To reduce housing shortages, small doses of cash could get many projects built. A bill introduced in Oregon this year suggests a clever place to find it.

Oregon’s housing catastrophe comes down to this: Alongside every home built in the state since the Great Recession is the ghost of another home that never was.

Cottages that might have slipped into backyards if they’d been able to cover the sewer connection fee. Apartment buildings that might have filled up with nursing assistants and preschool teachers if they’d qualified for a slightly larger loan. Would-be projects across the state that, for one of a thousand reasons, came up a little short on cash and never left the drawing board.

Economists calculate that it’s added up to the country’s fourth-worst housing shortage. When there aren’t enough new homes, bidding wars begin for the old ones. Since 2010, untold thousands of these price battles across Oregon have driven up home prices more than 60 percent.

A grizzled squad of the state’s housing nerds says they have a “big idea” that could help end these bidding wars by bringing these ghost homes to life, especially in smaller cities where low wages and decrepit infrastructure keep much of anything from being built. They calculate that a $300 million investment could produce 12,000 mid-price homes around the state within several years.

That’d be enough to meet several years’ worth of the state’s new production goal for that price category.

Then, like blueberry bushes, the seeds planted would bear fiscal fruit year after year. Even without further funding, a revolving housing loan fund seeded by a one-time state investment would produce thousands more homes over the decades to come, bringing the total public cost to $10,000 per home created.

The catch is that it’d cost money up front. But the concept’s backers say that if Gov. Kotek hopes to come anywhere close to her high-profile goal of nearly doubling housing production, there’s no more cost-efficient way to push up the numbers.

The idea for making more of Oregon’s ghost homes exist was captured this year in House Bill 2980. On Friday, the Portland Business Journal reported that that bill appears dead for this year; its backers aim to keep developing it and introduce it again.

Its concept is simple. The money comes from the future.

HAPPY HOMES AND GHOST HOMES

In a state with too few happy stories about housing, Mieko Frederick’s sidewalk-level apartment in Newberg, Oregon, might be home to one of the happiest.

Sitting at the little wooden table outside the door to Unit 103, a few blocks from downtown, Frederick cheerfully counted the ways she loves her new place, built in 2020.

“The grocery store is there, the library is there,”

said Frederick, 83, gesturing this way and that from the makeshift patio she set up after moving into the three-story building a year-and-a-half ago.

“I can walk and go everywhere.”

Then there are the stories like the one about the 8th Avenue Garden Cottages.

That was the name Dirk Knudsen gave his plan to add eight 250-square-foot freestanding homes to an oversized backyard just southeast of downtown Hillsboro, a booming tech hub north of Newberg. Within three blocks were a hospital, a university campus, a grocery store, and a light rail stop.

“We were looking for students, lower-income people in the service sector, and also seniors looking to move down out of their existing homes,”

Knudsen recalled.

But between construction costs and the $34,000 per new home that Hillsboro charges to finance new roads, pipes, and parks, Knudsen calculated that he couldn’t bring the cottages to market for less than $260,000 each—and he estimated that nobody would be willing to pay that much to live in one. So he pulled the plug. Today, the backyard is still sitting mostly empty, and the eight households that might have lived there are instead competing for housing with everyone else in Hillsboro.

“WE CAN’T SOLVE THE AFFORDABLE CRISIS IF WE DON’T SOLVE THE HOUSING...