by Calculated Risk on 11/17/2021 09:02:00 AM

Today, in the Real Estate Newsletter: Most Housing Units Under Construction Since 1974

Excerpt:

The fourth graph shows starts under construction, Seasonally Adjusted (SA).

Red is single family units. Currently there are 726 thousand single family units under construction (SA). This is the highest level since 2007.

For single family, most of these homes are already sold (Census counts sales when contract is signed). The reason there are so many homes is probably due to construction delays. Since most of these are already sold, it is unlikely this is “overbuilding”, or that this will impact prices.

Blue is for 2+ units. Currently there are 725 thousand multi-family units under construction.  This is the highest level since 1974! For multi-family, construction delays are probably also a factor. The completion of these units should help with rent pressure.

Census will release data next year on the length of time from start to completion, and that will probably show long delays in 2021. In 2020, it took an average of 6.8 months from start to completion for single family homes, and 15.4 months for buildings with 2 or more units.

Combined, there are 1.451 million units under construction. This is the most since 1974.

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