Supply, Demand Each Said to be Cause of Home Construction Dip

September 11, 2015

Home construction lagged behind job creation last year in nearly two-thirds of U.S. metro areas, according to a National Association of Realtors report. The issue is whether the swoon was caused by supply or demand.

This week an NAR report was released that studied the pace of home construction compared to the rate of job creation.

The Wall Street Journal reports that economists are arguing both sides of supply vs. demand. For those who say it’s a lack of supply, the slower pace of construction is cited as a reason. For demand, the viewpoint is that builders would make more houses if potential buyers were there.

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