As housing construction slows, rents and housing costs have increased according to a new report released in June, 2016 by the Urban Institute. In 2015 the U.S. saw 620,000 new homes built, which is 430,000 fewer than were anticipated.
With such a shortage, home prices and rents are skyrocketing despite low interest rates, says Urban Institute’s Laurie Goodman, co-director of the Housing Finance Policy Center.
“The United States entered the 2008 economic crisis with more housing than was needed, putting downward pressure on price,” she said. “But construction hasn’t kept up since then, and that surplus has been substantially eliminated.”
The report gathered data on single-family, manufactured and multi-family housing. Single-family was especially short, with housing starts and completions lower than those before the Great Recession.