After more than a decade of underbuilding relative to population growth, the gap between single-family home production and household formation grew to 6.5 million homes between 2012 and 2022, CNN reports. At the close of 2021, single-family home construction soared to its fastest pace in the last decade, and the total share of completions also reached a new high, but surging mortgage rates led to cooler buyer demand, lower builder confidence, and a slowdown in new-construction projects.
In the decade between 2012 and 2022, 15.6 million households were formed. During the same time period, 13.3 million housing units were started, and 11.9 million were completed. This includes 9.03 million single-family homes and 4.2 million multi-family homes. Of those, only 8.5 million single-family homes and 3.4 million multi-family homes are completed.
"Cooling buyer demand and builder confidence led to slower single-family construction and a shift in builder focus to multi-family last year," said Hannah Jones, economic data analyst at Realtor.com.
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