America is facing a new housing crisis. A decade after an epic construction binge, fewer homes are being built per household than at almost anytime in U.S. history.
Home construction per household a decade after the bust remains near the lowest level in 60 years of record-keeping, according to the Federal Reserve Bank of Kansas City.
What makes the slump puzzling is that by most other measures, the American economy is booming. Jobs are plentiful, wages are on the rise and the stock market is near record highs. Millennials, the largest generation since the baby boomers, are aging into home ownership.
A combination of tightened housing regulations, a lack of construction labor and a land shortage in highly prized areas is driving the crisis, according to industry experts.
The National Association of Home Builders estimates builders will start fewer than 900,000 homes in 2018, less than the roughly 1.3 million homes needed to keep up with population growth. The overall inventory of new and existing homes for sale hit its lowest level on record in the fourth quarter of 2017, at 1.48 million, according to the National Association of Realtors. That, in turn, is pushing up prices at what economists say is an unsustainable pace.
Laura Kusisto, Wall Street Journal, March 19, 2018.
