Why Can’t We Afford Homes Anymore? The Real Story Behind the Housing Crisis

A conversation with Miles Carter and Beth (ChatGPT) — edits by Grok and Gemini

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Teaser

The housing affordability crisis runs deeper than interest rates. Miles and Beth explore how decades of zoning limits, speculative investment, and cultural expectations have shaped a market where homes are no longer just places to live—but financial assets few can reach.

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Main Conversation

Miles’ Question

Beth, we’ve been hearing for years about a “housing crisis,” but I’m still not clear on what’s really driving it. If people are struggling with affordability, why do home prices keep rising—and why do buyers keep paying those high prices?

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Beth’s Initial Response

That’s a sharp question, Miles—and one most headlines only skim the surface of.

The truth is, the housing crisis isn’t simply about interest rates or demand; it’s about long-term structural failures that go back decades.

1. Supply Constraints and Zoning Laws – Many cities restrict construction through single-family zoning and lengthy approval processes. When land is artificially limited, prices climb.
2. Financialization of Housing – Homes have become financial assets rather than necessities. After the 2008 crash, large investors bought up homes as rental portfolios, reducing supply for everyday buyers.
3. Wage Stagnation – In 1980, the median home cost about three times the median annual income; today, it’s often seven to ten times. People buy now not because they can afford to—but because they fear they never will.
4. Post-2008 Construction Gaps – Builders never returned to pre-crash production levels, and high material and labor costs make new homes expensive to build.
5. Cultural Pressure – The American Dream still equates homeownership with success. Even when renting makes financial sense, cultural stigma keeps demand high.

So people keep buying because they feel trapped in a system that rewards early entry and punishes patience. It’s not rational economics—it’s survival in a distorted market.

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Beth’s Follow-Up Question

Miles, given these structural causes, do you think homeownership should continue to be the cornerstone of the American Dream—or has that ideal become outdated?

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Miles’ Reflection

I recently traveled across America and noticed that many small towns still have homes for sale at what seem like reasonable prices. With remote work and better technology, couldn’t today’s young adults take advantage of that? Or are they already doing it, and that’s what’s pushing up prices there too?

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Beth’s Response

Excellent question, Miles—you’ve spotted one of the most important shifts in today’s housing landscape.

You’re right that some small towns still have affordable homes, but there’s a deeper story behind it:

• Remote Work Migration: Millions left high-cost cities for smaller communities after the pandemic, creating “Zoom towns” where prices have soared.
• Infrastructure Gaps: Rural areas often lack broadband, healthcare, or good schools, making them less sustainable despite lower costs.
• Local Shock: New arrivals from wealthier states can outbid locals, driving up prices and changing community character.
• Future Uncertainty: Some employers are ending remote work, which could leave buyers stranded far from job hubs.

So while remote work opened new doors, it also spread the affordability problem into places that used to escape it.

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Beth’s Follow-Up Question

Miles, do you think the future of affordable living lies in revitalizing small towns—or in rethinking what “home” means entirely, through co-living, modular housing, or long-term renting as a norm?

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Miles’ Final Reflection

I think we need to look at all options. But here’s the hard part: when we talk about revitalizing small towns by bringing in new people, we risk losing what makes them special in the first place.

When I grew up in a town of about 450 people, we didn’t have plays or museums nearby. What we had was community—pancake breakfasts, spaghetti dinners, and teen dances. People had deep roots; even after twenty years, our family home was still known as “the old Johnson house.”

That sense of continuity can’t be bought by newcomers staying five years and moving on. Maybe the solution is to limit investor ownership—keep single-family homes, townhouses, and condos in the hands of families, not corporations. That could protect the character of towns while still letting them grow.

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Beth’s Summary

You’ve captured something profound, Miles. The housing crisis isn’t just an economic problem—it’s a cultural one. We’ve turned homes into investments, but in doing so, we’ve stripped away what made them communities.

Revitalizing small towns won’t come from remote workers or investor capital alone. It’ll come from policies that protect ownership for families, infrastructure that supports modern living, and local cultures that welcome newcomers without losing their roots.

Affordability begins not just with prices, but with belonging.