MINT HILL, NC – Currently, there is a 6.5 million single-family home shortfall in the U.S. due to a decade of under-building, according to a report from REaltor.com. This report looks closely at household formation, home sales, and housing start and discovered that from 2012 to 2022, there is a huge shortfall of single-family homes.

However, there has been a boom in multi-family homes, which has helped to fill in the gap. When multi-family homes are factored in, the shortfall drops to 2.3 million homes. These properties don’t provide a path to homeownership in some scenarios, however.

Why the Single-Family Home Shortfall?

There are two main reasons why this shortfall exists in the United States. First, the cooling buyer demand over the past decade has shifted the focus of builders. Second, builder confidence in single-family construction has dropped, which has led to more multi-family home building.

Many builders have moved to building apartments instead of single-family homes since the rental market has remained profitable.

A Look at the Numbers

Over the past decade, there were 15.6 million households formed, yet only 13.3 million housing units were started. Less than 12 million of those housing units were completed. The rate of housing also started to slow during this ten-year period.

In 2022, about one million single-family homes were started, which means construction began on these homes. This was down more than 10% compared to 2021. However, multi-family homes were much higher with an increase of about 15% compared to 2021.

During this housing deficit, affordability has also dropped quite a bit.

While the figure of 6.5 million might overstate the housing shortage due to multi-family homes not being factored in, there is certainly a housing shortage throughout the country. More builders are focusing on apartments and other rentals instead of single-family homes.

If mortgage rates and inflation soften, there might be a return of buyers to the market that are currently renting. However, it will also require some affordability to come back to the market. The shortage of single-family homes will continue to put pressure on the market, however.

I would love to be part of your journey when the time is right for you. If you ever have a real estate question or need, or know someone who does, trust that you can turn to me.  I will help you make the right move! Anna Granger (704) 650-5707 | annagrangerhomes@gmail.com | www.1stchoicepropertiesinc.com