I sense that a bit of the blogosphere is warming up to the idea that there are not enough homes in America, but now they are saying: we have the wrong kind of homes. They admit there are not enough apartments in NYC but think that the rest of America is flush with homes.
This would make a lot of sense if you have a core belief that urbanism is the future and that the big cities are set to boom even bigger. For my money urbanism is a potential future but I am starting to take the possibility of radical ex-urbanism more seriously.
Nonetheless, getting into the weeds of “which are the right types of homes” is too much for me to do when I am in forecasting mode. Its enough to just try and read the trends and see which ones match up. Trying to forecast where people will want to live and what types of urban arrangements the market will reward is like throwing bones – that is to say pure blogging.
Right now I am in forecasting mode, and I want to reiterate that whatever you might think about the distribution of new homes, the total amount of units coming online was more about a shift away from mulit-family and manufactured homes towards single family homes than about an unsustainable increase in the total number of homes.
As always Calculated Risk has great charts
Even as the US added millions of new residents over the last decade, mutli-family construction stalled before falling off a cliff and manufactured homes have been on a steady downward trend.
Population growth was matched – and mildly exceeded – by growth in single family homes. Now that single family has fallen of a cliff as well, we simply are not producing homes at the rate we are adding people.
Unless living patterns shift dramatically, something has to give. That means a ramp up in construction. The longer home building is suppressed the larger the imbalance will become.
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Wednesday ~ April 20th, 2011 at 3:34 pm
Simon K
I’m somewhat sympathetic with the “wrong kind of homes” thing. In California, the worst bubble areas were on the very outer periphery of the urban sprawl. Tracy, Stockton, and the the nowhere-land along I-80 between SF and Sacramento, and the vast sprawling Inland Empire, which seems to have had it even worse. Prices in the urban cores have held up well, and the inner suburbs have barely been affected at all. These outer suburbs still have masses of surplus housing stock. There are developments along I-80 that have been mostly vacant for 5 years, with hardly a unit sold.
The question with this stuff is, can anyone afford to live in those houses with five dollar gas on the horizon again? Okay, you get a 4 bedroom 2000 sq ft house instead of the 2 bedroom 800 sq ft apartment you could afford in the city. That’s nice. But you also have a 2 hour commute each way every day, in heavy traffic, that probably costs you $4k+ a year even disrgarding the massive waste of time. And that 4 bedroom house is still expensive even now by national standards, and its never, ever going to appreciate in value.
Wednesday ~ April 20th, 2011 at 5:49 pm
Lyle
You could do like some folks I used to work with in Houston, if one has a near by job, the long distance commuter maintains a minimal apartment in the city and commutes on weekends only, (better if a 4 day week can be arranged).
Wednesday ~ April 20th, 2011 at 5:51 pm
Lyle
I meant if one spouse works nearby so that the children have care, then the model does work. But even back in the mid 1980s I recall meeting folks with 50 to 60 mile one way commutes. (in LA of course)