According to the National Association of Realtors, the U.S. continues to face a housing crisis – with 6.5 million new single-family homes short of demand. While this is a concerning stat for the single-family housing market, it further proves the dependability of multifamily investing.
This same NAR article reported that there were over 2 million household formations in 2022 alone. Compared to the 15.6 million household formations over a 10-year period (2012 – 2022), it is obvious that an increase in available housing is necessary.
The NAR analysis states an average of 340,000 multifamily units were delivered annually over a ten-year period. A recent finding from CBRE reported that 716,000 multifamily units will reach the market within the next 24 months, or 358,000 a year. That’s an improvement, but not enough to meet demand.
“If only single-family homes are considered, the rate of housing starts would need to triple to keep up with demand and close the existing 6.5 million home gap in 3 to 4 years,” NAR wrote. “However, if the rate of total (multi- & single-family) housing starts increased by 50% from the 2022 rate to an average rate of 2.3 million housing starts per year…it would take between 2 and 3 years to close the existing 2.3 million home gap.”
The biggest takeaway here is the housing shortage in the U.S. continues to be a concern. We often get asked about oversupply in Omaha and other Midwest markets. The demand is so great that claims of oversupply are unfounded. To learn more about Metonic and our investment opportunities, visit Metonic.net or email us at info@metonic.net.