From Bill McBride again

The Census Bureau is releasing the demographic profile data for every state this month. Many analysts use the quarterly Census HVS to track the homeownership rate – and to calculate the excess supply of housing units. Important: Estimates using the HVS appear to overstate the excess supply. When all the data is released (by the end of May), we will probably have a better estimate of the excess supply as of April 1, 2010.

The number of vacant units is key in ascertaining how quickly pressure is building inside of home industry. Given the level of starts and the forecasts of homebuilders there is little doubt in my mind that pressure will mount significantly over the next 12 – 18 months.

It will be fascinating to see how much pressure already exists. My gut tells me that the market could be fairly tight especially in the East, but I am working with very crude series here. I will be extremely interested in what Bill and Tom Lawler conclude when they get a full look at the census data.

Advertisement