The McKinsey Podcast Confronting the affordable-housing crisis
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Jun 24, 2025 JP Julien, a Partner at McKinsey and head of the McKinsey Institute for Economic Mobility, tackles the pressing affordable housing crisis in the U.S. He highlights the critical link between safe housing and economic mobility, revealing insights on how this issue disproportionately affects Black Americans. Julien discusses innovative solutions like off-site construction and the importance of public-private partnerships to unlock investment. He encourages regulatory reforms and community engagement to create meaningful change, emphasizing that even small actions can make a big difference.
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Economic Gains from Housing Fix
- Solving the housing shortage could unlock $2 trillion in GDP and create 1.7 million jobs nationally.
- Locally, for example, Chicago could gain $30 billion in GDP and 27,000 jobs by addressing housing needs.
Key Causes of Housing Crisis
- The housing crisis stems from high land and construction costs, insufficient capital, and low income for many families.
- 75% of US residential land is zoned single-family, restricting housing density and affordability.
Zoning Reform to Increase Density
- Reform zoning laws by increasing multifamily options and reducing minimum parking requirements to boost housing density.
- Local control is vital but complex; incentives for communities to accept zoning changes are needed.