The housing market in the United States is 6.5 million units short. This shortage has been an ongoing issue for many years, and the lack of homes for purchase has caused many potential buyers to have difficulty finding something within their budget. This shortage of housing units is a result of a multitude of factors ranging from rising land costs, a lack of construction, as well as shifts in demand.
The lack of construction is due to a variety of factors including high building costs and lack of labor availability. With construction costs going up significantly in recent years, it has forced many builders to focus on larger and more expensive housing projects. This has caused a great shortage of the entry level, starter homes, and brought a decrease of inventory to the housing market. The lack of labor availability can be attributed to an increase in immigration restrictions creating a decrease in the number of workers in the building industry.
Due to the current shortage of housing units, the cost of an average home has risen significantly. This rise in cost has put housing unaffordable for many potential buyers, creating a barrier of entry. This is especially true in certain areas such as California and the North East where land costs and taxes make it even more challenging for those wanting to purchase a home.
The housing market is facing a great shortage in terms of the number of housing units, and this is due to numerous factors. Construction costs, labor availability, and shifts in demand have all contributed to a decrease in entry level housing units, making it more difficult for potential buyers to get into the market. The current situation has seen prices of housing rise, making it less affordable and an unattainable purchase for many.
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