The U.S. housing market is at a critical juncture in 2025. As the housing crisis deepens, experts are turning to “missing middle housing” as a key solution. This overlooked category of small, multifamily homes could play a major role in restoring affordability, increasing supply, and reviving walkable communities.
Understanding the housing crisis
America’s housing crisis stems from a persistent shortage of homes, soaring prices, and worsening affordability. In 2025, a household must earn $114,000 annually to afford a median-priced home, up 70% from five years ago. Meanwhile, new construction lags behind demand, particularly for affordable and mid-range homes.
Economic uncertainty, rising mortgage rates, and demographic shifts are adding pressure. Young buyers face steep barriers to entry, and older homeowners often remain in oversized homes due to a lack of downsizing options.
What is missing middle housing?
Missing middle housing refers to building types between single-family homes and large apartment complexes. Examples include duplexes, triplexes, fourplexes, cottage courts, townhouses, and mansion apartments. These homes are:
- Human-scaled: Typically 2-3 stories tall.
- Walkable: Located in neighborhoods close to amenities.
- Flexible: Suited for a range of lifestyles, from young couples to retirees.
- Efficient: Built with smaller unit sizes, maximizing land use.
Missing middle housing was common before World War II but has largely disappeared due to exclusionary zoning, financing challenges, and regulatory barriers.
How missing middle homes address the housing shortage
Missing middle housing offers several benefits critical to fixing the housing crisis:
- Affordability by design: Smaller units and simpler construction lower costs.
- Increased supply: Filling gaps in low-density neighborhoods.
- Walkable communities: Reducing car dependence and supporting local economies.
- Flexible living options: Meeting the needs of downsizing older people, single professionals, and small families.
- Environmental benefits: Lower carbon footprints compared to sprawl development.
Barriers to building missing middle housing
Despite its potential, missing middle housing faces significant obstacles:
- Zoning restrictions: Many cities outlaw duplexes or triplexes in most neighborhoods.
- High construction costs: Materials, labor, and regulatory requirements drive up prices.
- Financing challenges: Lenders favor single-family or large multifamily developments.
- Community resistance: NIMBYism often blocks new middle-density projects.
- Building codes: Regulations designed for high-rises impose costly requirements on small multifamily homes.
How policy changes are opening the door
Some states and cities are beginning to act:
- MBTA Communities Act (Massachusetts): Requires cities near transit hubs to allow multifamily housing.
- Statewide ADU laws: Legalizing accessory dwelling units (small backyard homes) without special permits.
- Starter Homes Initiatives: Encouraging construction of smaller, more affordable single-family homes.
- Zoning reform campaigns: Cities like Somerville, MA have re-legalized triple-deckers, a classic missing middle style.
These efforts show that smart, targeted zoning changes can dramatically expand housing options.
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Demographic shifts driving demand for middle housing
Demographic changes make missing middle solutions even more urgent:
- Aging population: Baby boomers need smaller, accessible homes.
- Shrinking households: By 2025, up to 85% of U.S. households are childless.
- Desire for walkability: Surveys show over half of Americans prefer walkable, amenity-rich neighborhoods.
Without appropriate housing options, gridlock worsens: Older people stay in large homes, young families struggle to find entry-level options, and cities miss out on economic growth.
Building a more resilient housing market
To truly tackle the housing crisis, the U.S. must move beyond traditional models and embrace middle housing:
- Legalize diverse housing types across cities and suburbs.
- Streamline permitting for small multifamily projects.
- Offer financing innovations to support small developers.
- Promote community education to overcome outdated fears about density.
- Prioritize infill development over sprawl to preserve green space.
Missing middle housing won’t solve the crisis alone, but it is a powerful tool to rebalance supply, increase affordability, and create healthier, more inclusive communities.
Conclusion: A critical step toward solving the housing crisis
The U.S. housing market cannot recover without addressing its supply and affordability gaps. Unlocking the potential of missing middle housing is essential. By updating zoning laws, supporting innovative development, and aligning housing with changing demographics, policymakers can reshape the housing market for a stronger, more resilient future.
The housing crisis demands urgent action—and missing middle housing must be part of the solution.