If you haven’t noticed first-hand, housing inventory is low. Very low. In fact, this past May, there were 64% fewer houses for sale than there were in May 2020. This problem isn’t limited to the Greater Chattanooga market. Over the past month, there has been an increase in houses listed for sale, but the demand is so intense that even with this increase, the homes are being sold so fast that inventory still remains a great concern. Simply put, low housing inventory is a concern nationwide. More and more organizations, including the National Association of Realtors®(NAR), are taking steps to help relieve this burden.
A report just released by NAR, titled Housing Is Critical Infrastructure: Social and Economic Benefits of Building More Housing, put the housing inventory shortage into a startling perspective. The data points to a shortfall of 5.5 million to 6.8 million housing units since 2001. Not only does that mean fewer homes, but fewer people are building wealth by not owning those homes.
The report summarizes the situation succinctly. NAR reports that “Following decades of underbuilding and underinvestment, the U.S. faces an acute shortage of available housing, an ever-worsening affordability crisis, and an existing housing stock that is aging and increasingly in need of repair—all to the detriment of the health of the public and the economy. The scale of underbuilding and the existing demand-supply gap is enormous and will require a major national commitment to build more housing of all types by expanding resources, addressing barriers to new development, and making new housing construction an integral part of a national infrastructure strategy.”
“There is a strong desire for homeownership across this country, but the lack of supply is preventing too many Americans from achieving that dream,” said Lawrence Yun, NAR’s chief economist. “It’s clear from the findings of this report and from the conditions we’ve observed in the market over the past few years that we’ll need to do something dramatic to close this gap.”
Recently, the price of lumber, which had been skyrocketing, is now starting to come back down. But other than that, what can be done to help? First, NAR recommends policy changes and encourages lawmakers to remove construction barriers to help incentivize new development. Earlier this year, NAR released a separate report, State and Local Policy Strategies to Advance Housing Affordability, which recommended lawmakers pursue solutions through fiscal policy measures. Also, this report outlined proposed policies aimed at increasing the housing supply and identified needed zoning and permitting policy reform. NAR’s proposals address the shortages in much-needed capital to develop affordable housing. Also, NAR suggests expanding resources, maximizing the potential of existing programs, and incentivizing shifts in local zoning and regulations, such as converting unused commercial spaces into residential housing. With these steps, Realtors feel we can substantially increase the quantity and density of developable residential property space.
Across the nation, Realtors are working to make more housing available. We do that by showing up and making the voices of our community heard by local and national officials. Our community and country need more housing, and Realtors are doing all they can to make that happen. That’s Who We R®.