Up for Growth’s research, which echoes a prior study by Freddie Mac, provides a granular look at what’s driving the deficit in different parts of the country. The reasons can vary widely.
The main problem in a city like Sacramento is underbuilding. In St. Louis, restrictive zoning has prohibited the construction of more homes. And in Detroit, which ranks high on Up for Growth’s list of metro areas with a large deficit, a huge stock of housing is uninhabitable.
Then there are places like Washington, D.C., where adults are more likely to share apartments or houses because of high costs. Up for Growth’s model attempts to account for how many “missing households” there are — people who would like to have their own place, but can’t or don’t for some reason.
A recession may slow household formation, if more people put off getting their own place or move back in with family, said Chris Herbert, managing director of the Harvard Joint Center for Housing Studies and a member of Up For Growth’s advisory council. But an economic downturn could also cause builders to pull back, exacerbating the supply challenge.
At the end of the day, he said, “we still have a housing shortage.”
This article was provided by Bloomberg News.