The Housing Affordability Crisis: Challenges and Solutions in Montana

Missoula, MT (KGVO-AM News) - Just what will it take to explode Missoula’s (and Montana’s) housing affordability impasse?

Thousands of potential homebuyers throughout the state are waiting for something to break, so I spoke to UM’s Patrick Barkey, Director of Research at the BBER for direction on solving the state’s housing availability and affordability problems.

Dr. Barkey Asks if Cities Can be Forced to Make Housing Affordable

“The notion of local control, of course, is extremely strong,” began Dr. Barkey. “People don't like to hear directives from above telling them what to do. But in the case of housing, what has happened is that so many communities have become so out of reach for home buyers, that it stands to reason that those who do not yet live in the communities where they want to live, who are essentially left out of the political process because they don't have a vote, it might be appropriate to review whether or not their preferences should nonetheless be taken into account.”

Barkey stated the blatantly obvious fact that housing demand has greatly outstripped supply.

He Said the Question of More Buildable Land Must be Addressed in Montana

“What has gotten so precious in all these communities in western Montana that are seeing big spikes on affordability is the availability and the affordability of developable land and the delays and costs of getting more housing approved,” he said. “That's starting to change, by the way, but the question is whether this sort of natural force that's causing a little bit more housing is sufficient to really bend the curve, if you will, of cost growth.”

Barkey acknowledged basic human nature when it comes to current home prices.

“The mindset of trying to get as much value out of any asset you own is ingrained,” he said. “That's what the economy runs on. Markets represent the interests of sellers, but the interests of buyers, are directly opposed, right? Buyers want it cheap, sellers want it expensive, etc. and that's just Economics 101, I don't think we're trying to defuse that. I think what we're trying to do in housing is try to roll back the tidal wave of restrictions and impediments to development of residential housing stock.”

Barkey said the upcoming Montana legislative session will have to be firm in creating laws that will treat buyers and sellers fairly.

READ MORE: Montana Housing Survey Aims to Support Low-Income Residents

Barkey Said the Legislature Will Have to Help Solve the Housing Market Question

“We're trying to roll that back in a meaningful way, not by attacking this or that regulation, but rather simply tasking these places that are not building enough to build more or else, but something that would actually have to come down from the legislature to do that,” he said. “It would be hugely unpopular in many, many parts of the state, no question about it, but doing what's popular has been what's gotten us in the situation where we are today.”

Dr. Barkey still writes and produces the popular Montana Economic Minutes that air on radio stations throughout the state.