The U.S. has a deficit of more than 5 million homes, as builders have been unable to keep up with demand over the past decade.
About 12.3 million households were formed in the U.S. from January 2012 to June 2021, but only 7 million new single-family homes were built during that time. The number of U.S. homes for sale is near a record low, with a widening gap between supply and demand.
A severe labor shortage and supply chain disruptions that pushed up materials prices are suppressing new housing starts. Land costs have risen as well, and demand has been fueled by people seeking larger dwellings during the pandemic.
Household formations have been outpacing new construction long before COVID, though.