Housing Market Reality Check
- josh63141
- Apr 29
- 3 min read
Key takeaways from our conversation with Ed Pinto, AEI Housing Center Co-Director
Last week, housing leaders, policymakers, and developers from across the region joined Housing Next for a candid conversation with Ed Pinto of the American Enterprise Institute.
Here’s what you need to know from our chat with Ed:
Market context
Grand Rapids is different, and that's an advantage.
Many U.S. markets, like Florida, Austin, and Boise, experienced extreme pandemic-era price spikes and are now correcting. Grand Rapids entered that period with lower baseline prices and saw steadier, more moderate growth. We're still appreciating. That's a window of opportunity.
West Michigan remains positioned to be one of Michigan's brightest spots for population and economic growth.
The core problem: We made it illegal to build what people need through zoning and land use restrictions.
"We didn't just stop building enough housing — we made it illegal to build the kinds of housing most people need."
— Ed Pinto, AEI Housing Center Co-Director
The region's new construction pipeline remains heavily weighted toward single-family homes on large lots. Builders build what zoning allows, not what households can afford.
Duplexes, townhomes, ADUs, and other “missing middle” housing types were once a staple of American neighborhoods. Over the past century, they've largely been zoned out of existence.
Ed Pinto's central argument: For housing affordability, the mantra is "small lot, small lot, small lot." Land use, not labor or materials, is the biggest driver of what homes cost.
The math is straightforward: smaller lots mean more homes per acre, lower land cost per unit, and more attainable prices. Pinto's research suggests that allowing smaller lots and denser housing typologies can reduce home prices by 10–20%.
The solutions: AEI is promoting three high-impact strategies:
Lot size flexibility: A modest reduction in minimum lot sizes could unlock thousands of additional homes regionally — with minimal disruption to existing neighborhoods.
Missing middle housing: Duplexes, triplexes, townhomes, and ADUs fill the gap between a single-family home and a large apartment complex. Light-touch density that fits the scale of our communities.
Housing near jobs: Allowing residential uses in commercial and light industrial zones is often the largest untapped opportunity in any region — and reduces commute burden at the same time.
Why supply matters: Building market-rate housing does help affordability.
A common misconception holds that new market-rate construction doesn't help lower-income households unless it's deeply subsidized. Pinto pushed back on this directly.
Housing works like a filtering system, when new homes are built at the middle of the market, they free up existing homes further down the affordability ladder. Supply at the top unlocks access at every level.
Five years ago, statewide zoning reform was rare. Since 2022, more than 20 states have adopted or are actively considering the measures AEI advocates for. These aren't mandates for a specific product type, but instead they raise the floor on what's possible, enabling more flexibility rather than prescribing outcomes.
Michigan's Housing Readiness Package is in the pipeline, though it has yet to receive hearings in the House of Representatives and faces a long road of debate ahead.
Bottom line: West Michigan has a real opportunity.
We start from a position of relative affordability. We have the jobs, the quality of life, and the growth trajectory that other regions envy. What we need now is to continue to align our land use with our economic ambitions.
AEI Residential and Land Use Mapping Tool
Free tool offers insight into local residential history
The Residential Year Built and Land Use Map is an interactive, nationwide mapping tool from the American Enterprise Institute (AEI) Housing Center, part of their free Housing and Economic Analysis Toolkit (HEAT).
The tool lets users browse residential properties across West Michigan and visualize key data such as: home size, lot size, year constructed, and more.
By filtering and exploring at the parcel level, planners, researchers, and policymakers can identify the age composition of housing stock in any neighborhood or metro area, redevelopment potential, and the pace of new construction relative to older inventory.
The map is free to use and accessible directly at heat.aeihousingcenter.org, alongside more than two dozen other data tools in the HEAT suite covering home prices, migration, new construction, and housing shortages.
