By Druta Bhatt
Housing as Both a Right and Commodity
Housing is both a right and a commodity: a shelter for families, a stable place in a community or neighborhood and a tool to build intergenerational wealth. As the U.S. housing crisis worsens, corporate purchases of homes rise, homeownership becomes unaffordable for median-income families, and building costs increase, making it unsustainable to build enough affordable homes to meet demand. It seems unlikely that the market forces — even when guided by subsidies and tax incentives — can reliably provide stable housing for all. In 2023, 42% of renter households in Allegheny County were cost-burdened, according to ACS data. Public intervention is crucial because stable housing affects health and education. It’s also one of the most effective ways of reducing childhood poverty.
Understanding Housing Decommodification
Decommodification refers to “the degree to which individuals, or families, can uphold a socially acceptable standard of living independently of market participation”. Policies aimed at housing decommodification seek to restore housing justice and reduce housing insecurities, especially for low-income populations.
Research from the Urban Institute largely attributes the commodification of housing in the U.S. to several historical trends:
The post-World War II push for homeownership as part of the American Dream
The simultaneous decline of public and subsidized housing in the 20th century
And the post-2008 financialization of housing by corporate and investment firms.
As a result, housing has become a tool for investment and profit — even at the expense of housing justice. Some housing advocates, particularly factions of the “Yes in My Backyard” (YIMBY) movement, support policies that make it easier for the private market to build homes, believing this can solve the current affordable housing shortage. However, many experts argue building and operating housing affordable to the lowest-income households is financially unsustainable.
Housing decommodification removes a significant stock of housing from private market pressures, increasing access and affordability.
Lessons from Europe
Research on housing decommodification in 31 European welfare states studied outcomes such as homeownership rates, housing affordability and housing conditions. Countries were grouped based on the level of commodification versus decommodification, using factors like:
The ratio of tenants in rent-subsidized housing versus those paying full rent
Share of the population receiving housing benefits
Percentage of outstanding mortgage loans relative to the Gross Domestic Product (GDP)
The countries were then divided into three groups:
Pre-commodified: Minimal financialization and government subsidies
Commodified: Housing is market-dependent and financialized
Decommodified: Generous state subsidies and housing benefits protect families from market risks
The housing outcomes mentioned above were then compared within these groups. Key findings include:
Homeownership was lower in decommodified countries, but rental access is higher and more equitable. Also, low-income households are more likely to own homes in decommodified contexts than in commodified ones.
Housing costs relative to income are comparable across commodified and decommodified countries.
Housing conditions, including overcrowding and deprivation, are similar overall, but income inequality in housing conditions is higher in commodified countries.
U.S. Policy Innovations
Some U.S. states and cities are beginning to treat housing as a place to live, rather than an investment:
San Francisco (2021): Allocated $64 million to purchase vulnerable properties and remove them from the private market.
Washington D.C. (2022): Approved the building of climate-friendly social housing.
Apart from public housing, other approaches to housing decommodification in the U.S. include shared ownership models, where policies support:
Community Land Trusts (CLTs) with property tax exemptions
“Opportunity to purchase” laws that give tenants and community-based organizations first rights to buy properties when landlords sell.
Washington, DC’s Tenant Opportunity to Purchase Act (TOPA) law has been in place for over 30 years, while Massachusetts and New York are now exploring statewide versions.
Strategies for Protecting Communities from Speculation
Another approach is to limit private and institutional investors’ ability to profit from housing speculation. Policymakers could pursue this through:
Land value taxes: Discourage hoarding on undeveloped land
Vacancy taxes: Deter owners from keeping units empty
Flipping taxes: Penalize short-term resale for profit
In addition, Atlanta Mayor Andre Dickens has called for limits on how much housing institutional investors can own, warning that unchecked speculation threatens local communities.