In my last article titled, “11.4 million U.S. households are paying more than 50 percent of income for housing,” I explained that the U.S is currently in a housing and economic crisis. Millions of Americans cannot find good paying jobs and/or affordable housing, and the problem is growing worse every month.
A new report by the National Association of Realtors®, had shown that 80% of the measured metro areas are currently lacking in single-family home construction which is creating a housing shortage crisis and curtailing affordability. Many of the largest cities in the country face the biggest housing problems.
Lawrence Yun, NAR chief economist said, “Inadequate single-family home construction since the Great Recession has had a detrimental impact on the housing market by accelerating price growth and making it very difficult for prospective buyers to find an affordable home – especially young adults. Without the expected pick-up in building as job gains rose in recent years, new and existing inventory has shrunk, prices have shot up and affordability has eroded despite mortgage rates at or near historic lows.”
In order to solve the housing problem, we simply need to build more affordable single-family and multifamily homes to meet the current demand.
The NAR report shows the top 10 metro areas with the biggest need for more single-family housing starts to get back to the historical average ratio are:
- New York (218,541 permits required)
- Dallas (132,482 permits required)
- San Francisco (127,412 permits required)
- Miami (118,937 permits required)
- Chicago (94,457 permits required)
- Atlanta (93,627 permits required)
- Seattle (73,135 permits required)
- San Jose, California (69,042 permits required)
- Denver (67,403 permits required)
- San Diego (55,825 permits required)
“The limited number of listings in several markets means that many available homes are receiving multiple offers and going under contract rather quickly,” says NAR President Tom Salomone, broker-owner of Real Estate II Inc. in Coral Springs, Florida. “It’s important in this situation to remain patient and not get caught up offering more than your budget allows. Find a Realtor® with experience serving clients in your desired area and rely on them to deploy a negotiation strategy that ensures success while sticking within budget.”
Read more of the NAR report at this link.
I’m LoanSafe.org’s mortgage expert and a senior loan officer with Prime Lending. If you need a live rate quote, or need help getting a new mortgage, please call me direct anytime at 619-379-8999.