By Mya Blanchard, Nashua Ink Link

There has been a lot of talk about the housing crisis in New Hampshire, and with the cost of finding a place to live so high, this can make the already daunting prospect of buying a house or renting an apartment seem that much more unattainable.

Elected officials have taken some measures, and can still take others, to lower the cost of housing and work toward pulling New Hampshire out of the crisis. To understand how to do that, it’s important to understand how we got here. 

Where we are 

“We simply don’t have enough housing to meet demand,” said Ben Frost, deputy executive director and chief legal officer at New Hampshire Housing. “It’s a classic supply and demand problem.” 

According to New Hampshire Housing’s 2023 Statewide Housing Needs Assessment, the current housing shortage is 23,000 units, which means many more units are needed to bring the market to stability. It is anticipated that the state will need 60,000 more units by 2030, and nearly 90,000 by 2040. 

“The shortage of housing, both current and prospectively, has real-life implications for people,” Frost said. “Because there’s not enough housing to meet demand, that means it’s a classic supply and demand problem. Prices go up, and the prices in New Hampshire for purchase or for rent are simply unaffordable for most people.”

“Most people do have a place to live,” he said. “It’s just that they’re spending far more of their income on their housing than we agree that they should.” 

Frost said the rule of thumb is that people shouldn’t be spending more than 30 percent of their income on housing, which means very few housing units in the state are actually affordable for the typical buyer. 

In fact, according to New Hampshire Housing’s 2024 Residential Rental Cost Survey, only 13 percent of two-bedroom units in the state are actually considered affordable for renters with a statewide median annual income of $56,814. They would have to earn over $73,000 a year for most two-bedroom apartments to be considered affordable.

Statewide, the median gross rent, including utilities, is currently $1,833 per month. 

“What we’ve seen is that, over the past five years, the median rent for a two-bedroom apartment statewide has gone up [more than] 36 percent, and we know incomes have not kept pace for that, especially renter incomes,” Frost said. 

How we got here

“This is a crisis that has been developing over decades,” Frost said. “There are a variety of factors that come to play in this.”

According to Frost, lots of units were being built in the 1980s, until the real estate crash in 1987, at which point the market suffered and prices went down. The real estate market recovered over the next eight years and reached a surplus. Around 1995, however, demand began to outstrip supply, and prices began to rise. 

“It really is a question then of how much we’re building,” Frost said. “What was going on in the ’80s or even the early 2000s, we’re building less than half of what we did just 20 years ago.” 

There are multiple reasons for that, one being that it’s been more difficult since the Great Recession of the early 2000s to get mortgages and for developers to get financing to build new units, limiting inventory and making what is built more expensive.

The cost of construction is also higher, in part because of the scant availability of materials and the supply chain problems that came along with the Covid pandemic. 

Skilled labor is in short supply in New Hampshire as well, driving up labor costs, as builders are getting older and retiring, and not enough young people are getting into the field to replace them. 
“What we talk about most of all, though, is the local regulatory environment,” Frost said. “Multifamily rental housing is, in many communities, made almost, if not actually, impossible to build because of the zoning regulations.” 

Where we are going

According to Frost, municipalities “can choose to make changes to the zoning ordinance to encourage the development of housing that is more affordable.” 

He noted that in the 1920s, the state gave New Hampshire municipalities the authority to enact their own zoning laws. Since then, the Legislature has passed laws to encourage development of affordable housing. 

The Workforce Housing Law — passed in 2008 — requires every municipality in the state to allow “reasonable and realistic opportunities” for development of housing that is affordable to working people. 

In 2017, the Accessory Dwelling Unit law was passed. It requires municipalities to allow at least one attached accessory apartment wherever single-family homes are allowed. However, some municipalities have added restrictions that create additional challenges to adding an accessory dwelling unit, such as requiring the addition of four parking spaces. 

Frost said lawmakers have more work to do to address the shortage, particularly when it comes to zoning restrictions.

“The Legislature has the power, and I would say the moral obligation, to ensure that municipalities are engaged in zoning in a way that is not detrimental to the state and its economy and its people,” Frost said. “I think there were a number of bills in this year’s legislative session that didn’t quite make it across the finish line. My hope is that we’ll see more going forward successfully in 2025.” 

The Know Your Vote youth voter guide project was designed, reported and produced by student and young professional journalists from The Clock, Concord Monitor, The Equinox, Granite State News Collaborative, Keene State College, Laconia Daily Sun, Monadnock Ledger-Transcript, Nashua Ink Link, and The Presidency and the Press program at Franklin Pierce University. See the full guide at www.collaborativenh.org/know-your-vote.