No homes, no workforce

Available affordable housing remains the state’s top economic issue

Housing continues to be the limiting factor to New Hampshire’s economic growth. That fact adds to the importance of a report the state issued in January that found housing production, as tracked by permits, reached a 20-year high in 2025.

This is important, because of all the economic issues facing the state, available affordable housing remains at the top of the list, and any progress on this front is important to the ability for our employers to recruit and retain workforce. Simply put, if there is nowhere to live, people will leave or take jobs elsewhere.

Most importantly, the results in this report point to practical models for how New Hampshire can continue to address housing affordability and availability. Those results can be traced to two significant state programs: InvestNH and Housing Champions.

Taken together, these initiatives illustrate how state-driven policy can use the two primary tools governments have to influence housing outcomes: financing and regulation.

The report, authored by the Department of Business and Economic Affairs (BEA) and titled “Current Estimates and Trends in New Hampshire’s Housing Supply,” finds that housing production reached its highest annual level in two decades.

In 2023, the Statewide Housing Needs Assessment estimated that New Hampshire would need 32,704 housing units between 2020 and 2025 to remain on track for a balanced housing market by 2040. According to the report, 25,688 units came online during that period. While this leaves us roughly 7,000 units short in the first five-year window, it still represents about an 80% success rate — with 15 years remaining.

For any government grappling with housing affordability and availability, the two primary policy levers are finance and regulation. On the financing side, debates about whether government should be involved are largely academic at this point. Across the country, federal, state and local housing finance programs are so numerous that they can make one’s head spin. Argue against them if you wish, but the reality is that public financing is now deeply embedded in any serious effort to address housing challenges.

The second major policy lever is regulatory reform. Cutting red tape that impedes housing development is foundational to progress in any state or community. Regulatory reform can include zoning or other planning changes that encourage certain types of housing in appropriate areas and help make development timelines and costs more predictable.

It also gives communities the opportunity to think carefully about how they want to grow. But maintaining a vibrant local economy ultimately requires new people, and new people need places to live.

With that context, the BEA report’s conclusions can be directly linked to two state efforts that exemplify these approaches.

First, in July 2022, Gov. Sununu launched the InvestNH housing program. Its core purpose was to invest $60 million directly into affordable housing developments in order to accelerate their time to market. By early 2023, InvestNH had begun making investments in projects across the state, accelerating the delivery of thousands of housing units. By the end of 2024, the program’s primary goals had largely been achieved.

InvestNH also incentivized local action by offering grants to help communities cover the often significant costs of zoning and planning reviews, as well as infrastructure and related expenses. Dozens of municipalities took advantage of these funds, easing the path toward locally defined housing solutions and the economic benefits that accompany them.

The second effort is the Housing Champions program — an underfunded but highly effective initiative that allows towns to signal that they want more housing, on their own terms. New Hampshire has a limited set of housing-related incentives and training programs, so Housing Champions packages those tools into a straightforward checklist that communities can use to become more housing-friendly. But the program is about more than incentives. When a town earns a Housing Champion designation, it is making an affirmative statement: “We want affordable housing here.”

Builders, lenders and investors see “NIMBY risk” almost everywhere. Housing Champion designation reduces that uncertainty and serves as a magnet for private investment, while allowing towns to retain local control. The BEA report notes that the state’s 28 Housing Champion communities accounted for nearly half of all new housing permits.

However we get there — through financing, regulatory reform or both — the priority must remain building more housing units. The BEA report highlights the types of initiatives that have worked in New Hampshire:

targeted investments that accelerate development, policies that preserve local control and incentives that encourage communities to act without mandates. These approaches are already paying dividends, and will continue to do so if we stay the course.

That’s the New Hampshire way.

Taylor Caswell has led economic policy agencies on the state and federal level for decades, most recently as New Hampshire’s commissioner of business and economic affairs. You can reach him on LinkedIn.