It is no secret that there has been a housing shortage for several years now. In fact, even though mortgage rates have risen dramatically, leading to significantly less home buyer demand, we are still seeing home prices hold steady throughout much of the country. In South Florida particularly, the persistent housing shortage combined with the amount of people moving to The Sunshine State is allowing home prices to remain steady or even slightly increase in some areas. Just how bad is the housing shortage? Well, these estimates vary widely depending on the source. We discuss below.
Housing shortage estimates
According to five reliable sources, the housing shortfall ranges from 1.7M to 7.3M homes. These estimates are as follows:
- National Low Income Housing Coalition: a shortage of 7.3M units
- National Association of REALTORS®: a shortage of 6.5M units
- Fannie Mae: a shortage of 4.4M units
- Up For Growth: (a policy group focused on the housing shortage): a shortage of 3.8M units
- John Burns Research & Consulting: a shortage of 1.7M units
Realtor.com’s approach to estimating the housing shortfall is to compare the number of new houses to the number of new households. Since 2012, the number of new household formations is 15.6 million. With this said, the number of single-family homes that began construction in that period is 9.03 million. Therefore, this leaves a gap of 6.5 million single-family homes. Of course, it is important to note that multi-family housing is also an important part of the housing stock and these figures are not being accounted for.
Although the estimates for the current housing shortage vary significantly, there is no doubt that the low housing inventory has been a challenge for quite some time. With Florida being the fastest growing state in the country, this has only exacerbated the housing shortage throughout The Sunshine State. Of course, this persistent demand for Florida housing is also keeping home prices steady.
Are you thinking about buying or selling a home in the South Florida area? We can help! Contact Natasha at Live South Florida Realty, Inc. today! Don’t forget to download the free Florida Home Search app for your mobile device as well.