This Land Is Our Land: "... Federal land reform could be a promising tool to improve housing supply and thereby housing affordability.".

• Author: Calder, Vanessa Brown
• Position: DOLLARS & SENSE

THROUGHOUT the pandemic, people have poured into states in the South and Intermountain West, including states like Idaho, Arizona, and Utah. According to Census Bureau estimates, areas including Boise, Idaho, and Salt Lake City, Utah, sustained some of the highest net migration increases during the 2020-21 period. Net internal migration encompasses migration to/from U.S. states. Net migration includes migration from abroad. California has some of the highest outbound migration of any state; this depresses net migration estimates for the West.

Following increasing in-migration, cities in these once-affordable states rapidly encountered housing affordability issues. For example, at the end of June, Phoenix, Ariz., and Salt Lake City had monthly mortgage payments that were up over 70%, year-over-year. Observed rents were up 15% year-over-year in the same areas (having fallen from their peak of 20% to 25%).

Various factors--including changing consumer needs, supply chain issues, labor shortages, and the like--combined with rising demand to produce rising prices. In addition, policies including restrictive zoning became newly salient in western states with burgeoning population growth.

However, there is another less-recognized policy issue affecting housing supply that is specific to western states: a substantial portion of the land is owned by the Federal government and not developable.

For example, in Nevada, Utah, and Idaho, the Federal government owns, respectively, more than 80%, 63%, and 60% of the land. In other states like Arizona, Colorado, Wyoming, California, and Montana, the Federal government owns more than one-third to one-half of available land.

Contrary to public perception, the vast majority of Federal lands are not national parks, monuments, or Bureau of Indian Affairs land. Instead, a majority of Federal western land is managed by the Bureau of Land Management (BLM) and U.S. Forest Service (USFS).

BLM land once was described as "land that nobody wanted," owing to the fact that homesteaders had passed over it. Today, BLM and USFS land is employed for a variety of uses, including grazing, mining, recreation, and energy transmission and production.

This land is not so far from urban development that it is of no practical use, and a significant portion of lands are within city or county boundaries: previous estimates indicate that there are 217,000 acres of BLM and USFS land within Utah city boundaries, and 650,000 acres of USFS...