(NewsNation) — Rising housing costs are the leading factor behind America’s declining fertility rates, according to new research that highlights the far-reaching effects of the housing crisis on the nation’s demographics.
“Housing and fertility are jointly determined because large and small families sort into different locations based on the number of children they have — or want to have — and housing costs,” said Benjamin K. Couillard, a doctoral candidate in economics at the University of Toronto.
The U.S. fertility rate currently stands at 1.62 children per woman, well below the 2.1 population replacement rate, according to the National Center for Health Statistics.
Couillard’s new preprint research paper found that since 1990, rising housing costs have led to 11% fewer children born nationwide. Between the 2000s and 2010s, those costs accounted for 51% of the total fertility decline.
If housing costs had remained flat after 1990, the research estimates 13 million more children would have been born by 2020, and fertility rates in the 2010s would have been 77% closer to the replacement level.
“That’s a surprising result,” Couillard said. “It suggests that housing costs are a major driver of fertility decline. Housing abundance is not just about affordability; it’s about long-term demographic sustainability.”
The research combined urban economics and industrial organization to build a model that separates the impact of housing costs from other factors influencing family and location choices.
“It’s actually more accurate to call it a living arrangement model, where fertility is a key component,” Couillard explained. “Agents can choose to start a family or remain with their parents, and the model captures dynamic considerations like life-cycle timing and long-term housing needs.”
The paper notes that most U.S. housing policies focus on expanding the supply of smaller units — such as studios and one-bedroom condos — to help first-time buyers enter the market. But Couillard’s findings suggest that increasing access to larger, family-sized homes would have a much bigger demographic impact.
“Current U.S. fertility rates would rise markedly with lower cost three-plus bedroom housing units,” said Professor Nathanial Baum-Snow, Couillard’s thesis supervisor. “Subsidizing the construction of additional one-bedroom housing units would do little to address demographic sustainability.”
In short, families would have more children if they could afford space to raise them comfortably.
“If we can get housing costs down, that’s good for affordability,” Couillard said. “But it also helps us avoid the demographic problems that come with aging populations and declining birth rates. A maximalist housing policy, one that aggressively expanded supply to prevent costs from rising, could have solved the majority of the fertility problem.”