More than a third of American households rent their homes. These skyrocketing rents are putting families at risk of living in sub-par conditions, facing eviction, or worse, becoming homeless. Leading experts agree that a lack of attainable housing is the main cause of homelessness in the United States, according to a new Urban Land Institute report.

During the pandemic, many state and local governments capped rents and limited evictions. These measures allowed millions of renters to stay in their homes. However, these policies did not address the long-term challenge renters face: a severe shortage of high-quality housing they can afford, especially for those of modest means who are most vulnerable to financial shocks.

This shortage of housing units predates the pandemic. Up for Growth’s recent Housing Underproduction in the US 2022 report estimates the national housing deficit was about 3.8 million units as of 2019, up from about 1.65 million units in 2012. With particular regard to rental housing, every state now has fewer low-rent units available than in 2011. For example, Colorado has lost 51.9% of its low-rent units; Texas has lost 49%.

Steep increases in home prices have exacerbated the rental property shortage, as many families have been priced out of homeownership and remain renters. The result is even more competition in the rental market, where lower-income renters are less able to compete with higher-income ones. One-quarter of renter households are “extremely low-income.” For these families, the shortage of affordable and available homes is 7 million units.

It also means renters often pay more than they sustainably can. An economic downturn–and the job losses that accompany it–could threaten their ability to stay in their homes. Families with disruptions in income are more likely to be evicted. Even a small amount of savings (less than $750) can safeguard a family against eviction in some cases–but one in four families has no savings at all.

To identify solutions, the Urban Land Institute surveyed more than 300 property owners, renters, and tenant advocates. Our research uncovered some surprisingly common ground among tenants and landlords.

One point of consensus is that instability in the market is largely driven by a lack of housing options. Respondents agreed the long-term solution is to increase the housing supply by constructing new units and rehabilitating older ones.

Local governments can start by reforming policies that inhibit new housing. There is no other way to address scarcity in a definitive manner. Tackling regulatory barriers will lower costs for renters and buyers, expanding opportunities for housing and economic mobility.

Some cities and states have eliminated the most prevalent barrier to housing production: exclusionary zoning and related regulations. These rules often prohibit even “gentle density,” such as duplexes and triplexes among single-family homes or the addition of accessory apartments to existing properties, thus limiting housing supply. While zoning codes can serve legitimate purposes, they have also been leveraged historically to segregate communities along racial and economic lines.

Today, single-family zoning and related regulations severely limit housing production. These rules are driving shortages and housing inflation more broadly and maintaining housing inequity by excluding lower-income households–in which racial minorities are overrepresented–from our highest-performing neighborhoods. Many of our “best” neighborhoods were built on decades of racially exclusive policies and investments, and we have the opportunity and a responsibility to provide more equitable access to their benefits and amenities today.

In addition to legalizing housing through zoning reform, cities can also increase housing production by reducing development costs, particularly for units affordable to lower and moderate-income households. Opportunities to reduce development costs include reductions in permitting and other fees, tax relief, density bonuses to incentivize lower-cost units, streamlined entitlement processes, including policies enabling by-right development, and public subsidies to support the delivery of units affordable to our lowest-income households.

We can also take immediate steps to enhance housing stability. To empower renters and help landlords comply with evolving protections, both parties must understand their legal rights and responsibilities and seek effective and cost-efficient methods to resolve disputes without litigation.

In Chicago, the government-sponsored Renters’ Rights campaign helps landlords and tenants meet their legal obligations and understand their rights. It also facilitates informal mediation processes that help renters and landlords resolve conflicts without turning to eviction.

The past two years show that we need a fairer, more functional rental market. An approach that balances the needs of tenants and property owners can put America on a path to real housing sustainability.

Christopher Ptomey is the executive director of the Urban Land Institute’s Terwilliger Center for Housing, which is the publisher of Homeless to Housed, Stable Residents, Stable Properties, and the Home Attainability Index.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not reflect the opinions and beliefs of Fortune.

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