Some of those challenges, including widespread homelessness and the state’s high cost of living, were well established before Gov. Gavin Newsom took office. Others, including a persistent multibillion-dollar budget deficit and a high unemployment rate, have become more pressing in recent years.

For Southern California and the Inland Empire, where housing costs, long commutes and economic pressures are daily concerns for many families, the question is not just whether California is struggling, but how the state compares with the rest of the country.

Two recent academic studies offer a clearer picture — and the findings are mixed.

One report, “State of the States,” comes from a broader “State of the Nation” research project sponsored by Tulane University’s Murphy Institute. The project aims to assess major public policy issues across the country using comparable measures, rather than partisan talking points.

California ranked first in the nation on the economy, third on trust, third on mental health and third on children and families, according to the study. But the state landed near the bottom in several major categories: 48th in work and labor force, 49th in inequality and 50th in environment. The report also found California ranked low on educational achievement, volunteerism and press freedom.

Those rankings complicate the image often promoted by California political leaders, including Newsom, who have described the state as a national model for economic opportunity, social equity and environmental policy. While California’s economy remains among the strongest in the country, the benefits are not evenly shared, and the state’s high costs continue to weigh heavily on residents.

The report also compared California with neighboring Western states and found that California outperformed them in only three of 14 broad topic areas. Still, the study noted that the state is improving over time on nine of 31 specific measures.

Texas, a frequent point of comparison for California, fared better in several areas where California ranked poorly, including press freedom. But Texas also showed significant shortcomings, including on environmental measures and voter participation.

One striking difference involved how residents view their own lives. Texas ranked near the top for residents’ satisfaction with their current circumstances, while California fell well below the national median.

A second set of findings came from the Berkeley Economy & Society Initiative, a UC Berkeley project supported by the Hewlett Foundation. Its reports focused on California’s affordability crisis and concluded that the state is “less affordable and poorer than it should be” given the size and strength of its economy.

The UC Berkeley researchers found that California is consistently more expensive than other places with similar median incomes. They also linked high costs to the state’s shift from a long-standing magnet for newcomers to a place many residents are leaving.

Since the 2008 recession, California has experienced sustained domestic out-migration, meaning more residents have left for other states than have moved in from elsewhere in the country. Between 2020 and 2024, California had the second-lowest net migration rate among states as a share of population, behind only New York, according to the report.

The Berkeley researchers argued that unaffordability is a major factor behind that reversal.

A follow-up report examined the causes of California’s high costs and pointed to a policy environment that makes it difficult to build the infrastructure needed for housing, energy, water and other essentials.

The report said growth restrictions increase costs primarily by limiting housing supply and driving up housing prices. Those restrictions also raise the cost of major infrastructure projects, contributing to higher energy and transportation expenses for consumers.

Among the solutions identified by the researchers were broader use of factory-built housing and new financing models to expand affordable housing production.

Taken together, the two studies present a familiar but sobering portrait of California: a state with a powerful economy and major institutional strengths, but also deep inequality, severe affordability problems and weak results in several areas that affect everyday life.

For the next governor and state lawmakers, the findings suggest that improving California’s standing will require more than celebrating the state’s economic scale. It will mean confronting the cost pressures and policy barriers that continue to shape life for residents across the state, including fast-growing and cost-burdened communities throughout Southern California and the Inland Empire.

Original source: CalMatters

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Trump has instead argued for protecting existing owners who have watched the values of their homes climb. It’s a position that flies in the face of what many economists, the real estate industry, local officials and apartment dwellers say is needed to fix a big chunk of America’s affordability problem.

“I don’t want to drive housing prices down. I want to drive housing prices up for people that own their homes, and they can be assured that’s what’s going to happen,” Trump told his Cabinet on Jan. 29.

That approach could bolster the Republican president’s standing with older voters, a group that over time has been more likely to vote in midterm elections. Those races in November will determine whether Trump’s party can retain control of the House and Senate.

“You have a lot of people that have become wealthy in the last year because their house value has gone up,” Trump said. “And you know, when you get the housing — when you make it too easy and too cheap to buy houses — those values come down.”

But by catering to older baby boomers on housing, Trump risks alienating the younger voters who expanded his coalition in 2024 and helped him win a second term, and he could wade into a “generational war” in the midterms, said Brent Buchanan, whose polling firm Cygnal advises Republicans.

“The under-40 group is the most important right now — they are the ones who put Trump in the White House,” Buchanan said. “Their desire to show up in an election or not is going to make the difference in this election. If they feel that Donald Trump is taking care of the boomers at their expense, that is going to hurt Republicans.”

The logic in appealing to older voters

In the 2024 presidential election, 81% of Trump’s voters were homeowners, according to AP VoteCast data. This means many of his supporters already have mortgages with low rates or own their homes outright, possibly blunting the importance of housing as an issue.

Older voters tend to show up to vote more than do younger people, said Oscar Pocasangre, a senior data analyst at liberal think tank New America who has studied the age divide in U.S. politics. “However, appealing to older voters may prove to be a misguided policy if what’s needed to win is to expand the voting base,” Pocasangre said.

Before the 2026 elections, voters have consistently rated affordability as a top concern, and that is especially true for younger voters with regard to housing.

Booker Lightman, 30, a software engineer in Highlands Ranch, Colorado, who identifies politically as a libertarian Republican, said the shortage of housing has been a leading problem in his state.

Lightman just closed on a home last month, and while he and his wife, Alice, were able to manage the cost, he said that the lack of construction is pushing people out of Colorado. “There’s just not enough housing supply,” he said.

Shay Hata, a real estate agent in the Chicago and Denver areas, said she handles about 100 to 150 transactions a year. But she sees the potential for a lot more. “We have a lack of inventory to the point where most properties, particularly in the suburbs, are getting between five and 20 offers,” she said, describing what she sees in the Chicago area.

New construction could help more people afford homes because in some cases, buyers qualify for discounted mortgage rates from the builders’ preferred lenders, Hata said. She called the current situation “very discouraging for buyers because they’re getting priced out of the market.”

But pending construction has fallen under Trump. Permits to build single-family homes have plunged 9.4% over the past 12 months in October, the most recent month available, to an annual rate of 876,000, according to the U.S. Census Bureau.

Trump’s other ideas to help people buy houses

Trump has not always been against increasing housing supply.

During the 2024 campaign, Trump’s team said he would create tax breaks for homebuyers, trim regulations on construction, open up federal land for housing developments and make monthly payments more manageable by cutting mortgage rates. Advisers also claimed that housing stock would open up because of Trump’s push for mass deportations of people who were in the United States illegally.

As recently as October, Trump urged builders to ramp up construction. “They’re sitting on 2 Million empty lots, A RECORD. I’m asking Fannie Mae and Freddie Mac to get Big Homebuilders going and, by so doing, help restore the American Dream!” Trump posted on social media, referring to the government-backed lenders.

But more recently, he has been unequivocal on not wanting to pursue policies that would boost supply and lower prices.

In office, Trump has so far focused his housing policy on lobbying the Federal Reserve to cut its benchmark interest rates. He believes that would make mortgages more affordable, although critics say it could spur higher inflation. Trump announced that the two mortgage companies, which are under government conservatorship, would buy at least $200 billion in home loan securities in a bid to reduce rates.

Trump also wants Congress to ban large financial institutions from buying homes. But he has rejected suggestions for expanding rules to let buyers use 401(k) retirement accounts for down payments, telling reporters that he did not want people to take their money out of the stock market because it was doing so well.

There are signs that lawmakers in both parties see the benefits of taking steps to add houses before this year’s elections. There are efforts in the Senate and House to jump-start construction through the use of incentives to change zoning restrictions, among other policies.

One of the underlying challenges on affordability is that home prices have been generally rising faster than incomes for several years.

This makes it harder to save for down payments or upgrade to a nicer home. It also means that the places where people live increasingly double as their key financial asset, one that leaves many families looking moneyed on paper even if they are struggling with monthly bills.

There is another risk for Trump. If the economy grows this year, as he has promised, that could push up demand for houses — as well as their prices — making the affordability problem more pronounced, said Edward Pinto, a senior fellow at the American Enterprise Institute, a center-right think tank.

Pinto said construction of single-family homes would have to rise by 50% to 100% during the next three years for average home price gains to be flat — a sign, he said, that Trump’s fears about falling home prices were probably unwarranted.

“It’s very hard to crater home prices,” Pinto said.

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What is California doing about its sky-high housing prices? Just ask the state’s housing chiefs.

In this special edition of the California Housing Crisis Podcast, The Los Angeles Times’ Liam Dillon and CalMatters’ Manuela Tobias interview Lourdes Castro Ramírez, secretary of the Business, Consumer Services and Housing Agency; Gustavo Velasquez, director of the California Department of Housing & Community Development; and Tiena Johnson Hall, executive director of California’s Housing Finance Agency.

They each weighed in on the most controversial issues dominating the California housing crisis debate — including rent control, Proposition 13, and building market rate homes in low-income neighborhoods — and provided some insights into what their agencies are working on to address housing affordability.

Castro Ramírez, who oversees housing and various other state departments, commended the predictability afforded by California’s capped property taxes — a controversial measure that has been blamed for many of the state’s housing woes — in stark contrast to those in Texas, where she was previously head of the San Antonio Housing Commission. “The price of homes may be lower than the price in California, much lower; the property taxes that one pays (in Texas) and the increase in that tax year over year over year, makes it difficult to project and to anticipate how much of your income you’re going to be spending,” she said.

Johnson Hall, whose agency provides financing and loans to low-income renters and homebuyers, described a new program that will provide grants to low-income households looking to build accessory dwelling units in their backyards. She said her experience living in public housing as a single mother right out of college shapes and informs all of her work.

“I look at (housing) still from the lens of a 26-year-old woman who but for affordable housing would have been homeless,” she said. “It changed not only my life, but it changed my children’s life as well. I lead with that passion.”

Velasquez, whose agency finances affordable housing and assesses local housing building production, called rent control “one of those important anti-displacement tools that are in the toolbox,” and hailed the rent control in the District of Columbia as “this golden kind of model for rent control and it has worked organizing tenants and ensuring that they utilize these measures.”

Velasquez’s agency just tripled the number of policy staff and attorneys to ensure local jurisdictions plan for and build enough housing to meet the state’s regional needs through a new Housing Accountability Unit. The department is investigating the rejection last week by the San Francisco Board of Supervisors of a 495-unit apartment complex proposed for a parking lot.

“There are jurisdictions that will be unwilling. We know that,” he said. “But we have now, thanks to the governor and the state Legislature, additional resources to have more capacity to track this work, to monitor this work, and if need be, take enforcement actions as required by state law. So persistence is the key here.”

CALMATTERS | CONTRIBUTED

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