Common Sense Institute (CSI) Iowa has released a new study providing a snapshot of the housing competitiveness of Iowa relative to the other 49 states and the District of Columbia.
The study, titled “Iowa’s 2023 Economic Competitiveness,” was authored by CSI Senior Economist Steven Byers and CSI Director of Policy & Research Ben Murrey.
According to a release from CSI Iowa, the index, developed by Mr. Byers, consists of four metrics that capture the supply and affordability of housing: the percentage of permits as a share of the housing deficit/surplus; the housing deficit/surplus as a percentage of the population; the hours required to pay a monthly mortgage; and the number of hours of work required to pay the monthly average rent.
“While buying a home has become less affordable across the United States since the pandemic, Iowa’s housing market has remained relatively affordable compared with other states,” Mr. Murrey said. “Central planners at the Federal Reserve and the federal government have printed trillions of dollars over the past four years, leading to record inflation and a lack of affordability in housing across the country. While Iowa has not dodged the pain, our research found that Iowa’s housing affordability has improved over the last decade relative to other states. The CSI Iowa Housing Competitiveness Index ranks the state in the top third for housing competitiveness in the country.”
Among the report’s findings:
- The overall Iowa Housing Competitiveness Index improved from 75 in 2011 to 81 in 2023, putting it at the 17th most competitive in the nation.
- While rents rose faster than wages in most states, the opposite was true in Iowa. The number of hours of work required to pay rent in Iowa declined from 40 hours in 2011 to 36 in 2023.
- The number of hours an Iowan must work to pay for a new mortgage increased from 26 hours in 2011 to 48 hours in 2023, an 85% increase.
- Despite improving its relative index scores, the “housing shortage as a percentage of population” and “permits as a percentage of the housing shortage/surplus” suggest deficiencies in Iowa’s current and future housing supply.
- The supply of housing valued at between $100,000 and $300,000 is far below the demand for housing in the same range.
For more information on the Common Sense Institute and its research in Iowa, go to www.commonsenseinstituteia.org
