Housing experts have been warning us for years that there is a pending housing affordability crisis. It was already rearing its ugly head in certain parts of America before the COVID-19 pandemic. but, since the pandemic, it’s accelerated even faster.

Housing prices and rents are getting higher and higher, and it’s likely still going to get worse before we reach the tipping point.

It is estimated that in the next decade the U.S. will need to add about two million new housing units per year to make up for the 7.4 percent population increase that took place in the 2010s.

However, in 2020, there were only 1.3 million new housing units developed – a number that falls well short of what will be needed if 2021 and beyond bring about similar totals.

And there isn’t much room for optimism right now. The cost of housing development has skyrocketed. The red tape that is local zoning codes and restrictions is slow to cut through – if you can get through it at all. And thanks to the pandemic, there is an unexpected labor shortage that is also slowing development.

With all those things working against housing developers, it’s hard to imagine making up that chasm of 700,000 homes needed to start to slow the crisis. Builders would need to collectively boost their production by 60% each year, a goal that is likely too ambitious to reach.

According to a study by the National Association of REALTORS®, done in conjunction with the Rosen Consulting Group, the country has been underbuilding housing for two decades, leading to a shortfall of 6.8 million housing units, when adding in homes lost in that same time frame due to disasters or demolition.

What was hard to predict was that even with the economy being hit hard by the pandemic in 2020 and into 2021, the prices of homes and rents continued to increase. This was because historically low mortgage interest rates allowed more buyers to enter the housing market, making demand significantly outpace the supply.

It created bidding wars, and alternative purchasing methods – like all cash offers, corporations buying up housing stock, bids well above the list price and even the purchase of properties sight unseen – more normal.

This also forced potential buyers, who could not afford a home in the bidding war, to resort to seeking rentals. As such, housing providers increased the cost of rentals as they started to be swallowed up by the same supply vs. demand game.

This left many Americans, in the lower income threshold, without affordable housing options – a dangerous precedent that has led to more homelessness – and could see those numbers spike even more once the country figures out how to resolve the conundrum created between property owners and renters brought on by the eviction moratorium.

According to the National Low Income Housing Coalition, Wages of between $20 and $25 per hour are needed just to afford the rent of a one or two-bedroom unit. Their data, according to Bisnow, also indicates that there are only 37 affordable housing unit available in America for every 100 extremely low-income renters.

The Senate recently passed a $1.2 trillion infrastructure bill that includes $213 billion in funds to preserve more than two million affordable housing units. And, while that’s a nice first step, it pales in comparison to the amount of time and money that would be needed to close the wound that has been festering for decades when it comes to housing affordability.