The Reno News posted an article and video in January that explains why housing prices are high in the Reno-Sparks market. The video explains in less than two minutes the problem: not enough housing is available and wages aren’t keeping up with costs of living. We’ve said this before, pointing out the idea of a guaranteed income for housing, something like a negative income tax, as a way of getting more money in poor people’s pockets. The problem with most policy makers is that they want to control prices with mandates, tax a good thing (more housing), and build very expensive subsidized units. The truth is that we need to cut lose the regulatory chains that hamper production, pass a big housing levy not just to build units but to efficiently distribute cash for living expenses directly to people who need it the most.

The easy way out, price controls on rent and wages probably, wouldn’t help.

The current state of increasing housing prices has economists worried about a stalling national economy. Proposals to raise the minimum wage would help, Eisenberg said, but it’s “a blunt instrument.” For him, raising wages would put money in people’s pockets but it wouldn’t solve the lack of supply or the high housing prices and likely would not help people buy increasingly expensive homes.

Remember, wages are a price for hourly labor. And while wages haven’t kept up with the cost of living in this country, the price of labor goes up when labor is scarce; that means more jobs than people to work in them. And trying to lock down prices will only throw gasoline on the inflationary fire created by the lack of housing.

So the answer is a campaign to make more housing, get more cash subsidies to poorer people and families, and create as many jobs as possible. Those are the answers. Not a simple set of changes to make, but we’d be better off working on these things than on interventions like rent control and Mandatory Inclusionary Zoning that are just as difficult but certain to make things worse.