Mississippi currently stands as one of the cheapest areas to buy a house. In fact, the state ranks 2nd in the United States in cheap housing at a median value of $144,074 per a typical single-family home. However, that home value only increases at a rate of 9.8%, one of the lowest in the nation.
The state government has instituted policies to make the price higher than it should be while keeping the increase in value at a lower rate. One such policy that has affected the prices of housing is the policy towards lumber. Currently, lumber costs are up, and the demand is high. Mississippi currently has plenty of it to make newer houses. The problem is that production cannot keep up with the demand, and it certainly does not help when the Mississippi government places too much of a burden through regulations and bureaucratic control. Mississippi has, in the past, relaxed these regulations in order to ease the burden. It should do so again.
Perhaps the biggest factor in housing costs, however, is the need to build the Mississippi economy. The housing market is often seen as the indicator of a thriving state economy. This is because people are more willing to move into the state in which business is booming. Due to competition, if the economy is thriving and more people want to live in Mississippi, the prices will find its way to an appropriate level. In other words, if Mississippi wants cheap, quality housing, building the economy and letting the market fluctuate naturally is the best way to go.
When considering policy in this context, thinking about the big picture is often the most effective. Edmund Burke often asserts that policy change needs have a specific justification. Simply throwing things at the wall to see what sticks will bring about unforeseen consequences, ones that are often not welcome. If Mississippi sees a thriving market such as the one it sees currently in real estate, it is best to step back and let the natural benefits of the free market take hold. Increasing taxes or implementing regulations will only stifle the process and either plateau or decrease the market’s progress.