We’re at an all-time housing inventory low. This “macro” shortage is almost the same size as the oversupply was in 2007. Florida is number three in a list of the top five states with the largest housing supply deficits. This shortage has put pressure on buyers and prices.
There are a number of reasons why:
- Years of underbuilding due to the disastrous years of overbuilding.
- Domestic migration as people seek employment and lower cost of living including taxes.
- Millennials and Gen Z’s entering the housing market.
- States with strong economies like California and Oregon have a very tight supply of housing making many areas unaffordable.
- Restrictive zoning regulations in some states.
“Simply put, new housing supply is not keeping up with rising demand,” says Sam Khater, Freddie Mac’s Chief Economist – a point echoed by the National Association of Realtors® (NAR). “We estimate that the housing market is undersupplied by 3.3 million units, and the shortage is rising by about 300,000 units a year.”