U.S. Housing Will Get Even Less Affordable
More investor-owned properties and rising construction costs are just two reasons homes are out of reach for many.
Housing is getting more out of reach for many.
Photograph: Bloomberg
The U.S. housing sector has mostly recovered from the subprime mortgage-led collapse. The homeownership rate has started rising again, to 64.2 percent from 62.9 percent in mid-2016, and the gap between rental and mortgage costs has moved in favor of single-family owners. Also, first-time home buyers totaled 2.1 million last year, almost back to the housing boom peak.
Still, buyers and realtors decry the lack of affordable inventory. The National Association of Realtors just said the inventory of available properties for sale tumbled 6.1 percent last month to the lowest ever for a May in the history of its data Why aren’t market forces filling this need? Single-family housing starts were at a 936,000 annual rate in May, half their 2006 peak level. But multi-family starts came in at a 414,000 rate, well above the 300,000 norm even though apartment vacancy rates have been rising.