Unpacking the Housing Affordability Crisis: National Trends and Local Realities in Aurora
Housing affordability has become a pressing issue across the United States, affecting communities from coast to coast. While the crisis manifests differently in various regions, common threads tie together the challenges faced nationwide. In Aurora, Colorado, these issues are particularly acute, reflecting both national trends and unique local factors.
National Landscape: The Roots of the Crisis
Supply and Demand Imbalance
The U.S. has experienced a significant shortfall in housing production over the past decade. According to the Brookings Institution, the U.S. housing market was short 4.9 million housing units in 2023 relative to the mid-2000s¹. This gap has been exacerbated by rising construction costs, labor shortages, and restrictive zoning laws. For instance, in California, from 2012 to 2017, the San Francisco Bay Area added 400,000 new jobs but only issued 60,000 permits for new housing units².
Stagnant Wages vs. Rising Housing Costs
While housing costs have surged, wage growth has not kept pace. The Harvard Joint Center for Housing Studies reports that nearly half of renter households are cost-burdened, spending more than 30% of their income on housing³. Between 2019 and 2022, the number of rent-burdened households rose by two million to 22.4 million⁴.
Regulatory and Zoning Constraints
Local zoning regulations often limit the development of high-density or affordable housing. These constraints, combined with lengthy permitting processes, hinder the ability to meet housing demand efficiently. Single-family zoning dominates residential areas, contributing to housing cost overburden by excluding multi-family and other affordable options⁵. Public hearings and community opposition can further delay or prevent new housing developments⁶.
Investment and Speculation
The rise of institutional investors purchasing single-family homes has drawn scrutiny. While some argue these entities increase rental supply, others contend they drive up prices and reduce homeownership opportunities for average Americans. Large firms acquiring properties en masse have also taken legal actions to thwart laws aimed at limiting rent increases⁷.
Colorado's Housing Challenges
Rapid Population Growth
Colorado has seen a significant influx of residents, with the Denver-Aurora-Lakewood metro area experiencing the highest home price-to-area median income ratios in the state. Between 2010 and 2022, three-quarters of all legislative districts in Colorado saw an increase in the share of people commuting over 30 minutes each way, indicating people are moving further from where they work due to affordability issues⁸.
Construction and Labor Costs
Building new housing in Colorado is increasingly expensive. The Apartment Association of Metro Denver notes that constructing a modest, four-story apartment building can exceed $340,000 per unit⁹. Labor shortages and high material costs further inflate these expenses. A 2023 Home Builders Institute report found that residential construction needs hundreds of thousands of new workers to meet demand, with 90% of home builders reporting a shortage of carpenters¹⁰.
Property Taxes and Insurance Rates
Homeowners in Colorado face rising property taxes and insurance premiums. The repeal of the Gallagher Amendment without a suitable replacement has led to increased tax burdens, while wildfire risks have driven up insurance costs¹¹. These additional expenses contribute to the overall cost of homeownership¹².
Short-Term Rentals and Housing Availability
The proliferation of short-term rentals (STRs) has impacted housing availability. Thousands of units converted to STRs reduce long-term rental options and drive up prices. In Colorado, STR growth has been linked to reduced housing availability for local residents¹³.
Aurora: A Microcosm of the Crisis
Gentrification and Displacement
Aurora has experienced significant gentrification, particularly near the University of Colorado Anschutz Medical Campus and Central Park neighborhoods. Longtime residents, including immigrants and refugees, face displacement as housing costs rise. Community activists have protested upscale developments lacking affordable units¹⁴.
Lack of Affordable Housing Policies
Unlike Denver, Aurora lacks ordinances requiring affordable units in new developments. This policy gap has led to upscale housing projects without provisions for lower-income residents. Aurora also has more restrictions on dense housing, leaving most residents with few options besides single-family homes¹⁵.
Homelessness and Resource Allocation
Aurora's approach to homelessness differs from Denver's. While Denver allocates substantial funds toward housing-first initiatives, Aurora's homelessness budget is more modest, limiting its capacity to address housing insecurity¹⁶.
Economic Disparities and Housing Access
Economic growth in Aurora has not been evenly distributed. Many residents find themselves priced out of the housing market, with incomes failing to match escalating housing costs. This disparity threatens the city's diversity and social fabric¹⁷.
Pathways to Solutions
Policy Reform: Implementing inclusionary zoning laws and streamlining permitting can facilitate affordable housing development. Reforming single-family zoning to allow multi-family units and accessory dwelling units (ADUs) can increase supply and diversity¹⁸.
Investment in Affordable Housing: Public and private investment are crucial. Incentivizing developers to include affordable units and providing subsidies can address the shortage¹⁹.
Community Engagement: Involving residents in planning ensures development meets diverse needs. Transparent communication builds trust for new housing initiatives²⁰.
Support Local Nonprofits
Amid a national housing crisis driven by decades of underbuilding, policy inertia, and widening economic disparities, small community-based nonprofits like Aurora Community Development Corporation (ACDC) are uniquely positioned to make a tangible impact. By focusing on acquisition and rehab of existing properties, ACDC preserves housing affordability, stabilizes neighborhoods, and ensures long-term community ownership in ways that large developers often can't—or won’t. Our work bridges the gap between housing need and housing access, particularly for the residents who are most vulnerable to displacement. But we can’t do it alone. Your support directly fuels our mission to create dignified, permanently affordable homes in Aurora. If you believe everyone deserves a safe, stable place to live, please make a donation today!
Sources:
1. Brookings Institution. (2024). Housing underproduction in the U.S. https://www.brookings.edu/articles/housing-underproduction-in-the-u-s/
2. California Legislative Analyst's Office. (2016). Perspectives on helping low-income Californians afford housing. https://lao.ca.gov/Publications/Report/3345
3. Joint Center for Housing Studies of Harvard University. (2024). America’s rental housing 2024.https://www.jchs.harvard.edu/americas-rental-housing-2024
4. Joint Center for Housing Studies of Harvard University. (2024). America’s rental housing 2024.https://www.jchs.harvard.edu/americas-rental-housing-2024
5. RAND Corporation. (2024). Land use regulation and housing supply.https://www.rand.org/pubs/research_reports/RRA2522-1.html
6. RAND Corporation. (2024). Public hearings and housing development.https://www.rand.org/pubs/research_reports/RRA2232-1.html
7. RAND Corporation. (2024). Corporate landlords and housing affordability.https://www.rand.org/pubs/research_reports/RRA2522-2.html
8. Bell Policy Center. (2025). Housing affordability in Colorado legislative districts.https://www.bellpolicy.org/2025/01/15/housing-affordability-colorado-legislative-districts/
9. Apartment Association of Metro Denver. (2024). Cost to build in Metro Denver.https://www.aamdhq.org/news/construction-costs-2024
10. Home Builders Institute. (2023). Construction labor market report. https://www.hbi.org/news-research/construction-labor-market-report-2023/
11. Bell Policy Center. (2025). Property taxes in the post-Gallagher era.https://www.bellpolicy.org/2025/01/30/property-taxes-post-gallagher/
12. Bell Policy Center. (2025). Rising insurance costs and housing. https://www.bellpolicy.org/2025/02/20/rising-insurance-costs-housing/
13. Bell Policy Center. (2025). Short-term rentals and housing markets. https://www.bellpolicy.org/2025/03/10/short-term-rentals-housing-markets/
14. City of Aurora. (2020). Housing strategy and action plan.https://www.auroragov.org/residents/housing/housing_strategy_and_action_plan
15. City of Aurora. (2020). Housing strategy and action plan.https://www.auroragov.org/residents/housing/housing_strategy_and_action_plan
16. City of Aurora. (2020). Housing strategy and action plan.https://www.auroragov.org/residents/housing/housing_strategy_and_action_plan
17. City of Aurora. (2020). Housing strategy and action plan.https://www.auroragov.org/residents/housing/housing_strategy_and_action_plan
18. Pew Research Center. (2024). Attitudes toward zoning reform. https://www.pewresearch.org/short-reads/2024/01/10/americans-attitudes-on-zoning-and-housing-reform/
19. Common Sense Institute. (2024). Funding affordable housing in Colorado.https://commonsenseinstituteco.org/funding-affordable-housing-in-colorado-2024/
20. International Monetary Fund. (2024). Housing policy and public trust.https://www.imf.org/en/Publications/WP/Issues/2024/03/15/Housing-Policy-and-Public-Trust-24-103
