Builders have been working as fast as they can (and sometimes faster than they should) around here non-stop since maybe 2011 or 2012, and it's not enough. Tons of new neighborhoods, probably half the apartment buildings I know of were put up in the last ten years, and so on, but house prices and rent are nuts and still increasing faster than inflation anyway.
We're at the end of what sure looks like about a decade-long housing construction boom, in my city, which is not trendy or growing very fast, and prices have done nothing but go up at 2-5x the rate of CPI the entire time. It's possible the under-supply was so bad that all the construction still isn't enough to catch up, but then why did prices not start higher than they did? I find it hard to believe that this city's gained new residents faster than it's gained new housing. Something else is going on.
In the last 40 years, the US population has picked up 100 million people. 227M vs 329M [1].
By 2050, the US population is estimated to be 379 million (+50M), and by 2100, it will be 434 million (+ an additional 55M) [2].
That's a lot of housing need to fill.
[1] Google "US population"; I'm not sure if these figures includes those here on non-permanent visas, but if not, it would probably increase the growth even more.
Do you think education could also be a factor? More university degrees than in prior decades leading to relatively fewer people with low wages in cheap apartments and more high earners desiring luxurious housing, which takes more material and labor to construct? And of course the pandemic generated a desire to get into less-dense spaces with home offices.
That could apply to some local markets, sure. But we are seeing massive price increases rather universally, which implies it's a more widespread phenomena than just local undersupply.
But it will be true for certain markets. Most homebuilding is concentrated in the SMILE states (southern, areas where people are migrating to)
We're at the end of what sure looks like about a decade-long housing construction boom, in my city, which is not trendy or growing very fast, and prices have done nothing but go up at 2-5x the rate of CPI the entire time. It's possible the under-supply was so bad that all the construction still isn't enough to catch up, but then why did prices not start higher than they did? I find it hard to believe that this city's gained new residents faster than it's gained new housing. Something else is going on.