Weekly Special | November 27, 2023

Construction Times Trending Poorly

The current US housing market is ch a racterized by a glaring imbalance: a pronounced undersupply of homes.

This imbalance is not just a recent phenomenon but a result of long-standing trends and regulatory challenges. As populations grow and cities expand, the demand for housing has surged, but the supply response has been insufficient, leading to a market where demand significantly overshadows supply.

Two major spikes in construction times have occurred for single-family homes: the post-2000s housing boom and, more recently, due to supply constraints.

In the case of multi-unit constructions, there has been a significant increase from an average of 10-12 months to over 25 months, highlighting structural issues in housing construction.

Even smaller projects, like 2-4 unit buildings, have more than doubled construction times, from 8 to 17 months. This trend indicates that the challenges in construction times are widespread, affecting various housing types.

The graph’s data underscores a critical need for addressing the root causes of housing undersupply, suggesting a need for a strategic shift in focus beyond financial measures to tangible changes in construction and regulatory practices.

Understanding and addressing these underlying reasons is crucial for mitigating the housing supply crisis.

The original one-page Weekly Special PDF is still available.