The median sales price of a U.S. home reached $403,000 in the first quarter of 2026, nearly five times the median household income, according to an analysis by Benjamin Powell, senior fellow at the Independent Institute and director of the Free Market Institute at Texas Tech University.
Powell argues in an opinion piece that supply restrictions imposed by state and local governments are the primary driver of housing unaffordability rather than federal policy failures. He contends that Americans solving their own affordability problems through interstate migration may be more effective than congressional action.
The Senate's 21st Century ROAD to Housing Act would require HUD to publish guidelines helping localities streamline zoning and expedite environmental reviews, while also streamlining procedures for factory-built and manufactured homes. Powell writes that these changes would help increase supply on the margin but would do little against state and local governments determined to block development.
Powell criticizes Senate provisions restricting large corporate landlords from purchasing additional single-family homes and requiring new built-to-rent homes to be sold to owner-occupants within seven years, arguing these measures would discourage investment in new construction and worsen affordability.
What the Left Is Saying
Progressive economists and housing advocates generally argue that federal intervention is necessary because market forces alone have failed to produce adequate affordable housing. They contend that corporate investors, private equity firms, and institutional landlords do contribute to rising prices by competing with individual buyers and converting homes to rentals.
Senator Tina Smith of Minnesota has advocated for significant federal investments in affordable housing construction, arguing that localities with restrictive zoning often face legal and political barriers they cannot overcome without federal requirements or incentives. Housing advocates from organizations like the National Low Income Housing Coalition have pushed for expanding rental assistance and publicly built housing as solutions.
Progressive critics note that Powell's emphasis on migration places the burden on individuals to relocate rather than addressing why certain communities have become unaffordable in the first place, potentially accelerating decline in states already facing budget challenges from population loss.
What the Right Is Saying
Conservative economists broadly agree with Powell that regulatory barriers at the state and local level drive housing costs. The American Enterprise Institute's Housing Policy Initiative has advocated for streamlining permitting processes and reducing zoning restrictions as primary solutions.
The House version of the housing bill would eliminate major restrictions on corporate investors, which Powell describes as a step in the right direction, though he argues it would barely impact prices. Some conservative commentators have argued that removing barriers to development generally, including from corporate builders, is more important than restricting investor activity.
Critics across the political spectrum have noted that migration is not equally accessible to all Americans, particularly low-income families, elderly residents with social ties, and those with limited job mobility. The Cato Institute's Mercatus Center has published research suggesting zoning reform at state levels could be more effective than federal mandates.
What the Numbers Show
According to IRS migration data cited by Powell, California, New York, Illinois, Massachusetts, and New Jersey experienced the largest net outmigration since 2020. These states received failing grades from the National Association of Realtors' Affordability Report Card for housing affordability and homebuilding conditions.
Texas, South Carolina, North Carolina, Florida, and Tennessee ranked among the top five states for net in-migration during the same period. The first three also placed in the top five on the NAR report card, while Florida and Tennessee were in the top half of rankings.
The median home price to income ratio stands at approximately 5:1 nationally, compared to generally accepted affordability guidelines of 2.5 to 3 times income. A Government Accountability Office report found corporate landlords represent only 1 to 3 percent of single-family home purchases in metro areas studied, though their share has grown in some markets.
The Bottom Line
Powell's analysis suggests that federal housing legislation faces structural limitations when the core barriers exist at state and local levels through zoning laws and permitting processes. Whether Congress can meaningfully address affordability may depend more on whether it can create incentives or requirements for local reform than on direct spending or regulation.
The ongoing migration patterns from high-cost coastal states to more affordable southern and interior states appear to be reshaping housing markets in real time, though this solution requires economic and social mobility that not all Americans possess. The long-term trajectory of affected areas on both ends of these migrations remains uncertain.
What happens next: Watch for whether the House and Senate can reconcile their different approaches to corporate landlords and built-to-rent provisions. Also monitor state-level zoning reform efforts in California, New York, and other high-cost states experiencing significant outmigration.