Of course, anyone who has practiced real estate, tried to buy a home, or turned on the news over the past year knows that the lack of available housing in America has helped create a market unlike any we’ve ever seen.
But this is not a bubble caused by unwise policies or unsafe lending practices. The ongoing inventory shortage shows how strong the appetite is for housing in America today. But it also tells us how far we have to go to close the gap between supply and demand.
Earlier this year, NAR partnered with the Rosen Consulting Group to author a research report about the state of housing in America. Our conclusion? Decades of underinvestment and underbuilding have created a shortage of homes that is more dire than most anyone in the industry had feared.
The report specifically found that America is in the midst of “underbuilding gap” of 5.5 to 6.8 million housing units dating back to the beginning of the century. Housing is Critical Infrastructure: Social and Economic Benefits of Building More Housing also explains that the gap will require a concerted, long-term nationwide commitment to overcome.
Fortunately, we know that with the right policies and a legitimate acknowledgement of the severity of this problem, we can protect the American Dream of homeownership for generations to come.
There is a strong desire for homeownership across this country. That is clear. But the lack of supply is preventing too many Americans from achieving that dream. In our report, NAR proposed a number of policy recommendations designed to help lawmakers get a head start on addressing this gap. Broadly, our proposals encourage lawmakers to expand access to needed resources, remove barriers to construction, incentivize new development, and make housing construction an integral part of a national infrastructure strategy.
A number of factors from the past 20 years are responsible for the massive housing investment gap we see in America today, but what’s important now is that we find solutions that will get us out of this crisis and provide more stability in future markets. Additional public funding and policy incentives for construction will very clearly provide huge benefits to our nation’s economy, and our work to close this gap will be particularly impactful for lower-income households, households of color and millennials. And it’s work that remains one of NAR’s top priorities in the months and years ahead.
Charlie Oppler, 2021 President of the National Association of Realtors®