By Mike Harris Sunday, February 22nd, 2026

Obstacles to building more, much-needed housing in California include regulatory and legal barriers, economic and financial risks and production costs.

Solutions to the state’s housing crisis include tougher rent controls and increased public investment in homes.

That’s according to a new study by California Lutheran University economist Jamshid Damooei, who presented it at a Feb. 19 housing conference at the Thousand Oaks school.

“What this study and conference are focused on is housing affordability – actually the lack of affordability,” Damooei told the Business Times.

“For real solutions, we have to look at the economic system, how it works, and how it undermines the well-being of many low-income people,” he said.

Damooei, professor and executive director of Cal Lutheran’s Center for Economics of Social Issues, is confident remedies can be found and implemented.

“I am 100% sure we have many solutions,” he said.

Millions of California families can’t access housing markets either to rent or buy, according to Damooei’s study entitled “California’s Housing Crisis: Roots of the Problem and What Lies Ahead.”

“The history of homeownership in California unfolds against the backdrop of long-standing affordability challenges,” the study says.

“For many years, housing has been out of reach for Californians, forcing many to spend a large portion of their income on rent and utilities,” according to the report.

Recent data indicates that approximately 30% of renters statewide allocate more than half of their income to those costs, the study says. 

The number of unhoused residents in California has reached a record high, with the latest federal estimate totaling 181,000, according to the report.

“Although it has not always been this severe, Californians have grown used to the state’s housing affordability crisis,” the study says. 

“Perhaps too used,” it says. “The level of despair experienced by many California families is complex to believe and even more challenging to accept.”

Obstacles to building more houses in the state include regulatory and legal barriers, economic and financial risks, production costs, environmental and geophysical constraints, community attitudes and local politics, the study notes.

Damooei recommends several steps to recognize housing as a basic need and make it affordable for everyone. They include:

• Rent control, which is limited because the state enforces strict restrictions on what local governments can do. “There is a need for rent management options that extend beyond state boundaries, offering practical, balanced solutions that support both renters and landlords,” the study says.

• Stricter regulations on large institutional investors, such as those that own large numbers of single-family rentals. “It is evident that the California housing market, whether for sale or rent, is driven more by increasing profits than by providing affordable options,” the report says.

• Increase transparency. “This can be done through mandating states collect information about property ownership, including parent companies, to better understand who controls the market,” Damooei writes. “Apply rent freezes to corporate owners with significant holdings.” 

• Increase public investment in social housing. “Maintaining a competitive rental housing market is essential to keeping rents low and ensuring stability and affordability,” the study says. “But how can this be sustained when the growth of corporate ownership might go unchecked?”

• A practical solution is for the government to enter the market, build and own rental properties, enforce fair rental standards, and set rents with subsidies for lower-income renters while they remain in that economic status, the report says.

• Bringing community together. A “solidarity economy” must be built that focuses on people rather than profit through cooperative, democratic, and community-based economic activities, according to the study.

“Ultimately, we must be candid about the economic forces that have led us to this point,” Damooei writes.

Affordability is neither a temporary disruption nor a fleeting concern, but the result of long-term structural shifts that have unfolded over decades, he says. 

The current trajectory is unsustainable, and change is inevitable, according to Damooei.

“The question is whether we will act deliberately and constructively,” he writes.

“We still have the opportunity to pursue reforms that promote stability, broaden economic security, and advance the common good,” Damooei says.

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