The housing market’s current affordability crunch has its roots in the financial crisis of 2008. After the economy crashed almost 20 years ago, there were far more homes available for sale than there were interested buyers. That caused home builders to pull back, building fewer new homes and beginning a cycle of underbuilding that’s lasted nearly two decades. Underbuilding – and Americans staying longer in their homes before selling – contributed to a deficit of roughly 4.7 million needed housing units. That gap has been growing for years and driving the price of homes higher. But, according to a new analysis of U.S. Census Bureau data, the deficit’s significant growth stopped in 2024. In fact, after increasing by 257,000 units in 2022 and 159,000 units in 2023, it grew by just 43,000 units in 2024. That shows meaningful gains and is a hopeful sign that the housing gap – and corresponding affordability issues – will both see additional improvement in the months and years ahead. (source)
