet a home that is affordable,safe,and of goo

49、d quality is increasingly out of reach for far too many Americans.This reality has few social or economic boundaries.It affects rural and urban households,14 young15 and old,16 poor and middle class17across racial groups.Nearly 70 percent of Americans are concerned about the rising cost of housing,a

50、n increase of eight percentage points from 2023 to 2024.18More older adults than ever are cost burdened,19 with 11.2 million individuals over 65 spending upward of 30 percent of their income on housing.20 At the same time,homeownership among young adults has declined since 1990,reflecting the pervas

51、iveness of housing challenges.21As of 2023,the United States had 8.2 million fewer housing units than required to meet the needs of American families,driven by mismatches in supply and demand as well as by geographic imbalances.Without decisive action,this gap could grow to 9.6 million by 2035.This

52、undersupply has far-reaching consequences,including escalating costs and financial insecurity.From 2019 to 2023,a period that included the COVID-19 pandemic,the gap between housing costs and household incomes widened,with rents rising 30 percent compared with a 20 percent increase in wageshighlighti

53、ng the mounting strain on households.22Persistent supply-and-demand imbalances have made affordable,quality housing increasingly unattainable.These barriers limit opportunities to rent or own and exacerbate long-standing economic inequities.23Specifically,housing influences economic mobility in four

54、 critical ways,24 all of which are particularly relevant to Black Americans.251.Housing dominates family budgets.Housing is the largest single expenditure for most households,typically more than double transportation or food.Households are considered cost burdened if they spend 30 percent of income

55、on housing.In 2022,one-third of US households were considered severely or moderately cost burdened,26 while 47 percent of Black households were in that category.272.Neighborhoods shape opportunity.Access to jobs,schools,services,and amenities is heavily influenced by housing.A reliable place to live

56、 enables people to go to work,attend school,and participate in their communities.Research shows that every year spent in a higher-quality neighborhood increases a childs earnings in adulthood.28 Jobs:Geographic proximity affects employment,29 hours worked,wages,and transportation costs.In many areas

57、,investment in public transportation infrastructure still occurs disproportionately in counties where Black households are underrepresented.305Investing in housing:Unlocking economic mobility for Black families and all Americans Schools:Where families live often determines which public schools their

58、 children can attend.Research31 shows that better school quality in a zip code correlates with higher home prices.This relationship is particularly strong in metro regions with greater income inequality.One in five Black residents lives in a high-poverty neighborhood(even if they themselves are not

59、experiencing poverty),compared with one in 25 White Americans.32 Neighborhood amenities:Location influences access to parks and restaurants,healthcare,grocery stores,and other essential services.Compared with White Americans,Black Americans are 2.4 times more likely to live in a healthcare desert.33

60、 Communities that are predominantly Black are more likely to be food desertsthat is,areas that lack grocery stores or other places to buy fresh,healthy foods.343.Housing is key to physical well-being and safety.Substandard housing disproportionately affects low-income households,exposing them to hea

61、lth and safety risks such as lead,mold,and structural deficiencies that contribute to chronic health issues.Black households are particularly vulnerable,with a greater likelihood of residing in inadequate housing relative to other racial or ethnic groups(Exhibit 2).For example,a report from the Urba

62、n Institute35 highlights that nearly three-quarters of housing complaints related to chronic health concerns and safety hazards in Philadelphia came from areas with higher-than-average poverty rates.More than two-thirds were in areas with an above-average share of Black residents.Black Americans are

63、 nearly one-third more likely than White Americans to perceive their neighborhood as having a significant impact on their health.36Exhibit 22.15.77.82.14.16.20.83.13.91.02.03.01.23.64.8Web 2025BEM-StateOfHousingBlackAmericaExhibit 2 of 14Share of US households in inadequate housing1 in 2023,by race

64、or ethnicity,2%1“Inadequate housing”includes housing with structural hazards,lead paint,water leaks,mold,system failures,and pests.2Household race or ethnicity refects householders race or ethnicity(Black households are those for which householder identifes as Black;White households are those for wh

65、ich householder identifes as White,etc).Source:American Community Survey,US Census Bureau,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisBlack American households are more likely than those of other races and ethnicities in the United Stat

66、es to live in inadequate housing.McKinsey&CompanyModerately inadequateSeverely inadequateOverallAsianWhiteHispanicBlack6Investing in housing:Unlocking economic mobility for Black families and all Americans4.Homeownership remains a driver of wealth.Home equity is the largest financial asset for most

67、middle-income families,representing between 50 percent and 70 percent of net wealth.37 For many Americans,homeownership remains a reliable path to wealth accumulation38 and is a key driver of the racial wealth gap.39 The BlackWhite homeownership gap widened from nearly 24 percentage points in 1970 t

68、o more than 29 percentage points in 2022(Exhibit 3).40 Black households are less likely to own than White households at every income level.Inequitable lending practices continue to limit asset-accretive homeownership opportunities for Black Americans,with cascading effects(see sidebar“A legacy of di

69、scrimination”).Exhibit 3OwnRentBlackWhite27557345BlackWhite36656435BlackWhite48735227BlackWhite62813819BlackWhite77882312BlackWhite45745526Web 2025BEM-StateOfHousingBlackAmericaExhibit 3 of 14US homeownership status in 2022,by income and race or ethnicity,1%1Household race or ethnicity refects house

70、holders race or ethnicity(Black households are those for which householder identifes as Black;White households are those for which householder identifes as White,etc).Source:American Community Survey,US Census Bureau,accessed Jan 2025;Steven Ruggles,Sarah Flood,Matthew Sobek,Daniel Backman,Annie Che

71、n,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(dataset),Minneapolis,MN:IPUMS,2024Across all income quintiles,US homeownership rates are lower in Black households than in White households.McKinsey&Company1st quintile$169,200All quintiles7Investing in hous

72、ing:Unlocking economic mobility for Black families and all AmericansSidebar1 George Fatheree,“A brief history of racial zoning and how to reverse the lasting effects of housing discrimination,”Urban Land Institute,February 20,2024.2“Shelley v.Kraemer(1948),”Cornell Law School Legal Information Insti

73、tute,updated April 2021.3 Melissa Stegman and Mike Calhoun,“Federal Housing Administration,”National Low Income Housing Coalition,2021;“Book review:The Color of Law:A Forgotten History of How Our Government Segregated America,”The Zinn Education Project,accessed January 23,2025.4 Kim-Eng Ky and Kath

74、erine Lim,The role of race in mortgage application denials,Federal Reserve Bank of Minneapolis,May 2022.5“Researchers find high levels of discrimination against Black and low-income renters in new study,”The Boston Foundation,July 1,2020.A legacy of discriminationThe housing crisis for Black America

75、ns is grounded in a history of exclusion,segregation,and discriminatory practices affecting access not just to homeownership but also to rental housing.For example,early zoning laws starting in 1910 segregated Black communities.While the Supreme Court outlawed racial zoning in 1917,1 racial covenant

76、s in deeds,which werent ruled unenforceable until 19482;Federal Housing Administration policies that worked to deny many Black Americans access to federally backed mortgages and devalued Black-owned properties and nearby neighborhoods3;and violence against Black families who tried to integrate into

77、White communities continued the trends that racial zoning established long beyond the early 20th century.Even with the passage of the Fair Housing Act in 1968,barriers persisted.Practices such as appraisal bias and lending discrimination continued.Today,Black households still confront lending dispar

78、ities.Data shows that from 2018 to 2020,Black mortgage applicants were 2.9percentage points more likely to be denied than White applicants,even when borrower characteristics were the same.4Meanwhile,Black renters are often shown fewer apartments and offered fewer incentives to rent.5 Additionally,zo

79、ning restrictions and other land use policies often limit affordable rental options,and Black families are disproportionately likely to be pushed toward higher-cost or lower-quality housing options.The affordability crisis disproportionately burdens Black AmericansOne of the core challenges of the h

80、ousing crisis is a shortage of housing units.This shortage is driven by three key factors:high land and construction costs,scarce capital for affordable housing,and limited incomes and support for families(Exhibit 4).These factors create outsize challenges for Black Americans for two key reasons:1)B

81、lack Americans are more likely to live in communities where housing supply is particularly limited relative to demand,and 2)they are disproportionately represented in the lowest income quintiles,where housing challenges are most prominent(see sidebar“Community profiles”).8Investing in housing:Unlock

82、ing economic mobility for Black families and all AmericansBlack Americans are overrepresented in communities with housing shortages Single-family zoningwhich applies to 75 percent of US residential land41and complex building restrictions have combined to constrain supply across the country,particula

83、rly in urban areas with robust economies and strong job prospects(Exhibit 5).Exhibit 42.2+37%50%+26%123Web 2025BEM-StateOfHousingBlackAmericaExhibit 4 of 14Drivers of US afordable-housing shortage Source:“2024 construction workforce shortage tops half a million,”Associated Builders and Contractors p

84、ress release,Jan 31,2024;“2024 rankings:NMHC 25 largest developers,”National Multifamily Housing Council,2024;American Community Survey,US Census Bureau,accessed Jan 2025;Emily Badger and Quoctrung Bui,“Cities start to question an American ideal:A house with a yard on every lot,”New York Times,June

85、18,2019;Oliver E.J.Wing et al.,“Inequitable patterns of US food risk in the Anthropocene,”Nature Climate Change,Feb 2022,Volume 12,Issue 2;Rakesh Kochhar and Mohamad Moslimani,Wealth surged in the pandemic,but debt endures for poorer Black and Hispanic families,Pew Research Center,Dec 4,2023;“Small

86、mortgages are too hard to get,”Pew Charitable Trusts,July 3,2023;Steven Ruggles,Sarah Flood,Matthew Sobek,Daniel Backman,Annie Chen,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(dataset),Minneapolis,MN:IPUMS,2024;“Top 50 afordable housing developers of 20

87、23,”Afordable Housing Finance,May 24,2024Three drivers underpin the US shortage of afordable housing.McKinsey&CompanyHigh land and construction costsRestrictive land use policies limit housingconstruction,particularly for multifamilyhousing,in high-demand areasLand is largest driver of housingcosts:

88、75%of residential landisexclusively single-family zonedRising construction costs fromlabor and material shortages and slow productivity reduce supply,especially for lower-cost unitsMaterial costsare over a third higher than before COVID-19 pandemic,compounding labor shortageLimited capital for aford

89、ablehousing means new construction disproportionately serves middle-and high-income households1 of top 25 afordable-housing developers started 2,000 units in 2023 vs all top 25 multifamily-housing developersWeak incentives for lenderslimit available capital for potential homebuyersAsset inequality a

90、nd limited wealth reduceeconomic cushion families can accessand limit up-front capital needed forrenting or owningIncreasing climate risks in areas with high house-building rates(eg,southern and coastal megacities)will contribute to higher insurance costs and needs for maintenance and adaptationDama

91、ges from fooding could increase 26%by 2050,with likely disproportionate impact in Black communitiesScarce capital for afordable housingLimitedincomesand supportfor families70%of homes$150,000 in 2021 fnanced by mortgage vs 26%of homes 500 units between number of available units and number of units n

92、eeded by households.3“Overrepresentation of Black Americans”defned as share of Black Americans higher than share in US population(ie,12%)Source:American Community Survey,US Census Bureau,accessed Jan 2025;Steven Ruggles,Sarah Flood,Matthew Sobek,Daniel Backman,Annie Chen,Grace Cooper,Stephanie Richa

93、rds,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(dataset),Minneapolis,MN:IPUMS,2024US housing undersupply is pronounced in areas where Black households are overrepresented.McKinsey&CompanyLow to no undersupplySignifcant housingundersupply2Signifcant housing undersupply and overrepresen

94、tationof Black Americans3Sidebar1 The state of Black residents:The relevance of place to racial equity and outcomes,McKinsey,February 1,2024.Community profilesBuilding on prior McKinsey research focused on Black residents,1 this report uses community profiles to categorize and contextualize local ho

95、using environments across US counties.For the following section,which dives into specific metropolitan statistical areas,we highlight three key community profiles:Megacities:Some of the nations largest cities,megacities generally have higher GDP per capita and more“superstar”industries than other ar

96、eas.But they also often have the most pronounced inequality and high costs of living.Urban periphery:This refers to counties outside the core of major cities(that is,suburbs and exurbs).GDP per capita tends to be lower in the urban periphery because residents often work in adjacent cities,but these

97、communities may have attractive amenities(such as quality school districts and green spaces).Stable rural counties:These counties have lower economic performance than neighboring cities and suburbs but more stable performance than trailing rural counties.These distinct community profiles were create

98、d based on economic factors,size,and other characteristics.For the full set of community profile definitions,see appendix,section 1.10Investing in housing:Unlocking economic mobility for Black families and all AmericansMegacities account for 25 percent of the housing gap,equaling about two million u

99、nits,followed by the urban periphery.This supply shortage disproportionately affects the nearly one-third of Black Americans in megacities such as New York City,San Francisco,and Atlanta(Exhibit 6).Black households in these communities are moderately and severely cost burdened at higher rates than i

100、n other areas,even at higher income levels.Exhibit 62517543267111362Web 2025BEM-StateOfHousingBlackAmericaExhibit 6 of 14US housing gap in 2023,by community profle,%of total housing units neededNote:Figures do not sum to 100%,because of rounding.For additional detail on each community profle,please

101、see The state of housing in Black America:How afordable housing shapes economic mobility appendix,section 1.Source:American Community Survey,US Census Bureau,accessed Jan 2025;US Census Bureau;US Department of Housing and Urban Development;McKinsey Global Institute analysisShortages in US housing ar

102、e the most prominent in community profles where Black Americans reside.McKinsey&CompanyRural outliers 0.5College-centric townsSmall powerhousesAmericasmakersLagging cities“Silver”citiesTrailingruralcitiesHigh-growthhubsIndependent economiesStable citiesRural communitiesUrban peripheriesMegacities90%

103、of BlackAmericanpopulation livesin these kindsof communitiesTotal of 8.2 millionhousing units needed11Investing in housing:Unlocking economic mobility for Black families and all AmericansLocalized shortages affect affordability Housing undersupply has an acute impact on both home prices(Exhibit 7)an

104、d rental markets,where costs have grown steadily over the past decade.Between 2012 and 2023,megacities saw annual home price increases of 7.3 percent,above the national average growth rate of 6.8 percent.These increases placed a financial burden on householdsparticularly Black and low-income familie

105、s.Rental markets have experienced similar pressures.Areas such as Dallas County,Texas,and Fulton County,Georgia,saw rent increases of more than 5 percent annually between 2015 and 2023,versus the national average of 4 percent.Despite growing demand,the total number of housing units with monthly rent

106、s below$600has declined.Nationwide,the number of low-rent units,42 adjusted for inflation,fell from 8.3 million in 2012 to 7.2 million in 2022.43Exhibit 7A02505007501,0001,2501,500204681012Web 2025BEM-StateOfHousingBlackAmericaExhibit 7A of 14CEROSUS home values and growth trends in 2023,by communit

107、y profleNote:For additional detail on each community profle,please see The state of housing in Black America:How afordable housing shapes economic mobility appendix,section 1.1Weighted growth rate across all US counties.2CAGR,201523.Source:American Community Survey,US Census Bureau,accessed Jan 2025

108、;Housing Data database,Zillow,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisThe 50 most housing-undersupplied US counties show rising home values and sustained high prices.McKinsey&CompanyOverallAveragehome value,$thousand201223 growth in

109、 home value,%2US average:$245,000US average1:6.8%OverallMegacitiesUrbanperipheries“Silver”citiesStablecitiesHigh-growthhubsLaggingcities12Investing in housing:Unlocking economic mobility for Black families and all AmericansHousing unaffordability and lack of savings were the two most cited barriers

110、to homeownership.Similarly,cost of living is the top reason for voluntary moves among Black Americans,according to our survey of thousands of households conducted in summer 2024.Addressing these entrenched challenges is a necessityand an opportunity to create widespread economic and social benefits.

111、Exhibit 7B02505007501,0001,2501,500204681012Web 2025BEM-StateOfHousingBlackAmericaExhibit 7B of 14CEROSUS home values and growth trends in 2023,by community profleNote:For additional detail on each community profle,please see The state of housing in Black America:How afordable housing shapes economi

112、c mobility appendix,section 1.1Weighted growth rate across all US counties.2CAGR,201523.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Housing Data database,Zillow,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisThe 50

113、most housing-undersupplied US counties show rising home values and sustained high prices.McKinsey&CompanyMegacitiesAveragehome value,$thousand201223 growth in home value,%2 Harris,TXFulton,GACollin,TXTarrant,TXDallas,TXCook,ILBronx,NYEssex,NJQueens,NYWestchester,NYKings,NYAlameda,CAOrange,CALos Ange

114、les,CAContraCosta,CAMiami-Dade,FLPalmBeach,FLMaricopa,AZBroward,FLUS average:$245,000US average1:6.8%OverallMegacitiesUrbanperipheries“Silver”citiesStablecitiesHigh-growthhubsLaggingcities13Investing in housing:Unlocking economic mobility for Black families and all AmericansExhibit 7C02505007501,000

115、1,2501,500204681012Web 2025BEM-StateOfHousingBlackAmericaExhibit 7C of 14CEROSUS home values and growth trends in 2023,by community profleNote:For additional detail on each community profle,please see The state of housing in Black America:How afordable housing shapes economic mobility appendix,secti

116、on 1.1Weighted growth rate across all US counties.2CAGR,201523.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Housing Data database,Zillow,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisThe 50 most housing-undersupplie

117、d US counties show rising home values and sustained high prices.McKinsey&CompanyUrban peripheriesAveragehome value,$thousand201223 growth in home value,%2Pasco,FLOsceola,FLSeminole,FLRiverside,CASan Bernardino,CAUS average:$245,000US average1:6.8%OverallMegacitiesUrbanperipheries“Silver”citiesStable

118、citiesHigh-growthhubsLaggingcities14Investing in housing:Unlocking economic mobility for Black families and all AmericansExhibit 7D02505007501,0001,2501,500204681012Web 2025BEM-StateOfHousingBlackAmericaExhibit 7D of 14CEROSUS home values and growth trends in 2023,by community profleNote:For additio

119、nal detail on each community profle,please see The state of housing in Black America:How afordable housing shapes economic mobility appendix,section 1.1Weighted growth rate across all US counties.2CAGR,201523.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Housing Data database,Z

120、illow,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisThe 50 most housing-undersupplied US counties show rising home values and sustained high prices.McKinsey&CompanySilver citiesAveragehome value,$thousand201223 growth in home value,%2Volu

121、sia,CAPolk,FLLee,FLUS average:$245,000US average1:6.8%OverallMegacitiesUrbanperipheriesSilvercitiesStablecitiesHigh-growthhubsLaggingcities15Investing in housing:Unlocking economic mobility for Black families and all AmericansExhibit 7E02505007501,0001,2501,500204681012Web 2025BEM-StateOfHousingBlac

122、kAmericaExhibit 7E of 14CEROSUS home values and growth trends in 2023,by community profleNote:For additional detail on each community profle,please see The state of housing in Black America:How afordable housing shapes economic mobility appendix,section 1.1Weighted growth rate across all US counties

123、.2CAGR,201523.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Housing Data database,Zillow,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisThe 50 most housing-undersupplied US counties show rising home values and sustain

124、ed high prices.McKinsey&CompanyStable citiesAveragehome value,$thousand201223 growth in home value,%2Cuyahoga,OHWayne,MIShelby,TNJackson,MOHamilton,OHPima,AZFresno,CAFranklin,OHDuval,FLHonolulu,HISan Diego,CASan Joaquin,CASacramento,CAUS average:$245,000US average1:6.8%OverallMegacitiesUrbanperipher

125、ies“Silver”citiesStablecitiesHigh-growthhubsLaggingcities16Investing in housing:Unlocking economic mobility for Black families and all AmericansExhibit 7F02505007501,0001,2501,500204681012Web 2025BEM-StateOfHousingBlackAmericaExhibit 7F of 14CEROSUS home values and growth trends in 2023,by community

126、 profleNote:For additional detail on each community profle,please see The state of housing in Black America:How afordable housing shapes economic mobility appendix,section 1.1Weighted growth rate across all US counties.2CAGR,201523.Source:American Community Survey,US Census Bureau,accessed Jan 2025;

127、Housing Data database,Zillow,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility analysisThe 50 most housing-undersupplied US counties show rising home values and sustained high prices.McKinsey&CompanyHigh-growth hubsAveragehome value,$thousand201223 g

128、rowth in home value,%2Santa Clara,CABexar,TXDavidson,TNClark,NVKing,WAOrange,FLHillsborough,FLTravis,TXUS average:$245,000US average1:6.8%OverallMegacitiesUrbanperipheries“Silver”citiesStablecitiesHigh-growthhubsLaggingcities17Investing in housing:Unlocking economic mobility for Black families and a

129、ll AmericansBlack Americans are disproportionately represented in the lowest-income quintile,where housing affordability challenges are most prominentMore than 70 percent of households in the bottom income quintile(annual household income under$40,000)are severely or moderately housing cost burdened

130、,including nearly 92 percent of renters and 63 percent of homeowners.44 Nearly 55 percent of households in the bottom income quintile are severely cost burdened,meaning they spend more than half of their income on housing costs.Eighteen percent are moderately cost burdened,spending 30 percent to 50

131、percent of income on owning or renting a home.In the second quintilehousehold income from$40,000 to$71,30047 percent of households are severely or moderately housing cost burdened;20 percent are severely housing cost burdened,and 27 percent are moderately burdened(Exhibit 8).Exhibit 7G02505007501,00

132、01,2501,500204681012US average:$245,000US average1:6.8%Web 2025BEM-StateOfHousingBlackAmericaExhibit 7G of 14CEROSUS home values and growth trends in 2023,by community profleNote:For additional detail on each community profle,please see The state of housing in Black America:How afordable housing sha

133、pes economic mobility appendix,section 1.1Weighted growth rate across all US counties.2CAGR,201523.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Housing Data database,Zillow,accessed Jan 2025;McKinsey Global Institute analysis;McKinsey Institute for Black Economic Mobility anal

134、ysisThe 50 most housing-undersupplied US counties show rising home values and sustained high prices.McKinsey&CompanyLagging citiesAveragehome value,$thousand201223 growth in home value,%2Hidalgo,TXKern,CAOverallMegacitiesUrbanperipheries“Silver”citiesStablecitiesHigh-growthhubsLaggingcities18Investi

135、ng in housing:Unlocking economic mobility for Black families and all AmericansExhibit 8A100755025010075502504.23.61.015.625.53.44.00.916.125.53.14.01.016.325.52.63.91.416.625.51.93.12.517.025.515.118.56.881.6127.6Web 2025BEM-StateOfHousingBlackAmericaExhibit 8A of 14CEROSNote:The Asian household cat

136、egory includes Pacifc Islanders.Within individual income quintiles,Asian and Pacifc Islander households are as likely,if not more so,to experience moderate and severe housing-cost burden than households of other races and ethnicities,though they are less likely to experience housing-cost burden in a

137、ggregate across all income quintiles.This is because these households are overrepresented in highest income quintiles(2.5 million households inhighest quintile vs 1 million in lowest quintile)and in homeownership(4.3 million homeowners vs 2.4 million renters),where households are less likely to have

138、moderate or severe cost burden.Additionally,Native American households,or“American Indian and Alaska Native”households according to the US Census Bureauare included in estimates for all households and not brokenly out separately because population and subsequent survey sample size are small.1We defn

139、e“severely burdened”as spending more than 50 percent of income on housing costs and“moderately burdened”as spending 3050 percent of income on housing costs.2Household race or ethnicity refects householders race or ethnicity.Black households are those for which householder identifes as Black;White ho

140、useholds are those for which householder identifes as White,etc.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Steven Ruggles,Sarah Flood,Matthew Sobek,Daniel Backman,Annie Chen,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(dataset),M

141、inneapolis,MN:IPUMS,2024McKinsey&Company1st quintile$169,200All quintilesBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllIn the United States,Black households experience severe and moderate ho

142、using-cost burden at higher rates than do other racial and ethnic groups.SeverelyburdenedModeratelyburdenedNotburdenedShare of 2022 US households with housing-cost burden,1 by income and race or ethnicity,2%All householdsAllhouseholdsRenterhouseholdsOwnerhouseholdsTotal numberof households,millions1

143、9Investing in housing:Unlocking economic mobility for Black families and all AmericansExhibit 8B10075502502.31.60.43.88.61.91.90.34.08.61.71.90.34.18.61.41.90.54.48.61.01.60.94.68.68.38.92.421.042.91007550250Exhibit 7GWeb 2025BEM-StateOfHousingBlackAmericaExhibit 8B of 14CEROSNote:The Asian househol

144、d category includes Pacifc Islanders.Within individual income quintiles,Asian and Pacifc Islander households are as likely,if not more so,to experience moderate and severe housing-cost burden than households of other races and ethnicities,though they are less likely to experience housing-cost burden

145、 in aggregate across all income quintiles.This is because these households are overrepresented in highest income quintiles(2.5 million households inhighest quintile vs 1 million in lowest quintile)and in homeownership(4.3 million homeowners vs 2.4 million renters),where households are less likely to

146、 havemoderate or severe cost burden.Additionally,Native American households,or“American Indian and Alaska Native”households according to the US Census Bureauare included in estimates for all households and not brokenly out separately because population and subsequent survey sample size are small.1We

147、 defne“severely burdened”as spending more than 50 percent of income on housing costs and“moderately burdened”as spending 3050 percent of income on housing costs.2Household race or ethnicity refects householders race or ethnicity.Black households are those for which householder identifes as Black;Whi

148、te households are those for which householder identifes as White,etc.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Steven Ruggles,Sarah Flood,Matthew Sobek,Daniel Backman,Annie Chen,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(datas

149、et),Minneapolis,MN:IPUMS,2024McKinsey&Company1st quintile$169,200All quintilesBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllIn the United States,Black households experience severe and modera

150、te housing-cost burden at higher rates than do other racial and ethnic groups.SeverelyburdenedModeratelyburdenedNotburdenedShare of 2022 US households with housing-cost burden,1 by income and race or ethnicity,2%Renter householdsAllhouseholdsRenterhouseholdsOwnerhouseholdsTotal numberof households,m

151、illions20Investing in housing:Unlocking economic mobility for Black families and all AmericansExhibit 8C10075502501.82.00.611.816.91.52.10.612.116.91.42.10.712.116.91.22.00.912.216.90.91.51.612.416.96.89.64.360.784.71007550250Web 2025BEM-StateOfHousingBlackAmericaExhibit 8C of 14CEROSNote:The Asian

152、household category includes Pacifc Islanders.Within individual income quintiles,Asian and Pacifc Islander households are as likely,if not more so,to experience moderate and severe housing-cost burden than households of other races and ethnicities,though they are less likely to experience housing-cos

153、t burden in aggregate across all income quintiles.This is because these households are overrepresented in highest income quintiles(2.5 million households inhighest quintile vs 1 million in lowest quintile)and in homeownership(4.3 million homeowners vs 2.4 million renters),where households are less l

154、ikely to havemoderate or severe cost burden.Additionally,Native American households,or“American Indian and Alaska Native”households according to the US Census Bureauare included in estimates for all households and not brokenly out separately because population and subsequent survey sample size are s

155、mall.1We defne“severely burdened”as spending more than 50 percent of income on housing costs and“moderately burdened”as spending 3050 percent of income on housing costs.2Household race or ethnicity refects householders race or ethnicity.Black households are those for which householder identifes as B

156、lack;White households are those for which householder identifes as White,etc.Source:American Community Survey,US Census Bureau,accessed Jan 2025;Steven Ruggles,Sarah Flood,Matthew Sobek,Daniel Backman,Annie Chen,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15

157、.0(dataset),Minneapolis,MN:IPUMS,2024McKinsey&Company1st quintile$169,200All quintilesBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllBlackHispanicAsianWhiteAllIn the United States,Black households experience severe an

158、d moderate housing-cost burden at higher rates than do other racial and ethnic groups.SeverelyburdenedModeratelyburdenedNotburdenedShare of 2022 US households with housing-cost burden,1 by income and race or ethnicity,2%Owner householdsAllhouseholdsRenterhouseholdsOwnerhouseholdsTotal numberof house

159、holds,millions21Investing in housing:Unlocking economic mobility for Black families and all AmericansThe affordability challenge is even more apparent for Black families;more than one-third are severely cost burdened across all income levels,the highest of any demographic.The affordability challenge

160、 for Black households is particularly pronounced in the South,where more than half of Black Americans in the bottom 40 percent of income reside,and which accounts for a majority of severely cost-burdened Black households(Exhibit 9).Exhibit 9AWeb 2025BEM-StateOfHousingBlackAmericaExhibit 9A of 14CERO

161、S1Household race or ethnicity refects householders race or ethnicity(Black households are those for which householder identifes as Black;White households are those for which householder identifes as White,etc).Source:American Community Survey,US Census Bureau,accessed Jan 2025;Steven Ruggles,Sarah F

162、lood,Matthew Sobek,Daniel Backman,Annie Chen,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(dataset),Minneapolis,MN:IPUMS,2024Both lower-income and cost-burdened Black households in the United States are concentrated in the South and along the coasts.McKin

163、sey&Company60%of US Black households in lowest 40%of income are in South and coastal areas,primarily Texas,Georgia,Florida,North Carolina,and Louisiana151678794444452,0002,000Distribution of US Black households1 in lowest 40%of income,number of householdsLower-income householdsLower-incomehouseholds

164、Cost-burdenedhouseholds22Investing in housing:Unlocking economic mobility for Black families and all AmericansExhibit 9B1819250251485 4861,0001,000Web 2025BEM-StateOfHousingBlackAmericaExhibit 9B of 14CEROS1“Severely cost burdened”defned as spending 50%of income on housing costs.2Household race or e

165、thnicity refects householders race or ethnicity(Black households are those for which householder identifes as Black;White households are those for which householder identifes as White,etc).Source:American Community Survey,US Census Bureau,accessed Jan 2025;Steven Ruggles,Sarah Flood,Matthew Sobek,Da

166、niel Backman,Annie Chen,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(dataset),Minneapolis,MN:IPUMS,2024Both lower-income and cost-burdened Black households in the United States are concentrated in the South and along the coasts.McKinsey&Company55%of seve

167、rely cost-burdened US Black households arein South and coastal areas,primarily Texas,Georgia,and FloridaDistribution of severely cost-burdened1 US Black households,2 number of householdsCost-burdened householdsLower-incomehouseholdsCost-burdenedhouseholds23Investing in housing:Unlocking economic mob

168、ility for Black families and all AmericansIn the previous chapter,we established housing as a cornerstone of economic mobility and laid out the urgency of addressing the projected 9.6-million-unit housing shortfall by 2035.In this chapter,we explore the broader opportunity:How can bridging the gap u

169、nlock sustainable,inclusive economic growth?To answer this question,we explore the transformative ripple effects of targeted investments in housing.At its core,the crisis affects the entire economy.Constrained housing supply can serve as a major barrier to economic growth;one study suggests that a l

170、ack of housing may have lowered aggregate US GDP growth by up to 36 percent between 1964 and 2009.45A constrained housing market creates a“spatial misallocation”of talent and resources.46 The result is limited individual geographic mobility and muted aggregate productivity,limiting the nations econo

171、mic potential.Targeted housing investments could unlock benefits in four critical areas:GDP growth,job creation,increased tax revenues,and improved housing affordability.The impact could also drive increased productivity,labor mobility,and wealth creationkey ingredients for inclusive and sustainable

172、 growth.For example,just as other sectors are harnessing artificial intelligence to transform their businesses,47 housing could increasingly leverage AI and other emerging technologies to reduce construction costs and improve the quality of manufactured homes,for example,and improve the delivery of

173、housing-related financial services.Technology could be a key enabler to unlocking these opportunities.Closing the affordable housing shortfall would do more than address inequities.It could offer national opportunities to fuel economic growth for households and communities and across industries.Beca

174、use Black families have suffered disproportionately from the housing shortage,our impact model suggests they would experience many of the benefits of addressing the crisis14 percent of all households lifted out of cost burden are Black,despite representing only 12 percent of overall households.That

175、said,Americans of all races and ethnicities would experience significant gains,both directly and indirectly,from a less supply-constrained housing market.At the same time,we recognize that capturing this opportunity would require trade-offs.Given tight labor markets,labor shortages in construction t

176、rades,48 and the importance of other critical national investments(such as education and healthcare),the task at hand would not be easy.That said,if the public and private sectors in the United States could create the capacity and investment needed,the benefits of closing the housing shortage could

177、be meaningful.CHAPTER 2The opportunity25Investing in housing:Unlocking economic mobility for Black families and all AmericansNational impact:Economic growth and jobsMacrolevel implications Housing investments have a multiplier effect on economic growth and tax revenues.Closing the gap by 2035 would

178、mean building 9.6 million housing units on top of the roughly 850,000 units per year already expected from 2023 to 2035.This incremental investment could generate nearly$2 trillion in cumulative GDP gains throughout the construction supply chain,equivalent to Brazils 2023 economic output.This growth

179、 would be fueled by an estimated$2.7 trillion in cumulative investments(Exhibit 10).Second-order effects49 could add even more,50 driven by additional job creation,earnings,and consumer spending tied to expanded construction activity.Addressing shortages could enhance labor mobility.Assuming housing

180、 production increases from 843,000 to 1.7 million units per year,it could add nearly two million new jobs,including more than 700,000 in construction trades.51 For Black Americanswho represent only 5 percent of employment in construction tradesan estimated 55,000 new jobs would be created,increasing

181、 household income of these workers by$40,000 on average.Asian workers similarly represent a small share of construction workers and could take on roughly 10,000 new jobs.The difference is even more significant for Latino workers,who could gain an estimated 280,000 new jobs.White workers,who account

182、for more than half of the industry,could stand to gain 370,000 jobs.52 Housing investmentsand subsequent economic upliftmay help alleviate housing-related cost pressures.For example,we estimate the median US household income may grow 3.2 percent annually from 2022 to 2035.Additionally,by building ho

183、using required to meet the 9.6-million-unit housing supply gap,we estimate home prices may grow at 2.1 percent per annum(below expected household income),alleviating cost pressures.Conversely,if the housing supply gap is not addressed,supply tightness may push prices to grow by 3.8 percent annually(

184、above expected household income growth),worsening cost pressures.Lower-and middle-income familiesincluding a significant portion of Black Americansstand to benefit as more jobs become available,incomes increase,and housing becomes Exhibit 102.10.5Web 2025BEM-StateOfHousingBlackAmericaExhibit 10 of 1

185、4Cumulative investment required to close 202535 US housing gap,$trillion1Note:Figures do not sum to 100%,because of rounding.1GDP(value added)and jobs created estimated through efect of economic multipliers that leverage geographic-specifc inputoutput tables to assess value linkages from origin indu

186、stry and impact(eg,housing construction)on other industries.2Construction-supply-chain impact captures changes in output,GDP,and jobs of residential-construction industry and their efect on all levels of construction industry suppliers,excl induced impact,which is generated by earning and spending c

187、hanges tied to change in output of initial industry(both direct and indirect afects).Source:McKinsey Global Institute analysisClosing the US housing gap would require an investment of$2.7 trillion.McKinsey&CompanyConstructionTotal:2.7$1.9 trillioncumulative GDP growth1.7 millionjobs createdEconomic

188、impact2Real estate brokers fees 0.02Other landacquisition costs26Investing in housing:Unlocking economic mobility for Black families and all Americansmore accessible and affordable.Overall,the number of cost-burdened households could decrease by around 15 percent.53 Across races,nearly six million c

189、ost-burdened households stand to benefit from addressing the housing gap,by no longer being cost burdened.Community impact:Spotlight on Atlanta,Chicago,and Washington,DCWhile our research is national in scope,metro areas such as Atlanta,Chicago,and Washington,DC,help provide compelling examples of t

190、he localized economic potential of greater housing investments.These cities are highlighted as examples given their geographic diversity,their significant Black populations,and the scale of the housing challenges they face.Estimates for housing units were developed using the same methodology as our

191、national model,while investment and impact accounted for each citys unique demographic composition and housing costs.These cities represent three common community profilesmegacities,urban periphery,and rural citieswhich together account for more than 50 percent of the nations housing shortage(Exhibi

192、t 11).Exhibit 11Area of detailArea of detailArea of detailWeb 2025BEM-StateOfHousingBlackAmericaExhibit 11 of 14Projected US housing undersupply in 2035,by metropolitan statistical area,number of housing unitsNote:Some counties do not have data available.Source:American Community Survey,US Census Bu

193、reau;Steven Ruggles,Sarah Flood,Matthew Sobek,Daniel Backman,Annie Chen,Grace Cooper,Stephanie Richards,Renae Rodgers,and Megan Schouweiler,IPUMS USA:Version 15.0(dataset),Minneapolis,MN:IPUMS,2024;US Department of Housing and Urban Development;McKinsey Global Institute analysis;McKinsey Institute f

194、or Black Economic Mobility analysisThree US metropolitan areas that are a mix of community types capture what the housing gap looks like at local levels.McKinsey&CompanyChicago,ILNaperville,ILElgin,ILWashington,DCArlington,VAAlexandria,VAAtlanta,GASandy Springs,GARoswell,GA189,00070,000193,000WIWVVA

195、MDGAALINILDCMegacitiesLargest urbancenters withhigh GDP/capitaCommunityprofleUrban peripheriesCounties outsidemajor cities withcomplementary economiesStable rural countiesCounties with economic performance lower than in neighboring cities andsuburbs but arent distressed100,000units50,00010,00027Inve

196、sting in housing:Unlocking economic mobility for Black families and all Americans Chicago:Addressing the 189,000-unit shortfall(in excess of expected housing construction)would require$54 billion in investment,contributing more than$30 billion to the local economy and generating nearly 27,000 jobs b

197、y 2035.Following through on this investment may lower the total number of cost-burdened households by 13 percent(about 200,000 total).Washington,DC:Closing the 70,000-unit gap54 would require$22 billion in investment,generating an additional$11 billion in economic growth and creating nearly 10,000 n

198、ew jobs by 2035.If this is addressed,10 percent of cost-burdened households may experience relief(about 70,000 total).Atlanta:Bridging the projected 193,000-unit55 housing gap would require$63 billion in investment.This could drive$36 billion in economic growth and create more than 34,000 jobs.Lower

199、 housing costs may decrease the number of cost-burdened households in the city by more than 20 percent(about 150,000 total).Atlanta,Chicago,and Washington,DC,help provide compelling examples of the localized economic potential of greater housing investments.28Investing in housing:Unlocking economic

200、mobility for Black families and all AmericansThe previous two chapters outlined the dramatic scale of the housing crisis and highlighted the significant benefits that resolving it could offer households,communities,and the economy.This crisis is unlikely to be resolved with a one-size-fits-all appro

201、ach.Rather,targeted solutions tailored to local and regional challenges,executed collaboratively by many different stakeholders,offer the most promise.In the private sector,developers,development corporations,financial institutions,insurers,investors,and manufacturers play crucial roles in construct

202、ion and housing finance.The public sectorencompassing federal,state,and local governments,along with public housing authorities(PHAs)is critical for funding and subsidizing housing(particularly for the most financially vulnerable),creating innovative incentives to leverage private capital effectivel

203、y,enforcing zoning and land use policies,and managing public programs.The social sector,including philanthropy and nonprofit providers,is key to supporting novel solutions and risk-taking,advocating for families,and supporting effective direct services and supports.Understanding and leveraging the d

204、istinct roles of these stakeholders can help our nation collectively address the challenges of affordable housing.Our research aims to build on the extensive work of institutions and individuals who have been pursuing this work for generations.Different strategies have shown varying levels of succes

205、s,but even what“works”is happening in piecemeal ways in pockets of the countryand many well-intentioned solutions face significant implementation challenges on the ground.This chapter shines a light on a handful of potential solutions that have been shown to work(or have the potential to do so),aims

206、 to uncover what barriers often impede these solutions from scaling,and explores creative approaches to a path forward.Our approachWe conducted a meta-analysis of research published in the past decade by more than 50think tanks,academics,industry associations,nonprofits,and others to catalog a list

207、of more than 80solutions to explore(see appendix,section 2 for the full list of solutions).We then shortlisted these solutions based on four factors:Relevance to Black residents.A solution is more likely relevant if it focuses on places where Black Americans are concentrated or if it addresses speci

208、fic barriers Black residents face.Strength of evidence.There is robust evidence demonstrating the solutions effectiveness or emerging consensus based on early evidence or analogs.Potential impact.A solution has the potential to truly move the needle by significantly increasing supply or improving af

209、fordability.Feasibility.A solution may garner buy-in across stakeholders including government,residents,financial institutions,developers,and others.CHAPTER 3Bold solutions for a promising future30Investing in housing:Unlocking economic mobility for Black families and all AmericansWe then conducted

210、nearly two dozen calls with experts across the public,social,and private sectors.Ultimately,five themes emerged:Theme 1:Unlock land through creative incentives and partnershipsThe problem todayZoning determines what housing is built where.Zoning restrictions limit where people can liveand have histo

211、rically been used as a tool to prevent families,particularly Black families and those from other racial and ethnic groups,from living in certain communities.56 Zoning restrictions can also increase housing prices by limiting supply.Higher-density development appears central to addressing the afforda

212、ble housing crisis.Within a 15-year window,around 150 policies have taken shape across nearly 100 municipalities in pursuit of zoning changes.57 These include reducing minimum lot sizes,changing parking requirements,and expanding multifamily zoning.While many experts,advocates,and policymakers agree

213、 that zoning reforms are critical,many of these well-intentioned changes are limited in scale,speed,and efficacy.Governments may be wary of backlash from vocal opponents and pushback from residents.Jurisdictions often lack the capabilities and know-how to optimize vacant landwhich,by some estimates,

214、accounts for 17 percent of urban land in the United States.58To address these impediments,we outline three strategies inspired by innovations inside and outside the United States.Example 1:Leverage transit to provide incentives for improved zoning States can provide incentives for communities to fun

215、d higher-density development near public infrastructure.While state initiatives may aim to enhance affordable housing options,they may also inadvertently cause displacement.Therefore,it is critical to adopt measures to ensure existing residents are not forced out of their neighborhoods.59 Colorados

216、2024 Housing in Transit-Oriented Communities law(HB 24-1313)requires 31municipalities to build higher-density residential development,of at least 40 units per acre,within a quarter mile of bus stops and a half mile of rail stations.The law includes a$35 million competitive grant program,which awards

217、 infrastructure funding to communities to upgrade transit and neighborhood centers.Other jurisdictions could explore similar competitive programs.60 As part of a 2021 Economic Development Bill,Massachusetts passed legislation similar to Colorados,requiring 171 rapid transit communities to enact rule

218、s that zone at least one district for multifamily development“by right”(instead of by discretionary review process).61 Unlike Colorado,Massachusetts established penalties for noncompliance.Communities with rapid transit facilities that fail to enact required zoning reform may lose funding eligibilit

219、y for other programs.Massachusettss transit-oriented legislation,Chapter 40A of the states Zoning Act,has been particularly effective at increasing housing supply because it complements prior legislation allowing developers to appeal aspects of zoning laws that limit building height.Other communitie

220、s might look to couple transit infrastructure funding with housing development in similar ways.Example 2:Increase incentives for existing residents via direct financial benefitsWhile states can help local jurisdictions circumvent some challenges in reimagining land use,many may still encounter oppos

221、ition from residents.Studies have demonstrated that affordable housing development is not correlated with trends in crime,property values,or taxes.62 This section focuses on incentives;however,we acknowledge that opposition to land use may be unmerited.In Massachusetts,54 percent of voters in Milton

222、a predominantly high-income,owner-occupied suburbrejected proposed zoning reforms even at the expense of losing funding for public projects,including a$140,800 grant for seawall improvements.63 A more novel solution could provide incentives to existing residents more directly via direct financial be

223、nefits:31Investing in housing:Unlocking economic mobility for Black families and all Americans Some state and local governments use tax increment financing(TIF)to fund development projects through future property tax increases.64 The process starts with the establishment of baseline revenues based o

224、n current property values within the municipality.Over time,as private or public development drives up value,the incremental tax revenue is reinvested in infrastructure and other projects.Evidence on TIF is mixed.Some cities have successfully used it to establish dedicated revenue streams.For exampl

225、e,Portland,Oregon,sets aside 45 percent of TIF revenue for housing,which has generated roughly$83 million to support construction of 2,200 units of affordable housing.65 That said,critics have argued that this policy diverts revenueswhich would have been captured even without the TIF-funded investme

226、ntsaway from other services,such as other public infrastructure.66 Some jurisdictions in California have begun innovating on TIF models,successfully forming enhanced infrastructure financing districts(EIFDs).EIFDs similarly capture incremental tax revenues but also empower local communities to deter

227、mine how and where those revenues are used via community-empowered governance structures.67 One approach could be to redistribute incremental tax revenues from rezoning directly to households.Through direct dividends,residents could gain a financial benefit from higher-density,mixed-income developme

228、nt.Taking inspiration from TIF and other direct-benefit incentive programssuch as the Alaska Permanent Fund(APF),a state program that distributes annual dividends to eligible residents from oil revenues generated by the Trans-Alaska Pipeline Systemthis approach might help reduce resident resistance

229、to zoning changes.While learning and testing would be critical,this approach could help unlock housing in historically more resistant communities.Example 3:Leverage publicprivate partnershipsMunicipalities could accelerate housing development by more creatively leveraging publicprivate partnerships(

230、see sidebar“Case study:Minneapolis”):The Copenhagen(CPH)City&Port Development Corporation,established in 2007 as a merger of the restad Development Corporation and the Port of Copenhagen,is a publicly owned,privately run corporation that manages publicly owned assets,assesses market value,and captur

231、es profits for public investment.68 National and local governments transfer underused assets to CPH City&Port Development,which rezones them for residential and commercial use.As the value of rezoned land rises,CPH City&Port Development secures low-cost loans from Denmarks National Bank,enabled by C

232、openhagens AAA credit rating.The capital raised is used to invest in public transit,roads,and other urban amenities that improve the livability and attractiveness of the residential and commercial assets,and is reinvested to help service the debt.Similarly,the Port of Greater Cincinnati Development

233、Authority(the Port),established in 2001,has supported a range of cross-stakeholder investments intended to accelerate residential development.For example,in 2022,the Port purchased 194 single-family homes with the goal of renovating them and creating opportunities for affordable homeownership.Throug

234、h the support of local government and philanthropyas well as close collaborations with small minority-and women-owned contractor businesses and diverse real estate brokerage firmsthe first slate of 19 homes has begun to have an impact on residents and local businesses.69 The Denver Regional Transit-

235、Oriented Development(TOD)Funda partnership of state and local housing agencies,philanthropic institutions,community development financial institutions(CDFIs),and major bankspromotes affordable housing alongside Denvers transit expansions.The fund provides low-cost loans to developers,subsidizing lan

236、d costs around transit centers.Between 2010 and 2022,the fund invested$50 million into 22properties resulting in more than 2,000 new or preserved affordable unitsdouble its goal.7032Investing in housing:Unlocking economic mobility for Black families and all AmericansImpact of scaling these strategie

237、sWe estimate that if localities upzoned such that 3 to 4 percent of projected single-family housing starts are replaced with multifamily units each year for the next decade,the United States could add approximately 530,000 to 620,000 housing units and have an impact on 120,000 to 140,000 Black house

238、holds from 2025 to 2034.71If roughly one in five localities rezoned 5 to 6 percent of vacant public land for higher-density residential development,we estimate that the United States could add 490,000 to 620,000 units and have an impact on 70,000 to 140,000 Black households over ten years.72Theme 2:

239、Augment programs to unleash private capitalThe problem todayWithout subsidies and creative financing,it is often difficult for the investment underwriting for affordable housing to pencil out.Financing shortages are particularly acute for Black-led affordable housing developers,who frequently cite c

240、hallenges in accessing capital.73 One solution that has helped make this work is the Low-Income Housing Tax Credit(LIHTC)program.A publicprivate partnership that leverages federal tax dollars to provide incentives for private investment,LIHTC is the largest source of new-construction funds for affor

241、dable housing development.74 Although it is not without its challenges,the program has financed the construction or rehabilitation of nearly four million units,contributed$257 billion in tax revenue,and generated more than$700 billion in wages and business income since 1986.75 From 2000 to 2019,LIHT

242、C provided at least partial financing for 25 percent of new apartments built nationwide,according to the Urban Institute.76Sidebar1“Affordable housing,”City of Minneapolis,updated December 18,2023.2 Minneapolis 2040the citys comprehensive plan,City of Minneapolis,October 25,2019.3 Alex Horowitz,Linl

243、in Liang,and Adam Staveski,“Minneapolis land use reforms offer a blueprint for housing affordability,”Pew Charitable Trusts,January 4,2024.4“GroundBreak Coalition shares progress toward ambitious vision during community briefing,”McKnight Foundation,accessed January 14,2025.5 Kim-Eng Ky,Libby Starli

244、n,and Zakary Yudhishthu,“Minneapolis 2040 Plan data tool prepared to measure impacts,”Federal Reserve Bank of Minneapolis,April 11,2024.Case study:Minneapolis Housing has become a central topic in Minneapolis,where approximately 50,000 renters earn less than 60 percent of the area median income(AMI)

245、.The city has a long history of action on affordability.1 Its most robust effort to date is Minneapolis 2040,a multiphase approach with more than 20 policies leveraging public transit,inclusionary zoning requirements,tax incentives,and preserving naturally occurring affordable housing(NOAH).2 The ai

246、m of the plan is to recover land taken by highway construction throughout the past 70 years,disproportionately affecting Black residents,especially those on the citys Northside.Less than five years into the plan,results are promising.Minneapolis has led major Midwestern cities in construction per ca

247、pita and has seen less growth in rental costs than the rest of Minnesota.Minneapolis saw a 12 percent growth in housing stock from 2017 to 2023,accompanied by a 1 percent growth in rent,compared to a 4 percent growth in statewide housing and a 14 percent increase in rent.3 The citys cross-sector col

248、laboration serves as a blueprint for leveraging innovative sources of capital.GroundBreak Coalition,a MinneapolisSaint Paul group of more than 40companies,nonprofits,and government entities,seeks to deploy upward of$5 billion in capital toward promoting wealth creation to counteract systemic inequit

249、y.The first tranche,a nearly$1 billion investment made in late 2023,focused on homeownership,using tactics such as special-purpose credit programs and low-cost capital through philanthropies.This aims to create a multiplier of$3 in private capital for every dollar of flexible capital.4 As its housin

250、g agenda unfolds,Minneapolis may continue to be an example of how cross-sector innovation can address housing challenges.5 33Investing in housing:Unlocking economic mobility for Black families and all AmericansBut constrained financing and complex application processes limit the programs efficacy an

251、d increase costs for developers,despite general support for the program.Most banks lack incentivesparticularly without LIHTC financingto underwrite affordable housing investments.Additionally,studies show that LIHTC projects are seldom placed in high-opportunity areas.To address this,states could co

252、nsider revising their allocation strategies for LIHTCs to emphasize placement in neighborhoods that offer greater opportunities for residents.77We examine four potential innovations that could further enhance LIHTC and help unleash other sources of private capital.Example 1:Streamline LIHTC applicat

253、ions at the state level Streamlining applications and centralizing funding sources may help fast-track affordable housing proposals and reduce costs for developers.One tax credit syndicator estimates that LIHTC arrangements with five or more soft funding sources add several hundred thousand dollars

254、in administrative costs,while another estimates an extra 10 percent of total project costs.78 In California,each additional soft source for new LIHTC construction increases per-unit costs by roughly$6,500 on average,or 1.7 percent of per-unit costs.Pennsylvania offers a one-stop-shop model to help r

255、educe costs.79 The Pennsylvania Housing Finance Agency(PHFA)consolidates numerous funding streams,including LIHTC,HOME allocations,and National Housing Trust Fund dollars,into one processaligning LIHTC with other state and local funding.This allows the PHFA to automatically consider developers for m

256、ultiple funding sources that have identical legal terms,similar requirements,and standardized monitoring processes.The PHFA handles all applications in-house with staff who are familiar with program requirements.This one-stop-shop approach could be a model for others to reduce the administrative bur

257、den(and related costs)of LIHTC processes.Example 2:Consider refinements to the cap on tax-exempt bondsIn 2023,one in three states maxed out automatic LIHTC credits after reaching the private activity bond(PAB)cap.PABs are government-issued,tax-exempt bonds for private projects that serve a public pu

258、rpose.When at least 50 percent of a housing projects financing consists of PABs,it automatically qualifies for 4 percent tax credits.These credits subsidize 30 percent of low-income unit costs in a project.However,the federal government caps the number of PABs any state can issue each year based on

259、a population formula.80 Volume caps do not apply to critical infrastructure and other public services considered to be public necessities.Affordable housing could be viewed similarly and therefore also be considered exemptwith alternative sources of income identified to support the expansion of the

260、cap.81 State-level LIHTC programs could provide a model to better inform federal action.Colorados state-level LIHTC program,for example,exempts LIHTC credits from the annual state cap if development takes place in counties affected by natural disasters.82 At the federal level,lifting the cap could u

261、nlock more LIHTC funding and construction.Example 3:Innovate and refine tax abatementsIn addition to LIHTC programs,“as of right”tax abatements could help affordable housing investors further spur development.In Illinois,the Affordable Housing Special Assessment Program offers property tax abatement

262、s for developers that make a minimum share of units affordable for families earning less than 60 percent of area median income(AMI)for at least ten years.83 In Florida,up to 100 percent of units in multifamily developments are exempt from property tax if a minimum share of units is affordable to hou

263、seholds earning less than 80 percent of AMI.8434Investing in housing:Unlocking economic mobility for Black families and all AmericansThese programs can help make affordable housing more attractive for investors,and further innovations could be explored.For instance,philanthropic capital could help m

264、ake these abatements more accessible by filling gaps in predevelopment financing for smaller developers that may lack the up-front capital and expertise needed to pursue these programs.85 Furthermore,philanthropic or mission-driven capital could provide forms of guarantees to reduce the regulatory r

265、isk of these state-run programs.Other states and jurisdictions could also consider launching similar programs to spur housing investment.Example 4:Unlock more capital for multifamily affordable housing Loan portfolios that are compliant with the Community Reinvestment Act(CRA)could improve access to

266、 financing for affordable housing developers.The CRA,which provides incentives for financial institutions to invest in affordable housing and other development projects,enabled$227 billion in mortgages and small-business loans and$151 billion in community development loans to flow to low-and middle-

267、income communities in 2022.86 More preassembled portfolios of CRA-compliant multifamily housing loans could reduce risks by helping small and medium-size banks pool resources and overcome capacity challenges to invest in affordable housing.Community Capital Management,a registered investment adviser

268、,manages$6.3 billion in CRA-qualified investments.It has invested$130 million in mortgage-backed securities for low-income housing through its Affordable Housing ETF since September 2024.87 CRA-compliant loan portfolios could also expand the secondary loan market for CDFIs.Between 2018 and 2022,CDFI

269、 lending more than doubled,reaching$67 billion in originations and$14 billion in loan sales.88 However,limited secondary loan markets prevent CDFIs from replenishing capital to originate new loans.More than half of CDFIs that report higher demand also report being unable to meet that demand.89 Creat

270、ing portfolios of CRA-compliant CDFI loans could help CDFIs meet this demand with a larger secondary loan market,90 particularly since changes to the CRA expected to take effect in 2026 will make purchasing CRA-eligible loans from CDFIs simpler and more beneficial for banks.91 Scale Link is one nonp

271、rofit fund that pools CDFI loan packages to sell to banks.Scale Link has purchased 3,500 loans from CDFIs,sold nearly$37 million to bank partners,and provided$55 million in capital to CDFIs since late 2020.92More solutions like these may help a greater share of institutions make affordable housing i

272、nvestments.Impact of scaling these strategiesIf the PAB cap for LIHTC were lifted and states that have maximized their PAB allocation increased PAB issuance each year by 14 percent to 16 percent,93 we estimate that an additional 330,000 to 380,000 LIHTC units could be constructed,affecting 70,000 to

273、 85,000 Black households over ten years.This estimate assumes an additional$24 billion to$34 billion in annual PAB allocation by the federal government for ten years,which represents nearly double the total multifamily PAB allocation in 2020($17.2 billion).94If financing strategies expanded the seco

274、ndary loan market for CDFIs such that CDFIs were able to increase multifamily housing lending by approximately$1.5 billion to$2.0 billion each year,we estimate that the United States could finance approximately 40,000 to 60,000 additional multifamily units,making an impact on 9,000 to 13,000 Black f

275、amilies over ten years.9535Investing in housing:Unlocking economic mobility for Black families and all AmericansTheme 3:Scale off-site home construction The problem todayTraditional,on-site construction is time-consuming and expensive.Producing components in factories and assembling them on-site cou

276、ld help address high material prices and skilled-labor shortages96 and offer the kind of productivity and innovation that has helped other sectors of the economy.Despite significant cost savings,prefabricated techniquesparticularly modular construction97have struggled to scale.Modular construction(E

277、xhibit 12)is 20 percent to 50 percent faster,20 percent cheaper,98 and more energy efficient99 than traditional methods.Yet it represented only 3 percent of multifamily and 4 percent of single-family completions from 2000 to 2023.100 This section of the report explores examples of ways to scale home

278、 construction.Example 1:Standardize state and local codes Federal HUD codes apply to manufactured but not modular housing,which is governed by state and local codes.101 As a result,states generally do not certify construction from an out-of-state factory without detailed inspections.Standardized cod

279、es could enable modular construction companies to operate in multiple states efficiently,as in the following examples:In Hawaii,the Federal Emergency Management Agency(FEMA)used modular homes constructed out of state to replace 2,000 homes destroyed by the Maui wildfires of August 2023.102 To do so,

280、FEMA relied on a set of off-site construction standards developed by the Modular Building Institute(MBI)and the International Code Council.Colorado,Montana,Rhode Island,Utah,and Virginia leveraged MBIs proposed industry-wide guidelines.Exhibit 12HUD1-regulated manufactured homes are constructed in f

281、actories and attached to a chassis on-siteMcKinsey&CompanyWeb 2025BEM-StateOfHousingBlackAmericaExhibit 12 of 14Construction methodNontraditional construction methods range from partially of-site build elements to fully of-site design and build.Traditional site-built homesPanelized constructionModul

282、ar constructionManufactured homesStructures are built on permanent property,with assembly of deliveredmaterials on-siteIndividual systems(eg,walls,foors,roofs)are produced in factories and assembled in pieces on-site Volumetric sections(eg,enclosed rooms,full units)are built in factories and assembl

283、ed like blocks on-site On-site constructionOf-site construction1US Department of Housing and Urban Development.36Investing in housing:Unlocking economic mobility for Black families and all AmericansExample 2:Develop tailored financing and lender education on the benefits of modular construction Modu

284、lar construction is considered riskier than standard construction because of its relative novelty and the highly customized nature of units,and therefore can require more up-front capital than traditional construction.A study by the National Renewable Energy Laboratory found that developers can requ

285、ire up to 30 percent higher equity for modular versus on-site construction.103 Tailored financing methodsin which a portion of funds is paid when materials are delivered rather than when construction is completed and inspectedmay reduce financial barriers.These methods have seen some success with le

286、nders,104 particularly when modular builders can educate investors about the benefits of off-site construction.105 According to HUD,“a lack of education,knowledge,and awareness”is a primary factor in the difficulty of financing for off-site manufacturing facilities and individual projects.106 Greyst

287、ar Real Estate Partners,the countrys largest apartment operator,recently opened its first modular apartment complex in Pennsylvania.107 Greystar also explained the capital structure for modular projects to lenders and took them on factory tours.Example 3:Explore long-term partnerships between constr

288、uction companies and the public sectorLong-term partnerships between the public sector and off-site construction companies may address barriers to financing and scalability.Government agencies have greater flexibility on financing terms.For example,Volumetric Building Companiesa vertically integrate

289、d manufacturing and construction group focused on modular multifamily housinghas received funding from the Pennsylvania Housing Finance Agency and the LIHTC program to build 32modular rental units in West Philadelphia.108 Other jurisdictions could explore similar partnerships to scale off-site produ

290、ction.While this section of our report primarily focuses on modular multifamily construction,modular and other off-site building methods are also important in single-family construction.Today,manufactured single-family homes(traditionally known as“mobile homes”)offer a more affordable entry point to

291、 homeownership,particularly in rural areas.109 Allowing homeowners to title manufactured homes as property,relaxing mandates such as permanent chassis requirements(which can be used to exclude manufactured homes from most residential zones),110 and helping mobile-home residents organize to buy the l

292、and they live on may make ownership of manufactured homes more affordable and accessible.Impact of scaling these strategiesImplementing these strategies to streamline codes and enhance lender education could add 120,000 to 190,000 affordable multifamily modular units over the next decade,with 27,000

293、 to 43,000 units for Black households.111 This does not include the impact of scaling other types of off-site construction or applying the strategies to single-family construction,which could further increase the impact of this solution.Theme 4:Reinvest in public housing and shared-equity models The

294、 problem todayPublic housingwhich faces a$115 billion backlog in capital to address basic quality,safety,and health problemshas suffered from decades of underinvestment in both physical units and neighborhoods.However,public housing remains fundamental to affordability for more than 900,000 low-inco

295、me families,112 nearly half of whom are Black.113Moreover,there are more than 300 shared-equity entities across the United States that provide critical solutions for housing affordability and wealth accumulation,with several innovations emerging.114 We examine strategies to reinvest in existing publ

296、ic housing and further explore shared-equity ownership models.37Investing in housing:Unlocking economic mobility for Black families and all AmericansExample 1:Expand PHA capacity for RAD conversionsThe Rental Assistance Demonstration(RAD)115 gives public housing authorities(PHAs)the financial means

297、to preserve and improve public housing while addressing the nationwide backlog of deferred maintenance.116 Under RAD,PHAs can leverage public and private debt and equity to convert up to 455,000 Section 9 public housing units to Section 8 project-based units with a permanent affordability contract.H

298、owever,PHAs often lack the technical capacity to facilitate RAD conversions,especially when rehabilitation costs are high.In a standard RAD conversion,a PHA reallocates its annual operating and capital subsidies into a Section 8 rent subsidy.117 Ensuring that projected rental income covers costs is

299、an essential,but time-intensive,exercise.Better access to technical assistance and sophisticated financial tools could help PHAs improve project viability,risk management,and financial oversight.Expanding PHA capacity for RAD conversions has demonstrated the potential for impact,but not without some

300、 mixed results.118 PHAs could also benefit from more robust internal capabilities for assessing project equity and navigating LIHTC applications.Investors may be reluctant to back projects that require major rehabilitation if they lack visibility into expected returns and tax exemptions.119 HUD note

301、s in its RAD conversion guide that PHAs with recent success in projects involving multiple financing sources“may likely have internal capacity to successfully plan and carry out a RAD conversion.”120 However,for PHAs that lack this experience,support for engaging external development partners and bu

302、ilding out their teams could be critical.Example 2:Scale publicphilanthropic capital for shared-equity housing solutions One common shared-equity model is community land trusts(CLTs).In traditional CLT models,CLTs purchase land and manage holdings either by selling structures to buyers who agree to

303、certain terms at resale or by renting to low-income families at submarket rates.First Homes CLT sells homes at below-market prices to homebuyers who earn less than 80 percent of AMI and buys them back on resale to maintain income covenants for qualified buyers.Founded with a$4 million initial grant,

304、First Homes helped alleviate an affordable housing shortage for Mayo Clinics 28,000 service workers in the Rochester,Minnesota,area.121 An alternative model is for CLTs to manage income-protected units within market-rate developments.The nonprofit Chicago Housing Trust works with the city to preserv

305、e long-term affordability for homes created through inclusionary zoning and other city-led programs.Like other CLTs,Chicago Housing Trust aims to level the playing field for first-time buyers by selling price-restricted homes,but unlike some other CLTs,it also maintains affordable rental units on be

306、half of the city.122 Scaling the impact of similar housing trusts would likely require additional support from philanthropic capital,which can provide funding for land acquisition,technical assistance,and down payment assistance to first-time buyers purchasing shared-equity homes.Given that 55 perce

307、nt of CLTs net income comes from donations,one way to scale CLTs is to increase the philanthropic capital available to them.123 Moreover,innovations such as mixed-income-housing trusts124 and impact-centered renter-equity models(for example,Enterprise Community Partners Renter Wealth Creation Fund12

308、5 and Up&Up126)have also shown early promise and are additional models for continued exploration.Impact of scaling these strategiesIf the RAD program expands as required to reach the conversion cap,110,000 to 200,000 units127 could be converted over the next decade,with Black households gaining acce

309、ss to an additional 48,000 to 85,000 units.12838Investing in housing:Unlocking economic mobility for Black families and all AmericansTheme 5:Revamp housing choice vouchers The problem todayHousing choice vouchers reduce homelessness,129 alleviate poverty,130 and facilitate moves to better neighborho

310、ods.131 The nations largest source of rental assistance,Section 8 housing choice vouchers serve more than five million people in 2.3 million households.132 Forty-five percent of voucher recipients are Black.133However,only one in four eligible families receives vouchers or other rental assistance,an

311、d the average wait time is two and a half years.134 And only 60 percent of families that do receive assistance find a housing unit to apply it to,while the rest must forfeit the support.135 Lease-up rates are even lower for Black residents.136Example 1:Scale pilot experiments that provide direct ren

312、tal assistance to familiesAdministrative burdenslengthy inspection processes,occasional rent negotiations with PHAs,and potentially delayed rental paymentscould make landlords reluctant to rent to voucher holders.Pilot programs in Philadelphia,Southern California,and Washington,DC,have experimented

313、with rental assistance paid directly to families to alleviate these burdens.Early randomized evaluation evidence from Washington,DC,where the city council used$5 million in local funds to provide$7,200 in annual rental assistance to 125 families for four years,suggests that flexible assistance reduc

314、es the use of other homelessness services.137 These other servicesemergency shelter,short-term homelessness prevention,and rapid rehousingtend to cost more than direct rental assistance.A national trial comparing direct rental assistance to traditional vouchers could explore other outcomes such as l

315、ease-up rates,housing,and neighborhood quality with the rigor of a larger sample size.HUD has indicated that it may consider such a trial.138Example 2:Improve landlord collaborationUp-front guarantees for landlords and streamlined rental processes such as inspection or payments could help remedy adm

316、inistrative burdens.While HUDs Moving to Work study assesses the impact of giving landlords incentives to rent to voucher holders(with results expected in 2026),locally led landlord partnerships may contribute to more efficient voucher programs.139 Virginia Beachs Landlord Engagement and Partnership

317、 initiative offers landlords predictable payment schedules,automatic direct deposits,up-front security payments,dedicated customer service staff to address landlord questions,and case managers to support tenants.140 Albuquerques Landlord Engagement Program offers up to$3,000 worth of repairs,$1,000

318、to help meet inspection standards,$500 for application and past-due fees,and funding for prolonged vacancy if repairs are needed from a previous tenant.141 This additional layer of security is particularly important for mom-and-pop landlords in a city where 85 percent of rentals are independently ow

319、ned.142 These strategies could work in tandem with increased monitoring and enforcement of protections against source of income discrimination.HUDs Source of Income Protections website,launched in March 2024,143 may be an example of a step in the right direction.Example 3:Increase access to high-opp

320、ortunity neighborhoodsExpanding access to high-opportunity neighborhoods has the potential to significantly improve long-term outcomes for low-income families.144 Additional voucher-related approaches would enable families to“lease up”in high-opportunity neighborhoods that improve outcomes for child

321、ren.One strategy is for PHAs to adopt small area fair market rent(SAFMR)standards.Unlike traditional metropolitan-wide standards,SAFMRs set rent thresholds specific to individual zip codes.These standards may allow voucher holders to move into neighborhoods with 39Investing in housing:Unlocking econ

322、omic mobility for Black families and all Americanslower crime,poverty,and unemployment.145 In 2023,45 percent of households receiving vouchers used them in SAFMR areas.146 HUD already requires that PHAs in 65 metro areas use SAFMR,but those in non-designated areas may also opt in.147 A second strate

323、gy is to scale counseling.In Seattle and King County,Washington,families who worked with a trained“housing navigator”to identify voucher-eligible units,submit rental applications,and access financial assistance were more than three times as likely to move to a high-opportunity neighborhood as those

324、who received no assistance.148Impact of scaling these strategiesIf flexible rental payments,incentives for landlords,and housing counseling were scaled such that 75 to 80 percent of families offered vouchers were able to lease up by 2035(compared with 60 percent for all families and 54 percent for B

325、lack families today149),approximately 220,000 to 290,000 additional families,including 150,000 to 190,000 Black families,150 would be able to use housing choice vouchers over ten years.Maximizing national and local impacts No single solution would fully address the affordable housing crisis or remed

326、y barriers faced by Black renters and homeowners.However,the solutions outlined across the five themes we examined(Exhibit 13)would begin to tackle the gap by supporting an estimated 1.8 million to 2.3 million households over the next ten years.151 This would have a particular impact on Black househ

327、olds,who could occupy nearly 30 percent of the total affected housing units.While this would be a start at reversing the trend,more actions would be required to fully resolve the supply shortage.Exhibit 1311,250280222380802142009045319040255290419042,3106806829Web 2025BEM-StateOfHousingBlackAmericaE

328、xhibit 13 of 14Estimated 202534 cumulative impact(maximum of ranges)1Ranges(in thousands):solution 1,1,0001,250;solution 2,330380;solution 3,120190;solution 4,110200;solution 5,220290;total impact,1,7802,310.2Ranges(in thousands):solution 1,190280;solution 2,7080;solution 3,3040;solution 4,5090;solu

329、tion 5,150190;total impact,490680.3Ranges:solution 1,1922%;solution 2,no range;solution 3,2125%;solution 4,no range;solution 5,6668%;total impact,2829%.An estimated 13.7%of Americans in 2023 identifed as Black.4Afected housing units,not new ones.5Double counting may occur for households afected by b

330、enefts of multiple solutions.Source:US Census Bureau;McKinsey Global Institute analysisImplementing fve solutions could afect up to 2.3 million US housing units.McKinsey&CompanyTotal new-housing units,thousands1Units accessed by Blackhouseholds,thousands2Black representation among afected units,%3Un

331、lock land through incentives and partnershipsAugment programs to unleash private capitalReinvest in public housing and shared-equity modelsScale of-sitehome constructionRevamp housing-choice vouchers Total impact5:40Investing in housing:Unlocking economic mobility for Black families and all American

332、sThese solutions should and must be tailored to meet the needs of local communities(Exhibit 14).Using the community profiles introduced earlier,we identify where these solutions are likely more relevant at the community profile level(recognizing the need for hyperlocal geographic context to fully ve

333、t and assess the potential of these solutions for any specific geography).Exhibit 14Web 2025BEM-StateOfHousingBlackAmericaExhibit 14 of 141Community profles categorized based on mathematical clustering method assessing a geographys economic health,business dynamism,industry mix,labor force demographics,and other characteristics.2Most US land is restricted to construction of single-family units,lim