Housing Shortage Will Be With Us for Years to Come
Zillow, a nation-wide real estate marketing firm, released a report that indicates that a housing shortage will be with us for years to come or at least through 2021. Zillow’s findings also line up with forecasts by the National Association of Home Builder’s Chief Economist, Robert Dietz. “Our forecast goes through 2021, and we have single-family starts approaching 900,000 units by the end of the forecast window — so staying under 1 million a year,” said Dietz. “On a demographic, or potential demand basis, we should be building 1 million to 1.1 million single-family homes a year. Dietz said labor shortages, high land costs, price increases for materials and growing government regulations have hammered housing construction in many markets.
Single-Family Housing Shortage Impacts to Rental Market
With the single-family housing shortage that is expected to be with us for several more years, it is expected to put even more pressure on the rental market in the form of higher rents that have a greater impact on lower income households. As market-rate rents continue to rise at rates that outpace the growth of income, more families will be in search of more affordable housing options. Their search will continue to push more low-income families to the suburbs and beyond or force more families to live in overcrowded conditions just to pay the rent.
Income-Based Affordable Housing Options Can Help Ease Pressure
Cities will continue to grapple with the loss of workforce needed to fill positions that pay lower wages. Hotel staff, coffee houses, restaurant staff, retail workers, construction workers, teachers, first-responders and the like are in dire need of quality, affordable housing options that can keep them and their families closer to where they work. When workers are living closer to their jobs, cities benefit by easing traffic woes and combating reductions in inner-city school enrollment as well as increasing and/or maintaining diversity and reducing poverty.