Though fewer homeowners are underwater on their mortgages and more new homes are being built, the housing market still has some issues that need to be worked out.
Urban Land analyzed the Harvard Joint Center’s State of the Nation’s Housing 2017 report, which was released earlier in June. While residential construction has increased for the seventh straight year, production is still markedly low by historical standards. Housing completions between 2007 and 2016 totalled 8.98 million units, significantly below the 15 million average for every 10-year period from the 1970s to the 1990s.
The lack of available homes have pushed up house and rent prices. In particular, middle-income residents are struggling to afford rent, which makes it difficult to save up money to buy a home.
New multifamily construction has been concentrated on high-end and luxury rental property. The number of units renting for $2,000 per month or more increased 97 percent between 2005 and 2015, while the new supply of units renting for less than $800 actually declined by 2 percent—260,000 units—during that period.