Sen. Anderson: All hands on deck for housing crisis

By Oregon State Senator Dick Anderson

You have heard time and time again that Oregon is in a housing crisis, but we didn’t get here overnight. There is a combination of factors that have created a severe imbalance between housing supply and demand, driving up costs and making it difficult for many residents to find affordable places to live.

One major driver is Oregon’s chronic underproduction of housing. Estimates suggest Oregon is short anywhere from 87,000 to 140,000 homes to meet current demand. This gap didn’t happen overnight and has been decades in the making. New construction lagged behind population increases, particularly between 2015 and 2019, when the state added three residents for every new housing unit built- double the national average. The lack of supply, and the large demand for homes has pushed home prices and rents to skyrocket. As of 2023, the typical home in Oregon cost around $528,000, significantly higher than the national average. Rental costs jumped 17% from 2020 to 2022 alone. For a minimum-wage worker, affording a two-bedroom apartment requires working 82 hours a week, an impossible burden for most. Even if you aren’t a minimum-wage worker the burden of rent is hard to ignore.

Oregon’s land use policies, which date back to the 1970’s, particularly the Urban Growth Boundary (UGB) system, play a significant role in this crisis as well. In 1973 Senate Bill 100 established the UGB system that Oregon has. Designated to curb sprawl and protect farmland, UGBs limit where new housing can be built- concentrating development within designated urban areas. These preserve Oregon’s natural beauty, a draw for many residents, restricts the supply of buildable land. Developers often face a shortage of “shovel-ready” lots due to permitting delays, high fees, and financing challenges, even when land is zoned for residential use. This bottleneck drives up land costs and stalls construction as well as local regulations and focus on single-family homes which hinder denser, more affordable projects.

Population growth and migration have intensified this demand. In the last 20 years, the state’s population has increased by about 750,000 people. Remote workers and retirees, especially from high-cost states like California, have further strained rural and suburban markets, tripling housing prices in some areas within months. This influx, coupled with slow construction, overwhelms existing stock.

Economic factors amplify the crisis. Wages haven’t kept pace with the housing costs. While prices have soared, incomes have only doubled over decades in some regions, leaving renters and buyers stretched thin. Half of Oregon’s renters spend over 30% of their income on housing, and a quarter spend over 50%, making them “cost-burdened” and vulnerable to eviction or homelessness. The state’s homelessness rate reflects this: Oregon ranks third nationally in homeless persons per capita and first for unsheltered children- with chronic homelessness nearly doubling over the last 15 years. These are major problems!

Finally, zoning and regulatory hurdles exacerbate the shortage. Single-family zoning dominates many areas, limiting multifamily housing that could serve moderate- and low-income residents- 95 % of the housing deficit targets these groups. Efforts to relax zoning, like legalizing accessory dwelling units or duplexes, face resistance from “NIMBY” (Not in My Backyard) sentiments, while infrastructure funding lags, delaying large-scale projects. Even with recent investments- like Governor Kotek’s $376 million housing package in 2024, production (around 12,000 units annually) falls short of her 36,000-unit goal.

In short, Oregon’s housing crisis is a perfect storm of insufficient supply, restrictive land policies, rapid demand growth, and economic pressures, all colliding to make homes unaffordable for too many. Solutions exist- more construction, smarter zoning, targeted subsidies. Overcoming decades of underbuilding and entrenched interest remains a steep challenge.

So, what is currently being done?

Construction is a mixed bag. Oregon is still short a lot of homes- and while Governor Kotek is pushing for 36,000 new units annually, the state’s only hitting about 12,000. Her 2025 legislative efforts are gaining traction with some cities already doubling their middle housing permits. However, rural areas and smaller cities lag, some even dropping to zero permits as well. Red tape, high land costs, and prevailing wage laws- which add an addition 10-20% to project costs, are slowing things down.

Senate Bill 974 is a bill I put forward this legislative session that has bipartisan support. This bill streamlines engineering, planning and review processes to speed up housing developments within Urban Growth Boundaries (UGB’s). This bill cuts the red tape to build homes faster. In some areas of the state, it can take cities up to 8 weeks to get a permit approved to be able to even start building, and this is only if the permit is complete- missing documents, unclear plans or failure to meet code requirements trigger revisions, restarting the review clock. Many building permits require review by multiple different agencies, each with its own review timeline, causing bottlenecks. This bill will require a city, or county to complete a review of a land use application for a single-family dwelling in 45 days. Where the law currently stands there is no time limit for engineering or final platting and design reviews. This can’t be the case when we are in a crisis and time is essential. This bill will be up for a vote on the Senate floor Monday.

Like Senate Bill 974, Senate Bill 6 ensures building homes and middle housing can happen fast in Oregon. Senate Bill 6 is a “shot clock” bill which requires building departments to approve or deny building applications in 45 business days or less. This clock only starts when the application is deemed complete. This bill will only apply to residential homes and middle housing in subdivisions (no commercial and large scale). This bill passed unanimously out of the Senate Housing Committee and was moved to Joint Ways and Means because of an indeterminate fiscal element. We got that removed so this bill could be sent to the senate floor for a vote. Other states are currently passing similar bills like this currently- California is passing a bill with a 30-to-60-day building permit requirement and Arizona is passing a bill with a 15-day requirement. If other states can do it, there is no reason that Oregon can’t do this as well. It’s entirely possible. It is also worth noting that Texas and North Carolina passed legislation that requires approval in just a few weeks. In Texas, a developer can now move forward with construction if a municipality takes more than 30 days to review a completed application.

A bill that has passed the Senate with strong support is Senate Bill 1086. This bill creates a statewide apprenticeship program to train more building inspectors and speed up housing construction. With Oregon short 115 inspectors annually, this bill breaks the logjam to get homes built faster while ensuring safety. This bill will now go to the House and if it passes, will make its way to the Governor’s desk to be signed into law.

We didn’t get into this housing crisis overnight. Some could argue that it has been decades in the making with the passing of Senate Bill 100 in the 1970’s. However, there is one thing that we can all agree on- something needs to be done now to fix this! When you are in a crisis that means all hands-on deck. We need to cut the red tape, expand UGB’s, streamline the application process and start building homes today, not tomorrow or next year. These bureaucratic delays are inflating construction costs and driving up the costs of homes.

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