What Buyers Need To Know About Today’s Housing Supply If you’re searching for a home right now, it’s important to understand a little bit about the current supply of homes available for sale. Here’s a look at two reasons why today’s housing inventory is low and some promising news as you move forward with your search. 1. New Home Construction Fell Behind for Several Years The graph below shows new home construction for single-family homes over the past five decades, including the long-term average for housing units completed. Builders exceeded that average during the housing bubble (shown in red on the graph). The result was an oversupply of homes on the market, so home values declined. That was one of the factors that led to the housing crash back in 2008 – and it’s very different than the inventory available today. Since then, the level of new home construction has fallen off. For the last 14 years, builders haven’t been able to construct enough homes (shown in green on the graph) to meet the historical average. That underbuilding left a multi-year inventory deficit going into the pandemic.
Single-Family Housing Units Completed In Millions (1970-2021) 4 Consecutive Years of a Record-Setting Number of Units
Long-Term Average
14 Straight Years Below the Long-Term Average
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
2021
Source: Census 14
